IN THE HIGH COURT OF NAMIBIA
REPORTABLE
REPUBLIC OF NAMIBIA
LABOUR COURT OF NAMIBIA MAIN
DIVISION, WINDHOEK
JUDGMENT
Case no: LC 101/2011
In the matter between:
WITVLEI (PTY) LTD
................................................................................APPLICANT
and
LIBONINA NAWA AND 20 OTHERS
..............................................RESPONDENTS
Neutral citation: Witvlei (Pty) Ltd
v Nawa & Others (LC 101/2011) [2013] NALCMD 30 (August 2013)
Coram: SMUTS, J
Heard: 19 July 2013
Delivered: 12 August 2013
Flynote: Application for
rescission of judgment and condonation for not bringing it within the
14 day period prescribed by rule 16. Reinstatement of an appeal
against an arbitrator’s award and consequential relief also
sought. Applicant failing to provide acceptable or reasonable
explanation for non-compliance with rule 16. The applicant also
failing to show reasonable prospects of success in the application.
The applicant also failing to provide a reasonable or acceptable
explanation for the failure to prosecute the appeal timeously.
Application dismissed.
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ORDER
That the application is dismissed.
JUDGMENT
SMUTS, J
In this application, the applicant
seeks to rescind a judgment and order of this court of 28 June 2012
and for condonation for bringing it out of time. The applicant also
applies for certain further substantial relief, in the form of
reinstating its appeal against an arbitrator’s award and
consequential relief referred to after briefly setting out the
background to this application.
The 2nd to 19th
respondents obtained an arbitration award under s 86 of the Labour
Act, 11 of 2007 (the Act) in their favour against the applicant. The
award was handed down on 23 August 2010. The applicant noted an
appeal against that award on 28 September 2010. It also applied for
an order staying the execution of the award pending the appeal. An
order to that effect was granted on 12 November 2010. In those
proceedings, the applicant undertook to make payment of the amount
of the award namely N$194 235, 25 into an interest bearing trust
account. That tender was accepted and was referred to in the court
order of 12 November 2012.
The applicant’s appeal however
lapsed on 29 December 2010.
On 12 July 2011 certain of the
respondents took steps to enforce the arbitration award, given the
lapsing of the appeal. As a result of these steps, the applicant on
31 August 2011 launched an urgent application (the 2011 application)
directed at stopping those steps and seeking the following relief:
setting aside a writ of execution
dated 13 December 2010;
an order declaring the attachment of
the applicant’s movable properties on 16 August 2011 null and
void;
setting aside the arbitration award
dated 23 August 2010;
alternatively an order interdicting
the respondents from enforcing the writ of execution, pending the
finalisation of an application for condonation for the late filling
of a review application which the applicant indicated would be filed
on or before 9 September 2011.’
That urgent application was set down
for hearing on 9 September 2011. It emerged at the hearing of that
application that it had not been served on the first and second
respondents, the Deputy-Sheriff and the Registrar of the High Court.
Certain relief was sought against them. The court indicated that it
would not entertain the application for the relief against them in
the absence of service upon them. The matter was then removed from
the roll at the instance of the applicant.
The deponent to the founding
affidavit in that urgent application was a certain Mr S.R.
Bezuidenhoudt, the then Acting General Manager of the applicant.
The application was opposed by
certain respondents represented by Mr Marcus. They also filed a
counter application, seeking an order directing that the applicant
pay the sum of N$194 235, 25 to the respondents via the trust
account of Mr Marcus. As I have indicated, this sum had been the
subject of an undertaking by the applicant to be paid into an
interest bearing trust account of the applicant’s legal
practitioners, pending the finalisation of the appeal. It was a
tender made and accepted by the Court in the application to stay the
enforcement of the award pending the appeal.
After the urgent application was
removed from the roll on 9 September 2011, the applicant took no
further steps to prosecute it. Nor was any review application
brought by 9 September 2011 or ever since on behalf of the
applicant, as was foreshadowed in the urgent application. The
respondents represented by Mr Marcus then took steps to set the 2011
application and counter-application down for hearing. The matter was
referred to case management and on 4 April 2012 a case management
order was given, setting it down for hearing on 28 June 2012.
The applicant’s erstwhile legal
practitioner however withdrew on the afternoon on 27 June 2012.
Prior to their withdrawal, no heads of argument had been filed. Nor
had the court file been indexed and paginated. The legal
practitioners in question, Tjitemisa & Associates, cited as the
20th respondent in this application, were also not
present when the matter was called in court on 28 June 2012. Nor was
any representative of the applicant, despite the applicant’s
name having been called at court.
After posing certain questions to Mr
Marcus and hearing brief argument on certain aspects raised by the
court, the court on 28 June 2012 proceeded to grant an order in the
following terms after giving a brief ex tempore judgment.
‘1.
That the Applicant’s application for the relief set out in
paragraphs 2 and 3 of the notice of motion is struck from the roll.
That
the relief sought in paragraphs 1, 4, 5, 6, 7, 8 and 9 of the notice
of motion is hereby dismissed.
That
the applicant is directed to pay the respondents grouped as 5th
Respondent the money in the amount of N$194 235.25 together with
interest thereon by not later than 5 July 2012, such payment to be
made to the offices of Nixon Marcus Public Law Firm.
No
order as to costs.’
This application is directed at
rescinding that order which was thus given in the absence of the
applicant.
