Kgethe and Others v LMK Manafacturing (Pty) Ltd and National Rubber Products CC (JA66/97) [1998] ZALAC 1 (13 February 1998)

Kgethe and Others v LMK Manafacturing (Pty) Ltd and National Rubber Products CC (JA66/97) [1998] ZALAC 1 (13 February 1998)

The Labour Appeal Court held that the Labour Court erred in refusing disclosure of the sale agreement and related documents. Without production of the agreement and details of assets and liabilities, it was impermissible to determine whether a transfer of business as a going concern had occurred under section 197. The appellants had legitimate grounds to apprehend that their rights under section 197 might have been infringed, given the circumstances and the respondents' reluctance to disclose information. The Court ordered the first and second respondents to furnish the appellants' trade union with a copy of the notice of intention to alienate business or assets (if any), full details of...

Citation
[1998] ZALAC 1
Parties
Appellant: Miriam Kgethe and Others; Respondent: L.M.K. Manufacturing (Pty) Ltd; Respondent: National Rubber Products CC
Court
Labour Appeal Court
Jurisdiction
South Africa
Judgment Date
13 February 1998
Case Number
JA 66/97
Procedural Posture
Civil Appeal / Appeal From Labour Court Judgment Refusing Disclosure and Interdictory Relief
Outcome
Appeal upheld in part; Labour Court order set aside and substituted with order for disclosure of documents and costs.
Judges
Kroon, Myburgh, Froneman
Legal Topics
Transfer of Business as Going Concern, Section 197 Labour Relations Act, Employee Rights on Transfer, Disclosure of Information, Retrenchment Procedure
Labour Law Civil Procedure Transfer of Business as Going Concern Section 197 Labour Relations Act Employee Rights on Transfer Disclosure of Information Retrenchment Procedure

Case Brief

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Parties

Miriam Kgethe and Others

Appellant

L.M.K. Manufacturing (Pty) Ltd

Respondent

National Rubber Products CC

Respondent

Procedural Posture

Civil Appeal / Appeal From Labour Court Judgment Refusing Disclosure and Interdictory Relief

Legal Issues

  1. 1 Whether the sale agreement between the respondents constituted a transfer of business as a going concern under section 197 of the Labour Relations Act.
  2. 2 Whether the appellants were entitled to disclosure of documents relating to the sale and the assets/liabilities of the first respondent.
  3. 3 Whether the appellants were entitled to interdictory relief preventing the sale or transfer pending disclosure and compliance with statutory safeguards.

Ratio Decidendi

The Labour Appeal Court held that the Labour Court erred in refusing disclosure of the sale agreement and related documents. Without production of the agreement and details of assets and liabilities, it was impermissible to determine whether a transfer of business as a going concern had occurred under section 197. The appellants had legitimate grounds to apprehend that their rights under section 197 might have been infringed, given the circumstances and the respondents' reluctance to disclose information. The Court ordered the first and second respondents to furnish the appellants' trade union with a copy of the notice of intention to alienate business or assets (if any), full details of...

Court Disposition

Appeal upheld in part; Labour Court order set aside and substituted with order for disclosure of documents and costs.

Orders

  • The first respondent is ordered forthwith to furnish the appellants' trade union, National Entitled Workers' Union, with a copy of the notice of intention to alienate its business and/or assets to the fourth respondent published in terms of section 34 of the Insolvency Act, No. 24 of 1936, or to advise if no such...
  • The first respondent is ordered to furnish full details of all its assets and liabilities immediately prior to the sale agreement concluded between the first and fourth respondents.