Madikizela v City of Ekurhuleni Metropolitan Municipality and Another (JR 2827/18) [2021] ZALCJHB 205 (26 July 2021)

THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

Reportable

Case No: JR 2827 / 18

In the matter between:

LUSANDA MADIKIZELA Applicant

and

CITY OF EKURHULENI METROPOLITAN

MUNICIPALITY First Respondent

ADVOCATE AFZAL MOSAM N.O.

Second Respondent

Heard: 3 December 2020

Delivered: 26 July 2021

Summary: Review application – review of municipal council resolutions – jurisdiction considered – Court has jurisdiction to consider review if related to employment – section 158(1)(h) applicable – constitutes a review application based on principle of legality – considerations applicable to legality review – principles considered

Review application – review of arbitration award under s 33 of the Arbitration Act – principles and review grounds considered – narrow grounds of review applicable – reasonable outcome review ground under LRA not applicable

Review application – review grounds of misconduct and gross irregularity under s 33 of Arbitration Act considered – applicant failed to make out a case of review based on these grounds – proper deference to be shown to private arbitrator – even wrong conclusion not reviewable – arbitrator conducting proper enquiry and fair trial of issues – review dismissed

Review application – review of municipal council resolutions – applicant failing to make out a case that resolutions unlawful in terms of principle of legality – review application having no merit – review dismissed

Dismissal – conduct tantamount to fraud – principles considered – conduct of applicant in this case fraudulent – constitutes misconduct justifying dismissal – conclusion of arbitrator upheld

Review application – no case for review made out – application dismissed

JUDGEMENT

SNYMAN, AJ

Introduction

[1] The current matter I am called on to decide is in essence two review applications, however consolidated into a single notice of motion and founding affidavit. Firstly, and in this application, the applicant seeks to review and set aside two resolutions adopted by the first respondent’s Municipal Council, relating to disciplinary action to be instituted against her. Secondly, the applicant had brought an application in terms of section 33 of the Arbitration Act[1], to review and set aside two arbitration awards issued by the second respondent as private arbitrator, in terms of which he held that the applicant committed misconduct, and that she be dismissed as a result.

[2] There exists, which is unfortunately often the case where senior managers in the public service are being disciplined, prior litigation between the applicant and the first respondent. Initially, the first respondent instituted disciplinary action against the applicant for misconduct. The applicant contended that the institution of such disciplinary action was in contravention of her employment contract, in terms of which she and the first respondent had agreed to pre-dismissal arbitration proceedings as contemplated by section 188A of the Labour Relations Act (LRA).[2] As a result, the applicant brought an urgent application to enforce her right to pre-dismissal arbitration, under case number J 2314 / 18, to the Labour Court.

[3] The litigation under case number J 2314 / 18 was fortunately settled between the parties. A settlement agreement was concluded on 26 July 2018, which was made an order of Court. It is this settlement agreement that contained the private arbitration agreement that gave rise to the private arbitration proceedings before the second respondent. I will refer to this agreement in this judgment as ‘the arbitration agreement’.

[4] In terms of the arbitration agreement, the parties specifically agreed to the appointment of the second respondent as private arbitrator in this matter. In exchange, the applicant abandoned any reliance on section 188A of the LRA and the first respondent terminated the pending disciplinary proceedings against the applicant. The second respondent would then be called upon to decide the charges against the applicant as contained in the original charge sheet presented to her, and would do so in accordance with the principles of fairness as prescribed by the LRA. It was agreed that the award of the second respondent in this regard would be final and binding between the parties.

[5] Notwithstanding these arbitration terms, the parties nonetheless further agreed that the applicant shall remain entitled to persist with an application to review and set aside the two resolutions of the first respondent’s Municipal Council relating to the disciplinary proceedings against her, being resolutions dated 22 February and 4 April 2018. The applicant’s case in this regard was that the resolutions were not lawful, and this consequently directly impacted on the lawfulness of any disciplinary action against her, including the private arbitration agreed to. The parties did however agree that the validity of the appointment of the second respondent as arbitrator shall not be challenged on any basis.

[6] The private arbitration proceedings then took place before the second respondent. Pursuant to these arbitration proceedings, and on 23 October 2018, the second respondent issued an arbitration award, in terms of which he found the applicant guilty of the first, third and fourth charges against her, as contained in the charge sheet. This was followed by further proceedings on the issue of an appropriate sanction, and in an arbitration award dated 16 November 2018, the second respondent determined that the applicant be dismissed.

[7] The above awards made by the second respondent then gave rise to the current review application brought by the applicant. The review application was filed on 28 December 2018. It was opposed by the first respondent. I will now commence deciding this review application by first setting out the relevant facts.

The relevant facts

[8] The applicant was employed by the first respondent as the Head of Department: Transport Planning and Provisions. She occupied this position as from 1 February 2017. In this capacity, the applicant was responsible for the entire Department, and of relevance to this case, for a number of construction contracts (projects) being conducted by the Department.

[9] The construction contract forming the subject matter of the misconduct charges ultimately brought against the applicant related to the Bluegum View Taxi Rank Contract (Bluegum Contract). This contract was awarded to Kubwa Kazi Construction JV (Kubwa). The contract was to construct a taxi rank. The Bluegum Contract was awarded to Kubwa in 2015, before the applicant’s tenure as Head of Department. The applicant was however fully briefed on this contract.

[10] Originally the contract data in the Bluegum Contract provided that it had to be practically completed within eight months of it being awarded. This however did not pan out as expected, and the first respondent afforded Kubwa a number of extensions of the contract, and ultimately the revised practical completion date was 9 May 2016. There was then an intervening dispute between the first respondent and Kubwa concerning an event which disrupted progress on the contract, which was subjected to alternative dispute resolution under the contract provisions. The dispute declared by Kubwa concerned the refusal by the first respondent to grant further extensions to the contract and then to make payment to Kubwa for delays which it alleged was not occasioned by it. The alternative dispute resolution was conducted by an independent third party, and in an outcome issued on 19 June 2017, it was determined that the complaints by Kubwa did not have substance. However, and because of this dispute, the deadline was extended to end June 2017.

[11] In the interim, and pending the resolution of the above dispute, there was a departmental Exco meeting in May 2017 to discuss, inter alia, the issue of the progress on the Bluegum Contract. The applicant was present in that meeting. It was clear from the discussion in that meeting that it was the view of all the managers involved that Kubwa was not going to make the end June 2017 extended deadline in any event. This created a problem, that there was only an approved budget for the contract until end June 2017. The applicant gave instructions in this meeting that representatives from the Department should meet with Johan Hattingh (Hattingh), the Project Engineer on the Bluegum Contract, to discuss whether the invoices of Kubwa for June 2017 could be amended to include work to be done after 30 June 2017, so as to still be able to access the budgeted funds. This is then what ultimately happened in August 2017, discussed below.

[12] Even after the contract dispute had been resolved by way of the alternative dispute resolution process set out above, it was still apparent that the final completion date of 30 June 2017 was unattainable. The cause of this was that Kubwa still had difficulty in properly performing the work required of it, was experiencing cash flow problems, and was waiting for delivery of materials. Hatting certified the project as being some 80% complete at this time. It must be said that Hatting was employed by PHB Engineers, the supervising engineers on the project, and was not an employee of the first respondent.

[13] Pursuant to the end June 2017 completion certification done by Hatting, for the work actually completed on the Bluegum Contract to date, Kubwa prepared an invoice in the sum of R428 103.53. Hatting also issued a payment certificate in that amount with corresponded with the actual work that had been completed to that point. What remained outstanding where it came to work to be completed on the Bluegum Contract was an asphalt layer and fencing to be constructed. As stated, the materials in this regard were still awaited. Until these materials were delivered, the work could not be completed.

[14] By August 2017, the outstanding work had still not been done. A meeting was held in August 2017 with Kubwa. Also present in this meeting was Thomas Sema (Sema) from the Finance Department, the Project Manager Mlungisi Mthembu (Mthembu), and Hatting. In this meeting, it was agreed that it be certified that the work on the asphalt layer was done despite it in fact not having done, in order to, inter alia, as it was described, protect the asset base. It was also agreed in this meeting that the original invoice of R428 103.53 be amended by adding the sum of R113 190.08 for the work still to be done, and that a total new invoice in the sum of R541 293.61 be issued and back dated to 30 June 2017.

