Jet Master (Pty) Ltd v Centre for Dispute Resolution Metal and Engineering Industry Bargaining Council and Others (JR1530/04) [2006] ZALC 62; (2006) 27 ILJ 1871 (LC) (16 May 2006)
The court found that the commissioner committed a gross irregularity by proceeding with the arbitration in the absence of the applicant, especially since there was no substantive application to set aside the settlement agreement. The applicant had a reasonable explanation for not attending the hearing, as the matter...
Source-derived case information.
- Citation
- [2006] ZALC 62
- Parties
- Applicant: Jet Master (Pty) Ltd; Respondent: Centre for Dispute Resolution Metal and Engineering Industry Bargaining Council; Respondent: Commissioner K. Kleinot; Respondent: Commissioner J. Mphaphuli; Respondent: National Canvas Union of South Africa; Respondent: Vincent R Shortridge
- Court
- Labour Court
- Jurisdiction
- South Africa
- Judgment Date
- 16 May 2006
- Case Number
- JR1530/04
- Procedural Posture
- Review Application / Labour Court Review of Commissioner’s Refusal to Rescind Arbitration Award
- Outcome
- Application granted; third respondent’s ruling set aside and substituted; costs awarded against fourth respondent.
- Judges
- E Revelas
- Legal Topics
- Rescission of Default Award, Arbitration Procedure, Settlement Agreement, Gross Irregularity
Source-derived case record
Summary, issues, holding and outcome
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Parties
Jet Master (Pty) Ltd
Applicant
Centre for Dispute Resolution Metal and Engineering Industry Bargaining Council
Respondent
Commissioner K. Kleinot
Respondent
Commissioner J. Mphaphuli
Respondent
National Canvas Union of South Africa
Respondent
Vincent R Shortridge
Respondent
Procedural Posture
Review Application / Labour Court Review of Commissioner’s Refusal to Rescind Arbitration Award
Legal Issues
- 1 Whether the commissioner committed a gross irregularity by refusing to rescind the default arbitration award.
- 2 Whether a settlement agreement can be set aside without a substantive application on notice.
- 3 Whether the applicant had a reasonable explanation for its absence at the arbitration hearing.
Ratio Decidendi
The court found that the commissioner committed a gross irregularity by proceeding with the arbitration in the absence of the applicant, especially since there was no substantive application to set aside the settlement agreement. The applicant had a reasonable explanation for not attending the hearing, as the matter was set down irregularly and the settlement agreement had not been properly challenged. The refusal to rescind the default award constituted a serious misdirection. The Labour Court held that only a substantive application on notice could justify setting aside a settlement agreement, and that the commissioner’s actions were procedurally unfair.
Court Disposition
Application granted; third respondent’s ruling set aside and substituted; costs awarded against fourth respondent.
Orders
- The third respondent’s ruling is set aside and substituted with: 'The award of the second respondent (Commissioner K. Kleinot) is set aside.'
- The fourth respondent is to pay the costs of this application.
Full Case Text
Judgment text and source record
36 paragraphs
IN THE LABOUR COURT OF SOUTH AFRICA
HELD AT JOHANNESBURG
Case No: JR 1530/04
In the matter between:
JET MASTER (PTY) LTD Applicant
and
CENTRE FOR DISPUTE RESOLUTION
METAL AND ENGINEERING INDUSTRY
BARGAINING COUNCIL 1st Respondent
COMMISSIONER K. KLEINOT 2nd Respondent
COMMISSIONER J. MPHAPHULI 3rd Respondent
NATIONAL CANVAS UNION OF
SOUTH AFRICA 4th Respondent
VINCENT R SHORTRIDGE 5th Respondent
JUDGMENT
REVELAS J
[1] The applicant seeks to set aside the third respondentâs ruling in terms of which he refused to rescind an arbitration award obtained in the absence of the applicant.
[2] The fifth respondent, Vincent Shortridge (âShortridgeâ), had been in the employ of the applicant as a welder when he was dismissed by the applicant for alleged theft of copper from the applicantâs premises.
[3] Shortridge, represented by the National Union of Metal Workers of South Africa (âNUMSAâ) referred a dismissal dispute to the first respondent, and the matter was eventually set down for an arbitration hearing on 25 March. Shortridge was represented by Mr M Ngwenya (âNgwenyaâ) of NUMSA. Before the matter proceeded, a settlement agreement was reached in terms whereof the applicant would pay Shortridge compensation in an amount equal to one monthâs remuneration. Ngwenya signed the settlement agreement on behalf of Shortridge.
[4] Shortridge was aggrieved with the settlement agreement and wished to resile from it. He simply had the matter set down again for an arbitration hearing on 5 May 2004. The applicant also received the notice of set down for that day.
[5] The applicant immediately wrote to the first respondent (âthe Centre for Dispute Resolutionâ or, âthe Centreâ) and brought to its attention that an agreement of settlement had been reached with Shortridge, and that it was not going to entertain the matter any further. The Centre then sent the applicant a copy of a letter from Shortridge requesting the Centre to review the settlement agreement because he said, Ngwenya had not represented him at those proceedings. The matter then proceeded on 6 May 2004, and the arbitrator then made an arbitration award in favour of Shortridge, having effectively set aside the settlement agreement. Shortridge was also represented by NUMSA at these proceedings, albeit by a different official.
[6] In my view, the arbitrator committed a gross irregularity in proceeding with the matter in the absence of the applicant. In the absence of a substantive application to have the agreement set aside, there was no obligation on the applicant to attend at the Centre to attend a new arbitration hearing which was set down in terms of an irregular procedure. Consequently, the third respondent failed in his duties as a commissioner in refusing to rescind the default award made by the second respondent. Clearly the applicant had a reasonable explanation for not attending the so-called âarbitrationâ hearing. Furthermore, it had a bona fide defence. The refusal to rescind the award in question, constituted a serious misdirection.
[7] Awards and settlement agreements become enforceable only once they are made orders of court. Except for default awards, which can be rescinded by the Centre, CCMA or Bargaining Council, awards can only be reviewed by the Labour Court. The same should apply to settlement agreements. Even if a commissioner indeed has the necessary powers to set aside a settlement agreement, (if such a power is perhaps incidental to the nature of a commissionerâs duties), such an agreement can only be set aside if a substantive application is brought on notice to the other party. It should never be dealt with as was the case in this matter.
[9] In the circumstances, I make the following order:
1. The third respondentâs ruling is set aside and substituted with the following:
âThe award of the second respondent (Commissioner K. Kleinot) is set asideâ
The fourth respondent is to pay the costs of this application.
___________________
Elna Revelas
Judge of the Labour Court
Date of hearing: 12 May 2006
Date of Judgment: 16 May 2006
On behalf of the applicant:
Mr Brian Bleazard
On behalf of the fourth to fifth respondents:
Mr C Leeuw of NCUSA