About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Cape Town Labour Court, Cape Town
SAFLII
>>
Databases
>>
South Africa: Cape Town Labour Court, Cape Town
>>
2019
>>
[2019] ZALCCT 38
|
|
Minister for Local Government, Environmental Affairs and Development Planning, Western Cape Provincial Government v Bitou Municipality and Others (C616/2019) [2019] ZALCCT 38; (2020) 41 ILJ 1154 (LC) (26 November 2019)
IN
THE LABOUR COURT OF SOUTH AFRICA, CAPE TOWN
Reportable
Case
no: C616/2019
In the matter between:
THE MINISTER FOR LOCAL
GOVERNMENT,
ENVIROMENTAL AFFIARIS
& DEVELOPMENT PLANNING
WESTERN
CAPE PROVINCIAL GOVERNMENT
Applicant
And
THE
BITOU MUNICIPALITY
First Respondent
LONWABO
MINIAWA RONALD NGOQO
Second Respondent
PLETTENBERG BAY
RATEPAYERS AND
RESIDENTS
ASSOCIATION
Amicus Curiae
Date
heard: 20 November 2019
Delivered:
26 November 2019
Summary:
Application in terms of
Section 18
of the
Superior Courts Act 10 of
2013
JUDGMENT
RABKIN-NAICKER, J
[1]
This is an application in terms of section 18 of the Superior Courts
Act 10 of 2013 (‘the Act’)
for execution and operation of
the order of Nieuwouldt AJ under the above case number which was
delivered on the 13 August 2019.
The Order reads as follows:
“
1.
The settlement agreement entered into between the first respondent
and the fourth respondent on or about 21 February 2019 is
reviewed
and set aside.
2.
The appointment of the fourth respondent
[1]
by the first respondent on or about 21 February 2019 is reviewed and
set aside.
3.
The further application to strike out by the first respondent
is refused.
4. The first
respondent is ordered to pay the applicant’s costs, inclusive
of costs of two counsel, save for the costs
occasioned by the
portions of the papers of the applicant that had been struck our and
the response thereto.”
[2]
On the 9 October 2019, leave to appeal was granted. A key issue on
appeal is set to be whether the decision
of Judge Lallie on 24
October 2014 in C1019/12 is a decision
in rem
.
[3]
Certain clauses of the settlement agreement are recorded hereunder
for the reason that they provide
background to the main application:
“
1.1
The Third Respondent (hereinafter the ‘Employee’), was
employed by the Applicant (hereinafter ‘the Employer’),
as its Municipal Manager until his dismissal on 6 February 2012;
1.2
The Employee referred his dismissal for arbitration to the South
African Local Government Bargaining Council (the ‘SALGBC’),
under case number WCP031205 (the ‘arbitration’);
1.3 On
22 October 2012, the Second Respondent (the ‘Commissioner’),
handed down an arbitration award, setting aside
the Employee’s
dismissal as procedurally and substantively unfair, and ordering
reinstatement and compensation (the ‘arbitration
award’);
1.4 On
review in the Labour Court under the above case number (‘the
review application’), the Honourable Ms. Justice
Lallie granted
the Employer’s application in a judgement dated 29 November
2014, setting aside the arbitration award and
remitting the matter to
the SALGBC;
1.5
The employee lodged an application for leave to appeal against the
aforesaid judgment and order of Lallie J, which application
is
pending as at the date of signature of this agreement (‘the
application for leave to appeal’);
1.6
Notwithstanding the order of Lallie J, the parties herewith agree to
settle their dispute on the terms and conditions set forth
below.
2.
Abandonment of Lallie J’s order
2.1
The Employer hereby abandons the whole of the judgment and order of
Lallie J. The Employee’s application for leave to
appeal is
thus redundant.
3.
Arbitrator/s award
3.1
The parties accept that the Arbitrator’s award made in
paragraph 52 is correct. The Employee abandons the award set out
in
paragraph 53.”
The Legal Principles
[4]
Section 18 of the Act provides in relevant part as follows:
‘
Suspension
of decision pending appeal
(1)
Subject to subsections (2) and (3), and
unless the court under exceptional circumstances orders otherwise,
the operation and execution
of a decision which is the subject of an
application for leave to appeal or of an appeal, is suspending
pending the decision for
leave to appeal or appeal.
(2)
Subject to subsection (3), unless the court
under exceptional circumstances orders otherwise, the operation and
execution of a decision
that is an interlocutory order not having the
effect of a final judgment, which is the subject of an application
for leave to appeal
or of an appeal, is not suspended pending the
decision of the application on appeal.
