City of Johannesburg v Lyall (JS171/14) [2016] ZALCJHB 219 (23 June 2016)

REPUBLIC OF SOUTH AFRICA

THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

JUDGMENT

Not Reportable/Reportable

Case No: JS171/14

In the matter between:

CITY OF JOHANNESBURG

Applicant

and

MICHAEL MATHIESON LYALL

Respondent

Heard: 12 January 2016

Delivered: 23 June 2016

PIENAAR, AJ

Introduction

[1] This is an opposed application for the rescission of a default judgment granted by Gush, J on 20 February 2015.

[2] For ease of reference, I will henceforth refer to the Applicant in this matter as "City of Johannesburg" and to the Respondent as "Lyall".

Background

[3] On 3 March 2014, Lyall filed a statement of claim at the Labour Court claiming to have been unfairly dismissed by the City of Johannesburg. As such, Lyall sought compensation and reinstatement. I will henceforth refer to this Application as the "main matter".

[4] It is not disputed that the statement of claim in the main matter was served on the City of Johannesburg on 4 March 2014.

[5] In terms of Rule 6(3)(c) of the Labour Court Rules, a party intending to oppose a referral to the Labour Court has to deliver a response within 10 (ten) days of the date on which the statement of claim is delivered. Therefore, City of Johannesburg's statement of defence was due on 18 March 2014, which City of Johannesburg did not dispute.

[6] City of Johannesburg served its statement of defence on Lyall on 31 March 2014 and filed same at the Labour Court on 1 April 2014. The statement of defence was therefore nine days late.

[7] Accordingly, at the same time as filing the statement of defence, City of Johannesburg filed an application for condonation for the late filing of the statement of defence. I will henceforth refer to this Application as the “first condonation application.”

[8] An affidavit of Boitumelo Madiba ("Madiba") was filed in support of the first condonation application. Madiba was employed as an attorney by City of Johannesburg's attorneys of record at the time, Mncedisi Ndlovu and Sedumedi Attorneys. Madiba cited administrative oversight and challenges at the offices of Mncedisi Ndlovu and Sedumedi as the reason for the delay.

[9] On 20 February 2015, the City of Johannesburg's first condonation application was heard by Gush, J. City of Johannesburg was not in attendance. Therefore, Gush, J granted default judgment in the first condonation application in favour of Lyall and ordered that the main matter be set down on the unopposed roll.

[10] The main matter was accordingly set down for 21 April 2015.

[11] City of Johannesburg proceeded to apply for rescission of the default judgment granted by Gush, J. Nkosenhle Mzinyathi, who was employed as an attorney by the City of Johannesburg’s attorneys of record at the time deposed a founding affidavit in support of such rescission application on behalf of City of Johannesburg.

[12] In this founding affidavit, it is stated that City of Johannesburg did not receive the notice of set down of the first condonation

application and only received a notice of set down of the main matter, as per the default judgment, on 17 March 2015.

[13] The City of Johannesburg submitted that it believed default judgment to have been erroneously granted in its absence as City of Johannesburg had not received a notice of set down of the first condonation application. City of Johannesburg proceeded to appoint and brief Counsel for the purpose of rescinding the default judgment. Upon perusal of the documents on brief, Counsel advised City of Johannesburg to establish the circumstances under which the first condonation application was dismissed.

[14] On 17 April 2015, the City of Johannesburg proceeded to peruse the court file. Upon doing so, it was established by City of Johannesburg that notice of set down of the first condonation application was faxed to City of Johannesburg's attorneys on 5 January 2015. According to Mzinyathi, the notice of set down never came to the attention of the attorney responsible for the matter.

[15] On 20 April 2015, the City of Johannesburg, accordingly, applied to this Court for the rescission of the default judgment granted by Gush, J on 21 February 2015.

[16] In terms of Rule 16A (2) (b) of the Labour Court Rules, the rescission application was due on 9 April 2015.

[17] Accordingly, City of Johannesburg filed an application for condonation for the late filing of the rescission application on the same day of filing of the rescission application. I will refer to this application as "the second condonation application."

[18] Therefore, I have before me an application for condonation for the late filing of the rescission application (the second condonation

application) as well as the rescission application.

Analysis and findings.

[19] First, I will decide whether the second condonation application should be granted.

[20] The following factors must be considered in deciding whether condonation should be granted:

20.1. extent of the delay in filing the rescission application (i.e. 7 days);

20.2. the explanation for the delay in filing the rescission application;

20.3. the prospects of success of the rescission application;

20.4. the importance of the issue;[1] and

20.5. the potential prejudice to be suffered by the parties if condonation is granted or not granted.

Extent of the delay.

[21] It is the version of Lyall, as per his answering affidavit, that he served the court order dated 20 February 2015 on City of Johannesburg on 25 February 2015. Thus, according to Lyall, the rescission application was in fact 20 days late.

[22] Lyall conceded during the hearing in this matter that he was at that stage well aware of the fact that City of Johannesburg was represented by its attorneys of record but nevertheless chose to serve the court order dated 20 February 2015 on City of Johannesburg

itself.

[23] I cannot accept that a party to proceedings who fails to serve documents on the chosen address of the other party is then entitled

to rely on such defective service for the purpose of calculating its own time periods.

[24] The City of Johannesburg’s attorneys allege that the default judgment did not come to their attention until 17 March 2015. I have no other acceptable version before me to dispute the version of City of Johannesburg.

