Hopkins v Man-Dirk (PTY) LTD (JS871/19) [2022] ZALCJHB 244 (25 August 2022)

IN THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

Not Reportable

Case no: JS871/19

In the matter between:

GORDON

HOPKINS

Applicant

and

MAN-DIRK

PTY

LTD

Respondent

Heard; 2 July 2021

Delivered: 25 August 2022

(This judgment was handed down electronically by circulation to the parties' legal representatives by email and publication on the Labour Court’s website. The date for hand-down is deemed to be on 25 August 2022.)

Summary: application for the condonation of the late service and filing of a Statement of Claim – claim for unpaid notice pay and unpaid commission in terms of section 77 of BCEA – claim for unfair retrenchment in terms of section 189 – legal principles on condonation considered – length of delay in service of Statement of Claim minimal - cogent explanation – prospects of success compensate for not so strong explanation - interests of justice requirements considered – main action ripe for hearing - Court not to lightly shut its doors on Applicant parties - condonation application granted.

JUDGMENT

MASUKU AJ

Introduction

[1] The issue for determination is whether the late service and filing of the Applicant's Statement of Claim stands to be condoned.

[2] To that end, this Court is called upon to exercise a judicial discretion in considering whether; i) the length of the delay in filing and effecting proper service on the Respondent; ii) the explanation proffered for the delay; the prospects of success in the main action; the relative prejudice to parties, and the interests of justice all support the granting of condonation.[1]

Brief background

[3] The facts of this matter and the pleadings' history are not controversial. Allied Putziger (Pty) Ltd (old employer) first employed the Applicant on 4 June 2012 as an Export Sales Manager, at a time prior to the old employer being taken over by the Respondent. The takeover subsequently took place during September 2018, when the Respondent presented a new employment contract for signature to the Applicant. This contract recorded the Applicant's original employment date with "Toolquip and Allied", and provides for three calendar months' notice of termination of employment.

[4] As at June 2019, the Applicant was earning R70 889.09 per month. The Applicant was, in terms of the employment contract, also eligible to participate in the Respondent's commission structure. As a result, the Applicant regularly earned commission pay in the months preceding his retrenchment.

[5] It is common cause between the parties that on 1 April 2019, the Applicant was served with a notice in terms of section 189(3) of the Labour Relations Act[2] (LRA), which invited him to a consultation in pursuance of the Respondent's contemplated restructuring process. The upshot of that process was that on 3 June 2019, the Applicant was served with notice of termination of employment by reason of the Respondent's operational requirements. The termination was effective immediately on that day, and the Applicant was paid up to and including for that day. It is also common cause that the Applicant was not paid notice pay equivalent to three months' remuneration, and that he was not paid any commission in respect of the months of April, May and June 2019. Thus, the three claims brought by the Applicant in the main action in this matter.

[6] As to the retrenchment claim, the parties differ as to whether any and/or sufficient consultation was undertaken by the Respondent. They also differ on the genuineness of the business case propounded by the Respondent for embarking on the retrenchment process in the first place. Ultimately, the parties differ on the substantive fairness of the resultant retrenchment. The Respondent also contends that the Applicant is barred by the provisions of section 189A(18) of the LRA from challenging the procedural fairness of his retrenchment before this Court. Ultimately, the Respondent's position is that the Applicant has poor prospects of success in the main action and that, for that reason, condonation must be refused.

[7] It merits mention, at this juncture, that as these claims for the unpaid three months' notice pay and commission brought in terms of section 77 of the Basic Conditions of Employment Act[3] are not covered by sections 191(5) and (11) of the LRA, no condonation is sought in that regard.

[8] After his retrenchment, the Applicant referred a dismissal dispute to the Commission for Conciliation, Mediation and Arbitration (CCMA) for conciliation. When the conciliation attempts made by Commissioner

Masenye proved unsuccessful on 22 July 2019, a certificate of non-resolution was issued indicating that the matter was to be referred to adjudication before this Court.

[9] On 23 October 2019, 92 days after the issuing of the certificate of non-resolution,[4] the Applicant's Statement of Claim was filed with this Court. The Statement of Claim was, therefore, filed with this Court 2 days out of time. However, the Statement of Claim was not simultaneously served on the Respondent.

[10] On 31 October 2019, the first attempt at serving the Statement of Claim on the Respondent's Randfontein office address was made by the Sheriff. As dealt with in more detail below under explanation for the delay, service was not accepted by a Manager of the Respondent. As a result, on 22 November 2019, a different Sheriff (the Sheriff for Johannesburg East) was instructed and, on 27 November 2019, that Sheriff effected proper service of the Statement of Claim on the Respondent at its Benrose office address.