(3)
A court may only order otherwise as
contemplated in subsection (1) or (2), if the party who applied to
the court to order otherwise,
in addition proves on a balance of
probabilities that he or she will suffer irreparable harm if the
court does not so order and
the that the other party will not suffer
irreparable harm if the court so orders.
(4)
If a court orders otherwise, as
contemplated in subsection (1) –
(i)
the court must immediately record its
reasons for doing so;
(ii)
the aggrieved party has an automatic right
of appeal to the next highest court;
(iii)
the court hearing such an appeal must deal
with it as a matter of extreme urgency, and
(iv)
such order will be automatically suspended,
pending the outcome of such appeal.
(5)
For the purposes of subsections (1)
and (2), a decision becomes the subject of an application for leave
to appeal or of an appeal,
as soon as an application for leave to
appeal or a notice of appeal as is lodged with the registrar in terms
of the rules.’
[5]
The law to be applied in a section 18 application (and a comparison
with the jurisprudence developed
in relation to the now repealed Rule
49(11)) was considered in the matter of
Incubeta Holdings (Pty)
Ltd v Ellis
2014 (3) SA 189
(GJ)
. In an analysis of the section,
Sutherland J stated the following:
“
[20]
A given phrase in any statutory provision has a function specific to
that provision and to that specific statute and the primary
aim of
the interpreter is to discover the function it performs in that
specific context. It may perform a different function in
another
statute and one must avoid being seduced by beguiling similarities.
[21] The context relevant
to s 18 of the SC Act is the set of considerations pertinent to a
threshold test to deviate from a default
position, i.e. the appeal
stays the operation and execution of the order. The realm is that of
procedural laws whose policy objectives
are to prevent avoidable harm
to litigants. The primary rationale for the default position is that
finality must await the last
court's decision in case the last court
decides differently — the reasonable prospect of such an
outcome being an essential
ingredient of the decision to grant leave
in the first place. Where the pending happening is the application
for leave itself,
the potential outcome in that proceeding, although
conceptually distinct from the position after leave is
granted,
ought for policy reasons to rest on the same footing.
[22] Necessarily, in my
view, exceptionality must be fact-specific. The circumstances which
are or may be 'exceptional' must be
derived from the actual
predicaments in which the given litigants find themselves. I am not
of the view that one can be sure that
any true novelty has been
invented by s 18 by the use of the phrase. Although that phrase may
not have been employed in the judgments,
conceptually the practice as
exemplified by the text of rule 49(11), makes the notion of the
putting into operation an order in
the face of an appeal process a
matter which requires particular ad hoc sanction from a court. It is
expressly recognised, therefore,
as a deviation from the norm, i.e.
an outcome warranted only 'exceptionally'……
[24]
The second leg of the s 18 test, in my view, does introduce a novel
dimension. On the South Cape test, No 4 (cited supra),
an even-handed
balance is aimed for, best expressed as a balance of convenience or
of hardship. In blunt terms, it is asked: who
will be worse off if
the order is put into operation or is stayed. But s 18(3) seems to
require a different approach. The proper
meaning of that subsection
is that if the loser, who seeks leave to appeal, will suffer
irreparable harm, the order must remain
stayed, even if the stay will
cause the victor irreparable harm too. In addition, if the loser will
not suffer irreparable harm,
the victor must nevertheless show
irreparable harm to itself. A hierarchy of entitlement has been
created, absent from the South
Cape test. Two distinct findings of
fact must now be made, rather than a weighing-up to discern a
'preponderance of equities'.
The discretion is indeed absent, in the
sense articulated in South Cape. What remains intriguing, however, is
the extent to which
even a finding of fact as to irreparable harm is
a qualitative decision admitting of some scope for reasonable people
to
disagree about the presence of the so-called 'fact' of
'irreparability'.
[6]
The interpretation set out in the paragraphs above was followed in
the matter of
UFS v Afriforum & another
[2016] ZASCA 165
in which the SCA considered an appeal in terms of section
18(4)(ii).
[7]
In
Incubeta
the application for leave to appeal had yet to be
set down. Sutherland J stated that he had made no reference to the
‘merits’
of the case which resulted in the interdict
expressing the view that, “…they are not pertinent to
this kind of enquiry.
