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[2019] ZALCJHB 355
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Public Servants Association of South Africa obo Members v Minister of Defence and Military Veterans and Others (JS857/16) [2019] ZALCJHB 355 (18 December 2019)
IN
THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not
reportable
Case
no: JS 857/16
In
the matter between:
PUBLIC
SERVANTS ASSOCIATION
OF
SOUTH AFRICA obo MEMBERS
Applicant
and
MINISTER
OF DEFENCE AND MILITARY
VETERANS
First Respondent
DEPARTMENT
OF DEFENCE
Second Respondent
SECRETARY
FOR DEFENCE
Third Respondent
MINISTER
OF THE PUBLIC SERVICE
AND
ADMINISTRATION
Fourth Respondent
DEPARTMENT
OF THE PUBLIC SERVICE
AND
ADMINISTRATION
Fifth Respondent
Heard:
30 August 2019
Delivered:
18 December 2019
Summary:
JUDGMENT
MABASO,
AJ
Introduction
:
[1]
In November 2016, the Public Servants Association of South Africa
(PSA), acting on
behalf of its members (the Applicants) caused a
civil action
[1]
against the
First to Fifth Respondents (collectively referred hereinafter as "the
State”). The State delivered a statement
of response wherein it
raised two special pleas, namely, (a) that the Applicants’
claim has prescribed
(The
prescription plea)
,
and (b) that the Applicants failed to comply with the Institution of
Legal Proceedings
Against
Certain Organs of
State
Act 40 of 2002
[2]
(The
Section 3 notice plea)
.
The Applicants delivered a replication, in a form of a condonation
application (the condonation), as an answer to the State’s
latter special plea. The State is opposing the condonation.
[2]
Mr Mkhari (with Ms Kgatla) ,for the State, submitted that the
pleadings in this matter
indicate that the matter relates to unfair
labour practice. Therefore, this Court will have to decide whether it
has jurisdiction
or not. The Applicants opted to approach this Court
in terms of section 77 of the BCEA, I do not think that the
Applicants
are not allowed to approach this Court ,as they have
done, because the BCEA and the LRA do not expressly prevent
parties
from doing so. Instead section 77(1) read with subsection (3)
of the BCEA allows a party to approach this Court if they have
a claim emanating from a contract of employment, as this section
provides that,
“
77.
Jurisdiction of Labour Court.—(1) Subject to the
Constitution and the jurisdiction of the Labour Appeal
Court, and
except where this Act provides otherwise, the Labour Court has
exclusive jurisdiction in respect of all matters in terms
of this
Act.
…
(3) The Labour Court
has concurrent jurisdiction with the civil courts to hear and
determine any matter concerning a contract of
employment,
irrespective of whether any basic condition of employment constitutes
a term of that contract.”
[3]
It is settled law that prescription does apply to dismissal disputes,
and unfair labour
practice disputes relating to the promotion.
In determining the issue of prescription, one has to first establish
the nature
of the claim. I propose to narrow the issues
hereinafter as follows.
The
prescription plea
[4]
Prior 1998, the Applicants were employed by SANDF as uniform members
, under the Defence
Act
[3]
,
performing finance duties. In 1995 the Defence Act was amended
and introduced
inter
alia
the transfer of the function of the accounting officer of the
Department of Defence (the Third Respondent). The process called
demilitarisation of the finance staff was introduced and then
discussed with the Applicants, which they accepted. Demilitarisation
was finally implemented on 01 November 1998. Contracts of employment
of the Applicants were amended accordingly.
[5]
The Applicants assert that before and after the implementation of
demilitarisation
they were made to believe that it was not going to
disadvantage them. However, its implementation resulted to
unfavourable terms
and conditions of their employment i.e. monthly
remuneration and pension benefits. As a result, they are claiming
that the State
breached the terms and conditions of the contracts
alternatively committed misrepresentation, therefore, they have
suffered financial
loss. Reliefs sought are that:
“
56.1
Declaring that the [Applicants] are entitled not to be in the worse
off position with regard to the
monthly salaries and pension
benefits
than the position they would have been in had
they not demilitarised,
56.2
Declaring that the respondents are in breach of an implied
alternatively tacit terms of the demilitarisation
contract, that [the
Applicants] would not be worse off after demilitarisation,
alternatively declaring that the respondents made
a fraudulent
alternatively negligent misrepresentation giving rise to the
demilitarisation contract, alternatively declaring that
the
respondents cause [the Applicants] pure economic loss
56.3
Ordering the respondents to with immediate effect. restore the
pension benefits for [the Applicants] to that
which would have
applied to him or her had he or she not demilitarised, including
extension of the compulsory retirement age to
65 instead of 60
alternatively restoring the extra 1 in every 4 years’ service
for purposes of pension…,
56.4
Ordering the respondents to with immediate effect place [the
Applicants] on a salary scales/notches respectively
that they would
have been only had they not been demilitarisation, and to pay each
member the concomitant monthly salary henceforth;
56.5
Ordering the respondents with immediate effect to pay the amount as
set out in Annexure “C”…
as damages with regard to
salary losses to the members.