[11] On 22 January 2020, some 56 calendar days after the service of the Statement of Claim and/or some 42 calendar days after the lapsing of the 10-day period for its service and filing (10 days lapsed on 11 December 2019), the Respondent's Statement of Defence was served and, on the next day, 23 January 2020, it was filed with this Court. No explanation has been provided therefor by the Respondent either in the Statement of Defence or in a separate application for the condonation of the late filing of same.

[12] Self-evidently prompted by the point in limine raised in the Statement of Defence relating to the late service of his Statement of Claim, on 5 February 2020, the Applicant launched the current application for condonation. That application was filed some three months and 13 days since the filing of the Statement of Claim.

[13] On 14 December 2020, the parties signed the pre-trial minutes, and on 3 March 2021, the Court file was prepared for set down.

The applicable legal principles

[14] It is trite that an application for condonation must be brought as soon as the party which applies for it becomes aware of the default.[5] It is also trite that condonation is a matter for serious consideration by this Court, and is not there simply for the asking.[6]

[15] The requirements to be considered by this Court in deciding an issue of condonation were set out by the Appellate Division (as it then was) in Melane v Santam Insurance Co. Ltd[7] (Melane), where the Appellate Division formulated the following test:

‘In deciding whether sufficient cause has been shown, the basic principle is that the court has a discretion, to be exercised judicially upon a consideration of all the facts, and in essence it is a matter of fairness to both sides. Among the facts usually relevant are the degree of lateness, the explanation therefor, the prospects of success, and the importance of the case. Ordinarily these facts are interrelated: they are not individually decisive, for that would be a piecemeal approach incompatible with a true discretion, save of course that if there are no prospects of success there would be no point in granting condonation. Any attempt to formulate a rule of thumb would only serve to harden the arteries of what should be a flexible discretion. What is needed is an objective conspectus of all the facts. Thus a slight delay and a good explanation may help to compensate for prospects of success which are not strong. Or the importance of the issue and strong prospects of success may tend to compensate for a long delay. And the respondent’s interest in finality must not be overlooked.’ (Own emphasis)

[16] the latter principle was confirmed by the Labour Appeal Court (LAC) in NUM v Council for Mineral Technology[8] (NUM), where the following was stated:

‘A slight delay and a good explanation may help to compensate for prospects of success which are not strong. The importance of the issue and strong prospects of success may tend to compensate for a long delay. There is a further principle which is applied and that is that without a reasonable and acceptable explanation for the delay, the prospects of success are immaterial, and without prospects of success, no matter how good the explanation for the delay, an application for condonation should be refused.’

[17] Recently, in Grootboom v National Prosecuting Authority and another,[9] the Constitutional Court resurrected the principles established in Brummer v Gorfil Brothers Investments (Pty) Ltd and others[10] and Van Wyk v Unitas Hospital and another (Open Democratic Advice Centre as amicus curiae)[11]. Briefly, the Constitutional Court held that the granting of condonation is a matter to be determined having regard to the “interests of justice”.[12] In giving meaning to the concept of interests of justice, the Constitutional Court held:

‘…I agree with [Zondo J] that, based on Brummer and Van Wyk, the standard for considering an application for condonation is the interests of justice. However, the concept “interests of justice” is so elastic that it is not capable of precise definition. As the two cases demonstrate, it includes: the nature of the relief sought; the extent and cause of the delay; the effect of the delay on the administration of justice and other litigants; the reasonableness of the explanation for the delay; the importance of the issue to be raised in the intended appeal; and the prospects of success. It is crucial to reiterate that both Brummer and Van Wyk emphasise that the ultimate determination of what is in the interests of justice must reflect due regard to all the relevant factors but it is not necessarily limited to those mentioned above. The particular circumstances of each case will determine which of these factors are relevant.’[13] (own emphasis) [Footnotes omitted]

At paragraph 51, the Constitutional Court held:

‘The interests of justice must be determined with reference to all relevant factors. However, some of the factors may justifiably be left out of consideration in certain circumstances. For example, where the delay is unacceptably excessive and there is no explanation for the delay, there may be no need to consider the prospects of success. If the period of delay is short and there is an unsatisfactory explanation but there are reasonable prospects of success, condonation should be granted. However, despite the presence of reasonable prospects of success, condonation may be refused where the delay is excessive, the explanation is non-existent and granting condonation would prejudice the other party. As a general proposition the various factors are not individually decisive but should all be taken into account to arrive at a conclusion as to what is in the interests of justice.’

[18] In Khosa v Absa Bank Limited,[14] the LAC granted condonation for the late filing of a Statement of Claim that was delivered some 54 days out of time, and where the application for condonation was itself only launched some 147 days after the filing of the Statement of Claim. At paragraphs 10 – 11, the LAC held:

‘[10] It is trite that the factors to be considered in a condonation application are not individually decisive but are interrelated. I agree with the statement to the effect that even if it is found that the explanation put forth does not constitute a reasonable explanation, it will not necessarily be regarded as an absolute bar to condonation. What is needed is indeed an objective conspectus of all the facts; the importance of the issue and strong prospects of success may tend to compensate for a long delay.

