Kouga Municipality v South African Local Government Bargaining Council and Others (P513/08) [2009] ZALC 158; [2010] 4 BLLR 414 (LC); (2010) 31 ILJ 1211 (LC) (19 November 2009)

IN THE LABOUR COURT OF SOUTH AFRICA

HELD AT PORT ELIZABERTH

CASE NO: P513/08

REPORTABLE

In the matter between:

KOUGA MUNICIPALITY …..................................................APPLICANT

and

SOUTH AFRICAN LOCAL

GOVERNMENT BARGAINING

COUNCIL …............................................................FIRST RESPODENT

COMMISSIONER MARTIN KOORTS ….........SECOND RESPONDENT

AR VAN DEN HEEVER …...................................THIRD RESPONDENT

HEARD ON: 3 September 2009

JUDGEMENT BY: C.J. Musi, AJ

[1] On 3 September 2009 I dismissed, with costs, this application to review and set aside the award made by the second respondent. These are my reasons for doing so.

[2] The third respondent who is an ex employee of the applicant (Kouga Municipality) referred a constructive dismissal dispute to the first respondent (South African Local Government Bargaining Council). The matter was conciliated on 17 March 2008. The dispute could not be resolved and a certificate of outcome was issued where after the third respondent referred the matter to arbitration.

[3] The second respondent found that the third respondent succeeded to prove, on a balance of probabilities, that he was constructively dismissed. He ordered the applicant to compensate third respondent with an amount equivalent to nine (9) months of his salary. This review application was then brought.

[4] In his opposing affidavit the third respondent challenged the authority of Rabela and Mosiane to act on behalf of the applicant and to depose to their respective affidavits in these proceedings. The third respondent then raised this issue as a point in limine, during argument. This judgment relates to the point in limine.

[5] In his founding affidavit Monwabisi Rabele states the followings:

“I am the Human Resource (Practioner) of the applicant having (it’s) (principle) place of business at 33 Da Gama Road, Jeffrey’s Bay 6330 with Telephone number: (042) 200 2200 and Fax number: 086 522 7357, and the facts deposed to in this affidavit are within my personal knowledge and belief true and correct, unless stated otherwise or as many appear to the contrary from the context..”

He does not allege that he is authorised to launch and prosecute these proceedings.

[6] Mr Pheelo Mosiane who filed a supplementary founding affidavit purportedly in terms of Rule 7 A (8) of this Courts Rules stated the following:

“I am an adult male and the Human Resources Manager of the applicant having its (principle) place of business at 33 Da Gama Road Jeffrey’s Bay, 6330 with Telephone number: (042) 200 2200 and Fax number: 086 522 7357 and the (Fax) deposed to ( ) this affidavit ( ) or within my personal knowledge and belief true and correct, unless stated otherwise or as may appear to the contrary (to) the context…

He, like his colleague, Rabela, does not state that he is authorised to institute and prosecute these proceedings.

[7] In the replying affidavit of Mr Edward Rankwana, the Municipal Manager of the applicant he states the following:

“1. I am the municipal Manager of the Third respondent, Kouga Municipality.

The fact deposed to herein are true and within my personal knowledge, unless it appears to the contrary from the context.

The submissions made herein are based upon advice obtained from the (Respondent’s) attorney.

I am duly authorised to dispose to this affidavit in

reply to the Third Respondent’s opposing affidavit.

I have perused the affidavit of Alan Richard Van Den Heever and respond as follows thereto:

Ad Paragraph 1

I note the contents of this paragraph.

Ad Paragraph 2

I respectfully submit that the Applicant is a legal entity who is obliged to act through its employees. Both Mr Rabela and Mr Mosiane are employed with the Applicant in its Human Resources Department and both are delegated by me to deal with this review application. They were at all material times instructed and authorised to depose to the affidavits submitted in this application by me.

I am authorised to launch the review application on behalf of the Applicant by virtue of my appointment as Municipal Manager of the Applicant, municipal legislation and my delegated authority.

In the premises the Third respondent’s submission that Mr. Rabela and Mr. Mosiane do not have locus standi to dispose to the affidavits submitted in this application, is ill founded and stands to be rejected.”

[8] The applicant is a juristic or artificial person. It can only function through its agents. It must therefore appear from the founding affidavits that the person launching the proceedings is duly authorised to do so. The onus is on the petitioner to show that the launching of the proceedings has been authorised by the applicant. The petitioner must therefore place sufficient evidence before the court to enable it to decide whether enough evidence has been placed before it to warrant the conclusion that it is the applicant which is litiganting and not some unauthorised person on its behalf. See Griffiths & Inglis (PTY) LTD v Southern Cape Blasters (PTY) LTD 1972 (4) SA 249 (C); Mall (Cape) (PTY) LTD v Merino Ko-operasie Bpk 1957 (2) SA 347 (C) at 351 H-352 C.