[15] The manner in which this transaction, for the want of a better way of calling it, was brought about, was even on mere face value irregular. There were a number of false suppositions applied, to arrive at the end result of the invoice for R541 293.61 being submitted for payment. First, Kubwa claimed a ‘variation order’ for the additional R113 190.08, which was false, because there was no variation order. Based on this purported variation order, the new invoice for R541 293.62 was submitted by Kubwa and back dated to 30 June 2017. The Engineer (Hatting) then issued a payment certificate for this same amount, also back dated to 30 June 2017. The certificate recorded that ‘… the quantities and totals have been checked by ourselves and are certified correct …’, which was a false statement, as the quantities were not checked and were not correct. Even the initially non-existent variation order was issued after the fact in which it was said that additional items of work was performed, which was also false.

[16] As touched on above, the transaction had a purpose. This purpose was so that the budget for the Bluegum Contract for the 2016 / 2017 financial year, which ended on 30 June 2017, could be ‘accrued’ to the following year to complete the project. In other words, the funds for the prior year’s budget would be used to pay for work to be done during the following 2017 / 2018 year for which there was no budget, as if it had already been done in the 2016 / 2017 when that was not the case. The back dated invoice of R541 293.61 and accompanying payment certificate would also have to be approved by the applicant as Head of Department before it could be submitted to the Finance Department for payment.

[17] The applicant was briefed on this transaction before approving it. She considered it ‘sensible’ to approve the amended invoice to include work that had not yet been done and would only be done after 30 June 2017. According to her, this would mean that the budget would be ‘secured’, thereby protecting the works that had already been done. That way, fruitless and wasteful expenditure would be avoided. She also stated that the approved invoice would be ‘accrued’ by the Finance Department for payment to be made only once the work was done. It appeared not to matter to her that the entire supporting documentary basis of this transaction was premised on false information being submitted. She approved invoice and payment, and the invoice and payment certificate were then submitted to the Finance Department for accrual and payment.

[18] Where it comes to making actual payment to contractors, all that is required is supporting documents from the Transport Department, a payment certificate signed by the engineer on the project and approval of payment by the applicant as the Head of the Department. If these documents are received, the Finance Department would simply process the invoice and effect the payment. The Finance Department is not required to validate the invoice for the purposes of payment. On 23 August 2017, the Finance Department then accrued the false invoice for payment.

[19] In terms of the contract between the first respondent and Kubwa, the first respondent was obliged to make payment within 28 days after the date on which the payment certificate was certified and the invoice approved. This meant that at any stage after the approval by the applicant, and even though the work was not done, Kubwa could demand payment when this due date for payment elapsed. Interest also accrued under the contract. It was common cause that Kubwa was ultimately paid the sum of R541 293.61 on 3 October 2017. According to the applicant, that was only after all the work had been completed in full by Kubwa, a view the first respondent did have reservation on.

[20] On 26 October 2017, the first respondent gave Kubwa notice of cancellation of the contract due to non-performance. It was found that the site had earlier been abandoned by Kubwa as contractor, leaving substandard work that needed to be remedied at additional cost. Kubwa responded to this termination notice by way of a letter to PHB Engineers (marked for the attention of Hattingh), copied to the first respondent, sent on 7 November 2017. In this letter, it was inter alia contended that Kubwa as contractor had not been fairly compensated for delays. With specific reference to the last outstanding asphalt surfacing, it was stated by Kubwa that all that was outstanding was ‘small defect rectification works’. PHB Engineers responded on 9 November 2017, disagreeing with this statement, and saying that the asphalt required ‘major’ repair works. It was thus apparent that Kubwa had been paid full for substandard work up front, which, according to the first respondent, it should not have been paid for in full.

[21] The difficulty the first respondent had with the conduct of the applicant in this instance is that she signed approval for the payment of an invoice and accompanying payment certificate, as if the project had been 100% completed by Kubwa when it was not completed, with the payment documents being back dated to 30 June 2017, whilst she knew this was not correct. This amounted to a misrepresentation which was considered by the first respondent to be fraud, which exposed it to prejudice.

[22] According to the first respondent, what the applicant should have done is once it became apparent that the project could not be completed in the 2016 / 2017 financial year, was to take all the steps necessary to ensure that the project was catered for in the 2017 / 2018 financial year and budgeted accordingly. The applicant disagreed, and explained that to attempt to secure a budget for the Bluegum Contract for the 2017 / 2018 year would cause an undue delay, during which the work must be suspended and that would put the work at risk and could possibly cost more money.

[23] On 23 February 2018, the applicant was presented with a notice of intention to suspend, in which she was asked to make representations as to why she should not be suspended. Part of the allegations made against the applicant in this notice of intention to suspend related to the above events on the Bluegum Contract. The applicant had to make her submissions by 2 March 2018.

[24] The applicant indeed made submissions on 2 March 2018. In these submissions, the applicant directly targeted the City Manager, stating that the City Manager had ‘maliciously instigated the false allegations’ against the applicant. The applicant called the allegations against her ‘baseless and absurd’. In dealing with the Bluegum Contract in her submissions, she explains that the contractor was only paid in October 2017 when the contract had reached practical completion stage. She offered no explanation with regard to the changed and backdated invoices and why this had been done, and instead persisted with a narrative of false and misleading information being ‘selectively leaked’, and there being a deliberate attempt to avoid shedding light on the issues. She concludes by saying that the process was ‘… instituted maliciously, based on improper motives, intended to harass and is engineered as threatened, to ensure my removal from employment within the City …’.

[25] The applicant was suspended on 5 March 2018. In the notice of suspension, it was indicated that the applicant was being suspended pending the conclusion of an investigation. The letter of suspension made no reference to any particular misconduct charge. It simply recorded the reasons for suspension, being that her presence at the workplace could jeopardise the investigation, the tone of her response to the notice of intention to suspend created a reasonable apprehension that she could interfere in the investigation, the integrity of the investigation had to be assured, her presence in the workplace during the course of all of this could detrimentally impact on the stability of the Department, and there was a reasonable apprehension of interference with potential witnesses. It was stated in conclusion in this notice that ‘… the suspension is precautionary in nature …’.

[26] An independent investigation was then conducted, and a report was tabled before the Municipal Council on 4 April 2018, in which report it was recommended that disciplinary action be instituted against the applicant. On 25 April 2018, the applicant was presented with a charge sheet and notice to attend a disciplinary enquiry to be held on 15 May 2018. She faced a total of nine charges. These charges included one of fraud relating to the fact that she approved payment of the invoice of R541 293.62 on the Bluegum Contract which created the impression that the work had been completed when it had not been completed. She was also charged with gross negligence, in that she failed to acquaint herself with the status and scope of the Bluegum Contract before certifying that the invoice be paid and then in effect misrepresenting to the first respondent that the work had been done by the service provider when it had in fact not been done.

[27] The other charges against the applicant related to an alleged contravention of section 15 of the Local Government: Municipal Finance Management Act (MFMA)[3], and a charge relating to another project, being the Vosloorus Taxi Rank project. The charge relating to the Vosloorus Taxi Rank project was not pursued in evidence by the first respondent when the matter was arbitrated before the second respondent. Also, the second respondent found that the applicant was not guilty of any of the charges based on section 15 of MFMA. As there is no cross review filed by the first respondent relating to any of these other charges, it is not necessary to deal with these charges any further in this judgment.

[28] As referred to in the introduction to this judgment, the parties ultimately agreed to private arbitration to take place before the second respondent, as agreed arbitrator, to determine whether the applicant was guilty of the misconduct with which she had been charged. The decision of the second respondent would be final and binding on the parties.

[29] Of relevance to this judgment, the private arbitration agreement concluded between the parties contained a number of further procedural provisions. In clause 5, it was recorded that either party would be entitled to review the decision of the second respondent relating to the charges ‘… upon the grounds contemplated in the LRA and/or the common law …’. It was also agreed that the applicant abandon all her preliminary challenges to the institution of the disciplinary enquiry against her based on alleged non-compliance with the Disciplinary Regulations for Senior Managers in Local Government.

[30] In clause 6 of the arbitration agreement, it is recorded that: ‘… The applicant is at liberty to persist with the review application before the Labour Court under case number JR 1275/2018 or any other case challenging the lawfulness of the Council resolutions of 22 February and 4 April 2018 and consequent lawfulness of any disciplinary action against her’. Despite this, the applicant recorded her agreement in clause 7 of the arbitration agreement that she will not in any manner seeks to challenge the appointment of the arbitrator.