The applicant launched this
application on 31 August 2012. It firstly seeks condonation for
non-compliance with rule 16 relating to the time period within which
applications for rescission of judgments or orders of this court are
to be brought. The applicant however seeks an order considerably
wider than the rescission of this court’s judgment and
condonation for the late bringing of the application. The applicant
also seeks an order reviving the appeal and an order that the
enforcement of the arbitration award be stayed and interdicting the
2nd to 19th respondents from proceeding with
the enforcement of any writ against the applicant and from taking
steps to execute the award against the applicant, pending the final
determination of the appeal.
In this rescission application, the
applicant heaps much of the blame for the failure to timeously take
steps in accordance with the rules upon its erstwhile legal
practitioners, Tjitemisa & Associates and its former labour
consultant, Mr Otniel Podewiltz. They were both cited as respondents
and the application was served upon them. The applicant also sought
an order against Tjitemisa & Associates, its erstwhile legal
practitioners, directing that they pay the costs of the application
on the scale as between an attorney and own client.
Despite the application having been
served upon Tjitemisa & Associates, they have not opposed the
relief sought against them. Nor have they filed any affidavit
dealing with the stinging criticism levelled at them for their
handling of the matter.
Even though Tjitemisa &
Associates have not opposed the special costs order sought against
them, I would have thought that they would have sought to explain
their conduct in an affidavit. They however declined to do so.
Mr Podewiltz however filed an
affidavit. It turns out that certain of the factual matter raised by
the applicant against him was in fact incorrect and that much of the
criticism of him was unjustified as the matter was at the time in
the hands of the legal practitioners in question.
Although the differing relief sought
in this application each has its distinct requirements, the factual
matter is interrelated and is to best out together. The rescission
application and the application for condonation for its late filing
are first dealt with in this context. The application to reinstate
the appeal is then referred to.
Rescission and the application
for condonation
Rule 16 of the rules of this court
provides:
‘(1)
Any party to an application or counter-application in which judgment
by default is given in terms of rule 7 may apply to the court to
rescind or vary such judgment or order provided that the application
is made within 14 days after such judgment or order has come to his
or her knowledge.
(2)
Every such application must be an application as contemplated by rule
6(23), and supported by an affidavit setting out briefly the reasons
for the applicant’s absence or default, as the case may be,
and, where appropriate, the grounds of opposition or defence to the
application or counter-application.
(3)
The court may on the hearing of any such application, unless it is
proved that the applicant was in wilful default and if good cause is
shown rescind or vary any other judgment or order complained of and
may give such directions as to the further conduct of the proceedings
as it considers necessary in the interest of all the parties to the
proceedings.
(4)
If such application is dismissed, the judgment or order becomes
final.
(5)
Where rescission or variation of a judgment or order is sought on the
ground that it is void from the beginning or was obtained by fraud or
mistake, application may be made not later than one year after the
applicant first had knowledge of such voidness, fraud or mistake.
(6).
. .’
Rule 7, referred to in rule 16(1)
deals with the hearing of applications. It provides in rule 7(2)
that this court may grant an order against a respondent who has been
served with an application or has delivered a notice of intention to
oppose and served with date of hearing but who fails to appear. It
also refers in rule 7(3) to the position of an applicant who fails
to appear at the hearing. A court may then dismiss the application
or make such orders as considers fit. When an applicant or
respondent does not appear. These are the provisions which deal with
the absence of parties and the power of the courts to make orders
where parties fail to appear. It would thus appear that the judgment
given on 28 June 2012 was one by default as contemplated by rule 7,
given the failure on the part of the applicant or its representative
to have appeared at court, despite the fact that the applicant’s
legal representatives were at least aware of the date of the
hearing.
Rule 16 requires that an application
of this nature be brought within 14 days after a judgment or order
has come to the knowledge of an applicant. The rule further
contemplates that unless wilful default on the part of an applicant
is established, rescission may be granted if good cause is shown.
The term ‘good cause’ in accordance with well settled
principles in turn contemplates establishing two distinct
components, each of which must be established.
They are firstly a reasonable and acceptable explanation for the
absence or default on the part of an applicant and secondly
reasonable prospects of success either with an application or with
its defence to one.
Although in the context of
establishing good cause in applications for condonation with its
rules, the Supreme Court has recently reaffirmed that where an
explanation for default is so lacking, and the default so flagrant,
a court would not need to enquire into the second component of good
cause being prospects of success and would dismiss an application
for condonation on that basis.
The applicant in this application
first needs to establish good cause to succeed with the condonation
application. In order to do so, the applicant would need to provide
a reasonable and acceptable explanation for the failure to comply
with the 14 day period for bringing the rescission application. It
would also need to establish that the rescission application itself
enjoys reasonable prospects of success. This in turn would entail
establishing a reasonable and acceptable explanation for the default
in respect of the rescission application and reasonable prospects of
success in the 2011 application which was dismissed and the counter
application which was granted. As the applicant also applies for
reinstatement of the appeal, its explanation for its default on
non-compliance at the various stages will be set out in full and
then each component separately analysed referred to in considering
whether the applicant has established good cause or failing to
comply with the rules relating to the filing of the record of that
appeal which had caused it to lapse in December 2010.
The applicant’s
explanations
Given the protracted proceedings and
their context, the applicant’s explanation for default not
only refers to events shortly before the hearing of 28 June 2012 but
goes back to the instruction given to Tjitemisa & Associates
after becoming aware of the arbitration award on 2 September 2010.
In the founding affidavit, it is stated by the applicant’s
managing director, Mr F.H. Badenhorst that the 2nd to
19th respondents were suspended from their employment
with the applicant in December 2007. The suspension was lifted on 5
March 2009 and they were reinstated and resumed employment. They
were not however paid for the period of their suspension. The
respondents referred this matter to the office of the Labour
Commissioner.