56.6…”:
[6]
The Applicants aver that they lodged grievances, and on or about 2010
the grievances
about the worse off conditions relating to some of
their colleagues, belonging to a different union, were resolved by
the State.
They further contend that “
[a]s later as November
2014 then continued to be indications that the respondents were
attending to the members' concerns concerning
pension benefits
however without any resolution".
They aver that the alleged
worse off is on-going.
[7]
The State contends that since the contracts which are the genesis to
this matter were
concluded in November 1998, the date of the
implementation of the demilitarisation, therefore, the claim, if
there is any, arose
and became enforceable in 1998. Consequently, it
prescribed in 2001, meaning after a period of three years following
the conclusion
of the demilitarisation. The State further avers that
the Applicants claim was launched during “October 2014”.
[8]
The Rules of this Court do not provide provisions for replication, as
is the case
in the High Court and Magistrate Court, wherein a party
has an opportunity to deliver a replication to the special plea.
Taking
into account the nature of the dispute, in reply, the
Applicants delivered an application for condonation for their
non-failure
to comply with the provisions of section 3. This Court if
it were to uphold this
special
plea, the prescription plea, there would be no need for
condonation application to be decided considering that the
condonation
application depends on this point. As section 3(4) (b)
Institution
of Legal Proceedings
Act
(the
ILPA) provides thus,
“…
the
court may grant an application referred to in paragraph (a) if it is
satisfied that-
(i)
the
debt has not been extinguished by prescription
”
[4]
As
a result, this Court is bound to consider the condonation in deciding
the issue of prescription.
[9]
The Applicants defence is that the alleged breach emanate from the
contracts which
were entered into in 1998 but contend that the
alleged breach and misrepresentation was based on the future,
inter
alia
,
refers to "
their
future careers", "as late as November 2014 there continued
to be indications that the Respondents were attending
to the member's
concerns concerning pensions benefits, however without any
resolution"/ "various grievances were raised
".
And due to the alleged misrepresentation "
members
are indeed worse off after demilitarisation with regard to
monthly
remunerations
and
pensions
benefits
"
.
[5]
One of the examples given is a retirement age which is alleged that
now is the age of 60, whereas civilian employees in the public
sector
may retire at the age of 65.
[10]
A party raising prescription has the onus to prove that the claim has
prescribed.
[6]
It can do so by
indicating the date that prescription began to run against
the
claim of the other party.
[7]
In
casu
,
the State does not accept a breach of contract or any liability.
Therefore, the statement of case and the condonation application
will
assist this Court.
When
did the prescription begin to run?
[11]
It is not disputed that the claim is a debt, under Prescription Act
(the Act), any debt which
is not covered under ss 11(a) to (c) of the
Act prescribes after three years.
[8]
Section 12 (1) of the Act provides that:
“
Subject to the
provisions of subsections (2) and (3), the prescription shall
commence to run as soon as
the
debt is due
”.
[9]
[12]
Before a debt could be said it is immediately enforceable, it has to
be claimed. Therefore, one
does not look at the date when it arises
but the date when it is due, for example, if a debtor is expected to
perform on a particular
date, such date is the date which can be said
it is the date of enforcement. Section 12(2) and (3) of the Act read
thus,
(2)
If the debtor willfully prevents the creditor from coming to know of
the existence of the debt, the prescription shall not commence
running until the creditor becomes aware of the existence of the
debt. (hereinafter referred to as “
Exception 1”)
(3)
A debt shall not be deemed to be due until the creditor has knowledge
of the identity of the debtor and
of the facts from
which the debt arises
: Provided that a creditor shall
be deemed to have such knowledge if he could have acquired it by
exercising reasonable care.”
(hereinafter referred to as
“
Exception 2”)
[13]
Exception 1 is not an issue herein, but part of the exception 2 is.
It is not contested that
by December 1998 the Applicants knew the
identity of the debtor (being the State). The only issue before this
Court relates to
facts from which the debt arises. The SCA in
Minister
of Finance and Others v Gore NO
[10]
rehashed
this aspect thus:
“
This
court has in a series of decisions emphasised that time begins to run
against the creditor when it has
the minimum facts that
are necessary to institute the action
. The running of
prescription is not postponed until a creditor becomes aware of the
full extent of its legal rights,
nor until the creditor
has evidence that would enable it to prove a case ‘comfortably.
