166336IN THE LABOUR COURT OF SOUTH AFRICA
(HELD AT JOHANNESBURG)
CASE NO: J1146/99
In the matter between:
RUFUS MOTHOKA MALATJI Applicant
And
INDEPENDENT MEDIATION SERVICES OF SOUTH
AFRICA
First
Responde
nt
TRANSNET BARGAINING COUNCIL Second
Responde
nt
CALVIN A PAUL N.O. Third
Responde
nt
JAN PETRUS STEMMETT N.O. Fourth
Responde
nt
TRANSNET LIMITED t/a METRORAIL / SPOORNET Fifth
Responde
nt
JUDGMENT
STELZNER AJ
1. This is an application for the review and setting aside of the
arbitration award of the fourth respondent sitting under the
auspices of the Independent Mediation Services of South Africa
(first respondent), which arbitration was conducted in terms of
the provisions of the Transnet Bargaining Council Constitution.
2. It is common cause that the applicant was dismissed from the
services of fifth respondent (Transnet Limited) on 8 May 1998 at
the conclusion of a disciplinary enquiry which investigated and
considered various charges brought against him. After that
dismissal the applicant lodged a dispute with the second
respondent (the Transnet Bargaining Council) challenging the
fairness of his dismissal. By agreement between the applicant
and the fifth respondent the dispute relating to the applicant’s
dismissal was referred to the fourth respondent for resolution by
arbitration. Fourth respondent is a member of first respondent’s
panel of arbitrators and was appointed by virtue of the provisions
of the constitution of second respondent.
3. Whilst the arbitration proceedings were pending, these
proceedings having at a point been postponed sine die, one
Cohen purporting to act on behalf of the fifth respondent
engaged in negotiations with the applicant which led to the
conclusion of a so-called settlement agreement. The settlement
agreement was signed by one Stander, who purported to act,
similarly, on behalf of fifth respondent. In terms of that
purported settlement agreement the sanction of dismissal dated
8 May 1998 was altered to a serious written warning valid for 6
months, the applicant was transferred to another depot and the
intervening period was to be regarded as unpaid leave. By
implication the applicant was, in terms of the agreement,
reinstated in fifth respondent’s employ.
4. At the relevant time, fifth respondent had in operation a policy
which defined managerial powers to sign agreements on its
behalf. The policy provides that:
“Under no circumstances are industrial relations staff to sign any
agreement. Their mandate only extends to negotiating and
drafting any agreement.”
It was clear that neither Cohen nor Stander fell within the
category of managerial positions entitling them to conclude or
sign the settlement agreement relied upon by the applicant. In
confirmatory affidavits both Cohen and Stander simply assert the
conclusion that they had the authority to conclude and sign,
respectively, the settlement agreement on fifth respondent’s
behalf. They do not indicate from where they derive the source
of their authority.
5. Subsequent to the applicant having recommenced working for
fifth respondent the matter was investigated in full by the human
resources office which discovered serious flaws in relation to the
manner in which the settlement agreement had been concluded
and signed. The conclusion reached was that neither Cohen nor
Stander had the necessary authority to conclude and sign the
agreement and that the agreement was therefore null and void.
The applicant was advised, therefore, that the original verdict of
dismissal reached at the disciplinary enquiry in May 1998 still
stood and he was relieved of all his duties.
6. The applicant then referred a new dispute in accordance with the
provisions of the Transnet Bargaining Council Constitution
concerning the alleged non-compliance by fifth respondent with
the settlement agreement. Fourth respondent was re-appointed
to arbitrate this dispute.
7. None of the first to fourth respondents opposed the application
for review but the fourth respondent filed an affidavit in which he
records certain facts about the issues which were placed before
him for determination. In his affidavit he states as follows:
“Since the arbitration was conducted in terms of the Transnet
Bargaining Council Constitution, an arbitration agreement was
not required. At the commencement of the proceedings on
02/02/99, it transpired that there were two issues in dispute: the
fairness of Mr Malatji’s dismissal and the validity of a subsequent
agreement to reinstatement him. The company’s representative,
Mr James Tshabalala, objected to the second issue and the
applicant’s representative, Mr Titus Greyling of Salstaff, indicated
that he was prepared to withdraw the second issue if the matter
could be postponed in order that he could prepare himself on the
dismissal issues. The company agreed and the matter was
postponed until 08/02/99.”
8. It is common cause that the matter then proceeded on 8
February 1999. In regard to the proceedings which took place
before him on that day fourth respondent states as follows in his
affidavit:
“The issue of the settlement agreement was already dealt with
on 02/02/99 and was withdrawn by applicant’s representative.
At the commencement of the proceedings on 08/02/99 the
parties were ad idem that the only issue was the fairness of the
applicant’s dismissal.”
And further
“I conducted the arbitration on the basis of the dispute as it was
agreed upon between the parties. I would not have proceeded
with the arbitration if there was disagreement over the issue in
dispute.”
