‘Reportable’
IN THE LABOUR COURT OF SOUTH AFRICA
(HELD AT JOHANNESBURG)
CASE NO. J5012/00
In the matter between:
SAVVAS NATHANIEL Applicant
and
NORTHERN CLEANERS KYA SANDS (PTY) LTD 1 ST
Respondents
COMMISSIONER M MILES N.O 2 ND
Respondents
THE COMMISSION FOR CONCILIATION,
MEDIATION AND ARBITRATION 3 rd
Respondents
JUDGEMENT
GAMBLE AJ
1. The applicant previously ran a dry cleaning business which went
insolvent. Pursuant to an arrangement with the liquidator of that
business, the 1 st respondent (“NCK”) purchased certain of the more
lucrative outlets to add to its enterprise. NCK decided that it was
necessary for the business efficacy of the newly formed group that the
applicant should be employed by it. In this regard on 13 April 1999,
the parties concluded a written agreement which made provision, inter
alia, for:
1.1 The acquisition by NCK of certain of the dry cleaning businesses from
the liquidators of the insolvent close corporation;
1.2 the employment of the applicant by NCK on certain specified terms;
1.3 the payment of certain commissions to applicant by NCK additional to
the applicant’s salary;
1.4 an enforceable restraint of trade over the applicant upon his
termination of employment with NCK.
2. It is common cause that the applicant commenced working for NCK at
the beginning of April 1999 and that his employment terminated during
September 1999. The precise nature of the termination is in issue
between the parties.
3. The applicant avers that he was unlawfully dismissed by NCK on 17
September 1999. Accordingly, he referred a dispute to the third
respondent (“the CCMA”) on 6 October 1999.
4. The matter eventually went to arbitration before the second
respondent (“the Commissioner”) where NCK alleged that the
applicant had not been dismissed but that he had left its service
voluntarily and by mutual consent.
5. After a protracted arbitration, the commissioner upheld the company’s
contentions and found that the applicant had not been dismissed.
6. The applicant now seeks to review and set aside the commissioner’s
award which was handed down on 18 October 2000, in terms of
section 145 of the Labour Relations Act, 66 of 1995 (“The LRA”).
INCOMPLETE RECORD
7. It is common cause between the parties that the record of the
proceedings before the commissioner is incomplete in that various
passages thereof are simply incapable of transcription. The parties
have gone to great lengths to reconstruct the record, including perusal
of their legal representatives notes, the commissioner’s notes and the
employment of a specialist transcriber to reasses the tapes.
Notwithstanding all of these endeavours, the record is incomplete in
certain material aspects of the evidence.
8. Mr. Smit, who appeared on behalf of the applicant, argued that, since
the record was hopelessly inadequate for a proper determination of
the review, the matter should be remitted to the CCMA for a fresh
hearing. Failure to do so, he said, would result in an inequity towards
the applicant, relying on the judgement of the Labour Appeal Court in
Department of Justice v Hartzenberg (2001) 22 IJL 1806 (LAC).
9. Mr. Barrie, for NCK, argued that the matter was not as simple as that.
He said that the grounds for variation and/or rescission of an
arbitration award are limited to either section 144 of the LRA, which
provides for a commissioner to vary or rescind the award on certain
limited grounds which do not apply in the present case, and section
145 of the LRA, which provides for this court to review and set aside in
accordance with the principles which have been laid down by the
Labour Appeal Court in cases such as Carephone (Pty) Ltd v Marcus
N.O. and others (1998) 19 IJL 1425 (LAC), Shoprite Checkers (Pty)
Ltd v Ramdaw N.O and others (2001) 22 IJL 1603 (LAC), Crown
Chickens (Pty) Ltd t/a Rocklands Poultry v Kapp and others (2002) 23
IJL 863 (LAC).
10. Mr Barrie argued further that the Hartzenberg case, supra, did not
apply to review proceedings and that the judgements of Francis J in
this court in Shoprite Checkers LTD v CCMA and others (2000) 23 IJL
943 (LC) and Uee – Dantex Explosives (Pty) Ltd v Maseko and others
(2001) 22 IJL 1905 (LC) were clearly wrong.
11. It was contended that the power of this court to review was limited to
the grounds developed in the LAC cases referred to above which
require an award to be objectively rational and justifiable in relation to
the reasons given by the commissioner. A deficient or missing record,
however, did not constitute grounds for setting aside a CCMA
commissioner’s arbitration award.
12. I agree with Mr. Barrie that the decision in the Hartzenberg case,
supra, does not apply to reviews under section 145 of the LRA – that
case was an appeal under the old LRA.
13. I have considered the decisions of Mr. Justice Francis in the Shoprite
Checkers and Uee – Dantex cases referred to in para 10 above and
respectfully find that they are distinguishable from the present case on
the facts. In both of those cases, there was no record made available
by the commissioner and the court found that the commissioner’s
failure to produce the record constituted a reviewable irregularity
under the LRA. As I have pointed out above, in the present case both
the parties and the Commissioner have gone to great lengths to
reconstruct as complete a record as possible.