”
[14]
The facts of this case were known to the Applicants back in December
1998, as they aver that
the demilitarisation commenced on 01 November
1998, and the alleged worse off occurred immediately thereafter.
December 1998 is
when
part
of the debt was due (I deal with
this issue below). The Applicants proceeded to launch grievances
although they do not state as
to when same were recorded. The
Applicants further contend that by 2010 grievances concerning their
allegations of worse off the
terms and conditions of employment of
their colleagues were addressed although they were excluded. Clearly,
the Applicants by December
1998 had the facts of the new contracts
entered into and according to the pleadings they started to
experience worse off back then,
then this enabled them to institute
an action against the State since that time.
[15]
Does the alleged monthly worse off have an effect on the “debt
due” date. Or put
it differently: Does the repetition of the
alleged conduct interrupt prescription? The Applicants contend that
since "
worse off financially with regard two monthly
remunerations continues and increases on a monthly basis - this is a
continuous call
on-going wrong
". In respect of monthly
remuneration and benefits, the Applicants clearly knew since December
1998 that on a monthly basis
they were not getting what they were
supposed to get, therefore, prescription in respect of remuneration
and benefits was immediately
enforceable on the date when it was due,
which is monthly starting from December 1998. I therefore conclude
that since the Applicants
launched the claim during October 2014, as
pleaded by the State, a claim relating to damages and/or salaries
and/or benefits that
the Applicants might have had against the State
in October 2011 backwards, has prescribed because the Applicants at
each
and every end of the month, after their respective
paydays, when they received their respective remunerations which are
allegedly
“worse off”, that is the time when they had
“
the minimum facts that are necessary to institute action
".
Was
the prescription interrupted by the launching of a grievance?
[16]
In
casu
,
the Applicants seem to suggest that they also rely on the fact that
the State had made indications that it was attending to the
grievances of the employees. I say this because they aver that
various grievances were allegedly raised by them as late as November
2014, there were continued indications that the State was attending
to the concerns that were raised. I conclude that the
lodging
of grievances would have “enable[d] [the Applicants] to prove
[their] case ‘comfortably”, which is what
the SCA, in the
Minister of Justice case above, discourages. Even in respect of the
pension benefits which should have been contributed
on the monthly
basis the Applicants have been having the minimum requirements to
institute an action after realising on the monthly
basis, since
December 1998. And I do not consider the conduct of the State(when it
indicating that was attending to the concerns)
as an
"
acknowledgement
of liability
".
[11]
[17]
The running of the prescription can be judicially interrupted in
terms of the provisions of section
15 of the Act, which provides
that,
15.
Judicial interruption of prescription
(1)
The running of prescription shall, subject to the provisions of
subsection (2),
be interrupted by the service on the
debtor of any process
whereby the creditor claims
payment of the debt.
(2)
Unless the
debtor acknowledges liability
,
the interruption of prescription in terms of subsection (1) shall
lapse, and the running of prescription shall not be deemed to
have
been interrupted,
if the creditor does not successfully
prosecute his claim under the process in question to final judgment
or if he does so prosecute his claim but abandons the judgment or the
judgment is set aside.
(3)
If the running of prescription is interrupted as contemplated in
subsection (1) and the
debtor acknowledges liability, and the
creditor does not prosecute his claim to final judgment, prescription
shall commence to
run afresh from the day on which the debtor
acknowledges liability or, if at the time when the debtor
acknowledges liability or
at any time thereafter the parties postpone
the due date of the debt, from the day upon which the debt again
becomes due.
(4)
If the running of prescription is interrupted as contemplated in
subsection (1), and the creditor successfully prosecutes his
claim
under the process in question to final judgment and the interruption
does not lapse in terms of subsection (2), prescription
shall
commence to run afresh on the day on which the judgment of the court
becomes executable.”
[18]
Are the facts of this matter show that the Applicants took “any
process
”? Subsection 15 (6) provides that,
“
for
the purposes of this section “ process” includes a
petition, a notice of motion, a rule nisi, a pleading in
reconvention,
a debt party notice referred to in any rule of law, and
any document
whereby legal proceedings
are commenced."
[19]
The Constitutional Court in
FAWU
v Gaoshubelwe v Pieman’s Pantry (Pty) Ltd
[12]
held that the term “any document” has to be given a wide
meaning. Before this court, there is no document that was
exchanged
between the Applicants and the State and / or any of the Respondents
between 1998 and 2014 which can be classified as
a document that
commenced legal proceedings.
Ongoing
effect
[20]
The Applicants further aver that the claim cannot prescribe because
the "unfair labour practice"
is ongoing, as it occurs
monthly. They rely on
SABC Ltd v CCMA
[2010] 3 BLLR 251
(LAC)
.