[31] The arbitration then convened before the second respondent as agreed arbitrator. The hearing commenced on 23 August 2018 and concluded on 27 September 2018. Both parties also filed supplementary closing arguments at the request of the second respondent. In an award handed down by the second respondent on 23 October 2018, the second respondent concluded that the applicant was guilty of the misconduct as contained in charges 1, 3 and 4 of the charge sheet. The applicant was acquitted of all other charges.

[32] In his award of 23 October 2018, the second respondent called upon the parties to make written submissions on the issue of an appropriate sanction, by 29 October 2018. In addition, a further hearing was convened on 6 November 2018, in which both parties had the opportunity to make oral submissions and present evidence on the issue of an appropriate sanction. In an award handed down on 16 November 2018, the second respondent determined that the appropriate sanction in this instance was that the applicant be dismissed.

[33] This final determination of the second respondent was then accepted by the first respondent, who resolved on 29 November 2018 that the applicant be dismissed. The applicant was issued with a letter of dismissal on 30 November 2018.

[34] The applicant, being dissatisfied with this outcome, and relying on clause 5 of the arbitration agreement, approached this Court by way of the review application filed on 28 December 2018. In this review application, the applicant not only challenged the arbitration awards of the second respondent on the misconduct charges against the applicant and the sanction recommended by him, but also challenged the lawfulness of the resolutions of 22 February and 4 April 2018.

[35] In opposing the review application, the first respondent has raised a number of points in limine. The first point in limine relates to the jurisdiction of this Court to entertain the review application to declare the resolutions of 22 February and 4 April 2018 unlawful. According to the first respondent, such an application can only be entertained by the High Court. The second point in limine relates to the applicant relying on the basis of review under section 145 of the LRA in bringing her review application. According to the first respondent, the applicant’s review application can only be entertained on the basis of the narrow grounds of review under the Arbitration Act. The third point in limine is that this Court cannot substitute the award of the arbitrator, as is permissible under the LRA,[4] because in the case of reviews under the Arbitration Act, all the Court can do is to remit the dispute to be heard de novo before another arbitrator. The final point in limine relates to the applicant having failed to bring her review application within the six weeks’ time limit as prescribed by the Arbitration Act, where it comes to the award of the second respondent containing his findings on the misconduct charges.

[36] When this matter was argued before me, the applicant did not dispute that under the Arbitration Act, there was no power given to this Court to substitute the arbitration award with a determination of its own. For that reason, the applicant then limited the consequential relief sought, in the case of a successful review of the arbitration awards of the second respondent, to an order that the matter be remitted for arbitration de novo before another arbitrator. This relief was in any event provided for in paragraph 5 of the applicant’s notice of motion. Nothing further thus needs to be said on this point in limine raised by the first respondent.

[37] It is appropriate, before coming to grips with the merits of the applicant’s review application, to first deal with the remaining three points in limine raised by the first respondent. I will start with the issue of this Court’s jurisdiction to consider the review application relating to the resolutions of 22 February and 4 April 2018.

Jurisdiction: The Resolutions

[38] According to the first respondent, what the applicant is seeking to set aside are resolutions made by the Municipal Council of the first respondent. The first respondent argued that any resolution made by a Municipal Council is governed by section 30 of the Local Government Municipal Structures Act.[5] The argument goes further that the jurisdiction of this Court is determined by section 157 of the LRA, which, according to the first respondent does not extend to matters relating to a challenge of the lawfulness or not of resolutions adopted by a Municipal Council. The first respondent has also argued that the applicant cannot rely on section 157(2), as it has not alleged that there was a violation of a fundamental right.

[39] I find myself unable to agree with this jurisdictional point raised by the first respondent. In my view, the point is founded on an incorrect interpretation of section 157. Firstly, section 157(1) is intended to define those matters over which the Labour Court has exclusive jurisdiction,[6] meaning jurisdiction to the exclusion of that of the High Court. As held in Gcaba v Minister for Safety and Security and Others[7]:

‘Section 157(1) confirms that the Labour Court has exclusive jurisdiction over any matter that the LRA prescribes should be determined by it. That includes, amongst other things, reviews of the decisions of the CCMA under s 145. Section 157(1) should, therefore, be given expansive content to protect the special status of the Labour Court, and s 157(2) should not be read to permit the High Court to have jurisdiction over these matters as well. …’

[40] However, the fact that a particular dispute can still be competently decided by the High Court, does not mean that it can only be decided in the High Court. There are instances where the Labour Court enjoys concurrent jurisdiction with the High Court. In these instances, it is not a case where the dispute must be decided in the Labour Court, but rather that the dispute may be decided in the Labour Court. Section 157(2) of the LRA is then intended to achieve this purpose.[8] In this regard, the Court in Gcaba supra said:[9]

‘The purpose of this provision is to extend the jurisdiction of the Labour Court to disputes concerning the alleged violation of any right entrenched in the Bill of Rights which arise from employment and labour relations, rather than to restrict or extend the jurisdiction of the High Court. In doing so, s 157(2) has brought employment and labour relations disputes that arise from the violation of any right in the Bill of Rights within the reach of the Labour Court. This power of the Labour Court is essential to its role as a specialist court that is charged with the responsibility to develop a coherent and evolving employment and labour relations jurisprudence. Section 157(2) enhances the ability of the Labour Court to perform such a role.’

[41] In section 23(1) of the Bill of rights, every person has the right to a fair labour practice. That right to a fair labour practice has been given effect to in the LRA. The complaint by the applicant concerning the resolutions, at its core, is that the disciplinary proceedings against her which ultimately gave rise to her dismissal was unlawfully instituted. That is the case as pleaded by her.[10] If this case is found to have substance, it would in my view violate her right to a fair labour practice and certainly is an issue that arises from her employment with the first respondent. It is undoubtedly a matter concerning employment and labour relations as contemplated by section 157(2) of the LRA.[11] The LRA in fact provides a suitable remedy for the infringement of such a right, in the form of section 158(1)(h) of the LRA, which reads:

‘The Labour Court may- … review any decision taken or any act performed by the State in its capacity as employer, on such grounds as are permissible in law.’

[42] The question that must now be answered is whether the two resolutions can be seen to be a decision taken by State in its capacity as an employer. In my view, undoubtedly so. It is trite that a local authority such as the first respondent is part of the State. Considering that the resolutions specifically relate to the bringing of misconduct charges against the applicant as an employee of the first respondent, it must be a decision taken by the first respondent in its capacity as an employer. It simply does not matter that the decision was taken by the Municipal Council of the first respondent. It is still a decision by the State as employer concerning the employment of applicant subject to review under section 158(1) the LRA.

[43] So, and once section 158(1)(h) applies, as it does in casu, it is clear that it indeed contemplates a review application. The applicable basis of a review application in terms of Section 158(1)(h) has been described in Hendricks v Overstrand Municipality and Another[12], as follows:

‘In sum therefore, the Labour Court has the power under s 158(1)(h) to review the decision … on (i) the grounds listed in PAJA, provided the decision constitutes administrative action; (ii) in terms of the common law in relation to domestic or contractual disciplinary proceedings; or (iii) in accordance with the requirements of the constitutional principle of legality, such being grounds 'permissible in law'.

[44] The applicant has not relied on PAJA[13] to establish any of her grounds of review relating to the resolutions, and therefore it need not be considered. But what the applicant did rely on was the principle of legality, which, as set out above, is indeed contemplated as a proper basis for a review application under section 158(1)(h) of the LRA. Dealing specifically with the concept of ‘legality’, the Court in Hendricks supra[14] said:

‘…. Legality includes a requirement of rationality. It is a requirement of the rule of law that the exercise of public power by the executive and other functionaries should not be arbitrary. Decisions must be rationally related to the purpose for which the power was given, otherwise they are in effect arbitrary and inconsistent with the rule of law.’

