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[1997] ZASCA 112
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Uitenhage Municipality v Molloy (332/96) [1997] ZASCA 112; 1998 (2) SA 735 (SCA); [1998] 1 All SA 140 (A); (1998) 19 ILJ 757 (SCA) (27 November 1997)
IN THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
Case Number 332/96
In the matter between
THE
UITENHAGE
MUNICIPALITY
Appellant
and
ALEXANDER O'NEIL MOLLOY
Respondent
CORAM: Mahomed CJ, Smalberger, Howie, Scott et Streicher JJA
HEARD: 13 November 1997
DELIVERED: 27 November 1997
JUDGMENT
MAHOMED CJ/
Mahomed CJ
During February 1995 the respondent in this appeal brought an action in
the court a quo against the appellant for payment of the sum of R 148 317- 98.
In the particulars of claim, it was averred that during the period 22 August 1983
to 30 June 1989 the respondent was employed by the appellant. It was further
alleged that the amount claimed was owed to the respondent because the
appellant had, in contravention of section 9(1) and 10(2)(a)(ii) respectively of
the Basic Conditions of Employment Act 3 of 1983 ("the Employment Act"),
failed to remunerate the respondent for work performed by him during the
relevant period on Sundays and in respect of overtime.
In addition to certain other pleas, the appellant lodged a special plea in
which it was contended that the claims of the respondent were prescribed in
terms of section 11 of the Prescription Act 68 of 1969 ("the
Prescription Act"
;).
By agreement between the parties the court a quo was requested to determine
whether this defence was sound in law. For this purpose only, it was accepted
by the parties that:
1. During the relevant period the appellant was the "employer" of the
2
respondent, and the respondent was an "employee" of the
appellant, within the meaning of those expressions as defined in
section 1 of the Employment Act.
2.
The appellant had contravened the provisions of section 9(1) and
10(2)(a)(ii) of the Employment Act, by failing respectively to
remunerate the respondent (in accordance with the formulae
prescribed by the Employment Act), for work performed on
Sundays and for overtime work.
3.
These contraventions had occurred between the period 22 August
1983 to 30 June 1989.
4.
At no stage prior to the issue of summons on 9 February 1995, had
the respondent satisfied or taken any steps to procure the
satisfaction of the conditions contained in section 30(3) (a) or (b)
of the Employment Act.1
1 Section 30(3) of the Employment Act now reads as follows:
" No employee shall recover from an employer any amount due to him by virtue of a provision
of section 9(1), 10(2)... unless
(a)
the employee ... produces to the court a certificate by the Attorney-General stating that he
has refused to prosecute the defendant for the alleged contravention of or failure to comply with
a provision or condition referred to above and in terms of which that amount is due to the
employee ...;
(b)
the employer or the manager, agent or employee of the employer has been acquitted on a
charge in respect of such contravention or failure ...
(c)the employee . . . produces to the court a certificate issued on application by the
Director-General stating that the employee .. .has requested that the provisions of section 27
shall not be applied in respect of his claim."
3
5. The respondent had sought and obtained a certificate in terms of
section 30(3) (c) of the Employment Act for the first time on 8
February 1995.
It was common cause between the parties that any remuneration for
Sunday or overtime work (to which the respondent was entitled in terms of
section 9(1) and 10(2)(a)(ii) of the Employment Act) was payable at the end of
the month during which such work had been performed. Counsel for the parties
were also agreed that in terms of
section 10
of the
Prescription Act read
with
section 11(d)
, any debts of the appellant to the respondent became prescribed
three years after they became due; that more than three years had elapsed
between the time when the remuneration became payable to the respondent in
terms of
sections 9(1)
and
10
(2)(a)(ii) and the time when the respondent instituted action for the recovery of such remuneration; and that more than
three years had also elapsed between the time when the respondent became
aware of the existence of his claims and the time when he so instituted action.