9. On 23 February 1999 fourth respondent gave an arbitration
award dismissing the applicant’s claim of unfair dismissal by the
fifth respondent. Having emerged unsuccessful from these
proceedings, the applicant seeks an order reviewing and setting
aside the fourth respondent’s award together with certain
consequential relief which is, in the main, directed at reinstating
him as an employee of the fifth respondent on terms no less
favourable than those which were applicable to him at the time of
his dismissal by fifth respondent in May 1998.
10. The arbitration was conducted under the auspices of the first
respondent and not the Commission for Conciliation, Mediation &
Arbitration. The applicant does not state in his notice of motion
or his affidavits specifically under which section of the Labour
Relations Act, No 66 of 1995 (“the Act”) he brings this review.
Logically, however, he cannot rely on the provisions of section
145 of the Act. In similar circumstances in the matter of Portnet
(a division of Transnet Ltd) v Finnemore & others [1999] 2 BLLR
151 (LC), in considering an application to review an award
handed down by an arbitrator where the dispute had been
referred in terms of the provisions of the Transnet Bargaining
Council Constitution, Landman J held that clause 13 of the
constitution of the Bargaining Council defines and regulates the
powers of the Bargaining Council to resolve disputes. The clause
provides, inter alia, that parties who are in dispute about alleged
misconduct of an employee are referred to arbitration.
“This arbitration, in essence therefore, amounts to compulsory
arbitration. The Council does not itself arbitrate the matter. The
arbitrator is an independent person who is appointed to arbitrate
the matter. The arbitrator does not act on behalf of the Council
but arbitrates by virtue of the submission to arbitration, and in
terms of the Arbitration Act 42 of 1965. It follows that the review
powers of this court under section 158(1)(g) of the Act, which
provide for the review of the performance or purported
performance of any function provided for in this Act or any act or
omission of any person or body in terms of this Act on any
grounds that are permissible in law, are not applicable. The
review of the arbitrator’s award must therefore be determined in
terms of section 157(3) of the Act which provides that any
reference to the court in the Arbitration Act of 1965 must be
interpreted as referring to the Labour Court when an arbitration
is conducted under that Act in respect of any dispute that may
be referred to arbitration in terms of this Act.” (At 152F-H).
11. In the same judgment Landman J goes on to refer to the
grounds for review as set out in section 33 of the Arbitration Act,
which provides for review where –
any members of an arbitration tribunal has misconducted himself in
relation to his duties as arbitrator or umpire; or
an arbitration tribunal has committed any gross irregularity in the
conduct of the arbitration proceedings or has exceeded his
powers; or
an award has been improperly obtained.
12. It is clear that the grounds of review as set out in section 33 of
the Arbitration Act are almost identical to those contained in
section 145 of the Labour Relations Act.
13. The applicant formulated his case for review on the grounds
that the settlement agreement entered into between himself and
the fifth respondent had settled the dispute about the fairness of
his dismissal and that this constituted a compromise which had
the effect of rendering the issue res judicata. Accordingly he
alleges that the fourth respondent had no jurisdiction to arbitrate
the dispute about the fairness of his dismissal. In other words it
would appear that he is alleging that the fourth respondent
exceeded his powers as arbitrator.
14. In the circumstances it appears that the two crisp issues
before me are as follows. In the first instance, whether or not the
dispute surrounding the dismissal of the applicant by the fifth
respondent on 8 May 1998 was settled. Secondly, whether the
fourth respondent was in the circumstances precluding from
determining that dispute on the grounds that it had been settled
and therefore whether by nevertheless doing so he assumed
jurisdictional powers which he did not have or, put differently,
exceeded the powers which he did have.
15. The fifth respondent disputes the validity of the settlement
agreement on the basis that it did not authorise any person to
enter into negotiations with the applicant and to conclude the
settlement agreement, specifically, that it did not authorise
either Cohen or Stander to act on its behalf in that regard.
Secondly, it alleges that the conduct of Cohen and Stander was in
conflict with the established policy of the fifth respondent which
requires a settlement agreement to be concluded by the
industrial relations or human resources managers of the fifth
respondent.
16. It is clear that the parties’ versions on the validity or otherwise
of the settlement agreement are contradictory. There is a
serious dispute of fact on the papers. Despite the serious dispute
of fact, however, the applicant seeks final relief. In dealing with
this dispute this court has to apply the well known principles as
set out in Plascon Evans Paints Ltd v Van Riebeeck Paints (Pty)
Ltd 1994 (3) SA 620 (A) and in particular as set out at 634E-H.
These principles are frequently applied by this court, see for
instance National Union of Mineworkers v Freegold Consolidated
Gold Mines (Operations) Ltd (President Steyn Mine); National
Union of Mineworkers v Freegold Consolidated Mines
(Operations) Ltd (Western Holdings) [1998] 9 (5) SALLR 122 (LC)
at page 142 para 66 of the judgment, where Zondo J (as he then
was) held:
“In this regard it must also be borne in mind that as the applicant
is seeking final relief, the decision of the court must be based on
the respondent’s version of what happened if there is a dispute of
fact between the versions of the two parties unless the
respondent’s version is so untenable that the court would be
justified in rejecting it on the papers.”