[45] The Court in Khumalo and Another v Member of the Executive Council for Education: KwaZulu-Natal[15] also specifically dealt with the meaning of ‘legality’, in the context of a review application under Section 158(1)(h) of the LRA, and held:

‘… The principle of legality is applicable to all exercises of public power and not only to 'administrative action' as defined in PAJA. It requires that all exercises of public power are, at a minimum, lawful and rational. …’

[46] In MEC for the Department of Health, Western Cape v Weder; MEC for the Department of Health, Western Cape v Democratic Nursing Association of SA on behalf of Mangena[16] the Court held that the principle of legality had developed over the past decade, to the extent that a parallel system of review for actions which fall outside of the strict definition of administrative action, had developed. Having so held, the Court then held as follows:[17]

‘… Public functionaries are required to act within the powers granted to them by law. See Fedsure Life Assurance Ltd v Greater Johannesburg Transitional Metropolitan Council & others [1998] ZACC 17; 1999 (1) SA 374 (CC) at para 58, furthermore, see the seminal judgment in Pharmaceutical Manufacturers Association of SA & another: In re Ex parte President of the Republic of SA & others [2000] ZACC 1; 2000 (2) SA 674 (CC) at para 85, where the court laid down the core element of legality as follows:

'It is a requirement of the rule of law that the exercise of public power by the Executive and other functionaries should not be arbitrary. Decisions must be rationally related to the purpose for which the power was given, otherwise they are in effect arbitrary and inconsistent with this requirement. It follows that in order to pass constitutional scrutiny the exercise of public power by the Executive and other functionaries must, at least, comply with this requirement.'

[47] I am therefore satisfied that the Labour Court has the jurisdiction, in terms of section 157(2) as read with section 158(1)(h) of the LRA, to consider the applicant’s application to review and set aside the resolutions of 22 February and 4 April 2018. This is because, as said in Gcaba supra[18], this Court would have ‘… the power or competence … to hear and determine an issue between parties …’. And in Merafong City Local Municipality v SA Municipal Workers Union and Another[19] the Court held:

‘Section 158(1)(h) of the LRA refers to a jurisdictional power of the Labour Court. It specifically provides that the Labour Court 'may review any decision taken or any act performed by the State'. The only way the Labour Court is able to review is by hearing and determining an application for review of the acts and/or decisions contemplated in s 158(1)(h). That section should be read as not only conferring a power, but also jurisdiction upon the Labour Court.’

[48] The first respondent’s jurisdictional objection to the effect that the Labour Court has no jurisdiction to determine the applicant’s application to review the resolutions of 22 February and 4 April 2018 is therefore dismissed.

The late review application

[49] It is true that in terms of section 33(2) of the Arbitration Act, a review application based on section 33(1) must be brought within six weeks of the award being made.

[50] According to the first respondent, there are two arbitration awards in this case. The first arbitration award was when the applicant was found guilty of some of the charges against her, and this award was issued on 23 October 2018. The second award was when the sanction of dismissal was recommended, and this award was issued on 16 November 2018. The first respondent argues that because the review application was filed on 28 December 2018, it is only within the six weeks’ time limit where it comes to the second award, and it is late where it comes to the first award, as both awards are separate and final in effect.

[51] In my view, the first respondent is being overly technical in its approach. The terms of refence of the second respondent as agreed to in the arbitration agreement prescribed that the second respondent had to determine the charges against the applicant ‘in accordance with the principles of fairness in the LRA’. This would firstly entail a determination as whether the applicant committed the misconduct concerned, and if so, as an integral part of that same enquiry, what the appropriate sanction for such misconduct would be. These are two components of a singular enquiry which are both needed to constitute a dismissal that is fair under the LRA.

[52] The separation of the guilt and sanction components, for the want of a better description, can be nothing more than a matter of convenience. Surely, it would be counterproductive and entirely unnecessary to deal with the issue of an appropriate sanction without it first being determined what exactly the employee would be guilty of, especially where there are multiple charges against the employee. In casu, the applicant indeed faced multiple charges, and it would in my view be quite appropriate to first decide what she was guilty of before resorting to the ultimate decision of what the sanction would be.

[53] In the case of a dismissal dispute, which is what the matter in casu in reality would be, the LRA requires an arbitrator to decide the fairness of the dismissal of the employee. It must follow from this that the final determination of the arbitrator can only be considered to have been made once it is decided that the employee, based on all these tenets of fairness, is dismissed. This is the arbitration award that is ultimately the final catalyst for the bringing of the review application.

[54] I therefore conclude that for the purposes of deciding whether the applicant’s review application has been brought within the six weeks’ time limit, the two arbitration awards must be considered together. The time limit should only start to apply from when the final determination of the dismissal of the applicant had been made by the second respondent. Considering that this happened on 16 November 2018, the review application relating to the finding of guilty of the applicant must also be considered to have been brought in time.

[55] I consider the point taken by the first respondent in this regard to be rather opportunistic. I am pretty sure that if the applicant would have sought to review the first award arbitration of the second respondent on guilt before the issue of sanction was determined, the first respondent would have complained bitterly that it would be an inappropriate course of action and the applicant needed to wait until the entire matter had been finally determined before launching any kind of review application. There is in any event a general aversion by the Courts to piecemeal litigation.[20] I believe the following dictum in Adams v National Bargaining Council for the Road Freight and Logistics Industry and Others[21] is appropriate when describing this point taken by the first respondent:

‘Although it is highly desirable for good order that rules be complied with on their own terms, the function of the rule is the paramount consideration and, where it can be safely found that the purpose of the rule is achieved, it is highly undesirable to approach the matter in a literalist way. Mechanical thinking is anathema to our law: cessante ratione legis cessat et ipsa lex. The objectives of the Labour Relations Act 66 of 1995 inform the context of interpretation and its penumbra of pragmatism. Our law is not an ass.’

[56] The objection in limine of the first respondent relating to the late review application where it comes to the arbitration award of the second respondent on the issue of guilt is therefore refused.

The basis for review

[57] The second objection in limine raised by the first respondent in fact falls hand in hand with a determination of the proper and competent basis upon which the applicant’s review applications must be considered. It is therefore not necessary to decide this objection separately. What must be answered, in simple terms, is whether it is competent for this Court to decide the applicant’s review application on the broader review grounds as contemplated by section 145 of the LRA or whether the applicant is limited to the far narrower review grounds under section 33 of the Arbitration Act.

[58] It is of course true that even though the review grounds as articulated in section 145(2) of the LRA is very similar to section 33(1) of the Arbitration Act, the primary difference is that the constitutionally suffused ground of the outcome of the arbitrator having to be a reasonable outcome in order to be sustainable on review does not apply to review applications under the Arbitration Act.

[59] In dealing with review applications under section 145 of the LRA, the Court Sidumo and Another v Rustenburg Platinum Mines Ltd and Others[22] held that ‘the reasonableness standard should now suffuse s 145 of the LRA’, and that the threshold test for the reasonableness of an award was: ‘… Is the decision reached by the commissioner one that a reasonable decision-maker could not reach?...’[23]. This means that the award in question is tested against all the facts placed before the arbitrator to ascertain if it meets the requirement of reasonableness.[24] In conducting this test it is always necessary and important for the Court to enquire into and consider the merits of the matter and the entire evidence on record in deciding what is reasonable.[25] In Herholdt v Nedbank Ltd and Another[26] the Court said:

‘… A result will only be unreasonable if it is one that a reasonable arbitrator could not reach on all the material that was before the arbitrator. Material errors of fact, as well as the weight and relevance to be attached to the particular facts, are not in and of themselves sufficient for an award to be set aside, but are only of consequence if their effect is to render the outcome unreasonable.’

[60] It has been considered in several authorities whether this wider ground of review under the LRA can equally be applied to review applications brought in terms of the Arbitration Act in the Labour Court, considering that the underlying dispute is after all an employment dispute. The Courts have consistently been answering this question in the negative.[27] In National Union of Mineworkers on behalf of Employees v Grogan No and Another[28] it was held:

‘…. since this is a review of a private arbitration award, it can only be reviewed on the grounds set out in s 33 of the Arbitration Act and not in terms of the grounds set out in s 145 of the LRA as extended by the judgments of this court in Carephone and Shoprite Checkers and by the judgment of the Constitutional Court in Sidumo. In my view, while parties to a dispute are able to give an arbitrator powers which he otherwise does not have in resolving their dispute, they cannot do the same with regard to a court such as the Labour Court which has statutory power to review arbitration awards issued by such arbitrator. Parties to a dispute such as the parties in this case cannot confer on the Labour Court powers to review a private arbitrator's award on grounds which it otherwise has no power to rely upon to review such an award. It would be different if there was a provision of the LRA which conferred upon the Labour Court the power to review such an award on any grounds upon which the parties to a dispute may agree. That is not the case here. Accordingly, I hold that the grounds of review applicable in this case are only those grounds set out in s 33 of the Arbitration Act ….’