It is apparent from the arbitrator’s
award that when the matter was referred for conciliation and
arbitration on 26 May 2010, the applicant was represented by its
then general manager, Mr Beuzuidenhoudt, and the matter became
postponed to 3 June 2010. The applicant’s representative did
not however appear on that date the arbitrator proceeded to
determine the matter and made his award on 23 August 2010.
The applicant states that it received
notice of the award on 2 September 2010. It timeously noted an
appeal against it on 28 September 2010. The applicant also applied
for an order staying execution of the award pending the outcome of
the appeal. An application to that effect was brought on 4 October
2010 and a rule nisi was granted. On the extended return date of 12
November 2010, the rule was confirmed and the applicant’s
tender – to pay the sum in question into an interest bearing
trust account – was noted in the court order. In the founding
affidavit to this application, the applicant’s managing
director, Mr Badenhorst stated that the tender made was not
authorised by the applicant, despite the fact that the deponent to
the affidavit in support of the application was its erstwhile
general manager. This aspect is dealt with in Mr Podewiltz’s
affidavit.
In its founding affidavit, the
applicant proceeds to refer to the basis upon which it contends that
there are reasonable prospects of success in the appeal. These
primarily relate to contending that there were irregularities in the
arbitration proceedings. I return to these aspects later.
In dealing with the lapsing of the
appeal, the applicant states that it was the Labour Commissioner’s
office which had failed to dispatch the record of proceedings within
the 21 day period prescribed by rule 17(7) and that its erstwhile
legal representatives, Tjitemisa & Associates, did nothing about
that. The applicant also states that neither Mr Podewiltz nor
Tjitemisa & Associates made any attempt to alert the applicant
of the lapsing of the appal. The applicant refers to a statement by
Mr Tjitemisa in correspondence to it stating that his firm was in
the process of applying to have the 90 day period extended because
there was delay on the part of the office of the Labour Commissioner
to provide the record. No such application was ever launched,
despite Mr Tjitemisa’s letter to this effect to the applicant
on 28 January 2011. Indeed the applicant does not refer to any steps
taken directed at securing the record, even after becoming aware of
the court’s order of 28 June 2012. No record has to date been
filed, some 3 years after the award.
The applicant’s Mr Badenhorst
further states that the applicant heard nothing further from Mr
Tjitemisa and in April 2011 received a visit from the Deputy-Sheriff
with a view to the attachment of property to satisfy the award. (It
would appear to have been a visit by a labour inspector at that
stage.) This resulted in him addressing a letter Tjitemisa &
Associates to ‘address the situation’ on 7 April 2011.
Mr Badenhorst states that he tried to get hold of Mr Tjitemisa to
find out the status of the matter and complained that he was only
able to communicate with the latter’s personal assistant, Ms
Zaal, after it became apparent that the award was to be enforced and
executed against the applicant.
The next event involving action by
the applicant on the issue occurred in August 2011 after the deputy
sheriff attempted to attach property to execute the award. Mr
Badenhorst took the matter up against with Mr Tjitemisa on 22 August
2011. Mr Tjitemisa informed Mr Badenhorst that he was in the process
of filing an urgent application to seek the further stay of the
arbitration award. That application was then the application
launched on 31 August 2011. The deponent to the founding affidavit
was again Mr Bezuidenhoudt, the acting general manager at the time.
The applicant was informed that the
matter was to be argued on 9 September 2011. Mr Badenhorst states
that he could not attend and sent his personal assistant who,
despite what transpired in court when the matter was removed from
the roll in no uncertain terms, had inexplicably apparently reported
to Mr Badenhorst that the relief sought had been granted. Mr
Badenhorst further complains that Tjitemisa & Associates made no
attempt to serve the application ‘on the employees’.
This statement is however incorrect as it was the Deputy-Sheriff and
the Registrar who had not been served, as is plainly apparent from
the transcript of the proceedings of 9 September 2011 attached to
his affidavit.
Mr Badenhorst further states that on
1 December 2011 he received an email ‘out of the blue’
from Tjitemisa & Associates suggesting that the employees were
threatening ‘further legal action due to our office not
providing them with a settlement proposal’. This elicited a
response from Mr Badenhorst the next day to enquire why a settlement
was suggested and requesting a written summary of the state of the
matter. Despite this request on 2 December 2011, no written report
was provided. Nor was any explanation forthcoming for the suggestion
of a settlement. Indeed Mr Badenhorst states that nothing further
was heard from Tjitemisa & Associates until 27 June 2012. Mr
Badenhorst states that he then received an email (on 27 June 2012),
apparently sent late on the previous afternoon, recording that Mr
Tjitemisa had tried to contact him on 26 June 2012 but to no avail.
It recorded that the matter was to proceed for a case management
meeting on 28 June 2012 and sought settlement proposals by 12h00 on
27 June 2012. That email was followed up by a letter from Mr
Tjitemisa of 27 June 2012, presumably sent after 12 noon, indicating
an intention to withdraw as legal practitioner due to a lack of
instructions. Mr Badenhorst promptly responded by insisting upon an
immediate withdrawal.
The applicant contends as a
consequence of these facts that it was ‘constantly kept in the
dark about the state of the case’ and that its legal
representatives had even made fraudulent misrepresentations to it,
creating an impression that everything was under control whereas the
applicant’s position in the matter gradually deteriorated to
the point when it became convenient for its practitioners to
‘abandon ship’. The applicant further states the matter
could have been salvaged by the practitioners doing what was
required of them and that the applicant intended to press charges
against that firm with the Law Society in due course.