The alleged compulsory of retirement age, which is 60, is on-going
but has to be decided based on each Applicant’s case,
for
example if Mr X reached 60 years about three years back then his
claim will be calculated from the date of retirement and if
it
happens that is beyond three years then their claim might be affected
by the provisions of the Prescription Act, because that
is when the
debt was due. Further, in respect of monthly remuneration the
Applicants contends that is ongoing.
[21]
The facts in the SABC matter are distinguishable from the facts in
casu
, in that in the SABC matter, the issue was about a
continuous discrimination allegedly perpetrated by the SABC and the
LAC said
the following about the employees’ referral document
“
the
dispute was on-going and that the dispute had its genesis in 1998
when the appellant promoted or upgraded three artisans from
a salary
scale of 403 to 300. Furthermore, the correspondence from the
respondent’s attorneys explained that the respondent
was
only proceeding with a claim that fell within a time frame over which
the CCMA had jurisdiction”
.
Based
on those facts the LAC held that "the date of dispute does not
have to coincide with the date upon which the unfair labour
practice/
unfair discrimination commenced because it is not a single act of
discrimination but one which is repeated monthly.”
Therefore,
my understanding of the SABC case, relating to “ongoing effect”
confirmed that the cause of action would
be regarded as a factor if
by the time of referral the conduct was still there, but the LAC did
not say the issue of prescription
cannot be successfully raised. In
this matter, my view is that the ongoing effect supports the
Applicants cause of action only
relating a period of 3 years from
October 2011 onwards.
Condonation
application
[22]
Based on the conclusion above, that the claim relating to the
remunerations was due each and
every end of the month when
remunerations were supposed to have been paid, now I have to deal
with the condonation for the period
from October 2011 to the date of
the launching of this application. The condonation for the period
prior October 2014 is not necessary
because I have concluded that the
debt for that period is extinguished by prescription.
[23]
Section 3 provides that a party before instituting a claim against an
organ of state for recovery
of the debt has to issue a notice in
writing and this must be done within six months from the date on
which the debt becomes due.
[24]
The applicant contend that following the demilitarisation, the formal
grievances were launched,
and as late as November 2014 there
continued to be indication that the State were attending to
their concerns in respect
of the pension funds however without any
resolution . In a condonation application a court has to take into
account an interest
of justice. Section 3 (4)(a) of the ILPA provides
that this Court may grant condonation if good cause exists for the
failure and
the organ of state was not unreasonable prejudiced by the
failure. Based on the reasons provided for the non-compliance with
the
provisions of section 3 notice and that parties were engaging
each other and that before me there is no suggestions that the State
was unreasonable prejudiced by the failure to comply with the
provisions of section 3. I have considered the facts of this case
and
the explanation provided for the delay and am of the view that it
would not be in the interest of justice if condonation is
not granted
for the period that I have mentioned above, October 2011 onwards.
Costs
[25]
In respect of costs, I am of the view that since each party herein
has partially succeeded it
would not be in the interest of justice
that cost order be made in this matter.
[26]
Order:
1.
The special plea of prescription, relating to claims
before
the period of October 2011 is upheld.
2.
The special plea of prescription, relating to claims
after
October 2011 is dismissed.
3.
The Applicants failure to comply with
section 3
of the
Institution of
Legal Proceedings Against Certain Organs of State Act condoned
.
4.
There is no order as to costs.
_____________________
S
Mabaso
Acting
Judge of the Labour Court of South Africa
Appearances
For
the Applicant: Adv F Van der Merwe
Instructed
by: Otto Krause Inc.
For
the Respondent: Adv W Mkhari SC with Adv M Kgatla
Instructed
by: The State Attorney, Pretoria
[1]
Section 77 of the Basic Conditions of Employment Act 75 of 1997
(“the BCEA).
[2]
(
“the
Institution
of Legal Proceedings
Act”).
[3]
Act
44 of 1957.
[4]
Links v Members of Executive Council Department of Health Northern
Cape Province 2016 (5) BCRL 656 (CC) (Links), paras 15 and
16.
[5]
Court emphasis
[6]
Ibid, at 24.
[7]
Ibid, at 24.
[8]
SS 11(d) of the Act.
[9]
See also FAWU obo Gaoshubelwe v Pieman’s Pantry (Pty ) Ltd
2018 (5) BCLR 527
(CC), at para52
[10]
(230/06) [2006] ZASCA 98; [2007] 1 All SA 309 (SCA); 2007 (1) SA 111
(SCA).
[11]
See section 14 of the Act.
[12]
2018 (5) BCLR 527
(CC).