[11] I also differ from the Respondent on the assertion made, on its behalf, that it is not in the interests of justice that this matter should be allowed to proceed. What interests of justice will be served by denying the Appellant an opportunity to state his case before Court? Why should the “doors of justice” be closed on him, particularly where, prima facie, there appears to be a reasonable prospects of success? Certainly it is in the interests of justice that both the Appellant and the Respondent be allowed an opportunity to ventilate their respective issues before Court. I would accordingly grant condonation in the instant matter.’

Analysis

Computation of period of delay

[19] In Latiff v Donro (Pty) Ltd,[15] this Court clarified that the number of days required by a provision of the LRA is to be computed with reference to the definition of day contained in the Interpretation Act.[16] The Interpretation Act provides, in essence, that days for the purposes of the LRA refers to calendar days rather than Court days as contemplated in the Rules for the Conduct of Proceedings before the Labour Court[17] (Rules). The reckoning of the days is exclusively of the first day and inclusively of the last, unless the last day falls on a Sunday or a public holiday, in which case it shall be reckoned exclusively of the first day and exclusively also of every such Sunday or public holiday.

[20] Section 191(5)(b)(i) read together with 191(11)(a) of the LRA require that those dismissal disputes that fall to be resolved through adjudication before this Court must be referred to this Court within 90 days of the issuing of a certificate of non-resolution. Section 191(11)(b) empowers this Court to condone any non-observance of that time period.

[21] Accordingly, the Statement of Claim ought to have been served and filed by no later than Monday, 21 October 2019, the certificate of non-resolution having been issued on Monday, 22 July 2019.

[22] The period of delay is only two days in respect of the filing thereof with this Court, and some 38 days in relation to the service thereof on the Respondent's Benrose address on 27 November 2019.

[23] It is also noteworthy that the Applicant did attempt to serve the Statement of Claim on 31 October 2019, which is evidenced by the Sheriff's Return of Service. The Applicant was unable to effect service by reason of Visser's refusal to accept same on that day, however. Had she accepted service, the Statement of Claim would have been only 10 days out of time.

[24] The periods of delay are, while excessive, not egregious.

The explanation for the delay

[25] The Applicant has provided a detailed account of the steps pursued in attempting to effect service of the Statement of Claim. However, the explanation preferred fails to give an account for every period of delay as required.

[26] Briefly, the Applicant laboured under the impression that the Respondent's Head Office is the Randfontein office that is recorded in his employment contract. He opted to serve the Statement of Claim at that office address, which necessitated the utilisation of the Randfontein Sheriff. After the filing of the Statement of Claim in this Court on 23 October 2019, the first opportunity for it to be transmitted to the Randfontein Sheriff was on the following day, 24 October 2019, which was duly done via urgent courier. The Statement only arrived at the Sheriff's offices on 28 October 2019,

and it was then attempted to be served on the Respondent's Randfontein address on 31 October 2019 as alluded to at paragraph 9 above.

Thereafter, a process of tracing the Respondent's correct head office address and its company details was then earnestly undertaken. Once confirmation of the Benrose address was obtained, and the Statement of Claim received back from the Randfontein Sheriff, the Sheriff for Johannesburg East was instructed on 22 November 2019. It was only on 27 November 2019 that the Sheriff managed to effect service at Benrose.

[27] The explanation is by no means granular in detail. However, it is cogent and, in my value judgment, suffices to cover the bulk of the periods of delay, albeit not every single aspect/day thereof. It is nevertheless acceptable taking into account the length of the delay; the steps earnestly pursued by the Applicant in attempting to effect service; the inexplicable conduct of Visser that partly caused a further delay in service; and the clear intention of pursuing rather than abandoning his claims demonstrated by the conduct of the Applicant. I am not persuaded that the Applicant acted in a manner that lacked diligence or that he, at any point, demonstrated an intention to abandon his claims in this matter. I am also not persuaded that the Applicant demonstrated a cavalier attitude towards the requirements of section 191 relating to the time and manner of service.

[28] For these reasons, the explanation, although not covering the entire periods of delay day-by-day, is cogent and suffices, particularly considering that the period of delay is not egregious. It is on this basis that I proceed to consider prospects of success in the main action as guided by Melanie and NUM.