The applicant states that it only on
5 July 2012 received notice of the order of 28 June 2012 when
receiving the file contents from Tjitemisa & Associates. Other
legal practitioners were already engaged to attend to the matter
with an instruction to note an appeal. It transpires from the
answering affidavit that an appeal was ‘noted’ on 5 July
2012. What the applicant fails to disclose is that Mr Marcus
responded to it by fax on 10 July 2012, pointing out that the notice
was a nullity and correctly pointed out that leave to appeal would
first need to be sought and obtained.
It is further stated in the founding
affidavit that a consultation was set up with counsel on 24 July
2012 to ‘determine the proper wording for the grounds of
appeal’. It is then stated that at the consultation it
transpired that the applicant would need to seek rescission of the
order of 28 June 2012 instead of ‘noting’ an appeal
against it. The applicant further states that at this point in time,
the 14 day period to bring a rescission application had thus
expired. The applicant however states that it had been under the
impression that it would have 30 days to note an appeal. The
impression created in the founding affidavit is that the applicant
learnt for the first time that its noting of its appeal was inept at
the consultation on 24 July 2013, despite Mr Marcus’ fax of 10
July.
A further consultation was scheduled
for 6 August 2012, because, it is stated, counsel had advised that
the applicant should obtain a transcript to the proceedings of 9
September 2011 to determine what had transpired when that
application had been heard. Surprisingly, the transcript of
proceedings of 28 June 2012 was not sought, despite the attempt to
‘note’ an appeal. It is further stated that on 6 August
2012, counsel was presented with a lever arch of 400 folios and
because of the complexity of the matter, advised that senior counsel
also be retained. The founding affidavit was thereafter drafted. It
runs into 30 pages and some 200 pages of annexures are attached. The
application was served on 31 August 2012.
Had the transcript to the proceedings
of 28 June 2012 been obtained by the applicant, it would have been
apparent that the court enquired and established that, after the
applicant had removed the matter from the roll on 9 September 2011,
it did not taken any further action to prosecute that application.
The court also noted that the respondents had taken the initiative
to set the matter down for hearing and also referred to the case
management process which had preceded the date of hearing. The court
also enquired and established that, despite the lapsing of the
appeal, the applicant had not caused the record of appeal to be
filed and had not taken any action to compel the production of the
appeal record or brought any application to condone a non-compliance
with the rules or extend the period within which the appeal record
should be provided. The court also noted that the withdrawal had
occurred late on the previous afternoon and that the applicant’s
legal practitioner had not filed heads of argument or even attended
to indexing and paginating the court file. The court also obtained
confirmation that the practitioner had been aware of the date of
hearing. The court concluded in the brief ex tempore judgment given
that the applicant had been remiss in prosecuting the appeal and the
application which served before it.
Contentions
Mr Marcus, who appeared for certain
of the respondents, contended that the applicant could not avoid the
consequences of its own remissness, even though it stated that it
was unaware of the errors perpetrated by its legal representatives
and that it was even misled by them.
Mr Marcus submitted that the
applicant had taken no particular interest in the case, especially
from January 2011 until after the matter was heard on 28 June 2012
when it unduly delayed in bringing its condonation application. Mr
Marcus referred to Mr Podewiltz’s affidavit and pointed out
that the applicant had been informed by Mr Podewiltz, a specialist
labour consultant who had been ‘appointed’ as a human
resource officer for the applicant
that an appeal is deemed to have lapsed if not prosecuted within 90
days. This he had been advised of in some detail on 26 January 2011
already.
Mr Marcus also referred to the letter
from Tjitemisa & Associates which informed the applicant on 28
January 2011 that the firm was busy preparing an application to file
for an extension of the 90 day period for the record to be filed. Mr
Marcus also referred to the affidavit of Mr Podewiltz in which the
latter had stated that the applicant had throughout done nothing to
follow up progress and only did so when the labour inspector
attempted to enforce the award in April 2011. Mr Podewiltz also
pointed to the further period of several months which followed
before the applicant again contacted its legal practitioners in
August 2011 and further suggested that this contact had again only
occurred after the Deputy-Sheriff had attempted to proceed with an
attachment.
Mr Marcus also referred to the
applicant’s lack of knowledge of the August 2011 application
which expressly referred to the institution of a review application
and the failure to have followed that up. Mr Marcus further referred
to Mr Badenhorst’s email of 2 December 2011 in which the
applicant had requested a report on the matter from Tjitemisa &
Associates. This, he pointed out, had followed a request to the
applicant directed at securing instructions from it to settle the
matter. Despite the fact that a report had not been received, the
applicant took no steps to follow the matter up with its legal
practitioners. Mr Marcus correctly submitted that it was incumbent
to upon it to do so. After that, more than six months passed without
any further contact between the applicant and its attorneys.
Despite the fact that the applicant
knew on 27 June 2012 that the matter would be called in court on 28
June 2012, albeit being told for case management, the applicant did
not urgently appoint other representatives or even send a member of
staff to attend in court but instead insisted upon the immediate
withdrawal of Tjitemisa & Associates the day before.
In the founding affidavit Mr
Badenhorst repeatedly stated that the tender made in court which had
formed the subject of the counter application which was granted on
28 June 2012 had been entirely without its instructions. This
despite the fact that it had been provided by counsel in court on
the instruction of the applicant’s then General Manager. This
issue is in any event trenchantly gainsaid by Mr Podewiltz who
pointed out that he had acted within his mandate at the time and
that the tender was discussed with the erstwhile General Manager of
the applicant and that the tender had been made in order to improve
the applicant’s chances in obtaining a stay of the arbitration
award. Mr Podewiltz also stated that he informed the applicant’s
managing director by mail on 26 January 2011 of the order of court
that the money should be paid into an interest bearing trust
account. Despite this, the applicant took no steps to countermand
that instruction or address that issue until asserting in the
founding affidavit that the tender was without instructions. A
defence of lack of authority in respect of the tender would not in
my view enjoy prospects of success.