[9] It is trite that in motion proceedings the essential factual averments necessary to obtain the relief sought must be made in the founding affidavit. In Sherpard v Tuckers land and Development Corporation (PTY) LTD (1) 1978 (1) SA 173 (W) at 177-178 Nestadt stated:

“Courts will not allow an applicant to make or supplement his case in his replying affidavits and will order any matter appearing therein which should have been in the founding affidavits to be struck out. (See Herbstein and Van Winsen p75)

In Titty’s Bar and Bottle Store (PTY) LTD v A.B.C. Garage (PTY) LTD and Others 1974 (4) SA 362 (T) Viljoen, J, at p368 stated:

‘It has always been the practice of the Courts of South Africa to strike out matter in replying affidavits which should have appeased in petitions or founding affidavits, including facts to establish locus standi or jurisdiction of the Court… In my view this practise still prevails.’ This is not however an absolute rule. It is not a law of the Medes and Persians. The Court has discretion to allow new matter to remain in a replying affidavit, giving the respondent the opportunity to deal with it in a second set of answering affidavits. This indulgence however will only be allowed in special or exceptional circumstances…”

See also Roebuck v Aerial Exchange CC (2002) 23 ILJ 523 (LC) at paragraph 13.

[10] The petitioner must make out a prima facie case in the founding affidavit. Poseidon Ships Agencies (PTY) LTD v African Coaling and Exporting Co (Durban) (PTY) LTD and Another 1980 (1) SA 313 (D) at p315 to p316. The applicant does not have to authorise Rabela and Mosiane to depose to affidavits. They should, however, be authorised by the applicant to institute and prosecute the proceedings. See Ganes and Another v Telecom Namibia 2004 (3) SA 615 (SCA) at paragraph 19.

[11] In this case neither of the deponents avers that they were authorised to institute and prosecute these proceedings. There is not an iota of evidence, in the founding affidavits, that the deponents were authorised by the applicant to institute these proceedings. Even on the “minimum of evidence” approach, this application does not make the threshold. See Moila infra at paragraph 26. The Municipal Manager tried in his replying affidavit to establish for the first time that Mosiane and Rabela had been authorised to depose to affidavits and not to institute the proceedings. I will elaborate on this aspect later.

[12] This case should be distinguished from cases such as Mall (Cape) (PTY) LTD v Merino Ko-operasie supra; Moila v University of the North & Others (2005) 26 ILJ 452 (LAC); Msunduzi Municipality v Natal Joint Municipal Pension/Provident Fund and Others 2007 (1) SA 142 (N); Baeck & Co SA (PTY) LTD v Van Zummeren and Another 1982 (2) SA 112 (W) ; National Co-op Dairies Ltd v Smith 1996 (2) SA 717 (N) and Kritzinger v Newcastle Local Transitional Council & Other 2000 (1) SA 345 (N); because in all those cases there was an allegation in the founding affidavit that the petitioner is duly authorised to institute the proceedings or to dispose to the founding affidavit and that factual allegation was denied and the applicant’s authority challenged. That is not the situation in this case.

[13] There is no special reason or exceptional fact or circumstance in this case that necessitates me exercising my discretion in favour of allowing the issue of authority to be raised, in the manner that it is raised, for the first time in the replying affidavit. As I will point out later Rankwana’s affidavit does not state that Rabela and Mosiane had authority to institute these proceedings on behalf of the applicant. In my view the allegations in relation to locus standi in Rankwana’s affidavit, at best, establishes that he has authority to institute these proceedings. He did not launch the application. That being the case the application ought to fail at this stage.

[14] Even if I have regard to the replying affidavit this application is still doomed to fail. Rankwana’s choice of words is telling. He states that Rabela and Mosiane “are delegated by me to deal with this review application. They were at all material times instructed and authorised to depose to the affidavits submitted in this application by me.” (My underlining).

[15] It is significant that Rankwana does not state that he authorised Rabela and Mosiane to institute or launch and prosecute these proceedings. What he states is significant but what he omits to say is vital. They were according to him delegated to deal with the review application. It is unclear what he means by dealing with the review application. To deal with an application can mean many varied things that still fall short of instituting the proceedings. They did not need his authorization to dispose to their respective affidavits. What they needed was authorization to institute and prosecute these proceedings. It is clear from Rankwana’s replying affidavit that Rabela and Mosisane were not given authority to institute these proceedings.

[16] Initially I thought that it is Rankwana’s lack of understanding of the objection that made him choose the words “deal with the review application.” The next paragraph however puts the issue beyond doubt that Rankwana knew the objection is about the launching of these proceedings. He states that “I am authorised to launch the review application on (the) behalf of Applicant by virtue of my appointment as Municipal Manager of the Applicant, municipal legislation and my delegated authority…” He clearly distinguishes between dealing with the review and launching the review.

[17] Even if I accept that he has authority to launch these proceedings on behalf of the applicant, he does not state that he has delegated such power or authority to Rabela and Mosiane. His authority to launch these proceedings is of no moment because he did not launch it. It is Rabela and Mosiane’s authority to launch these proceedings that was challenged. If a municipal manager sub – delegates his/her authority to launch court proceedings on behalf of a municipality to a staff member of that municipality he/she should state that fact unambiguously. He/She should also mention that the sub – delegation has been approved by the council or that it was done in terms of the council’s delegation policy. If necessary he/she should attach the relevant council resolution. Whether it is necessary to attach the aforesaid resolution will depend on the facts of each case.