The court a quo held that the claims of the respondent had, in these circumstances, not become prescribed and that the special plea
of prescription
should therefore be dismissed.
4
The correctness of that conclusion depends on the proper application and
meaning of
section 12(1)
of the
Prescription Act which
provides that subject to
sub-sections (2) and (3) (which do not affect the debate in the present case):
"...prescription shall commence to run as soon as the debt is due".
It follows that if the appellant's debts to the respondent for overtime and
Sunday work became "due" at the end of each month, during which the
respondent so worked on a Sunday or on overtime, they are indeed prescribed
and the appeal must succeed. If on the other hand, these debts only became
"due" when they were "recoverable" in terms of section 30(3) of the
Employment Act they would not be prescribed and the appeal must fail because
these debts cannot, in terms of section 30(3), be recoverable until section
30(3)(a) or (b) is satisfied and it is common cause that neither of these
subsections were satisfied when proceedings were instituted by the respondent.
(The certificate in terms of section 30(3)(c) was obtained the day before the
institution of the respondent's action but it was agreed that if the debts
concerned had become prescribed in the interim because of the lapse of the
prescriptive period of three years, a certificate in terms of section 30(3)(c)
obtained thereafter could not revive such a prescribed claim.)
5
The essential premise upon which the respondent's case must therefore
rest is that a debt in terms of section 9 or 10(2) (a)(ii) of the Employment Act is
not "due" for the purposes of
section 12(1)
of the
Prescription Act, until
it is
"recoverable" in terms of section 30(3) of the Employment Act.
In my view this is an erroneous premise because section 30(3) itself
distinguishes between the amount which is "due" to an employee (or employer)
"by virtue" of the relevant provisions of the Employment Act (which include
sections 9 and 10(2)(a)(ii)) and the conditions in the sub-section which have to
be satisfied before the amount so "due" may be "recovered".
Section 12(1)
of the
Prescription Act and
section 30(3) of the
Employment Act postulate two different and distinct enquiries. The enquiry in
terms of
section 12(1)
of the
Prescription Act is
: When does a debt become
"due" for the purposes of determining the date when prescription commences
to run? The answer to that question is: "When the time arrives for the
performance by the debtor of the obligation to pay the creditor in terms of the
Employment Act". The enquiry in terms of section 30(3) of the Employment
Act is: When may a debt in terms of the Employment Act be "recovered"? The
answer to that enquiry is: "After one of the requirements of section 30(3)(a),(b)
6
or (c) is satisfied".
Where there is no difference between the date when the debtor is
required to perform this obligation to pay the creditor and the date when the creditor can recover that debt, the answer to both enquiries
might yield the
same result, but the nature of the two enquiries remains different.
On this approach it accordingly follows that in respect of each of the
claims of the respondent, prescription commenced to run from the end of the
relevant month during which the respondent performed the work on Sunday or
on overtime.
A creditor against whose claim prescription commences to run, may
protect himself or herself from its consequences, by causing the interruption of
prescription in terms of
section 15
of the
Prescription Act through
the service
of "any process, whereby the creditor claims payment of the debt". Does
section 30(3) of the Employment Act preclude a creditor in the position of the
respondent from doing so? I do not think so. In the case of Willows v National Industrial
Commercial Workers Union
1991 (3) SA 546
(D) at 551E it was held
that the "conditions prescribed [in section 30(3) of the Employment Act] must
7
be in existence before any action may be instituted". I do not agree with that
conclusion. As the court in Willows' case recognised, the word "recoverable"
can bear different meanings. Depending on the context of the statute in which it
is used and its objects, "it may refer to the whole process of recovery comprising all steps from the institution of action to
its conclusion" or it may
be "confined to the obtaining of the judgment in which it culminates" (Willows, supra, at 549C). In my view the latter meaning
must have been intended by the
legislature. The section itself distinguishes between the amount which is "due"
to an employee by an employer in terms of the Employment Act and the right
which an employee acquires to "recover" the amount so due to him or her.