The considerations that are valuable
pre-suppose a bona fide application for leave to appeal or an actual
appeal. No second guessing
about the judgment per se comes into
reckoning.” The SCA in
Stellenbosch University
stated
the following
:
“
[14]
A question that arises in the context of an application under s 18,
is whether the prospects of success in
the pending appeal should play
a role in this analysis. In
Incubeta
Holdings
Sutherland J was of the view
that the prospects of success in the appeal played no role at all. In
Liviero Wilge Joint Venture
Satchwell J, Moshidi J concurring, was of the same view. However, in
Justice Alliance
Binns-Ward
J (Fortuin and Boqwana JJ concurring), was of a different view,
namely that the prospects of success in the appeal remain
a relevant
factor and therefore ‘. . . the less sanguine a court seized of
an application in terms of s 18(3) is about the
prospects of the
judgment at first instance being upheld on appeal, the less inclined
it will be to grant the exceptional remedy
of execution of that
judgment pending the appeal. The same quite obviously applies in
respect of a court dealing with an appeal
against an order granted in
terms of s 18(3)’.
[15]
I am in agreement with the approach of Binns-Ward J. In fact,
Justice
Alliance
serves as a prime example why
the prospects of success in the appeal are relevant in deciding
whether or not to grant the exceptional
relief. Binns-Ward J
concluded that the prospects of success on appeal were so poor that
they ought to have precluded a finding
of a sufficient degree of
exceptionality to justify an order in terms of s 18 of the Act. This
conclusion was subsequently proven
to be justified when this court
upheld the main appeal in
Justice
Alliance
. However, in the present
appeal, the appeal record in the review application was not before
us. The prospects of success shall
therefore not feature in our
consideration of whether or not the order of the Full Court should be
upheld.”
[8]
I do not take the above paragraphs in a matter concerning a section
18 (4) (ii) appeal as authority
for the proposition that the court of
first instance (which this Court is) should take into consideration
the prospects of success
on appeal. This would mean a second guessing
of its own judgment and order granting leave to appeal. In any event
as the above
paragraphs reflect the SCA did not make its decision in
that matter based on a consideration of the prospects of success on
appeal,
given the absence of the appeal record. I do not therefore
take submissions made by the parties on this question into account.
[9]
In the founding affidavit, the applicant makes the case that the
factual matrix of this matter is exceptional
given the re-employment
by a local authority of its own former municipal manager, previously
dismissed for serious financial misconduct.
It submits that what
makes it even more exceptional is that such re-employment was
combined with a settlement agreement containing
novel terms. The
applicant further underscores that such an appointment was prohibited
by Regulation 18
[2]
in that the
first respondent was forbidden in its terms from occupying such a
position for ten years after having been dismissed
for financial
misconduct.
[10] It is
further argued that given the position of Municipal Manager is one
that has constitutional obligations to
ensure service delivery, and
efficient administration of the Municipality, this in itself
constitutes exceptional circumstances.
The retention of the second
respondent in his current position would negate and severely
undermine the relief sought in the main
application, given that the
purpose of the main application was to ensure that the first
respondent complies with the principle
of legality. The order of
Niewoudt J would be of little value if the appeal was dismissed but
the second respondent was permitted
to effectively serve the
remainder of his contract.
[11]
The possible risk to contracting third parties with the first
respondent, (for example, to successful tenderers
whose contracts
with the Municipality may be impugned), based on the unlawful
appointment of the second respondent is another issue
highlighted by
the applicant. It also emphasizes that the appeal process may outlive
the second respondent’s terms in office.
[3]
[12] The
applicant further submits that the first respondent will not suffer
irreparable harm if the order is immediately
implemented. It could
appoint another municipal manager, pending the outcome of the appeal.
Any possible financial prejudice to
the second respondent by his
employment being suspended pending the outcome of the appeal can be
addressed by appropriate financial
compensation in the future. It
argues, that on the other hand, if the appeal fails the chances of
the ratepayers recovering any
salary paid to the second respondent,
pending the finalization of the appeal are negligible. Those funds
would in all likelihood
have been dissipated.
[13] The
first respondent submits in answer that the applicant has conflated
the alleged factual bases for “exceptional
circumstances”
and of “irreparable harm”. Further, that there is no
legal or factual basis for the claim that
the court a quo’s
judgment will give rise to public distrust which in turn would
warrant execution of the order pending appeal.
It is submitted that
there is nothing novel about the settlement agreement.