[18] Even if I accept that Rankwana has the authority, which I doubt, to ratify the launching of these proceedings ex post facto, he does not purport to be ratifying Rabela and Mosiane’s unauthorised actions. See National Co-op Daries Ltd v Smith supra at 718-719. The replying affidavit does not contain “minimum of evidence” of authority.

[19] There is another reason why this application was stillborn. In Pretoria City Council v Meerlust Investments (PTY) Ltd 1962 (1) SA 321 (A) at 325 Ogilvie Thompson JA said the followings:

“(S)ince an artificial person, unlike an individual, can only take decisions by passing of resolutions in the manner prescribed by its constitution, less reason exists to assume, from the mere fact that proceedings have been brought in its name, that those proceedings have in (tact) been authorised by the artificial person concerned. In order to discharge the above mentioned onus, the petitioner ought to have placed before this court an appropriately worded resolution of the council.”

No resolution of the applicant was placed before me. Although a resolution is not always required, it is the best evidence to ward off a challenge of this nature. In this matter a resolution by the applicant was necessary to meet the challenge.

[20] In terms of section 109 (2) of the local Government Municipal Systems Act, no 32 of 2000 (MSA)

“A municipality may compromise or compound any action, claim or proceedings, and may submit to arbitration any matter other than a matter involving a decision on its status, power or duties or the validity of its actions or by – laws”

[21] Section 59 of the MSA deals with delegations. Section 59 (1) and (2) reads as follows:

“(1) A municipal council must develop a system of delegation that will maximise administrative and operational efficiency and provide for adequate checks and balance, and, in accordance with that system may –

delegate appropriate powers, excluding a power mentioned in section 106 (2) of the Constitution and the power to set tariffs, to decide to enter into a service delivery agreement in terms of section 76 (b) and to approve or amend the municipality’s integrated development plan, to any of the municipality’s other political structures, political office bearers, councillors, or staff members;

instruct any such political structure, political office bearer, councillor, or staff member to perform any of the municipality’s duties, and

withdraw any delegation or instruction

A delegation or instruction in terms of subsection (1) –

must not conflict with the Constitution, this Act or the municipal structure Act,

must be in writing

is subjected to any limitations, conditions and directions the municipality council may impose

may include the power to sub – delegate a delegated power

does not divest the council of the responsibility concerning the exercise of the power or the performance of the duty, and

must be reviewed when a new council is elected or, if it is a district council, elected and appointed.”

[22] Section 59 (4) reads that:

“Any delegation or sub – delegation to a staff member of a power conferred on a municipal manager must be approved by the municipal

council in accordance with the system of delegation referred to in subsection (1).” (My underlining)

[23] It is clear from the wording of section 109 (2) that the applicant has authority to launch these proceedings. It may do so by way of a resolution (general or specific) authorizing an agent to institute and prosecute the proceedings. Rankwana alleges that he has such authority by virtue of municipal legislation and delegated authority. I will for the purpose of these proceedings accept that he was properly delegated.

[24] He avers that Rabela and Mosiane were delegated by him to deal with the review. In terms of section 59 (4) of the MSA any sub – delegation by him must be approved by the municipal council and it must also comply with 59 (2) (a) to (f). It must for example be in writing and may be subject to limitations or conditions and directions that the council may impose (section 59 (2) (b) and (c)).

[25] In my view the provisions of section 59 (4) read with section 59 (1) and (2) are peremptory. Any sub – delegation to a member of staff of a municipality by the municipal manager must comply with those provisions.

[26] The effect thereof is that the municipal manager may sub – delegate. He, however, does not have unfettered power to sub - delegate. His power to sub - delegate is subject to council approval. If that sub – delegation is not approved by the council it will be improper. In the circumstances of this case Rankwana ought to have stated that he sub – delegated his authority to institute these proceedings to Rabela and Mosiane and that such sub - delegation has been approved by the municipal council.

[27] In any event, taking into consideration the ease with which Rankwana could have established that Rabela and Mosiane had authority - by attaching the written sub – delegations and approval – I can not find that these proceedings were launched with the necessary approval of council. Rankwana does not say that these proceedings were authorised by the municipal council. I have serious doubt that they were duly authorised. After taking into consideration all the facts of this case I can not say on a balance of probabilities that it is the applicant that is litigating.

[28] It must be remembered that if the applicant did not authorize the launching and prosecution of the proceedings it is open to it to repudiate the proceedings in which case the third respondent, even though successful, may incur costs without being able to recoup it from the applicant. See Durban City Council v Minister of Labour and Another 1947 (1) SA 373 (D) at 376.

[29] In my view there is no reason why costs should not follow the success. It is only fair that it should.

[30] It is for these reasons that I made the order as set out in paragraph 1 above.

______________

C. J. MUSI. AJ

19 November 2009

For Applicant: J. P. van Der Walt

Instructed by: Kirchmanns Inc

PORT ELIZABETH

For Third Respondent: Mr T. D. Potgieter

T. D. Potgieter Attorneys