[61] Accordingly, it cannot be legitimately contended that the applicant is entitled to rely on an unreasonable outcome as envisaged by review applications brought under section 145 of the LRA as a basis for review where the Arbitration Act applies. The applicant remains confirmed to the narrower grounds of review under section 33(1) of the Arbitration Act.

[62] The applicant has argued that the matter in casu is somewhat different, because the parties have agreed in the arbitration agreement that this Court may apply the review grounds under the LRA and / or the common law in considering the review application in this case. It is true that such an agreement is contained in clause 5 of the arbitration agreement and that this agreement has been made an order of Court. However, and despite the best intentions of the parties in articulating such an agreement, it is still of no force and effect. The fact that it was made a Court Order does not change this, as there is no indication that when merely making the settlement agreement (which contained the arbitration agreement) an order of Court, the Court specifically considered and then decided the issue of whether such review grounds are indeed appropriate or permissible.

[63] It has been determined in various authorities that it is simply not open to the parties to private arbitration proceedings to by agreement expand the grounds of review as set out in the Arbitration Act to wider grounds, such as those contemplated by section 145 of the LRA. The only manner in which the parties are able to do this is by way of creating an appeal panel in terms of the arbitration agreement, which panel may then reconsider the decision of the original arbitrator on wider grounds of review. But this expanded jurisdiction, for the want of a better description, cannot be extended by agreement to the Courts, as the Arbitration Act simply does not allow for it. As held in Telcordia Technologies Inc v Telkom SA Ltd[29]:

‘… by agreeing to arbitration the parties limit interference by courts to the ground of procedural irregularities set out in s 33(1) of the Act. By necessary implication they waive the right to rely on any further ground of review, 'common law' or otherwise. If they wish to extend the grounds, they may do so by agreement but then they have to agree on an appeal panel because they cannot by agreement impose jurisdiction on the court. …’

[64] Therefore, the fact that clause 5 of the arbitration agreement allows for wider review grounds such as those envisaged by section 145 of the LRA and / or those under the common law, is of no assistance to the applicant. The simple truth is that the parties could not so agree, and it is simply not competent to decide the applicant’s review application on that basis. Once again, the applicant remains limited to those narrower review grounds as found in section 33(1) of the Arbitration Act.

[65] So where does that leave the applicant, when it comes to the appropriate review grounds applicable to all the challenges she has brought? Firstly, and where it comes to the review application relating to the 22 February and 4 April resolutions, as envisaged by section 158(1)(h) of the LRA, the applicant must show that these decisions failed to meet the following essential requirements: (1) The decision was rationally connected to the purpose for which the power was given to it, thus meaning that the decision would not be considered to be arbitrary; (2) The decision accounted for all the relevant facts informing the decision, to the extent that the decision made can be said to be rational; (3) The process giving rise to the decision was lawful and fair; and (4) the decision itself was lawful, meaning that it is not a decision that falls outside the scope of the power afforded to the functionary.[30]

[66] Secondly, and where it comes to the applicant’s review application brought under section 33 of the Arbitration Act, the appropriate point of departure is a consideration of section 33(1), which reads:

‘(1) Where –

(a) any member of an arbitration tribunal has misconducted himself in relation to his duties as arbitrator or umpire; or

(b) an arbitration tribunal has committed any gross irregularity in the conduct of the arbitration proceedings or has exceeded its power; or

(c) an award has been improperly obtained,

the court may, on the application of any party to the reference after due notice to the other party or parties, make an order setting the award aside. ….’

[67] In her review application challenging the awards of the second respondent, the applicant has contended that the second respondent committed misconduct in relation to his duties as arbitrator and committed gross irregularities in the conduct of the arbitration proceedings, which is in line with the wording in section 33(1)(a) and (b) of the Arbitration Act. The applicant then explained these grounds by stating that the second respondent made decisions not congruent with the principle of legality, made irrational and unreasonable decisions, that he failed to act honestly by having due consideration of the evidence and applicable legal principle, that he ‘materially malfunctioned’, and that he misconceived the nature of the enquiry. But it all still remains in essence about whether the second respondent committed misconduct and a gross irregularity.

[68] Where it comes to ‘misconduct’ as contemplated by section 33(1)(a) of the Arbitration Act, it does not mean a gross or material mistake committed by the arbitrator. It is narrower than that. Misconduct in this context contemplates ‘… wrongful or improper conduct, dishonesty, mala fides or partiality and moral turpitude …’.[31] In Total Support Management (Pty) Ltd and Another v Diversified Health Systems (SA) (Pty) Ltd and Another[32] the Court held as follows:

‘… the basis on which an award will be set aside on the grounds of misconduct is a very narrow one. A gross or manifest mistake is not per se misconduct. At best it provides evidence of misconduct (Dickenson & Brown v Fisher's Executors (supra at 176)) which, taken alone or in conjunction with other considerations, will ultimately have to be sufficiently compelling to justify an inference (as the most likely inference) of what has variously been described as 'wrongful and improper conduct' (Dickenson & Brown v Fisher's Executors (supra at 176)), 'dishonesty' and 'mala fides or partiality' (Donner v Ehrlich (supra at 160 - 1)) and 'moral turpitude' (Kolber and Another v Sourcecom Solutions (Pty) Ltd and Others (supra at 1108A)).’

[69] The next ground to consider is ‘gross irregularity’ as contemplated by section 33(1)(b). This issue was specifically dealt with in Telcordia supra[33], which judgment has been consistently applied and followed since it was handed down. First, and in considering the meaning of ‘gross irregularity’, the Court in Telcordia held that the following reasoning in Dickenson & Brown v Fisher's Executors[34] was still good law:[35]

‘… This Court held that a review on this basis was impermissible on two grounds. The first was the general principle that when parties select an arbitrator as the judge of fact and law, the award is final and conclusive, irrespective of how erroneous, factually or legally, the decision was. Second, the colonial laws (in that case the one of Natal) did not change the position. Such an error, he held, could not amount to misconduct unless the mistake was so gross and manifest that it could not have been made without some degree of misconduct or partiality, in which event the award would be set aside not because of the mistake, but because of misconduct.’

The Court in Telcordia in fact aptly illustrated the point as follows with reference to the facts in that case:[36]

‘The fact that the arbitrator may have either misinterpreted the agreement, failed to apply South African law correctly, or had regard to inadmissible evidence does not mean that he misconceived the nature of the inquiry or his duties in connection therewith. It only means that he erred in the performance of his duties. An arbitrator 'has the right to be wrong' on the merits of the case, and it is a perversion of language and logic to label mistakes of this kind as a misconception of the nature of the inquiry - they may be misconceptions about meaning, law or the admissibility of evidence but that is a far cry from saying that they constitute a misconception of the nature of the inquiry. …

Likewise, it is a fallacy to label a wrong interpretation of a contract, a wrong perception or application of South African law, or an incorrect reliance on inadmissible evidence by the arbitrator as a transgression of the limits of his power. The power given to the arbitrator was to interpret the agreement, rightly or wrongly; to determine the applicable law, rightly or wrongly; and to determine what evidence was admissible, rightly or wrongly. Errors of the kind mentioned have nothing to do with him exceeding his powers; they are errors committed within the scope of his mandate. … ‘

[70] In Lufuno Mphaphuli & Associates (Pty) Ltd v Andrews and Another[37], the Constitutional Court considered section 33(1) in the light of the Constitution, and came to the following conclusion:

‘… it seems to me that the values of our Constitution will not necessarily best be served by interpreting section 33(1) in a manner that enhances the power of courts to set aside private arbitration awards. Indeed, the contrary seems to be the case. The international and comparative law considered in this judgment suggests that courts should be careful not to undermine the achievement of the goals of private arbitration by enlarging their powers of scrutiny imprudently. Section 33(1) provides three grounds for setting aside an arbitration award: misconduct by an arbitrator; gross irregularity in the conduct of the proceedings; and the fact that an award has been improperly obtained. In my view, and in the light of the reasoning in the previous paragraphs, the Constitution would require a court to construe these grounds reasonably strictly in relation to private arbitration.’