[14] It is
denied that the appointment of a new Municipal Manager would avoid
prejudice to the First Respondent given
that this would require
significant expenditure of human and capital resources in order to
screen and select a new candidate. In
the event that the appeal is
successful the expenditure would have been incurred for no good
reason. In addition, the first respondent
would have to compensate
the second respondent in the intervening period. There are a number
of averments in the answering affidavit
as to the positive role the
second respondent is playing since he returned to his role as
Municipal Manager in March this year
and to the disruption his
removal would cause, particularly during the height of the tourist
season.
[15] The
amicus curiae, the Plettenberg Bay Rate Payers and Residents
Association, which represents some 400 rate payers
who reside in or
who have houses in the Municipality, was given leave to intervene by
Gush J on 20 October 2019. Mr. Brassey made
submissions on their
behalf. These were principally directed at grounds supporting the
applicant’s prospects of success in
the forthcoming appeal
hearing. The amicus will be seeking leave to intervene in that
hearing.
Evaluation
[16] In the
application before me, the essence of the exceptionality and the
irreparable harm requirements relied on
by the applicant, is one
founded on the protection of the principle of legality in the public
interest. Specific evidence of alleged
irreparable harm is sparse in
the founding affidavit. The challenges in obtaining recovery of
monies paid in terms of the settlement
agreement and monies spent on
the salary of the second respondent, appear to be the high water mark
of these allegations. Although
the harm to ratepayers in this regard
is alleged in general terms, there is no specific evidence provided
on their behalf in the
founding papers.
[17] The
applicant’s submissions that the Municipality will not suffer
irreparable harm if the section 18 application
is granted are
substantively dealt with in some detail in the answering papers. I
find that, on balance of probabilities on the
evidence in the papers
before me, the applicant has not met its onus in proving exceptional
circumstances
and
irreparable harm. In the
Afriforum
SCA
judgment (supra), the first section 18 (4) (ii) appeal heard
by the SCA, the Court made the following observations:
“
[21]
I fail to see how, even if there had been an infringement of rights
as contended for, this would constitute
exceptional circumstances as
envisaged in s 18(1) of the Act. The mere reliance on the foregoing
of the right by the students to
exercise a choice does not in itself
(ie without proof of any adverse consequences) constitute exceptional
circumstances. As submitted
on behalf of the UFS, the submission on
behalf of Afriforum is
conceptually
confused because it conflates the deprivation of a right with the
adverse consequences flowing therefrom
in
circumstances where there is no proof at all of such adverse
consequences. As recorded earlier, there is simply no evidence of
a
single individual student intending to exercise this right in the
affected faculties or of any adverse consequences which may
befall
any student until final judgment on appeal. It accordingly follows,
in my view ,that Afriforum failed to show the existence
of
exceptional circumstances justifying relief implementing the order of
the Full Court of 21 July 2016 pending the determination
of the
appeal.
[22]
This brings me to the additional requirements for an order of this
nature as set out in s 18(3).
Firstly, Afriforum was required to
prove on a balance of probabilities that the students whose interests
it represented would suffer
irreparable harm if an order in terms of
s 18 was not made. As recorded earlier, Afriforum did not suggest
that any actual harm
would befall this small number of potential 2017
first-year Afrikaans students.
In fact,
Afriforum based its argument on the same premise as before, namely
that the foregoing of an opportunity or right to be
taught in a
language of choice per se constitutes irreparable harm. This line of
reasoning is, as I have said, conceptually flawed.
Infringement of
the right per se does not constitute proof of irreparable harm……”
(emphasis mine.)
[18]
In view of all of the above, the application must fail. Given the
content of my judgment above, and based on the submissions
of the
parties, I consider this a matter in which costs should follow the
result.
[19] I make
the following order:
Order
1.
The application is dismissed with costs,
including costs of two counsel.
_________________
H. Rabkin-Naicker
Judge
of the Labour Court
Appearances:
Applicant:
Kahanovitz C (SC) with Williams J instructed by the State Attorney
First
Respondent: A. de Vos SC with L. Fereiria instructed by HDRS
Attorneys c/o Erasmus Attorneys
[1]
Second
Respondent in this application
[2]
Regulations
on Appointment and Conditions of Employment of Senior Managers GN21
in GG 37245 (17 January 2014)
[3]
I
should note however that there is nothing precluding the applicant
requesting the LAC to hear the appeal on an urgent basis
in order
that the Court a quo’s judgment may be confirmed, given that
the matter in all its process has been treated urgently
by the
Labour Court on the applicant’s instance.