REPUBLIC OF SOUTH AFRICA
IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG DIVISION, PRETORIA
CASE NO: 137492/25
1. REPORTABLE: NO
2 OF INTEREST TO
3 REVISED: NO
07 September 2026
DATE
In the matter between:
FETAKGOMO TUBATSE LOCAL MUNICIPALITY Applicant/Respondent for Leave
And
KIPP CONSUL TING ENGINEERS (PTY) LTD
ARB IT RA TOR CP WESLEY SC NO
Applicant for Leave/First Respondent
Second Respondent
ARBITRATION FOUNDATION OF SOUTHERN AFRICA Thi rd Respondent
LEAVE TO APPEAL JUDGMENT
MOGALE, AJ
Introduction
1. This is an application for leave to appeal brought by the First Respondent ,
Kipp Consulting Engineers (Pty) Ltd ("Kipp"), against the whole judgment and
order I handed down on 2 June 2026. In that judgment , I reviewed and set
aside the arbitrator's rulings of 8 May 2025 and 27 May 2025, set aside the
final award of 4 July 2025, remitted the matter to AFSA for determination by a
different arbitrator, dismissed Kipp's application to have the award certified as
an order of court, dismissed Kipp's counter-application , and ordered Kipp to
pay the costs of the application and counter-app lication on enhanced scales.
2. The Municipality opposes the application for leave to appeal.
3. I have considered the notice of application for leave to appeal , the grounds for
the appeal , the heads of argument filed on behalf of Kipp, and those filed on
behalf of the Municipality . I have also considered the record of proceedings
and the judgment sought to be appealed .
LEGAL FRAMEWORK
4. Section 17(1 )(a) of the Superior Courts Act 10 of 2013 provides that leave to
appeal may only be granted where the judge is of the opinion that:
(i) the appeal would have a reasonable prospect of success ; or
(ii) there is some other compelling reason why the appeal should be heard,
including conflicting judgments on the matter under consideration .
5. The test is well-established . In Mount Chevaux Trust v Tina Goosen and 18
Others 2014 JDR 2325 (LCC) para 6, Bertelsmann J held that the threshold
has been raised by the new Act:
"The use of the word 'would' in the new statute indicates a measure of
certainty that another court will differ from the court whose judgment is sought
to be appealed against." This requires a realistic prospect of success , not
merely a possibility .
6. The Court in S v Smith (4 75/1 0) [2011] ZASCA 15 (15 March 2011) held that
leave should not be granted merely because a party wishes to appeal ; there
leave should not be granted merely because a party wishes to appeal ; there
must be a sound, rational basis for concluding that there are prospects of
success on appeal.
7. I must also consider whether there is some other compelling reason for the
appeal to be heard, even if prospects are not strong. Such reasons include
conflicting judgments on the issue, or matters of great public importance that
require appellate guidance .
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EVALUATION OF THE GROUNDS OF APPEAL
8. Kipp has advanced numerous grounds of appeal. I have carefully considered
each of them and, for the reasons set out below, I am not persuaded that any
of them meet the threshold for the granting of leave to appeal.
Ground 1: The Court decided an unpleaded Constitutional issue
9. Kipp contends that I erred by finding mero motu that Article 9.1 of the AFSA
Rules for Expedited Arbitration is inconsistent with constitutional public policy,
when no such case was pleaded , argued , or relief sought by the Municipality .
10. This ground is without merit. The Municipality's case was squarely founded on
the right to a fair hearing under section 34 of the Constitution. The founding
affidavit specifically pleaded that the arbitrator's exclusion order deprived the
Municipality of its right to a fair hearing and constituted a gross irregularity.
See caselines 001-13 para 22.
11 . In Lufuno Mphaphuli & Associates (Pty) Ltd v Andrews and Another 2009 (4)
SA 529 (CC), the Constitutional Court held that arbitration agreements and
rules must be interpreted and applied consistently with the Constitution . The
Court stated that "should the arbitration agreement contain a provision that is
contrary to public policy in light of the values of the Constitution , the arbitration
agreement will be null and void to that extent."