[71] In the end, the meaning of ‘gross irregularity’ as contemplated by Telcordia was succinctly summarized in Palabora Copper (Pty) Ltd v Motlokwa Transport and Construction (Pty) Ltd[38] as follows:

‘… It suffices to say that where an arbitrator for some reason misconceives the nature of the enquiry in the arbitration proceedings with the result that a party is denied a fair hearing or a fair trial of the issues, that constitutes a gross irregularity. The party alleging the gross irregularity must establish it. Where an arbitrator engages in the correct enquiry, but errs either on the facts or the law, that is not an irregularity and is not a basis for setting aside an award. If parties choose arbitration, courts endeavour to uphold their choice and do not lightly disturb it. The attack on the award must be measured against these standards.’

[72] The approach adopted in Telcordia supra relating to the review of private arbitration awards has found fertile soil in the Labour Court and Labour Appeal Court.[39] In sum, it is always only about whether the party raising the complaint has received a fair trial of the issues the arbitrator was called on to decide. It does not matter if the arbitrator may have erred on the facts and / or on the law. The point can be aptly illustrated by the following dictum in the judgment of the Labour Appeal Court in Lawrence v Mutual and Federal (Pty) Ltd and Another[40]:

‘There is no merit in this ground of appeal, and it is mentioned to be dismissed. The arbitrator did consider all the evidence. That explains how he came to the conclusion that the appellant was not guilty of gross negligence, but only negligence. We have, in paras 10-12 above, referred in some detail, to the reasoning of the arbitrator in arriving at that conclusion. In short, the arbitrator concluded that the appellant had failed to ensure that there were proper control measures in MLCD. We agree with Mr Van As, counsel for the first respondent, that such a finding by a private arbitrator, even if wrong, does not constitute a reviewable irregularity. As explained by Harms JA in Telcordia, the general principle is that “when parties select an arbitrator as the judge of fact and law, the award is final and conclusive, irrespective of how erroneous, factually or legally, the decision was.”

[73] Finally, it is required by the applicant to fully set out the grounds of review as relied on by the applicant in her founding affidavit and supplementary affidavit (if any).[41] Unless a ground of review is specifically pleaded, it cannot be raised later in argument, nor can it be considered by this Court.[42] A failure to properly plead grounds of review commensurate with section 33(1) of the Arbitration Act may be fatal to the review application in itself.[43]

[74] I have touched on the general review grounds raised by the applicant in her review application, as set out above. The applicant, in her founding affidavit, elaborated on these review grounds as follows:

74.1 The second respondent misconceived the nature of the enquiry and his duties relating to the enquiry where it came to determining the guilt of the applicant, in that he unduly limited the enquiry and failed to appreciate that he had to decide whether the applicant was guilty of all the elements of the misconduct, and not just those elements the second respondent perceived he had to decide. It is contended that this misconception resulted in the applicant being deprived of a fair trial of the issues.

74.2 The second respondent found the applicant guilty of the third charge against her when there was no evidence before him to support such a finding, which constitutes a gross irregularity.

74.3 The second respondent found the applicant guilty of fraud in circumstances where all the elements of fraud had not been established. It is contended that the second respondent did not apply his mind to all the elements of fraud and misconceived the nature of the enquiry he had to make in this regard. The principal complaint in this regard is that the second respondent failed to appreciate that on the evidence, it could not be shown that the applicant had fraudulent intentions.

74.4 The second respondent found the applicant guilty of the fourth charge of gross negligence without applying his mind to the evidence. According to the applicant, the evidence showed that that conduct concerned was reasonable to protect the work and that what happened was the way such issues are ordinarily dealt with. The applicant also contended that the second respondent ignored the evidence that the process of applying for a budget adjustment would not assist in this case.

74.5 The second respondent failed to apply his mind to the fact that the first respondent had suffered no financial loss, because all the required work for payment to be made had been done.

74.6 The second respondent failed to apply his mind on the issue of inconsistency, because another employee, Sema, was also intimately involved in the entire matter and he was the one who advised that the invoice should be amended in order to secure the budget. Sema also sent the amended invoice to the finance department. Sema was however not charged.

74.7 Finally, the applicant contends that the second respondent failed to consider material evidence where it came to the issue of dismissal as an appropriate sanction. The applicant contended there was no proper evidence of the break down in the trust relationship, that she was not dishonest, that her conduct was motivated by altruistic intentions, and that there were other more appropriate alternative sanctions available (such as a period of unpaid suspension).

[75] I will now turn to deciding the applicant’s review application based on these pleaded grounds of review, as well as in respect of the issue of the resolutions of 22 February and 4 April 2018 which the applicant contends is unlawful.

Analysis

[76] I will start with the challenge to the two resolutions. In this regard, the case of the applicant is that the first respondent, as a municipality, functions through the Municipal Council, and all decisions of the Municipal Council must be taken by way of a vote. The core complaint of the applicant is that the resolutions of 22 February and 4 April 2018 were issued without such a required vote.

[77] I must say that I find it difficult to understand what relevance the resolution of 22 February 2018 has in this matter. A consideration of the contents (terms) of this resolution reflects that the City Manager must institute a process as envisaged by the Regulations[44] to make a determination on the precautionary suspension of the applicant. This does not constitute a decision to take disciplinary action against the applicant. It is trite that precautionary suspension is not disciplinary action, but simply a holding operation pending a disciplinary process or investigation that may follow.[45] The matter in casu in does not concern any dispute about the applicant being suspended unfairly or irregularly. The applicant has even stated in her own founding affidavit that she had a dispute pending before South African Local Government Bargaining Council in this regard. Accordingly, the resolution of 22 February 2018 has no relevance to the matter and hand, and whether or not it is reviewed and set aside would have no impact at all on the validity of the subsequent disciplinary proceedings bought against the applicant. Therefore, the application by the applicant to review the resolution of 22 February 2018 is refused.

[78] Considering next the 4 April 2018 resolution, it was inter alia resolved therein that disciplinary action be instituted against the applicant as envisaged by Regulation 5(6) of the Local Government: Disciplinary Regulations for Senior Managers (the Regulations)[46]. It was also resolved that an independent and external chairperson be appointed to preside over the matter. It is this resolution that ultimately gave rise to the disciplinary proceedings against the applicant, which was then overtaken by the events as set out above, and which led to the private arbitration agreement for arbitration instead of such disciplinary hearing.

[79] The second respondent was not called on to decide whether the resolution of 4 April 2018 was lawful. As such, there is no evidence relating to the same forming part of the record of the proceedings. All that has been provided by the applicant in this case is the resolution itself, coupled with a bald statement by the applicant that it was not voted on. The first respondent disputed this, and stated that the resolution was passed unanimously at a Council meeting. In resolving this factual controversy, the principles as set out in Plascon Evans Paints v Van Riebeeck Paints[47] must be applied. It follows that the facts averred in the applicant's affidavits which have been admitted by the first respondent, together with the facts alleged by the first respondent, must form the basis of the decision. It is only where the dispute of fact is not real or genuine or the denials in the first respondent's version are bald or uncreditworthy, or the first respondent's version raises obviously fictitious disputes of fact, or is palpably implausible, or far-fetched or clearly untenable, that the Court would be entitled to reject such version, and as such, accept the facts as presented by the applicant.[48] Considering the content of the resolution itself and what is clearly stated therein, together with the first respondent’s clear statement that the Council unanimously resolved to accept what was tabled in the meeting held on 4 April 2018 (which meeting indeed took place), there is no reason not to accept this version of the first respondent, despite the complaints by the applicant that it is not credible. As said in TIBMS (Pty) Ltd t/a Halo Underground Lighting Systems v Knight and Another[49]:

‘… Credibility is only capable of being addressed on paper when the assertions are palpably absurd or demonstrably false. The threshold that had to be cleared is ‘wholly fanciful and untenable’. Moreover, the appetite to resolve paper contests by reference to the probabilities, though ever present, is not appropriate. On the allegations canvassed on the record, the threshold was not cleared …’

[80] Further, the first respondent has provided the complete minutes of the Municipal Council meeting of 4 April 2018. From these minutes, it appears that a quorum of councillors was present, and that the issue of the disciplinary action to be taken against the applicant was on the agenda. The investigation report into the alleged misconduct was tabled for discussion. It appears that after discussion, the resolution to take the disciplinary action recommended therein was carried. The applicant has put up nothing to gainsay this.