Section 30(3) of the Employment Act only precludes an employee from
"recovering" from any employer any amount "due" to him or her by virtue of
the provisions of the sections specified in section 30(3) (including sections 9(1)
and 10(2)(a)(ii)), if one of the conditions referred to in section 30(3)(a), (b) or
(c) have not been satisfied. It does not provide that such an employee is
precluded from serving "any process whereby the creditor claims payment of
the debt" and thus interrupting prescription in terms of
section 15(1)
of the
Prescription Act. It
is also of some significance that
section 30(3)
(a) (and
section 30(3)
(c)) which require certificates from the Attorney-General and the
Director-General respectively, only require such certificates to be produced to
8
the court. The section does not provide that they must "exist" before
proceedings are instituted. For these reasons section 30(3) of the Employment
Act should not be interpreted so as to preclude an employee from instituting proceedings for the recovery of debts to such employee
before one or other of
the conditions prescribed by section 30(3) have been fulfilled. Conditions
which might have the effect of clogging access to the courts must be
restrictively construed (Benning v Union Government (Minister of Finance)
1914 AD 180
at 185).
I am aware of dicta in a number of cases which suggest that a debt
becomes "due" when the creditor acquires the right to institute action or when
the creditor has "a complete cause of action" in respect of such debt (HMBMP Properties
(Pty) Ltd v King
1981 (1) SA 906
(N) at 909D-E; The Master v IL Back
& Co Ltd and Others
1983 (1) SA 986
(A) at 1004F-G; Deloitte Haskins
& Sell Consultants (Pty) Ltd v Bowthorpe Hellerman Deursch(Pty) Ltd
[1990] ZASCA 136
;
1991
(1) SA 525
(A) at 532H). These cases, however, do not deal with section 30(3)
of the Employment Act or with the time when a debt claimable under the
Employment Act becomes "due" within the meaning of
section 12(1)
of the
Prescription Act. Indeed
the distinction between a debt which is "due" and one
which is recoverable was not at all in issue in these cases. Nor was it an issue in
9
the line of cases which explain that a cause of action becomes "complete" when
it gives rise to an "enforceable claim" (Evins v Shield Insurance Co Ltd
1980
(2) SA 814
(A) at 838D-G, Abrahamse & Sons v SA Railways and Harbours
1933 CPD 626).
The basic fallacy in the contention advanced on behalf of the respondent,
is that an employer's debt arising from overtime work or work performed on Sundays, and which is payable at the end of the month in
which such work was
performed, nevertheless ceases to be "due" for the purposes of
section 12(1)
of
the
Prescription Act, merely
because some procedural conditions prescribed in
section 30(3)
have to be satisfied before that debt is recoverable. If that
contention was correct the employee concerned could simply wait for up to
twenty years before seeking to fulfil for the first time any of the conditions
specified in section 30(3) of the Employment Act. An employer in the position
of the appellant could, after the lapse of so many years, find itself presented
with a claim for work allegedly done on some Sunday many years ago, without
any effective means of counteracting such allegations. Material witnesses might
have died in the interim and no records might be available to investigate the
claims, because in terms of section 20(3) of the Employment Act an employer
is only obliged to retain such records for a period of three years.
10
This kind of anomaly also supports an alternative approach to the dispute
which would lead to the same result in this appeal. It is this. Assuming in
favour of the respondent, that his claims against the appellant only became
"due" within the meaning of
section 12(1)
of the
Prescription Act, after
one of the conditions in section 30(3)(a), (b) or (c) of the Employment Act are
satisfied, can he rely on the fact that they were not so satisfied if he himself
took no steps to procure such satisfaction?
In my view, he cannot do so. Section 30(3)(c) of the Employment Act,
for example, is a condition which can easily be satisfied on the initiative of the
respondent himself. It requires simply a certificate from the Director General
stating that the respondent has requested that section 27 of the Employment Act
shall not be applied in respect of his claim.