12. I did not declare Article 9.1 constitutionally invalid in the abstract ; rather , I held
that its interpretation and application in this case, as an automatic , total, and
permanent exclusion without any proportionality enquiry, violated the
Municipality's right to a fair hearing . That was a necessary application of
constitutional principles to the pleaded and argued facts. No separate
declaration of invalidity was sought or granted . The Municipality was entitled
to rely on section 34, and the Court was duty-bound to give effect to it.
13. The cases cited by Kipp, such as Fischer v Ramahlele and Phillips v NDPP ,
13. The cases cited by Kipp, such as Fischer v Ramahlele and Phillips v NDPP ,
are distinguishable. In those cases, the constitutional complaint was entirely
new and not pleaded. Here, the constitutional right to a fair hearing was the
very foundation of the review application . The challenge to the rule's
application was directly raised in the papers and also in oral argument. This
court did not formulate a new issue; it applied settled constitutional principles
to the facts.
Ground 2: The arbitrator had procedural authority , and no gross irregularity
was established
14. Kipp contends that the arbitrator acted within his powers under the AFSA
Rules and section 14(1 )(a)(ii) of the Arbitration Act, and that his enforcement
of agreed procedural consequences did not constitute a gross irregularity.
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15.1 disagree . The test under section 33(1 )(b) is whether the arbitrator committed
a gross irregularity in the conduct of the proceedings . As stated in Ellis v
Oessai 1909 TS 576 at 581, 'an irregularity in proceedings does not mean an
incorrect judgment, it refers not to the result, but to the method of a trial, such
as, for example , some high-handed or mistake action which has prevented
the aggrieved party from having his case fully and fairly determined" .
In Palabora Copper (Pty) Ltd v Motlokwa Transport Construction (Pty)
Ltd (298/207)(2018) ZASCA, the court held that "where an arbitrator for some
reason misconceives the nature of the enquiry in the arbitration proceedings
with the result that a party is denied a fair hearing or a fair trial of the issues ,
that it constitutes a gross irregularity under section 33(1 )(b)."
16. The arbitrator here misconceived the nature of the enquiry. He treated the
Municipality's failure to deliver an amended statement of defence, a
procedural default in response to a claim amendment , as a justification for
excluding the Municipality entirely from the arbitration, including from its own
counterclaim and all remaining issues. He did not consider whether the
default was wilful, whether prejudice could be cured by costs, or whether a
less drastic sanction would suffice. He applied Article 9.1 automatically and
mechanically, without any proportionality assessment.
17. The parties ' agreement to the AFSA Rules does not render the arbitrator's use
of those rules immune to constitutional review . Party autonomy is limited and
must align with public policy and constitutional principles. I concluded that the
complete exclusion in this case violated those boundaries.
18. The arbitrator also misunderstood his role when he stated that he could not
permit the Municipality to participate unless a court order required it. He
believed he lacked the authority to revisit his own ruling, when in fact Rule 6.5
believed he lacked the authority to revisit his own ruling, when in fact Rule 6.5
granted him the widest discretion to ensure a just and final determination. This
misconception of his powers is a gross irregularity .
Ground 3: The Court's proportionality test was not a legally grounded review
standard
19. contends that I devised a proportionality enquiry that is not found in the
Arbitration Act, the AFSA Rules, or binding authority , and that I thereby
substituted my own conception of fairness for the procedural regime chosen
by the parties.
20. This criticism is unfounded . The review of proportionality is not new; it is
inherent in the constitutional right to a fair hearing under section 34. Any
procedural penalty , especially one as harsh as complete exclusion from
proceedings , must be proportionate to the breach . Courts have consistently
required courts and tribunals to weigh the parties' interests and explore less
severe alternatives that can achieve the inte~ded goal.
21 . In Telcordia Technologies Inc v Telkom SA Ltd 2007 ,_(3) SA 266 (SCA), the
court emphasised that the Constitution requires courts-to strike a balance that
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curtails the unacceptable excesses of freedom of contract. I merely gave
effect to that balance by identifying factors that should have guided the
arbitrator's exercise of discretion .
22. The factors I listed are not jurisdictional prerequisites ; they are rational
considerations that any fair decision-maker ought to consider before imposing
a permanent and comprehensive exclusion . The arbitrator considered none of
them.
Ground 4: The separation of issues did not remove the arbitrator's procedural
authority •
23. Kipp contends that I erred in finding that the separation of issues created a
procedural barrier to applying Article 9.1 to the remaining issues.
24. This ground mischaracterises my reasoning . I did not hold that the separation
of issues removed the arbitrator's procedural authority altogether . I held that
the separation agreement meant that the Municipality's default in responding
to an amendment on one aspect of Kipp's claim could not justify excluding the
Municipality from entirely separate issues, particularly its own countercl aim.
The arbitrator 's exclusion order was overbroad and disproportionate because
it swept up issues unrelated to the default.
25. The separation agreement set out how the arbitration should be conducted
and was binding on the arbitrator. It could not be ignored unilaterally or used
to treat the whole process as a single, inseparable proceeding for the purpose
of imposing penalties . The default concerned only Kipp's amended claim and
did not prevent the Municipality from pursuing its own separate counterclaim,
which was postponed.
Ground 5: The remedy was overbroad and failed to consider severability
26. Kipp contends that even if any irregularity was established , it did not justify
setting aside the entire final award, and that I should have considered
severability.
27. This ground also lacks merit. The arbitrator's exclusion of the Municipality
from all further participation meant that the entire subsequent proceedings ,
from all further participation meant that the entire subsequent proceedings ,
including the hearing on the remaining issues, the counterclaim , and the final
award , were conducted without the Municipality's participation. The irregularity
was not confined to a discrete aspect of the award; it infected the entire
proceedings after the exclusion ruling. The final award was a product of that
unfair process.
28. In Palabora Copper, the court did set aside only the affected part of the award
because the irregularity was confined to the counterclaim while the claim was
properly heard. Here, the exclusion order prevented the Municipality from
participating in any aspect of the remaining issues, including Kipp's own
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amended claim . The entire remainder of the arbitration was tainted by the
same irregularity . Severance was neither appropriate nor feasible.
COMPELLING REASONS
29. I have considered whether , even if prospects are not strong, there are
compelling reasons for the appeal to be heard. Kipp argues that the matter
raises questions of general importance about the limits of judicial intervention
in private arbitration, the relationship between party autonomy and
constitutional public policy, and the proper application of section 33(1 )(b) of
the Arbitration Act.
30. While these issues are undoubtedly important , established jurisprudence has
already addressed them. The principles are clear: private arbitration is subject
to constitutional norms; courts will intervene only where a gross irregularity
has occurred ; and the right to a fair hearing is non-waivable. Applying these
principles to the facts of this case does not raise novel or unresolved legal
questions that require appellate guidance.
31 . Moreover , this matter is essentially a dispute about the correctness of a
procedural ruling in a single arbitration. It does not involve conflicting
judgments on the same point, nor does it affect a class of cases beyond the
parties. The interests of justice do not require that leave be granted.
CONCLUSION
32. Having considered all the grounds of appeal advanced by Kipp, I am not
persuaded that there is a reasonable prospect that another court would come
to a different conclusion on the merits of the review application.
33. The application for leave to appeal is therefore dismissed .
ORDER
34. The following order is made :
1. The application for leave to appeal is dismissed .
2. The First Respondent (Kipp Consulting Engineers (Pty) Ltd) is ordered
to pay the costs of this application , including the costs consequent
upon the employment of senior counsel on Scale C and junior counsel
on Scale B.
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Date of Appeal hearing:
Date of judgment:
Appearances
Applicants' counsel:
Junior Counsel:
Instructed by;
Responden~'counsel :
Instructed by:
K MOGALE
ACTING JUDGE OF THE HIGH COURT
GAUTENG DIVISION, PRETORIA
26 August 2026
07 September 2026
Advocate Rip SC
Advocate W Maodi
Mmakola Matsimela Attorneys
Advocate Solomon SC
Michael Ramphela's Attorneys
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