[81] The applicant had conceded in her founding affidavit that she is a manger as contemplated by section 56 of the Local Government: Municipal Systems Act (Systems Act).[50] This means that she is a manager directly accountable to the Municipal Manager.[51] In terms of section 57(3A) of the Systems Act, any regulations that relate to the duties, remuneration, benefits and other terms and conditions of employment of a section 56 manager must be regarded as forming part of an the manager’s employment contract. This means that the Regulations would form part of the applicant’s contract of employment.

[82] The disciplinary procedures against senior managers is regulated by clause 5 of the Regulations. It is provided that the misconduct concerned must be brought to the attention of the Municipal Council, and if ultimately the Municipal Council is satisfied after investigation that there is misconduct by the manager concerned, the Municipal Council must by way of a resolution institute disciplinary proceedings against the manager concerned.[52] Even on face value, the resolution of 4 April 2018 certainly complies with all of these requirements. It is also certified to be a true extract of the Council meeting on that date and is stamped and signed by the Council secretary. As such, its mere production would at least on a prima facie basis prove the resolution taken. In terms of section 110 of the Systems Act:

‘In legal proceedings against a municipality, a certificate which purports to be signed by a staff member of the municipality and which claims that the municipality used the best known, or the only, or the most practicable and available methods in exercising any of its powers or performing any of its functions, must on its mere production by any person be accepted by the court as evidence of that fact.’

[83] The applicant has accordingly failed to prove that the resolution of 4 April 2018 in terms of which the Municipal Council resolved that disciplinary proceedings be instituted against her is in any manner unlawful. I in any even find it difficult to accept that the applicant on the one hand agrees to the appointment of an arbitrator to preside over a comprehensive private arbitration to determine her guilt on the misconduct with which she had been charged and in which arbitration she fully participated, whilst she on the other hand complains about the lawfulness of the institution of disciplinary proceedings against her. This in my view smacks of opportunism on her part. If the applicant believed that the disciplinary proceedings against her were never approved by the first respondent’s Municipal Council, then she should have pursued such a case before the disciplinary proceedings even got underway. For her to launch a legal challenge to her disciplinary hearing, then agree to private arbitration in the course of those proceedings, only to then again seek to challenge the earlier resolution bringing the disciplinary hearing in the first place, is just not on. I have little hesitation is dismissing the applicant’s application to set aside the resolution of 4 April 2018 as well.

[84] Turning then to the merits of the review application of the applicant, she unfortunately faces a number of insurmountable difficulties. Firstly, and insofar as she seeks to rely on the misconduct provisions as contemplated by section 33(1)(a) of the Arbitration Act, the applicant has unfortunately made out no case in this regard. She has not indicated the kind of mala fides, turpitude or unacceptable behaviour on the part of the second respondent that would justify intervention in terms of this provision. On the evidence, in any event, I am satisfied that there is nothing to indicate that the second respondent behaved improperly and inappropriately. He conducted the proceedings in a manner consistent with what can be expected from any impartial arbitrator. He simply committed no misconduct.

[85] This only leaves section 33(1)(b) for the applicant to rely upon, and in this regard, did the applicant prove that she was denied a fair trial of the issues? In my view, and for the reasons to follow, she failed to do so. As a general proposition, the applicant’s challenge is directed at the outcome arrived at by the second respondent, and even though she couched her review terminology in a manner consistent with the evaluation of review grounds under the Arbitration Act, what she is really saying is that the outcome arrived at by the second respondent is unreasonable based on the facts properly and holistically considered, as well as the relevant provisions of law. This is in reality a Sidumo based review. It goes beyond the parameters of what is permitted under the Arbitration Act, having regard to the discussion above.

[86] Did the second respondent misconceive or misconstrue the enquiry he was required to make? I think not. In his award, he clearly stated that he needed to decide on a balance of probabilities whether the applicant committed the misconduct with which she had been charged. He added that this must be established by the first respondent as employer on the proven facts. He also stated that if misconduct is established, then he must establish what the impact thereof would be on the employment relationship between the parties. That is exactly what the principles of fairness under the LRA would require him to do, and thus which the arbitration agreement compelled him to do. The second respondent therefore clearly understood the enquiry he was required to undertake, and what he needed to consider and decide in the course thereof.

[87] When evaluating the award of the second respondent on the misconduct the applicant was charged with, I am satisfied that he had proper regard to the pertinent facts, as proven. In the end, and stripped of all its peripherals, the misconduct issue the second respondent had to decide was simple, and the evidence in this regard was uncontested. This evidence was that the applicant deliberately decided to approve a back dated invoice of R541 293.62 for payment on the Bluegum Contract, which invoice the applicant was aware included work to the value of R113 190.08 that had not yet been done despite the invoice reflecting that it had been done. It was also undisputed that the invoice and payment certificate reflected that the work had been completed, when it had not been completed. Was it not for the applicant’s approval of this transaction, the invoice would never have been accrued and processed by the Finance Department for payment. Based on these simple core facts, the second respondent had to decide if the applicant committed misconduct in the form of fraud. This he appreciated and it is clearly reflected in his award.

[88] The second respondent believed the applicant did commit this misconduct. He considered that the purpose of the transaction was to manipulate the payment certification process to create budget availability from the 2016 / 2017 budget year into the following budget year. This finding was undoubtedly correct, even on the applicant’s own version. According to the second respondent, if the work had not been done, it could not be accrued for, and there cannot be a liability created for goods or services that have not been received or delivered. He also believed that the applicant had to take steps to ensure that proper provision was made for completion of the work in the new financial year. Again, the second respondent appreciated and understood the enquiry he was required to make.

[89] What is immediately apparent from the aforesaid reasoning of the second respondent is that it simply cannot be legitimately said there was not a fair trial of the issues. As stated above, it is not about whether the outcome he arrived at was reasonable. Even if the applicant believes his conclusions are wrong or even unreasonable, this does not establish a case for review under the Arbitration Act. As a matter of legal principle, the second respondent as private arbitrator has the right to be wrong. The second respondent clearly considered all the pertinent facts. He drew his own conclusions of law based on these facts. That is all that is required to pass muster on review. It is thus not about the end result he arrived at. It is instead about the process he embarked upon in arriving at the end result, which, in casu, cannot be faulted.

[90] The second respondent also had regard to what he considered to be the duty of good faith the applicant as senior manager owed the first respondent as her employer, and her accompanying obligation to behave honestly and faithful and not to conduct herself against the interests of her employer.[53] According to the second respondent, the applicant did not discharge this obligation and did not protect the interests of her employer. The second respondent cannot be criticized for having regard to these considerations. It is certainly part of the fairness considerations under the LRA when deciding if an employee committed misconduct. In Sappi Novoboard (Pty) Ltd v Bolleurs[54] the Court held as follows:

‘It is an implied term of the contract of employment that the employee will act with good faith towards his employer and that he will serve his employer honestly and faithfully: … The relationship between employer and employee has been described as a confidential one (Robb v Green at 319). The duty which an employee owes his employer is a fiduciary one 'which involves an obligation not to work against his master's interests' … If an employee does 'anything incompatible with the due or faithful discharge of his duty to his master, the latter has a right to dismiss him' …’

[91] The second respondent decided that the applicant was guilty of fraud because she acted with intent when she manipulated the payment certification process to create the impression that work was completed when that work was not completed, and so created budget availability. The applicant complains that this is wrong because it fails to account for all the legal requirements necessary to establish fraud. In this regard, the applicant places some emphasis on the judgment of Nedcor Bank Ltd v Frank and Others[55], where the Court held that ‘… Dishonesty entails a lack of integrity or straightforwardness and, in particular, a willingness to steal, cheat, lie or act fraudulently ...’. The applicant contends that none of this was proven by the first respondent, which the second respondent failed to have any regard to. In my view however, the judgment in Nedcor Bank is completely distinguishable on the facts. In particular, and in Nedcor Bank, there was no false representation made by the employee concerned, and even more importantly, there was no rule or provision prohibiting the conduct of the employee, as the rule in question was only introduced after the fact.[56] This is clearly not the case in casu. The applicant knew that the information as contained in the invoice and payment certificate was false. She knew that it constituted a manipulation of the budget system to secure funds for project completion not budgeted for in the following budget year. Considering the seniority of her position and nature of her duties, she must at the very least reasonably have known that was happening was irregular and cannot be allowed. She finally knew that based on her approval, the Finance Department would make payment. This puts her in a different class to the employee in Nedcor Bank.