2
An employee who elects not to apply for a certificate in terms of section
30(3)(c), cannot contend that his or her claim in terms of sections 9(1) or
10(2)(a)(ii) was not "due" because such a certificate had not been issued. The
2
Section 27 creates machinery in terms of which the court convicting such an employer for a
contravention of certain sections of the Employment Act (including section 9(1) and 10(2)(a)(ii)) is directed to
determine the difference between the amounts paid to the employee and the amounts which should have been paid.
Sections 28 and 29 thereafter provide for an order directing the employer to pay that difference to a designated
officer, and for this difference to be paid to the employee concerned in whole or in part depending on the
circumstances.
11
remedy lies in the employee's own hands. Such an employee cannot profit by
his or her own inaction. As was stated by Van den Heever J in Benson and Another
v Walters and Other
1981 (4) SA 42
(C) at 49G:
"Our Courts have consistently held that a creditor is not able by his own conduct to
postpone the commencement of prescription."
This approach was confirmed by the court in the case of The Master v IL,
Back & Co Ltd, supra, at 1005G when Galgut AJA endorsed the following
assertion:
"If all that is required to be done to render the debt payable is a unilateral act by the
creditor, the creditor cannot avoid the incidence of prescription by studiously
refraining from performing that act."
Section 30(3) (c) was only introduced into the Employment Act by
section 18 of Act 104 of 1992 which came into operation on 1 May 1993. It
was therefore not possible for the respondent to cause that condition to be
fulfilled but there was nothing which precluded the respondent from taking
steps to procure the fulfilment of the conditions specified in section 30(3)(a) or
(b).
12
It is perfectly true that the fulfilment of the conditions specified in
section 30(3)(a) or (b) did not lie within exclusive competence of the
respondent - in order to satisfy section 30(3)(a) the Attorney General had to
issue a certificate stating that he had refused to prosecute the employer, and in
order to fulfil the conditions set out in section 30(3)(b) the court had to acquit
the employer. But in both cases the respondent prevented the possibility of
having the relevant condition fulfilled by failing or refusing to make the complaint or to prefer charges, or initiate any other steps
which could have lead
to the prosecution of the appellant.
The rationale in the cases which have held that a creditor cannot "by his
own conduct postpone the commencement of prescription" by refraining from
satisfying the condition which would render a debt due and payable, apply
equally where the creditor has failed to take or initiate the steps which fall
within his or her power to make it possible for such a condition to be satisfied.
Were it otherwise, an employee seeking to pursue an old claim in terms of the
Employment Act, who fears that the claim may be defeated in court by the
production of the employer's records, could overcome this difficulty by waiting
to pursue that claim civilly until those records had been destroyed in terms of
section 20(3) of the Employment Act.
13
One of the main purposes of the
Prescription Act is
to protect a debtor
from old claims against which it cannot effectively defend itself because of
loss of records or witnesses caused by the lapse of time. If creditors are allowed
by their deliberate or negligent acts to delay the pursuit of their claims without
incurring the consequences of prescription that purpose would be subverted.
For these reasons I am of the view that even if the debt claimed by the respondent was not "due" until one of the conditions
articulated in section
30(3)
was satisfied, and even if none of these conditions were in fact satisfied,
the case sought to be made on behalf of the respondent must fail because he
himself failed to take or initiate any steps to procure the satisfaction of any of
these conditions.
It follows that the court a quo erred in dismissing the special plea of
prescription upon which the appellant relied in the court a quo.
It is ordered that:
1. The appeal is upheld.
14
2.
The order made by the court a quo is substituted by the
following:
"The plaintiff's claims are dismissed with costs, such costs
to include the costs attendant upon the employment of two
counsel".
3.
The respondent is directed to pay the appellant's costs of
appeal.
I Mahomed
Chief Justice
Smalberger JA} Howie JA} Concur Scott JA} Streicher JA}
15