Bezer v Cruises International CC (C535/2001) [2002] ZALC 101; (2003) 24 ILJ 1372 (LC); [2003] 6 BLLR 535 (LC) (1 December 2002)

Bezer v Cruises International CC (C535/2001) [2002] ZALC 101; (2003) 24 ILJ 1372 (LC); [2003] 6 BLLR 535 (LC) (1 December 2002)

The court found that the applicant, Ms Jauch, had deliberately entered into an arrangement whereby she established a close corporation and concluded an agency agreement between the respondent and the CC. The agency agreement was not entered into by Ms Jauch in her personal capacity but by the CC, a distinct juristic entity. The evidence showed that the applicant was fully aware of the tax benefits anticipated from the CC and had ample opportunity to consider and obtain advice on the arrangement. The substantive terms of the agency agreement, while resembling an employment relationship, were not sufficient to override the fact that the contractual relationship was with the CC. The...

Citation
[2002] ZALC 101
Parties
Applicant: Tania Bezer (neé Jauch); Respondent: Cruises International CC
Court
Labour Court
Jurisdiction
South Africa
Judgment Date
1 December 2002
Case Number
C535/2001
Procedural Posture
Civil Jurisdictional Point / Preliminary Hearing on Employment Status (point in Limine)
Outcome
Point in limine upheld; applicant failed to prove employee status at the relevant time.
Judges
K S Tip
Legal Topics
Employment Status, Independent Contractor Vs Employee, Close Corporation Structures, Retrenchment, Tax Efficiency, Sham Agreement
Labour Law Commercial and Corporate Employment Status Independent Contractor Vs Employee Close Corporation Structures Retrenchment Tax Efficiency Sham Agreement

Case Brief

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Parties

Tania Bezer (neé Jauch)

Applicant

Cruises International CC

Respondent

Procedural Posture

Civil Jurisdictional Point / Preliminary Hearing on Employment Status (point in Limine)

Legal Issues

  1. 1 Whether the applicant was an employee or an independent contractor at the time of the respondent's restructuring exercise.
  2. 2 Whether the agency agreement and the formation of the close corporation were bona fide or a sham.
  3. 3 Whether the applicant is entitled to claim relief under the Labour Relations Act as an employee.

Ratio Decidendi

The court found that the applicant, Ms Jauch, had deliberately entered into an arrangement whereby she established a close corporation and concluded an agency agreement between the respondent and the CC. The agency agreement was not entered into by Ms Jauch in her personal capacity but by the CC, a distinct juristic entity. The evidence showed that the applicant was fully aware of the tax benefits anticipated from the CC and had ample opportunity to consider and obtain advice on the arrangement. The substantive terms of the agency agreement, while resembling an employment relationship, were not sufficient to override the fact that the contractual relationship was with the CC. The...

Court Disposition

Point in limine upheld; applicant failed to prove employee status at the relevant time.

Orders

  • The point in limine is upheld with costs.
  • The Registrar of this Court is directed to refer this judgment to the Receiver of Revenue at Cape Town for further investigation.