THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
NOT REPORTABLE
Case No: JR542/23
In the matter between:
SIZAKANCANE BUSINESS ENTERPRISE CC Applicant
and
COMMISSION FOR CONCILIATION, MEDIATION
AND ARBITRATION First R espondent
COMMISSIONER MATOME SEHUNANE NO Second Respondent
CHRISTOPHER JABULANE DUBE Third Respondent
Heard: 18 March 2025
Delivered: 18 March 2025
Summary : Application to review and set aside settlement agreement
Application dismissed.
JUDGMENT
DANIELS J
2
Introduction
[1] This is an application brought to review and set aside a settlement
agreement concluded by the applicant and the third respondent, before the second respondent ( hereafter the “commissioner”) .
Procedural issues
[2] On the date of the hearing, the third respondent failed to appear. His
representative had served a notice of withdrawal ( as attorney of record) on the
applicant’s attorneys a few days prior. The applicant requested that the matter
proceed in the absence of the third respondent and suggested that the court could accept that the third respondent had knowledge of the set down but chose
not to appear. I accepted these submissions.
[3] The applicant moved its application for condonation for the late filing of
its replying affidavit. I accepted the submissions and granted condonation. Material facts
[4] The facts of the matter are common cause:
4.1 The applicant dismissed the third respondent for alleged
misconduct. Thereafter , the third respondent referred a dispute
concerning the fairness of his dismissal to the first respondent for conciliation. The first respondent enrolled the dispute for con- arb before
the commissioner .
4.2 At the con- arb, the applicant arrived prepared for arbitration and
resolute not to settle. Despite this, the applicant and the third respondent entered into a settlement agreement which required the applicant to pay the third respondent an amount of R37 500, 00 in five separate
instalments.
3
4.3 The applicant alleges that it was unduly pressured by the
commissioner, into entering into the settlement agreement because:
4.3.1 The commissioner informed the applicant that, if the arbitration
proceeded, the applicant could end up approximately R300 000, 00 for
legal costs . This was , allegedly, an exaggeration of the possible legal
costs.
4.3.2 The commissioner advised the applicant that the dispute could
take several years to finalise,
4.3.3 The commissioner was in a position of authority and abused his
authority ,
4.3.4 The commissioner was biased against the applicant.
4.4 As a result, the applicant alleges that it entered into the settlement
under undue pressure, and against the will of the applicant.
Legal principles and analysis
[5] In GB Engineering (Pty) Ltd v Mbongo & others
1 the Labour Appeal
Court confirmed that this court has jurisdiction to set aside a settlement agreement, which is not a collective agreement, where the agreement was concluded under duress or where the agreement w as induced by
misrepresentation. However, importantly, at para 25 of its judgment, the LAC
echoed the sentiments of the Constitutional Court which has stated that : “when
parties settle an existing dispute in full and final settlement the public and the courts have a powerful interest in enforcing such an agreement and that none should be lightly released from an undertaking seriously and willingly
embraced”.
1 (2024) 45 ILJ 267 (LAC)
4
[6] The exact nature of the duress, alleged by the applicant, is unclear. The
applicant, and its owner, do not allege that they were subjected to any unlawful threat, physical force, or imminent harm, which caused them to be afraid. It is
trite that effective mediation or conciliation requires the commissioner to
address the potential consequences of failing.
[7] Even if there was unequal bargaining power, which I do not accept, this
cannot assist the applicant on the facts of this matter . In Medscheme Holdings
(Pty) Ltd & another v Bhamjee
2 the SCA noted, in relation to alleged economic
duress, at para 18:
‘In commercial bargaining the exercise of free will ... is always fettered to
some degree by the expectation of gain or the fear of loss ... hard
bargaining is not the equivalent of duress, and that is so even where the bargain is the product of an imbalance in bargaining power. Something more ... would need to exist for economic bargaining to be illegitimate or unconscionable and thus to constitute duress .’
[8] It is possible that the commissioner may have overestimated the legal
costs if the dispute were to proceed, but this is uncertain. We are in the realm of speculation. This court cannot render judgment for the applicant based on the
possibility that the commissioner may have over estimated costs. The applicant
does not explain why the commissioner misrepresented the period of time that the dispute could take to finalise. If the dispute proceeded to review stage, the dispute could take more than a year to finalise. In the circumstances, there was no substance to the allegation that the commissioner abused his authority . Nor
is there any substance to the allegation that the commissioner was biased against the applicant. These are serious allegations and should not be made
lightly.
[9] The applicant does not expressly allege that it was induced into the
agreement by a false misrepresentation, but this remains a necessary
2 2005 (5) SA 339 (SCA)
5
consideration. The principles are clear:3 (i) the misrepresentation must be
material or significant, ( ii) the misrepresentation must have induced the innocent
party to enter into the agreement, and (iii) the innocent party must have acted
with ordinary prudence and discretion. Here, the applicant clearly did not act
with ordinary prudence or discretion. If the applicant was concerned about the representations made by the commissioner as to the costs or the duration of the litigation, it should have made appropriate enquiries from the commissioner.
There is no indication that the applicant made any such enquiries.
[10] In addition, I have taken into consideration that the settlement agreement
was entered into by the owner of the business, in the presence of the Human Resources Manager. I was informed that the HR Manager attended the con- arb
proceedings in order to advise the business owner. This is clearly not the case of an innocent, impressionable, uneducated, or naïve, individual having been
induced into a settlement.
[11] I am of the view that the applicant entered into the settlement cognizant
of its rights. The applicant accepted the advice of the commissioner, entered into the settlement, but now regrets doing so. There was nothing outlandish about the advice of the commissioner and there is no clear misrepresentation. [12] In the circumstances, I am unable to find that there was any duress ,
misrepresentation, or any other valid basis , to review and set aside the
settlement agreement.
Costs
[13] Costs do not follow the result in employment disputes. However, here,
the applicant approached the court on a matter without any merit whatsoever. Not only that, but it made allegations against the second respondent which were unwarranted and vexatious. Accordingly , law and fairness require that the
applicant bears the costs of the third respondent, until his attorneys withdrawal .
3 See Goddard v Metcash Trading Africa (Pty) Ltd (2010) 31 ILJ 104 (LC) at para 21
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Conclusion
[14] In the circumstances, for the reasons set out above, I make the following
order:
14.1 The application is dismissed ,
14.2 The applicant is ordered to pay the costs.
Reynaud Daniels
Judge of the Labour Court of South Africa
Appearances :
For the Applicant :
Mr S Zungu Mosehla Attorneys