14. The problem of an incomplete record recently came before the Labour
Appeal Court in Lifecare Special Health Services (Pty)Ltd t/a
Ekuhlengni Care Centre v CCMA and others [2003] 5 BLLR 416
(LAC). In that case, the record of arbitration proceedings before the
CCMA was incomplete because certain of the tapes on which the
proceedings had been recorded were physically lost. In the result,
Comrie AJA gave directions as to how the record should be
reconstructed (including the Commissioner and the parties’
representatives sitting together and attempting to utilize their notes to
reconstruct the record). The matter was then postponed to enable
this to be done.
15. The approach suggested by Comrie AJA in the Lifecare case, supra,
has already been undertaken in the instant case and, it is common
cause, these is nothing further which can be done to reconstruct the
record.
16. I agree with Mr. Barrie that it is not legally permissible in the
circumstances of the present case to remit the matter back to the
CCMA for a rehearing due to the defective record. The applicant
cannot contend that the award of the Commissioner is not rationally
justifiable merely because the evidence which was adduced before
him (and which presumably influenced him in his decision) cannot be
placed before this court. In the present circumstances, then, the court
must look at the award of the Commissioner together with all the
documentary and other evidence before him (including a clandestine
tape recording of certain important discussions between the employee
and employer’s representatives) as well as the available transcript of
proceedings, and then decide whether the award passes muster in
accordance with the jurisprudence set out in para 9 above.
17. In a case such as the present, it would, in my view, be open to the
parties to depose to the material (missing) facts in their affidavits filed
in the review and if there is a dispute in that regard, have that dispute
determined by oral evidence. The parties did not, however, adopt
such an approach.
18. While accepting that this court was established as a court of law and
equity in terms of section 151(1) of the LRA, it does not follow that in
all cases where the equities may be more favourable to one party than
another, the court must simply set aside proceedings an order re
hearings de novo . The applicant in a review has an onus to prove his/
her case and must do so on all the evidential material properly placed
before the court. If, after consideration of all of that material (defective
as it may be) the court is unable to find a reviewable irregularity then
the applicant will obviously fail. A defective record in such
circumstances is but one of the vagaries which accompany the
litigation process.
19. Mr. Barrie printed out that a case such as the present differs materially
from an appeal, for example, from the Magistrates Court to the High
Court, where a party has a statutory right of appeal. He argued that a
party’s rights in the present context were limited to just and fair
administrative action. If it happened that the matter could not be
properly placed before the reviewing court because of a incomplete
transcription (and there was no failure by the Commissioner in the
discharge of his statutory function) then so be it, he said.
20. Even where there is such a statutory right of appeal, the High Court
has held, in the case of an incomplete record, that the court would
have to be convinced, on the existing record, that the magistrate was
wrong. JMYK Investments CC v 600 SA Holdings (Pty) Ltd 2003 (3)
SA 470 (W). I consider that a similar approach would be appropriate
in the present case.
21. In the circumstances, I do not consider that the application for remittal
is wellfounded and I decline the request to do so. I shall then
proceed to determine the case on all the available evidential material.
THE MATERIAL FACTS
22. It was common cause that a meeting took place on 31 August 1999
between the applicant and Messers Pansegrouw and Bate who
represented NCK. The precious financial state of NCK was discussed
and Pansegrouw suggested that Bate and the applicant take a
reduction in salary. Understandably, neither was amenable to do so.
23. The applicant, either at that meeting or shortly thereafter, suggested
then that his services be terminated as part of a costcutting measure.
In evidence at the arbitration he said:
“My attitude was I have a contract, I would rather leave and
take my commission”.
24. The commission referred to was to be calculated in accordance with a
formula stipulated in the written contract of employment referred to
above. If the applicant terminated his services before the expiry of a
period of 12 months calculated form April 1999 he would only be
entitled to commission up to the date of termination. If the company
terminated within the 12 month period, the applicant would be entitled
to the full commission.
25. I was informed from the Bar during argument that the full commission
was a substantial amount – apparently in excess of R700 000.
26. Both Pansegrouw and Bate regarded the applicant as an important
cog in the corporate wheel and did not wish to lose his services
immediately, particularity because he was busy implementing a new
computer system for NCK. Pansegrouw then suggested that the
applicant stay on at least until the end of September 1999 – a
proposal which appears to have been acceptable to the applicant.
27. Thereafter there were ongoing discussions between the parties in
relation to payment of the applicant’s commission. Having taken legal
advice, the applicant believed that he had an entitlement to a
substantial payment pursuant to the written agreement.
28. Pansegrouw, on the other hand, believed that the written agreement
was not binding for want of compliance with the suspensive conditions
stipulated therein. He wanted to negotiate a different agreement with
the applicant involving payment of a reasonable sum to the applicant
in exchange for a 3 year restraint of trade in favour of NCK. The
commissions referred to in the written agreement would serve as a
“starting point” for discussions in this regard.
29. Ultimately the negotiations came to nought because, according to
Pansegrouw, the applicant’s demands were too high.