[25] I must, therefore, accept that the time at which the default judgment came to the attention of City of Johannesburg’s attorneys of record was 17 March 2015.

[26] Accordingly, the rescission application was seven days late, which, in my view, is not excessive.

Explanation for the delay

[27] The default judgment by Gush, J came to the attention of City of Johannesburg on 17 March 2015 and City of Johannesburg only perused the court file to determine the reason for such default judgment on 17 April 2015.

[28] I am not entirely satisfied with the explanation for this delay, as set out above. City of Johannesburg should have perused the court file sooner and not only upon Counsel's advice to do so.

[29] Nevertheless, given that the delay in filing the rescission application was not excessive and that City of Johannesburg has

prospects of success in the rescission application (as set out below), this factor is not decisive.

Prospects of success: rescission application

[30] In order to determine prospects of success, it is incumbent on me to consider the prospects of the rescission application being granted.

[31] The requirements for the rescission of an order of the Labour Court are provided for in section 165 of the Labour Relations Act 66 of 1995 ("LRA"):

‘The Labour Court, acting on its own accord or on the application of any affected party may vary or rescind a decision, judgement or order-

(a) erroneously granted in the absence of any party affected by that judgement or order;

(b) in which there is an ambiguity, or an obvious error or omission, but only to the extent of that ambiguity, error or omission; or

(c) granted as a result of a mistake common to the parties to the proceedings.’

[32] City of Johannesburg must accordingly also show that it has a reasonable explanation for its default and that it has a bona fide defence in the first condonation application.[2] It appears from the case law that establishing a bona fide defence implies showing prospects of success.

Is the explanation for the default reasonable?

[33] As mentioned above, Mzinyathi stated in his founding affidavit that the notice of set down of the first condonation application did not come to the attention of the attorney dealing with the matter on behalf of City of Johannesburg.

[34] Mzinyathi also stated that, had the matter come to the attention of the attorney responsible for the matter, City of Johannesburg's

attorneys would have proceeded to appoint Counsel to argue the first condonation application.

[35] Mzinyathi stated further that the notice of set down of the first condonation application was sent while City of Johannesburg's

attorneys were still on festive break and that, upon returning from such break, the notice of set down was not brought to the attention

of the attorney dealing with the matter.

[36] Mzinyathi submitted that the failure to attend the hearing on 20 February 2015 was not a wilful act by the attorney or by City of Johannesburg.

[37] In Honey and Blankenberg v Law,[3] the Court held as follows with regard to negligence on the part of an attorney:

‘The test for establishing [negligence on the part of the attorney in performing his or her duties] is whether [such attorney] has been proved to be guilty of such failure as no attorney of ordinary skill would be guilty of if acting with reasonable care. He will not be guilty of negligence merely because he committed an error of judgement whether on matters of discretion or law.’[4]

[38] This finding was referred to with approval by the Appellate Division in Mouton v Die Mynwerkersunie.[5]

[39] The Appellate Division in Saloojee and Another NNO v Minister of Community Development (“Saloojee”), held that it cannot be assumed that non-compliance with Rules of Court, which is entirely attributable to the attorney of the non-complying party, should automatically result in an Application for condonation being granted.[6]

[40] I am satisfied that City of Johannesburg has submitted satisfactory cause for its non-attendance at the proceedings of 20 February 2015. It appears that such absence was attributable merely to human error.

Bona fide defence

[41] Regarding whether City of Johannesburg has a bona fide defence in the first condonation application, it must be borne in mind that Lyall, who did not oppose the first condonation application, conceded in the proceedings before me that he was advised and believed that the first application for condonation would in all likelihood succeed.

[42] In light of Lyall’s concession, it is not necessary for me to consider the first condonation application further, except to say that such application would in all likelihood be granted.

[43] I, therefore, find that the City of Johannesburg has prospects of success in the rescission application.

Prejudice

[44] It is my view that granting the second condonation application would not cause undue prejudice to Lyall. However, if not granted, it would effectively prevent City of Johannesburg from arguing an application in which they have prospects of success (as set out below).

[45] While I am not entirely satisfied with the explanation for the delay in filing the rescission application, the delay is not excessive; the City of Johannesburg has prospects of success in the rescission application and in light thereof, would suffer prejudice if the second condonation application is not granted. Therefore, I am of the view that the factors weigh in favour of granting the second condonation application.

[46] The rescission application should also be granted on the basis that City of Johannesburg provided a reasonable explanation for its default and has prospects of success in the first condonation application, as set out above.

Findings

[47] For these reasons, I order as follows:

1. The late filing of the Application for Rescission is condoned.

2. The Application for Rescission is granted.

3. The matter should now be re-enrolled on the opposed motion roll to consider the Application for Condonation for the late filing of the Statement of Defence.

_____________

Pienaar, AJ

Acting Judge of the Labour Court of South Africa

Appearances:

For the Applicant: Advocate L P Mkize

Instructed by:

Mncedisi Ndhlovu Sedumedi

For the First Respondent: In person

[1] Melane v Santam Insurance Co Ltd 1962 (4) SA 531 (A) at 532C-D.

[2] Sizabantu Electrical Construction v Guma and Others (1999) 4 BLLR 387 (LC) at para 7.

[3] 1966 (2) SA 43 (R).

[4] Ibid at 46H-47A.

[5] 1977 (1) SA 119 (A) at 142H-143A.

[6] 1965 (2) SA 135 (A) at 141B-H.