The thrust of Mr Strydom’s
argument, who appeared for the applicant, was that the applicant had
been very poorly served by its legal practitioners who had been
grosly neglectful in their handling of the matter and that the
applicant should not be penalised for this.
Mr Marcus also referred to the delay
in bringing the rescission application itself and submitted
condonation should not be granted.
The applicant had received the file
from Tjitemisa & Associates by 5 July 2012. The application was
only filed on 31 August 2012. The instruction to file a notice of
appeal to the applicant’s current legal practitioners is not
explained at all. It is not explained how and upon what basis the
newly instructed legal practitioners could have accepted such an
instruction in the face of the provisions of s 18 of the High Court
Act and not pointed out that it was inept and that leave to appeal
should be sought or that a rescission application should be brought
and the time limit for doing so. The applicant had after all not
even ordered a transcript of the proceedings of 28 June 2012 which
would plainly have been required for an appeal. It inexplicably only
did so in respect of the proceedings of 9 September 2011 and then
only after consulting with counsel on 5 August 2012.
Not only is no explanation given for
the notion that a notice of an appeal should be filed, but Mr
Marcus’ fax of 10 July to the applicant’s current legal
practitioners is not disclosed. It was made very clear in that fax
that the noting of an appeal was inept. Mr Badenhorst statement that
the consultation with counsel scheduled only for 24 July 2012 in the
face of that letter – not disclosed and significantly not even
referred to in reply – is telling and renders his statement
that he laboured under an impression that the applicant had ‘30
days to appeal’ as suspect. This statement would rather appear
to have been an afterthought in a bid to explain the delay which had
occurred after receiving the court file and knowledge of the order
on 5 July 2012 and only first consulting on the issue on 24 July
2012 in the face of the 14 day period in rule 17. The explanation
given for this delay is in my view singularly unconvincing and weak.
The further explanation for the
delays in preparing the papers would also not in my view be
reasonable. It is not explained why counsel had not been properly
briefed at the first instance on 24 July 2013 but only provided with
a full set of papers after the initial consultation. A delay of some
two weeks to 6 August 2013 to schedule a consultation with counsel
in the face of an application already out of time is also not at all
properly explained. The further delay in preparing the application
is likewise not adequately explained. As is pointed out by Mr
Marcus, much of the material contained in the application setting
out the contentions relating to prospects of success had essentially
been lifted from the August 2011 application. There was thus no
proper or acceptable explanation quite why the application had taken
so long in its preparation.
Mr Marcus accordingly submitted that
the applicant had failed to provide a proper and acceptable
explanation for the delay in bringing the rescission application and
that condonation for the non compliance with rule 16 should not be
granted.
Mr Marcus further referred to rule 17
which deals with appeals against an arbitration awards and the
procedure for the filing of a record, failing which the appeal is
deemed to have lapsed. He submitted that the explanation proffered
for not timeously prosecuting the appeal was likewise unacceptable.
Mr Marcus referred to the principle
frequently reiterated by the Supreme Court and followed by this
court that applications for condonation and reinstatement of an
appeal must be filed without delay and as soon as facts which have
given rise for the need to do so have become apparent. He referred
to the need for a full, detailed and accurate explanation,
for the delay to be provided and to the factors which the Supreme
Court has found would be considered in whether to grant condonation.
These include
the extent of the non-compliance with
the rules;
the reasonableness as offered for the
non compliance of the rules;
the bona fides of the application and
the prospects of success on the merits of the case;
the respondents’ interest in
finality of the judgment;
the prejudice suffered by the other
litigants as a result of non compliance; and
the convenience of the court and the
avoidance of unnecessary delay in the administration of justice.
As was stressed by the Supreme Court
in the Arangies matter with reference these factors:
‘These
factors are not individually determinative, but must be weighed, one
against the other. Nor will all the factors necessarily be considered
in each case. There are times, for example, where this court has held
that it will not consider the prospects of success in determining the
application because the non-compliance with the rules has been
“glaring”, “flagrant” and “inexplicable”.’
Mr Marcus argued that the delay in
this matter amounted to a flagrant breach of the rules of this court
and that the approach recently restated by the Supreme Court in
Kleynhans v Chairperson of the Council of the Municipality of
Walvis Bay
should apply where the court stated in quoting a judgments to the
effect:
‘.
. . (W)here the non-observance of the rules has been as flagrant and
as gross as in the present case, the application should not be
granted, whatever the prospects of success might be.’
Analysis of explanations
The Supreme Court has held that where
non-compliance with the rules is due to a lack of diligence on the
part of a litigant’s legal practitioner, a court may still
refuse that condonation as it is well established that there is a
limit beyond which a party cannot escape the consequences of the
negligence or lack of diligence of its legal representatives.
This principle would apply where a litigant, knowing that action was
required, ‘sat passively by without directing a reminder or
enquiries from (its) legal practitioner instructed with the matter’
and even ‘where all the blame can be attributed to the
litigant’s attorneys’.
The application for reinstatement of
the appeal, sought as further relief in this rescission application,
has only been launched, as Mr Marcus pointed out, 20 months after
the appeal had lapsed. He correctly submitted that the delay in
question was considerable.