30. Pansegrouw called a meeting with the applicant on 17 September
1999. Bate had insisted on the meeting because, as he said, he had
a business to run and the applicant was absent a lot of the time. He
wanted to know whether the applicant was staying or leaving.
31. The applicants version of events at the arbitration in regard to this
meeting was as follows:
“I was just called into Mr. Raymond Bate’s office and I was
told leave the premises with immediate effect and I again
stated that I did not accept this termination of employment,
but obviously I couldn’t stay on the premises because I was
being told to leave and I then asked for my salary to be paid
until the end of the termination period, and I was told, firstly
that I was not entitled to any salary from the 1 st to the 17 th
or for the entire month, initially and then after which
deliberation, Mr.Kosie Pansegrouw came around and said to
me “well if that’s the case then I’ll give you half your salary,
for a half a month”, which I still told him I do not accept but I
would obviously take the money.”
I should point out that the agreed monthly salary was R20000.
32. Pansegrouw and Raymond Bate denied this version of events and
alleged that the applicant left voluntarily. While the record of the
arbitration proceedings is incomplete in regard to the meeting of 17
September 1999 the following passage from the evidence of Bate is
clear:
“Mr. Nathaniel stated to Mr.Pansegrouw that he cannot carry
on in this company with this …(unclear)… Now that he has
gone to see lawyers, etc, etc. He opted to leave there and
then. Mr. Pansegrouw said, yes if that’s your choice then
you can leave. Mr. Pansegrouw did say to Mr. Nathaniel
that he’s not going to pay him a full salary, because its (sic)
17th of the month. He would give him half his salary which
Mr. Nathaniel agreed to.”
The applicant was also offered (and received) use of his company vehicle
until the end of September 1999.
33. Raymond Bate denied the applicants suggestion that the real reason
for the dismissal was that there had been conflict between his brother
Tom Bate and the applicant.
34. From the aforgoing it can be seen that the issue for determination by
the Commissioner at arbitration was a crisp one. Regrettably not all of
the crossexamination on this point was capable of transcription. The
evidenceinchief is, however, sufficiently complete to understand the
parties respective versions.
THE COMMISSIONER’S FINDINGS.
35. The award of the Commissioner dated 16 October 2000 is a
document of some 25 pages. It contains a thorough summary of the
evidence (10 pages) and a reasoned evaluation thereof (15 pages).
36. The Commissioner has demonstrated through his award that he was
very much alive to the issues before him. To the extent that there may
be gaps in the record due to poor transcription, the Commissioner’s
award provides a very useful summary of the evidence and in
particular of the crossexamination of the applicant and Pansegrouw.
37. The Commissioner thoroughly reviewed the evidence before him and
carefully evaluated it. To the extent that he has made credibility
findings against the applicant it is clear that he had the opportunity of
seeing and hearing the witnesses give evidence and to evaluate them
firsthand. He was also able to consider the veracity of the witnesses
in relation to the other evidential material before him, particularly the
clandestine tape recording made by the applicant of a meeting with
Pansegrouw at which the applicant intimated that there was ongoing
discussion between the parties in relation to the mutual termination of
his employment.
38. In my considered view Mr. Smit was not able to refer to any passages
in the record of the arbitration proceedings which demonstrate that the
commissioner committed any reviewable irregularities.
39. I am mindful, too, of the fact that the matter before me is a review of
the arbitration proceedings and not an appeal. While it may be
argued that the boundary between appeals and reviews has become
somewhat blurred in the context of a constitutionally based right of
review which permits consideration of the merits of a matter, the
distinction is nevertheless very clearly still there. ( Roman v Williams
N.O. 1998 (1) SA 270 ( C ) @ 285 A; Carephone case supra at para
32)
40. The approach on constitutionally based review was well summarized
by Nicholson JA in the Crown Chickens case , supra @ para 19.
“By rational I understand that the award of an arbitrator must
not be arbitrary and must have been arrived at by a
reasoning process as opposed to conjecture, fantasy
guesswork or hallucination. Put differently the arbitrator
must have applied his mind seriously to the issues at hand
and reasoned his way to the conclusion. Such conclusion
must be justifiable as to the reasons given in the sense that
it is defensible, not necessarily in every respect, but as
regards the important logical steps on the road to his order.”
41. I have carefully considered the arguments advanced by counsel in this
case and the relevant passages of the record upon which they rely for
their submissions. I am unable to conclude that the commissioner
erred in the manner contended for by the applicant. On the contrary
the award appears to be a model in logic and conclusion which, in any
event, accords with the probabilities. In my view, therefore, the
application cannot succeed.
42. In the result I grant the following order:
42.1 The application to review the award of the second respondent dated
16 October 2000 is dismissed.
42.2 The applicant is to pay the 1 st respondents’ costs of suit herein.
_____________________
P A L GAMBLE
Acting judge of the Labour Court
Date of hearing : 26 June 2003
Date of judgement : 9 July 2003
For the Applicant : Adv. M. Smit instructed by David C. Feldman
Attorneys
For the 1 st Respondent : Adv. F.G. Barrie instructed by Jac Van Niekerk
And Partners Inc.