Prospects of success

[29] The Applicant failed to deal with this aspect in the founding affidavit to the application for condonation. However, the Applicant attached the Statement of Claim as an annexure to the founding affidavit and also dealt with this issue in reply. The Statement of Defence and the Pre-trial Minutes are also before this Court. A judicial consideration of the papers, where form is not unduly elevated over substance, reveals the following:

a. The restructuring process undertaken by the Respondent involved a section 189A process, which required consultation over a period of sixty days prior to the issuing of any notice of termination. Whether any meaningful consultation took place over the period between 1 April and 3 June 2019 is the subject of a factual dispute between the

parties.

b. The Applicant avers that no consultation took place and, effectively, that he was presented with retrenchment as a fait accomplii. Those letters sent to the Applicant by the Respondent on the retrenchment issue, which are annexures to the Statement of Claim, also reveal that the Respondent appears to have concluded that due to the Applicant refusing to accept an alternative job offer with flexible working conditions and a lower salary, he was to be and he was indeed retrenched. The Applicant, therefore, challenges the Respondent's business case for embarking on the retrenchment process in the first place and contends that his retrenchment was a fait accomplii.

[30] This recount of the background leading to the Applicant's retrenchment demonstrates, in my view, reasonable prospects of success for the Applicant in relation to this aspect of his claim in the main action. That is, should the Applicant succeed in establishing that there was no genuine business case, that there was a less than a meaningful consultation process, and that his retrenchment was presented a fait accomplii, there are strong prospects that the trial court may find in his favour in relation to the substantive fairness of his retrenchment.

Prejudice

[31] The Applicant avers that no prejudice stands to befall the Respondent as a result of the delay in the service and filing of the Statement of Claim, taking into account that it was not an egregiously lengthy delay. As I understand it, the Applicant contends that none of the issues that would typically arise as a result of a lengthy delay in serving the Statement of Claim such as the departure of personnel with knowledge of the matter from the employ of the Respondent and/or

the loss of or the available documentary and other evidence becoming otherwise unreliable through the passage of time, which would

jeopardise the Respondent's ability to defend its position at the trial, come into play in this matter. Indeed, as alluded to above,

the Statement of Defence and pre-trial minutes have since been filed and the matter is ripe for trial.

[32] For these reasons, any prejudice to befall the Respondent is not of such a nature that its ability to defend its position at trial has been jeopardised. Of course the trial Court may consider the delay in making any costs orders, which may ameliorate any prejudice on the part of the Respondent.

[33] In the premises, I am of the view that all four of the Melane considerations count in favour of this Court exercising its discretion in favour of granting rather than refusing condonation. Furthermore, considering the conduct of Visser, without which the delay in the service of the Statement of Claim could have been lessened, considering the stage at which the Pleadings are in the main action, and considering that an exercise of this Court's discretion against the grating of condonation would be a draconian step, the result of which would be the inequitable shutting of the Court's doors to an Applicant who has a prima facie case to be answered at trial by the Respondent, I am satisfied that the interests of justice call for the granting of condonation in the circumstances of this matter. The interests of justice also dictate that true finality ought to be afforded to the parties in the form of an opportunity for a proper ventilation of the issues raised by the Applicant and the final determination of those issues on the merits, the Respondent being in as good a position to place its version before the trial as it would have been had the Statement of Claim been served and filed timeously.

Costs

[34] As to costs, it is trite that they do not ordinarily follow the result in litigation before this Court. Furthermore, considering the blameworthiness of the Applicant for the delay, without which this application would not have been necessary, I do not deem it in the interests of the law and fairness to award him any costs. The Respondent is also not deserving of a costs order being granted in its favour when Visser's conduct is taken into account and when one considers the late filing of the Respondent's own Statement of Defence.

[35] In the premises, I make the following order:

Order

1. the application for the condonation of the late filing and the late service of the Statement of Claim is granted.

B Masuku

Acting Judge of the Labour Court of South Africa

Appearances:

For the Applicant:

S Jackson

Dyabala Attorneys

For the Respondent:

J Jones

McGregor Erasmus Attorneys

[1] See generally: Grootboom v National Prosecuting Authority and another [2014] 1 BLLR 1 (CC) (Grootboom).

[2] Act 66 of 1995, as amended.

[3] Act 75 of 1997.

[4] See generally: Latiff v Donro (Pty) ltd (2004) 25 ILJ 2219 (LC) (Latiff) on the reckoning of the number of days required by a statute that does not itself offer a definition for day.

[5] See: Seatlolo and Others v Entertainment Logistics Service (A Division of Gallo Africa Ltd) (2011) 32 ILJ 2206 (LC).

[6] Foster v Stewart Scott Inc (1997) 18 ILJ 367 (LAC).

[7] 1962 (4) SA 531 (A) at 532C-E.

[8] [1999] 3 BLLR 209 (LAC) at para [10].

[9] Grootboom supra at n 1 above.

[10] 2000 (5) BCLR 465 (CC).

[11] 2008 (4) BCLR 442 (CC).

[12] Grootboom at para [22].

[13] At para [22].

[14] Unreported judgment under case no JA55/2013 delivered on 15 January 2015.

[15] Latiff supra at n 4.

[16] Act 33 of 1957.

[17] GN 1665 of 1996.