It is clearly apparent that the legal
practitioners in question were very remiss in failing to take steps
to see to it that the record was filed and also to properly
prosecute the 2011 application and, when they failed to do either,
to properly apprise the applicant of the status of the proceedings
and also that certain of the respondents were seeking to set down
the 2011 application in order to dispose of it. The legal
practitioners were afforded the opportunity to place their version
before court and declined that invitation even though a special
costs order was sought against them. In the absence of any
explanation from them, it would seem that they were appallingly
remiss in the way in which they handled the matter on behalf of the
applicant. But the applicant is however not without blame. Its own
conduct, as was submitted by Mr Marcus, demonstrated a comprehensive
lack of interest in the case. The applicant was only spurred to
action sporadically when confronted with steps taken to execute the
award at different junctures and displaying indifference and
disinterest by inaction in between.
The applicant was not entitled to sit
back and do nothing, particularly after being advised that the
appeal would lapse and of the need to bring an application to extend
the period for the record to be filed and especially after the
applicant appeared to become aware of inaction on the part of its
own legal representatives when demanding a statement as to where the
matter stood on 2 December 2011. The applicant most certainly should
have followed the matter up. It would have been apparent to it with
the slightest diligence that a review application had not been
prepared following the 2011 application, as had been expressly
foreshadowed in it. No explanation is given as to why this was never
followed up with its legal practitioners.
Months went by on occasion without
any follow up on the part of the applicant as to the conduct to the
matter from its legal practitioners. It is well settled that an
applicant in an application of this nature is required to explain
each component of the delay.
But it failed to do so in respect of the periods between January and
4 April 2011 and again from then until 22 August 2011, from 9
September to 2 December 2011 and that period following 2 December
2011 until 27 June 2012.
The applicant’s Mr Badenhorst
also knew that an application to extend the time period for filing
the record was required. Yet no enquiry was directed at this either.
It was incumbent upon the applicant to do so. Instead, the applicant
sat back passively without so much as directing a reminder for the
report or an enquiry concerning the further prosecution of the
review or the application to extend time periods. The failure to
have done so does not excuse the manifold delays in this matter. As
was stressed by the Supreme Court in the Arangies matter, a
weighty and persuasive explanation would be required for a
substantial delay of this kind in prosecuting an appeal. The
explanation is however unpersuasive and weak.
In respect of the application for
rescission, Mr Badenhorst on 2 December 2011 sent a request for a
report and directed an enquiry as to why settlement was proposed.
When he received no response from the applicant’s legal
practitioners, he did not direct a single further enquiry or
reminder to them in some seven months which then followed, despite
the knowledge that further steps were required. Even when the
practitioners expressed the intention to withdraw on the eve of a
court appearance, no step was taken to secure alternative
representation or even send a representative to court in an
endeavour to explain the position and ask for time to appoint other
lawyers. No explanation is provided for this inaction on the part of
the applicant.
Even after the file is received and
the applicant became aware of the order (of 28 June 2012) on 5 July
2012, there was a delay until 24 July before a consultation with
counsel took place. This delay is not explained except for stating
that the applicant gave instructions to note an appeal. A diligent
practitioner would have known that the noting of an appeal was
inept. Yet this is not explained. I have already referred to the
failure to disclose Mr Marcus’ fax of 10 July which would have
alerted the applicant of the need to take urgent action. A diligent
practitioner would also have immediately advised that a rescission
application be investigated and alerted the applicant as to the time
period contained in rule 17 for the bringing of such an application
or to apply for leave to appeal. No explanation is given as to why
the former approach was then not adopted especially after the fax of
10 July. Nor is any proper explanation given for the further delay
from 24 July to 6 August when the next consultation with counsel was
held, except to state that the transcript of the proceedings of 9
September 2011 was sought. No explanation is given as to why a full
brief was only provided to counsel on 6 August and not urgently
after receipt of the fax of 10 July – some 4 weeks before.
This should surely have occurred prior to the first consultation
(which should also have been held far earlier). The explanation
given for another 25 ordinary days taken before the application
could be brought is also inadequate, particularly when regard is had
to the portion relating to prospects of success which, as Mr Marcus
correctly points out, was largely lifted from the earlier
application.
As far as the reinstating of the
appeal is concerned, the applicant was already aware in January
2011of the deadline for filing a record which had not been met and
the need to extend the period by way of an application. The
applicant was informed that the practitioners were in the process of
preparing such an application. Yet no enquiry or reminder was
directed to them in that regard. The appeal had lapsed in December
2010. The applicant was apprised of that fact yet failed to follow
up steps needed to address the position.
As the Supreme Court stressed in
Namib Plains Farming and Tourism:
‘It
is trite law that where non-compliance with the rules is time –
related, the explanation must cover the entire period.’
There are lengthy periods during
which the applicant should have addressed in respect of which no
explanation, at all are forthcoming. These periods of inaction at
times run into months.
In the Kleynhans matter, the
Supreme Court cited the following passages in Aymac CC and
Another v Widgerow
with approval:
‘[39]
Culpable inactivity or ignorance of the rules by the attorney has in
a number of cases been held to be an insufficient ground for the
grant of condonation. See PE
Bosman Transport Works Committee and Others v Piet Bosman Transport
(Pty) Ltd
1980 (4) SA 794 (A) at 799B-H; Rennie
v Kamby Farms (Pty) Ltd
1989 (2) SA 124 (A) at 131I-J; Ferreira
v Ntshingila
1990 (4) SA 271 (A) at 281G-282A; Blumenthal
and Another v Thomson NO and Another
1994 (2) SA 118 (A) at 121C -122C. The principle established by these
cases is that the cumulative effect of factors relating to breaches
of the rules by the attorney may be such as to render the application
for condonation unworthy of consideration, regardless of the merits
of the appeal.’
‘[40]
There is a further reason why the court should not grant condonation
or reinstatement in the face of gross breaches of the rules.
Inactivity by one party affects the interest of the other party in
the finality of the matter. See in this regard Federated
Employers Fire & General Insurance Co Ltd and Another v McKenzie
1969 (3) SA 360 (A) at 363A where Holmes JA said the following
concerning the late filing of a notice of appeal:
“The
late filing of a notice of appeal particularly affects the
respondent's interest in the finality of his judgment - the time for
noting an appeal having elapsed, he is prima
facie
entitled to adjust his affairs on the footing that his judgment is
safe; see Cairns'
Executors v Gaarn
1912 AD 181 at p. 193, in which SOLOMON, J.A., said:
‘After
all the object of the Rule is to put an end to litigation and to let
parties know where they stand.’ ” ’
These considerations particularly
apply to labour matters. The importance of achieving finality in
labour matters is strongly underpinned by the short time periods in
the Act for referring disputes and the short periods within which a
review
of an arbitrator’s award must be brought, and appeal
prosecuted
and the confining of appeals to questions of law. A speedy
resolution of proceedings in the court is expressly contemplated by
rule 7(1) which provides:
‘The
hearing of an application must be conducted in such manner as the
court considers most suitable to the clarification of the issues
before it and generally to the just handling of proceedings and the
court must, so far as it appears appropriate, seek to avoid formality
in the proceedings in order to ensure a speedy and fair disposal of
the proceedings.’
It follows from the aforegoing that I
find that explanation for the late filing of the rescission
application to be weak and unpersuasive and thus unreasonable and
unacceptable.
Prospects of success of
rescission application
I turn to the second component of the
condonation application which would involve a consideration of
prospects of success in the rescission application. That application
would likewise require both a reasonable explanation for its default
as well as enjoying prospects of success, as I have pointed out. It
is however clear to me that the applicant is unable to get over the
first hurdle in that two-fold requirement in the rescission
application. Despite the laxity and remissness on the part of its
erstwhile legal practitioners, the applicant has itself demonstrated
a singular lack of diligence in following up the prosecution of the
2011 application (as well as the need to apply to court to extend
the period for filing the record in the appeal). The explanation
provided for its default in respect of the hearing on 28 June 2012
is likewise lacking, weak and unpersuasive and thus unreasonable and
unacceptable. It is indeed so poor that it is in my view glaring and
flagrant so as even to preclude a consideration of the merits of the
2011 application. The application for rescission as a consequence is
so lacking in prospects of success for this reason alone that it
would in my view also not be granted without the need to consider
the other component of good cause being prospects of success.
One aspect relating to the prospects
of success as a component of the 2011 application and the appeal was
heavily relied upon my Mr Strydom during the oral argument of this
matter. He submitted that the arbitrator had lacked jurisdiction to
hear the dispute in the first place and that the award is a nullity
as a consequence. This submission was also contained in the 2011
application. It was pointed out in that application as well as in
the founding affidavit that the employees were suspended without pay
on 4 December 2007 and the suspension uplifted in March 2009. It was
thus contended that the causes of action would have lapsed in
December 2008 and that the cause of action had not arisen on 17
April 2009 as alleged in the respondents’ referral to the
office of the Labour Commissioner.
Mr Strydom contended that the
arbitrator lacked jurisdiction to determine a dispute raised outside
the time period provided for in the Act. In view of decisions of
this court
that an arbitrator is not empowered to grant condonation for the
referral of a dispute beyond the time periods provided for in s
86(2), Mr Strydom argued an arbitrator would have no jurisdiction to
hear such a matter and that the award would be a nullity as
consequence. The applicant also contended that the award was a
nullity because the arbitrator had made the award in the course of
conciliation proceedings and not during an arbitration. This was
prominently raised in the 2011 application in support of the relief
directed at setting aside the award itself. In the course of oral
argument, I raised questions and invited counsel to file additional
written argument on these issues subsequently which they both did.
Mr Marcus countered by submitting
that the Louw decision was incorrect and should not be
followed and that the 2011 application in attempting a collateral
challenge to the validity of the award (and this application in
seeking to perpuate it) amounted to an abuse of process in the
context of the appeal which had lapsed and the failure to bring a
review of the award timeously. I am unpersuaded that the Louw
decision is clearly wrong. On the contrary, I am of the view that it
is, with respect, sound. It has also been followed. I turn to the
issue of the collateral challenge below.
Mr Marcus further contended that
there was in any event no substance in either point. Both had been
addressed in the respondents’ opposition to the 2011
application. He argued that form over substance would show that the
arbitrator in fact engaged in arbitration proceedings after
conciliation had not resolved the dispute. He also pointed out that
the employees had been suspended in terms of the applicant’s
disciplinary code in December 2007 but the lifting of the
suspensions in March 2009 and reinstatement gave rise then
(in March 2009) to a claim for payment during suspension. There is
much substance to this latter argument if the point had been
properly raised in the arbitration. The cause of action was after
all not stated as an unfair suspension but rather unfair labour
practice. It was raised after the reinstatement following the
lifting of the suspension which was not with full pay and benefits
during the period of suspension. The cause of action for payment of
wages and benefits may thus only have arisen in March 2009 when
payment was refused notwithstanding the unconditional lifting of the
suspensions. It may have arisen from the terms of the applicant’s
disciplinary procedures. What is apparent from the aforegoing is
that it is by no means clear that the respondents’ cause of
action had lapsed more than 12 months before dispute had been
referred. On the contrary, that dispute had after all only risen in
March 2009 upon non payment and the entitlement to payment for an
entire period would then arise even exceeding 12 months. It follows,
on the basis of what is contained in the 2011 application and in the
founding affidavit to this application, that the applicant had in
any event not established that the claims had lapsed and that the
arbitrator lacked jurisdiction.
As for the other contention for the
award being a nullity, this would amount to a collateral challenge
to the award (as well as the contention as to the lapsing of the
claims). The question arises as to whether it would be permissible
in these proceedings and in the 2011 application to raise these
collateral challenges to the award.
In his supplementary note to address
this issue Mr Marcus argued that s 89(4) of the Act precluded such a
challenge. It requires in peremptory terms without any power for
condonation (as opposed the late filing of a notice to appeal) that
a party alleging a defect in any arbitration proceedings is to apply
to review those proceedings within 30 days of the award being served
unless the defect involves corruption. In that event, a period of
six weeks from the discovery of the corruption is applicable. In s
89(5), the term defect used in s 89(4) is stated to include where
the arbitrator’s powers were exceeded.
In the present context the
legislature has thus laid down time periods within which an affected
party is to raise a defect in applying to set aside an award. This
is in keeping with the common law requiring a party to bring a
review within a reasonable time.
If a party does not do so, it loses its right to complain of the
defect.
In the National Panasonic case
(in the context of industrial relations), the court described a
collateral challenge in these terms:
‘A
collateral challenge, writes Wade Administrative
Law
6th
ed at 331 will only be allowed “if the right remedy is sought
by the right person in the right proceedings”. I venture to add
to that “and at the right time”.’
I respectfully agree with the aptness
of this description.
After referring to the need to launch
a review within a reasonable time at the pain of losing the right to
complain, the court stressed:
‘The
danger of a contrary approach is, of course, that, if a party to an
industrial dispute were not obliged to bring his complaint before the
court by way of review, he might raise it at any time and will, if he
has any nation of strategy, raise it at the time most inconvenient or
damaging to his opponent. This tactic might make it appear as though
the court is being drawn into the fray, not to prevent some injustice
(unless one were to regard the non-observance of statutory
formalities as an injustice), but to add weight to the scale on the
one side or the other. I need not emphasise how undesirable such an
impression would be. I think, therefore, that the applicant’s
collateral challenge was made at the wrong time. It was too late. The
lock-out was already well under way. It was beginning to bite.
Everyone thought it was legal when it started. The applicant itself
was getting ready to strike in the belief that what had been done up
till then had been validly done it was not under the circumstances
desirable
for
the court to interfere.’
That court reached its conclusion in
that matter (not to uphold a collateral challenge) even though the
complaint in question went to jurisdiction, which it, with respect,
correctly acknowledged this to be a troublesome area. But it held
that there was no glaring invalidity in the proceedings or a
manifest absence of jurisdiction. That approach is, with respect,
correct and would in my view apply to the matter at hand. It is for
that reason that I have referred to the jurisdiction challenge in
greater detail than the other alleged irregularity raised.
The approach of the court in that
matter was cited with approval in the well reasoned approach set out
in Oudekraal Estates (Pty) Ltd v City of Cape Town and Others.
The court in Oudekraal also further lucidly explained the
nature of a collateral challenge in the following way:
‘It
will generally avail a person to mount a collateral challenge to the
validity of an administrative act where he is threatened by public
authority with coercive action precisely because the legal force of
the coercive action will most often depend upon the legal validity of
the administrative act in question. A collateral challenge to the
validity of the administration act will be available, in other words,
only “if the right remedy is sought by the right person in the
right proceedings”. Whether or not it is the right remedy in
any particular proceedings will be determined by the proper
construction of the relevant statutory instrument in the context of
the principles of the rule of law.’
The enforcement of an arbitration
award under the Act against a party which had been cited and served
in those proceedings and where the award is served upon that party
shortly after it is made is entirely unlike the position of person
threatened with coercive action by a public authority under
subordinate legislation or by virtue of an administrative act (where
the complainant was not party to it) which is then challenged. The
Act expressly provides a remedy for the challenging of the award –
by both appeal and review – for an unsuccessful party. A
collateral challenge to the award or any enforcement action (such as
a writ) pursuant to it would not in my view be the right remedy for
an unsuccessful party to invoke as has been sought in the
circumstances of this matter as it would fundamentally undermine the
provisions of the Act, the finality of judgments and awards and thus
the rule of law.
The raising of the applicant’s
attack upon the award as a collateral challenge in the 2011
application does thus not in my view enjoy prospects of success.
Conclusion
It follows that the condonation
application must as a consequence fail for this reason as well.
It also follows that the attempt to
reinstate the appeal and the further relief sought in the
application must also fail given the flagrant and glaring failure on
the part of the applicant to take steps to address the lapsing of
the appeal.
As for the costs order sought against
the 20th respondent, Tjitemisa & Associates, I
pointed out to Mr Strydom that s 118 of the Act precludes this court
from making an order for costs against a party unless that party has
acted frivolously or vexatioulsy. It contemplates costs orders
against parties. It does not contemplate a costs order of the kind
sought by the applicant. Mr Strydom correctly accepted that.
I accordingly make the following
order:
The application is dismissed.
_______________
D SMUTS
Judge
APPEARANCES
APPLICANT: JAN Strydom
Instructed by Behrens & Pfeiffer
2nd -6th AND 8th
-19th
RESPONDENTS: N. Marcus
Instructed by Nixon Marcus Public Law
Office
Witvlei (Pty) Ltd v Nawa and Others (LC 101/2011) [2013] NALCMD 30 (12 August 2013);