17. The fifth respondent denied the authority of both Cohen and
Stander and this denial appears to accord with the provisions of
respondent’s policy as contained in the papers. Neither Cohen
nor Stander are able to indicate in their affidavits where they
derived the source of their alleged authority. Even if one has
regard to the evidence of Cohen and Stander themselves,
therefore, it would appear that the applicant has failed to
demonstrate actual or ostensible authority on their part to
negotiate and conclude the settlement agreement relied upon by
him. There are, furthermore, inherent probabilities which militate
against the applicant’s version but which support the
respondent’s version. For instance, the applicant’s dismissal was
based on a finding and a sanction made after a duly established
disciplinary enquiry. It appears highly unlikely that such a finding
would be reversed and certainly not without the sanction of those
duly authorised officials of the fifth respondent who were
involved in the disciplinary process in the first place.
18. Accepting, therefore, that the so-called settlement agreement
was not valid, the original dispute arising from applicant’s
dismissal on 8 May 1998 had not, therefore, been validly
compromised and could not be regarded as res judicata. The fact
that the Bargaining Council may have been advised, in the
meantime, that the dispute had been settled and might have
closed its files cannot alter this fact.
19. The fact remains, most importantly, that when the matter
came before fourth respondent in February 1999 he canvassed
carefully with the parties the nature of the issue/s which he was
required to decide and he states quite categorically in his
affidavit that he conducted the arbitration on the basis of the
dispute as it was agreed upon between the parties. To the
extent that there is a dispute of fact about what happened in this
regard there is no doubt that I must prefer fifth respondent’s
version as corroborated by the version of fourth respondent
himself, in line with the Plascon Evans principles as referred to
above.
20. Furthermore, it appears appropriate to take account of the
following facts, namely, that the applicant was represented at the
arbitration proceedings when they commenced on 2 February
1999, that the proceedings were postponed to 8 February 1999
at the request of the applicant’s representative, that the
postponement was requested by the applicant’s representative
because he was not fully prepared to proceed with the arbitration
in regard to the dismissal, that when the proceedings resumed on
8 February 1999 it was quite clear that the only issue on which
the parties presented evidence was the fairness or otherwise of
the dismissal on 8 May 1998 and, finally, that the applicant
presented his evidence in this regard through the assistance of
the selfsame representative who had requested the
postponement. It is inconceivable that the applicant and his
representative would have remained quiet and would have
abided by the supposed direction issued by the fourth respondent
that the only issue for determination was the fairness of the
applicant’s dismissal if they had in fact thought that the only
issue properly before the arbitrator was the question of fifth
respondent’s alleged non-compliance with a settlement
agreement. Applicant’s version in this regard is so improbable
that it falls to be rejected.
21. In the circumstances I find that by agreement between the
parties, the fourth respondent was entitled to arbitrate on the
dispute arising from applicant’s dismissal of 8 May 1998. Fourth
respondent, furthermore, arbitrates by virtue of the submission
to arbitration by the parties. His powers are conferred on him by
the parties and not by the Act. (See the Portnet decision referred
to above.) In so doing, he did not exceed the powers conferred
upon him. As such he did not fall foul of the provisions of section
33(1)(b) of the Arbitration Act and applicant has failed to
establish a ground for review.
22. Even if I am wrong in regard to the invalidity of the settlement
agreement then it appears that applicant subsequently, by his
conduct at the arbitration proceedings in February 1999, waived
any such rights as he might have had under the settlement
agreement. The settlement agreement in this instance, even if it
were a valid agreement, constituted a contract between the
parties the provisions of which could be waived in accordance
with the normal principles of contract. The facts in this case are
distinguishable from the facts in the case of Macyusuf v North
West Communication Services (1999) 20 ILJ 1061 (LC) where the
court was concerned with a settlement agreement entered into
under the auspices of conciliation proceedings at the CCMA and
where it was held that the provisions of the Act do not allow for
the challenging of allegedly defective settlement agreements or
for the resolving of disputes concerning the terms of settlement
agreements.
23. This is a case where the applicant, having emerged
unsuccessful from arbitration proceedings brought the present
proceedings by making what have turned out to be spurious
allegations against the fourth respondent. I agree with the
submissions made by Mr Maleka, who appeared on behalf of the
fifth respondent, that applicant appears to have invented the
arguments presented in this case after the award was made
against him and in a manner which suggest opportunism. There
is no ongoing relationship between the parties and there
appears, therefore, no good reason why costs should not follow
the result.
24. In the circumstances I make the following order:
24.1 The application for the review and setting aside of the
arbitration award of the fourth respondent is dismissed.
24.2 Applicant is ordered to pay fifth respondent’s costs.
S STELZNER
Acting Judge of the Labour Court of South Africa
DATE OF HEARING: 12 August 1999
DATE OF JUDGMENT: 25 August 1999
APPEARANCE FOR APPLICANT: Mr D Maluleke
OF: National Entitled Workers’
Union
APPEARANCE FOR
RESPONDENTS:
Mr I V Maleka
INSTRUCTED BY: