CASE NO. LC 7/2010

SPECIAL INTEREST

IN THE LABOUR COURT OF NAMIBIA

In the matter between:

SHOPRITE NAMIBIA (PTY) LTD APPLICANT

and

FAUSTINO MOISES PAULO 1^ST RESPONDENT

EMMA NIKANOR N.O. 2^ND RESPONDENT

CORAM: HOFF, J

Heard on: 2010.03.19

Delivered on: 2010.03.26

JUDGMENT

HOFF, J: [1] The applicant approached this Court on 22 January 2010 on an urgent basis for an order in the following terms:

“1. Condoning the applicant’s non-compliance with the Rules of this Honourable Court and dispensing, as far as need be, with the forms and service provided for in these Rules and hearing this application on an urgent basis as provided for in Rule 6(24) of the Rules of the Labour Court.

2. Suspending the operation of the second respondent’s award dated 22 December 2009 in arbitration number CRWK 510-09 pending the finalization of the applicant’s appeal against the award.

In the alternative to prayer 2:

3. That a Rule nisi shall issue calling upon the respondents to show cause, if any at 10h00 on Friday, 5 March 2010, why an order in the following terms should not be made final:

3.1 suspending the operation of the second respondent’s award dated 22 December 2009 in arbitration number CRWK 510-09 pending finalization of the applicant’s appeal against the award

4. Further and/or alternative relief.

[2] On 5 March 2010 at the time when the application was heard the applicant was absent and this Court dismissed the application.

[3] It subsequently appeared that counsel appearing on behalf of the applicant had arranged that the application be heard at 14h15 on 5 March 2010. At this time the application had been already been heard and dismissed. On 8 March 2010 first respondent gave notice of abandonment of the judgment granted in his favour on 5 March 2010 and the application was set down on 19 March 2010.

The second applicant does not oppose this application.

[4] On 19 March 2010 applicant prayed for the filing and acceptance of two supplementary affidavits. The first one, deposed to by Jose Rodriques da Silva, the divisional loss control manager of the applicant, dealt with the trust relationship between applicant’s management and first respondent and deals with information which only became available to the applicant on 16 February 2010, after the filing of applicant’s replying affidavit. The second one deposed by one Chrisstoffel Johannes Jan Labuschagne, a director of the applicant, dealt with the authority to bring this application on behalf of the applicant.

[5] It is trite law that this Court may in its discretion permit the filing of further affidavits.

(See Ritz Reise (Pty) Ltd v Air Namibia (Pty) Ltd 2007 (1) NR 222; Otjozondjupa Regional Council v Dr Ndahafa Aino-Cecilia Nghifindaka & Two Others, unreported judgment of this Court, Case LC 1/2009 delivered on 22 July 2009).

[6] This may be necessary to enable a party to make a full representation of is or her case. This Court in its discretion granted leave to the applicant to file these two supplementary affidavits.

[7] Mr Akweenda who appeared on behalf of the first respondent raised two points in limine. The first concerned the issue of authority to bring this application on behalf of the applicant and the second point relates to the issue of urgency.

Authority to bring application

[8] First respondent in his answering affidavit challenged applicant to provide a board resolution on the authority to bring this urgent application.

The divisional manager of applicant, Paul Malan, stated in his founding affidavit that he was duly authorised to depose to the founding affidavit and to bring this application on behalf of the applicant. No board resolution was attached to the founding affidavit. In his replying affidavit a written resolution, passed by directors of applicant, authorising the institution of legal proceedings in the Labour Court was attached. This resolution passed on 27 January 2010 was signed by only two of applicant’s five directors. Mr Akweenda in his heads of argument (filed on 18 February 2010) submitted that this resolution was not valid in law as it was not adopted by the majority of the directors.

This prompted applicant on 3 March 2010 to pass another resolution ratifying the action taken by Paul Malan who deposed to the founding affidavit. This resolution was signed by four directors. Labuschagne in his supplementary affidavit explained that the majority of applicant’s directors could not have ratified the action taken by Paul Malan at an earlier stage due to conflicting schedules of applicant’s directors.

[9] It was also submitted in terms of the resolution dated 27 January 2010 that legal proceedings were instituted by filing an interim application to suspend the arbitrator’s award. The resolution, it was submitted, did not refer to an urgent application. The term interim, it was further submitted, should be given its natural meaning i.e. not urgent. Therefore applicant has never authorised the bringing of the present urgent application.

[10] In terms of the resolution passed on 3 March 2010 the applicant ratified all previous actions taken in prosecuting applicant’s “appeal and/or review and/or application to suspend the operation of the arbitration award to their/its finality …”

[11] In SWA National Union v Tjozongoro and Others 1985 (1) SA 376 (SWA) at 382 H Strydom J (as he then was) said the following:

“In my opinion the resolution authorizing the president to obtain an interdict to stop the congress is a document empowering an agent to present the party in a court of law and must be construed on the same principles as set out in the cases referred to.”

[12] The cases referred to were O & DH Fraser Ltd v Waller 1916 AD 494 where Innes CJ with reference to a power of attorney stated that it has not been the practice to apply a rigid interpretation to such documents, and National Board (Pretoria) (Pty) Ltd v Swanepoel 1975 (1) SA 904 (W) where Cilliers JP with reference to an authority given by a principal to his agent stated that those powers must be given a reasonable interpretation.

[13] I am of the view that the only meaningful and reasonable interpretation of “interim” application in the present circumstances can only mean the urgent application launched by Paul Malan on behalf of the applicant.

[14] Regarding the ratification of the initiation of the proceedings on 19 January 2010 Muller J in Otjozondjupa Regional Council (supra) explained the position as follows on pp. 14 and 15:

“(a) The deponent of an affidavit on behalf of an artificial person has to state that he or she was duly authorised to bring the application and this will constitute that some evidence in respect of the authorization has been placed before Court;

(b) If there is any objection to the authority to bring the application, such authorisation can be provided in the replying affidavit;

(c) Even if there was no proper resolution in respect of authority, it can be taken and provided at a later stage and operates retrospectively;

(d) Each case will in any event be considered in respect of its own circumstances; and

(e) It is in the discretion of the Court to decide whether enough has been placed before it to conclude that it is the applicant who is litigating and not some unauthorised person on its behalf.”

[15] The ratio is that where somebody acts on behalf of an artificial person the Court must be satisfied that such artificial person cannot avoid a cost order.

[16] In Smith v Kwanonquebela Town Council 1999 (4) SA 947 (SCA) at 954 D Harms JA said the following regarding the issue of rectification:

“I am in general in agreement with the analysis and conclusion reached in Merlin Gerin. Apart from making perfectly good sense and being practical, it is legally sound. A party to litigation does not have the right to prevent the other party from rectifying a procedural defect.”

[17] The applicant filed a resolution ratifying the previous acts of its office bearers, the applicant was entitled to do this due to the fact of first respondent’s challenge, and I am satisfied that enough information has been placed before me that the applicant is presently prosecuting this application and not some unauthorised person.

[18] The point in limine relating to the lack of authority to prosecute is accordingly dismissed.

[19] The second point in limine relates to the issue of urgency.

[20] It was submitted on behalf of the first respondent that the arbitration award was issued on 22 December 2009 and applicant 28 days later brought this application 3 days prior to the date determined for applicant to make payment to first respondent in terms of the award. This, it was submitted, was a self created urgency, and in addition, that applicant was not bona fide in bringing the application. It was further submitted that applicant did not provide reasons why applicant would not be afforded substantial redress at a hearing in due course.

[21] The applicant in its founding affidavit stated the following at paragraphs 25, 26 and 27:

25.

“I submit further that the applicant will not be afforded any redress should this matter be heard in the ordinary course. I am advised that applications brought in the ordinary course are not only heard at the earliest three to four months after being lodged. This lapse of time would defeat the entire purpose of the application.

26.

The applicant took all reasonable steps to avoid the necessity of bringing this application. After the award was delivered on 22 December 2009 to the applicant’s representative at the arbitration proceedings, Mr Robin Raines, the applicant approached its current legal representatives of record for advise. As the award was delivered during a period when the majority, if not all, law firms were closed, the applicant secured the first available appointment with its legal representatives for the first week of January 2010. On the advise of its representatives counsel was engaged. As the parties were during the beginning of January 2010 engaged in settlement negotiations, counsel was not initially briefed with the voluminous exhibits and transcript of the disciplinary proceedings. Once it became clear that the negotiations would not be successful, the further exhibits and the transcript were delivered and considered. Due to the volume, inter alia, of the transcript, this application was only finalized and served on 19 January 2010.

27.

I humbly submit that the applicant has brought this application without due delay and has demonstrated that its appeal against the award has been noted in a genuine attempt to test the correctness of the second respondent’s award. I submit further that the balance of irreparable harm favours the applicant and therefore pray for an order in terms of the accompanying notice of motion.”

[22] It was submitted by Mr Maasdorp on behalf of the applicant that the application was brought having regard to the circumstances without undue delay. The circumstances referred to include the fact after the arbitration proceedings the majority of law firms had been closed, that applicant secured the first available appointment with its legal representatives during the first week of January 2010, that the proceedings had been voluminous and that applicant was entitled to engage counsel to get a proper opinion before rushing to Court.

[23] In the Three Musketeers Properties (Pty) Ltd and Another v Ongopolo Mining and Processing Ltd and Two Others, an unreported judgment of this Court, Case (P) A 298/2006 delivered on 30 November 2006, Smuts AJ, with reference to topics of urgency and claims of spoliation said the following at p. 10 paragraph 29:

“[29] Mr Heathcote representing the respondents in my view correctly did not contest the urgency of the matter. He correctly conceded that a claim of spoliation is invariably an inherently urgent process and that the applicants had complied with Rule 6 (12)(b) in stating why they would not be afforded substantial redress at the hearing in due course as required in Smith v Salt and Another 1990 NR 87 (HC) and had also met the requisites set out by this court in Bergmann v Commercial Bank of Namibia and Another 2001 NR 48 (HC). In addition he pointed out that the logistics of putting together and application of this nature and preparing answering papers should also be taken into account. I agree with this submission. This aspect was also addressed in Mr Frank SC’s argument by referring to the various factors a court would take into account in account whether there had been unreasonable delay in the context of bringing review proceedings as set out in Radebe v Government of the Republic of South Africa and Others 1995 (3) SA 787 (N) at 799 B – F. I agree that the factors listed, such as a reasonable time to be taken to take all reasonable steps preceding an application including considering and taking advice, attempts to negotiate, obtaining copies of relevant documents and obtaining and preparing affidavits, should also be taken into account, if these are fully and satisfactorily explained, in considering whether an application should be heard as one of urgency. In addition, I agree that in considering the time taken to prepare the necessary papers, allowances should be made for differences in skill and ability between practitioners practicing as attorneys and advocates, and that a party cannot be expected to act over hastily, particularly in complex matters.”

[24] The present application is the staying of execution of an arbitration award granted in favour of the first respondent.

The applicant in its founding affidavit (para. 23) stated that an application of this nature by its very nature urgent.

In Hardap Regional Council v Sankwasa James Sankwasa and Another, an unreported judgment of this Court in Case no. LC 15/2009 delivered on 28 May 2009 Parker J on p. 6 para. 4 expressed himself on this issue as follows:

“I accept that by its very nature application for stay of execution is an urgent matter to be brought and heard on an urgent basis; but with this qualification, that is, provided for example, execution is reasonably imminent and the applicant is not guilty of any blameable conduct in not bringing the application timeously.”

[25] In casu, I must accept that execution is imminent since the first respondent at no stage stated that this is not his intention i.e. to enforce the arbitration award given in his favour. I am further of the view, having considered applicant’s explanation in paragraphs 25 – 27 and the factors mentioned in Three Musketeers (supra) that the circumstances relating to urgency had been explicitly set out (which do not indicate a self created urgency) as well as the reasons why applicant would not be afforded substantial redress at a hearing in due course.

[26] This Court thus condones the applicant’s non-compliance with the Rules and will hear the matter on an urgent basis.

The merits of the application.

[27] In L F Boshoff Investments v Cape Town Municipality 1969 (2) SA 256 CPD at 267 A – F Corbett J (as he then was) in considering the requisites of an interdict pendente lite expressed himself as follows:

“… counsel for both parties addressed argument to the Court on the question as to whether the requisites for the grant of a temporary interdict pending determination of the main action had been established by the Company and I shall now consider this question.

Briefly these requisites are that the applicant for such temporary relief must show-

(a) that the right which is the subject-matter of the main action and which he seeks to protect by means of interim relief is clear or, if not clear, is prima facie established, though open to some doubt;

(b) that, if the right is only prima facie established, there is a well-grounded apprehension of irreparable harm to the applicant if the interim relief is not granted and he ultimately succeeds in establishing his right;

(c) that the balance of convenience favours the granting of interim relief; and

(d) that the applicant has no other satisfactory remedy.

See Gool v Minister of Justice and Another, 1955 (2) SA 682 (C) at pp. 687-8; Pietermaritzburg City Council v Local Road Transportation Board, 1959 (2) SA 758 (N) at p. 772). Where the applicant cannot show a clear right, and more particularly where there are disputes of fact, the Court’s approach in determining whether the applicant’s right is prima facie established, though open to some doubt, is to take the facts as set out by the applicant, together with any facts set out by the respondent which the applicant cannot dispute, and to consider whether, having regard to the inherent probabilities, the applicant should not those facts obtain final relief at the trial of the main action (see Gool’s case, supra).”

[28] These requisites are not considered in isolation since they interact.

In Olympic Passenger Services (Pty) Ltd vs Ramlagin 1957 (2) SA 382 (D & CLD) at 383 Holmes J (as he then was) explained this interaction as follows:

“It thus appears that where the applicant’s right is clear, and the other requisites are present, no difficulty present itself about granting an interdict. At the other end of the scale, where his prospects of ultimate success are nil, obviously the Curt will refuse an interdict. Between those two extremes fall the intermediate cases in which, on the papers as a whole, the applicant’s prospects of ultimate success may range all the way from strong to weak. The expression “prima facie established though open to some doubt” seems to me a brilliantly apt classification of these cases. In such cases, upon proof of a well grounded apprehension of irreparable harm, and there being no adequate ordinary remedy, the Court may grant an interdict- it has a discretion, to be exercised judicially upon a consideration of all the facts. Usually this will resolve itself into a nice consideration of the prospects of success and the balance of convenience – the stronger the prospects of success, the less need for such balance to favour the applicant: the weaker the prospects of success, the greater the need for the balance of convenience to favour him. I need hardly add that by balance of convenience is meant the prejudice to the applicant if the interdict be refused, weighed against the prejudice to the respondent if it be granted.”

and in Eriksen Motors (Welkom) Ltd v Protea Motors, Warrenton and Another 1973 (3) SA 685 AD at 691 E – G Holmes JA with reference to aforementioned interaction stated as follows:

“The aforegoing considerations are not individually decisive, but are interrelated: for example, the stronger the applicant’s prospects of success the less his need to rely on prejudice to himself. Conversely, the more the element of “some doubt”; the greater the need for the other factors to favour him. The Court considers the affidavits as a whole, and the interrelation of the foregoing considerations, according to the facts and probabilities; see Olympic Passenger Services (Pty) Ltd v Ramlagin 1957 (2) SA 382 D at p. 383 D – G. Viewed in that light, the reference to a right which “though prima facie established, is open to some doubt” is apt and practical, and needs no further elaboration.”

[29] L F Boshoff Investments and Olympic Passenger Services were referred to with approval by Mtambanengwe J in Rossing Uranium Ltd v Cloete and Another 1999 NR 98. In Transnamib Holdings Ltd v Carstens NLLP 2004 (4) 209 NLC Hannah J referred to South Cape Corporation (Pty) Ltd v Engineering Management Services (Pty) Ltd 1977 (3) SA 534 (AD) at 545 where Corbett JA (as he then was) in considering an application for leave to execute stated that in such an application a Court has a wide general discretion to grant or refuse leave and that in exercising such discretion a Court should determine what is just and equitable in all the circumstances and a Court would inter alia have regard to the prospects of success on appeal and where there is the potentiality of irreparable harm or prejudice to both appellant and respondent, the balance of hardship or convenience.

Background to this application

[30] The first respondent who was a regional personnel manager employed by the applicant appeared at a disciplinary hearing on charges of misconduct, gross insubordination, insolence, and non-compliance with established procedures/standing instructions. The hearing was scheduled to commence on 30 April 2009 but was postponed to 14 May 2009 to enable the first respondent to obtain legal representation. On 14 May 2009 the matter was again postponed to 3 June 2009 on request of first respondent’s legal representative. On 3 June 2009 the first respondent pleaded not guilty on all the charges. At the conclusion of the disciplinary hearing the first respondent was convicted of all the charges and dismissed. Thereafter the first respondent approached the Office of the Labour Commissioner alleging unfair dismissal by applicant. Arbitration proceedings commenced on 22 October 2009 during the course of which both parties called witnesses. The arbitrator found that first respondent’s dismissal was substantially unfair because there was no valid reason to dismiss him. The arbitrator further stated that “procedures were followed”. I interpret this to mean a fair procedure had been followed during the disciplinary hearings.

Applicant was ordered to reinstate applicant with full remuneration by 28 December 2009 and compensate first respondent in the amount of N$140 185.56 (begin his full salary for a period of six months) on or before 22 January 2010.

[31] It was against this award by the arbitrator that applicant lodged an appeal on 18 January 2010.

[32] The applicant’s grounds of appeal inter alia relates to the fact that the arbitrator erred on the law/and or on the facts in finding that on the material before her, the instructions given by applicant to respondent were not clear; that she erred in finding that the charges leveled against first respondent did not justify dismissal and she erred in finding that appellant, in disciplining respondent for misconduct committed prior to the first respondent making an appointment to discuss his grievance, treated the first respondent unfairly.

[33] In this application there are disputes of fact and my approach in this regard should be in determining whether applicant is entitled to temporary relief to take the facts as set out by applicant, together with any facts set out by respondent which cannot be disputed by applicant and to consider whether having regard to the inherent improbabilities, applicant should obtain final relief in the main action (i.e. the appeal).

“The facts set up in contradiction by the respondent should then be considered. If serious doubt is thrown on the case of the applicant he could not succeed in obtaining temporary relief, for his right prima facie established, may only be open to some doubt. But if there is mere contradiction or unconvincing explanation, the matter should be left for trial and the right be protected in the meanwhile, subject of course to the respective prejudice in the grant or refusal of interim relief.”

(See Webster v Mitchell 1948 (1) SA 1186 (WLD) at 1189).

[34] The right which applicant asserts is its right in terms of the provisions of section 89 of the Labour Act 11 of 2007 to appeal against an arbitrator’s award made in terms of the provisions of section 89. The first respondent in his answering affidavit does not dispute the right of applicant to appeal against the arbitrator’s award.

Prospects of success on appeal

[35] The first respondent claimed that his dismissal during the disciplinary hearing was procedurally as well as substantively unfair. The arbitrator found that procedures were followed and in my view having regard to the record of the disciplinary hearing I am of the view that the disciplinary hearing procedures were procedurally fair. The first respondent was legally represented at those procedures, witnesses called on behalf of applicant were cross-examined, proceedings were postponed in order to accommodate first respondent in the preparation of his defence and the chairperson of the disciplinary hearing had given the first respondent ample opportunity to address him on the issues in dispute. The allegation that first respondent was not given an opportunity to put his case is not born out by the evidence presented at the disciplinary hearing.

Regarding the issue of substantive fairness which was found to be lacking by the arbitrator one needs to have regard to the reasons provided by the arbitrator. Firstly it was never the first respondent’s case at the disciplinary hearing that the instructions received by the first respondent were not clear (as found by the arbitrator).

Secondly first respondent’s supervisor testified at both disciplinary and arbitration hearings that certain instructions were given at more than one occasion which first respondent refused to obey, namely on 16 April 2009 and again on 17 April 2009. The arbitrator (second respondent) found that all the refusals “were committed” on 17 April 2009. Uncontested e-mails accepted into evidence at the arbitration hearing confirm applicant’s averments that first respondent on more than one occasion refused to carry out instructions. It is significant that the arbitrator remarked that first respondent had been rude to his supervisor on 17 April 2009. The first respondent denied that he refused to comply with these instructions.

[36] The second respondent further found that first respondent had probably felt overworked and frustrated as no one would listen to his grievance (against his supervisor) and thus refused to attend to his duties but “not with the intention to refusing for the sake of it”.

[37] In this regard it appears from the record that first respondent made an appointment to discuss his grievance with the divisional manager after first respondent had already refused to carry out instructions.

[38] It is furthermore trite law that insubordination is a dismissible offence in Namibian Law. In my view the applicant enjoys reasonable prospects of success on appeal.

The balance of convenience/irreparable harm or prejudice

[39] The applicant in its founding affidavit stated that the first respondent will not be able to repay applicant the amount of N$140 185.56 should applicant make such payment to the first respondent and applicant is eventually successful on appeal. This allegation is denied by first respondent in his answering affidavit and first respondent adds that he has assets in excess of “$300 000.00”. I shall accept that this is a reference to Namibian Dollars in the absence of any clarification by the first respondent.

First respondent’s averment in this regard is very vague and unsubstantiated. He did not say what the nature of the assets are and if they consist of immovable property whether such property is bounded or not. First respondent provided no details of such assets in spite of the fact that he is the person in the best position to provide this information to this Court.

The applicant tendered to pay all amounts due in terms of the arbitration award into an interest bearing trust account which money will be immediately paid to first respondent should applicant’s appeal prove to be unsuccessful.

[40] Applicant in its founding affidavit states that first respondent is a senior manager dealing on a daily basis with human resources matters, including organising and even conducting disciplinary hearings and appeals. He also deals on regular basis with very important and confidential information. Applicant further states that first respondent’s presence at applicant’s premises is severely disruptive and that any trust applicant may have had in first respondent has now been finally extinguished. In its supplementary affidavit, deposed to by Jose Rodriques da Silva, applicant stated that subsequent to the arbitration award given in favour of first respondent, he (i.e. first respondent) allowed an unauthorised person on various occasions to drive his company motor vehicle (in clear disregard of company rules) and that this conduct directly impacts on the trust relationship between the parties.

[41] In my view the balance of convenience and the possible irreparable harm to be suffered by any of the parties favour the applicant having regard to all the circumstances of this application.

[42] In the result I am satisfied that applicant has made out a case as prayed for in its notice of motion and the following order is made:

1. The arbitration award CRWK 510-09 dated 22 December 2009 given in favour of first respondent by the arbitrator Emma Nikanor is hereby stayed pending the finalization of the appeal instituted by the applicant on 18 February 2010.

2. Applicant shall provide security to first respondent’s legal practitioner in favour of first respondent in the amount of N$140 185.56 on or before 16 April 2010 which amount plus interest would become payable immediately upon dismissal of applicant’s appeal.

3. No order as to costs is made.

___________

HOFF, J

ON BEHALF OF THE APPLICANT: ADV. MAASDORP

Instructed by: G F KÖPPLINGER LEGAL PRACTITIONERS

ON BEHALF OF THE 1^ST RESPONDENT: ADV. AKWEENDA

2^ND RESPONDENT: NO APPEARANCE

Instructed by: UEITELE & HANS LEGAL PRACTITIONERS