[92] Even if the applicant’s arguments that the second respondent erroneously considered and applied the legal principles relating to fraud may have traction, the problem is, once again, that the arbitrator has the right to be wrong. Even if the arbitrator erroneously applied the legal principles relating to fraud, it simply does not establish a case for review under the Arbitration Act. The authorities discussed above makes this clear. The fact is that he was called on to decide whether the applicant acted fraudulently, which he did. He considered the facts as he saw it and applied the legal principles as he considered it to be, in coming to the conclusion that he did. Again, that is all that is required of him for his award to pass muster on review under the Arbitration Act.

[93] In her argument, the applicant placed considerable emphasis on the testimony by Hatting concerning the issue of the invoices, the certificates, the backdating thereof, and what he considered to be the appropriate course of action to have taken in this case. It appears that Hatting did not have much concern about the manner in which the applicant went about securing the budget to complete the project, as what was important was that the project be completed and the works secured (protected). The applicant’s complaint on review, as referred to above, is that the second respondent in essence ignored all the testimony of Hatting about the transaction. In my view, the second respondent did not ‘materially malfunction’, as the applicant calls it, by having little regard to the testimony of Hatting. Hatting was the consulting engineer. He was not even employed by the first respondent. His responsibilities were to ensure that the project was properly executed and completed. He simply was not in the position to comment on what the legitimate financial processes in the first respondent entailed. He was not the custodian of budget management. What may be in order for him, was certainly not in order for the first respondent, especially considering the broader picture of first respondent’s accounting records needing to be accurate and its integrity ensured, as public funds are at stake. In short, nothing said by Hatting could assist the applicant’s cause.

[94] In any event, I do not believe the manner in which the second respondent came to the conclusion that the applicant committed fraud in this case was grossly irregular. In Monare v SA Tourism and Others[57] it was held that ‘… To establish fraud there must be proof of unlawful misrepresentation causing prejudice to another which was made with the intention to deceive …’. Similarly, and in Pick ’n Pay Retailers (Pty) Ltd v JAMAFO obo Maluleke and Others[58] it was held that: ‘… Fraud is constituted by the unlawful and intentional making of a misrepresentation which causes actual prejudice or which is potentially prejudicial to another’. Considering the facts in casu, by approving the invoice and payment certificate in the sum of R541 293.62 for payment on the basis that work was completed when it was not, the applicant committed a misrepresentation. She clearly knew that what was reflected on the invoice and payment certificate was false, but she nonetheless deliberately decided to approve it.[59] This undoubtedly must be an unlawful misrepresentation, especially considering that she knew what was expected of her.[60] She clearly acted with intent to deceive, considering this was a stratagem to secure funds from a budget in a prior year for a project not provided for in the next financial year. If not for her approval, the invoice would never be paid, and therefore her misrepresentation exposed the first respondent at the very least to potential prejudice. The fact that payment was only ultimately actually made once the work was done is a fortunate happenstance, and does not change the wrong of what happened in the first place. Her altruistic motivation of simply trying to protect the works and thus avoid fruitless and wasteful expenditure would only be a consideration relevant to the issue of an appropriate sanction, and does not detract from the existence of the misconduct. In Workforce Group v McLintock and Others[61] the Court said:

‘… The fact that Mr McLintock and Ms Fuhri had decided to disclose the financial mismanagement to Messrs Diamond and Katz does not detract from Mr McLintock’s fraudulent conduct. A motive is the underlying reason why an employee would commit a particular offence. It is irrelevant, particularly in the circumstances of this case, in establishing the employee’s guilt. It may well play a role in determining the appropriate sanction.’

[95] On the third and fourth charge, the second respondent held that because the applicant was aware as far back as May 2017 that the project would not be completed in time, she could have taken proactive measures to ensure that it was then provided for the budget for the next year (2017 / 2018). According to the second respondent, and in failing to do so, there was no justification for the manipulation of the invoice and the applicant was grossly negligent in having to do so instead of following the right processes. This reasoning of the second respondent indicates that he understood the charge and what he was called on to decide. The fact that the applicant had an explanation at hand as to why it would not be practical to try and provide for the project in the following year’s budget does not matter. Even if this explanation had substance, it still does not matter. The second respondent rejected this as a justification for her misconduct, which was clearly within the scope of what he had to decide. It is not about whether he should have accepted it, as the applicant contends. Because of the fact that this is private arbitration under the Arbitration Act, the necessary due deference must be applied when considering the second respondent’s award, and there is simply no legitimate cause for interference because he may have rejected a defence (explanation), rightly or wrongly.

[96] Therefore, and in my view, the applicant has failed to make out any case of any gross irregularity being committed by the second respondent in finding that the applicant committed misconduct as contemplated by the first, third and fourth charges against her. The second respondent clearly understood and appreciated the enquiry he was tasked with and required to conduct, and he considered the proper pertinent facts in making this enquiry together with relevant principles of law. Even if it can be said that he erred in evaluating and then applying these facts, as well as the relevant principles of law, it still cannot serve as a basis to review and set aside his award, this being private arbitration.

[97] This brings me to the issue of the appropriate sanction. In this regard, the applicant’s application has even less merit. In my view, a proper consideration of the second respondent’s award on the issue of an appropriate sanction indicates that he was fully aware of what he needed to consider. He was undoubtedly familiar with all the principles under the LRA relating to sanction, and he indeed aptly summarized the same in his award.[62] He placed emphasis on the seniority of her position, gravity of the misconduct, the destruction of the trust relationship and the risk posed to the first respondent as employer. He also recorded that the applicant never acknowledged wrongdoing or showed remorse for what she did. The second respondent thus conducted a proper enquiry on the issue of dismissal as an appropriate sanction as expected of him, and there was a fair trial of this issue as contemplated by the Arbitration Act. In short, the second respondent went down the right road, and the fact that the applicant disagrees with the destination he arrived at does not matter, and does not make his award reviewable.

[98] But once again, and in the interest of being thorough, I find myself compelled to agree with much of what the second respondent has said in his award, which I certainly do not believe is grossly irregular. Whilst it cannot be gainsaid that the applicant’s intentions were noble, the fact is that the road to hell is paved with good intentions.[63] The kind of conduct of approving an inflated invoice that contains an amount for work that was not even done, as if it was done, is in my view inexcusable, no matter what the intention, or better put, motivation. It is this kind of situation that is partly to blame for opening the doors to the largescale corruption and maleficence that permeated the public service and state owned enterprises over the last decade. The fact is that there is often an excuse of ‘good intention’ to justify irregular conduct, and one of these kinds of excuses is that something was needed, but the budget did not provide for it.[64] The applicant should have known better. It must also be pointed out that section 171(3)(d) of the MFMA designates conduct by a senior manager to be financial misconduct where such manager deliberately or negligently provides incorrect or misleading information to the accounting officer of the municipality. This is certainly so in this case.

[99] A perusal of the record also convinces me that the applicant showed no real remorse or genuine contrition for what she did.[65] In giving testimony in mitigation of sentence, she basically had to be cajoled by her representative into saying that she was sorry for what she did an would never do it again. However, and before she extended this expression of remorse, she first was adamant that what she had done, she was justified in doing, because that the best option available in the circumstances. She again said that finance ‘would keep the money’ until the work had been completed. She basically continued to maintain that what she did was justified and in order. The second respondent intervened, and indicated that he had already made a finding on this, and in fact expressed his reservations on these contentions constituting remorse, saying ‘… I mean this, is this a genuine remorse on your part? …’. The applicant then only turned around and sought to convey what she described as genuine remorse, but a proper consideration of her testimony leaves one with the distinct impression it was coached and not meant. The negative impact this has on the trust relationship, especially for a manager at this level, cannot be gainsaid. The applicant seemed incapable of appreciating for herself why what she did was wrong and why it exposed the first respondent to material risk. Comparable is the following dictum in Roscher v Industrial Development Corporation and Others[66] where it was said:

‘Roscher’s testimony before the CCMA brings to light her flawed insight at the time she drafted the recommendation and her persistence in that error throughout the hearing. Through her conduct (and her testimony justifying it) Roscher established that she lacks judgment and cannot be trusted to act appropriately in the best interests of her employer. Her defence of her conduct on the dubious bases she advanced during the CCMA hearing confirms her unreliability. Her repeatedly stated conviction that she had no duty or obligation to disclose the negative assessment of the NFVF to the credit committee, and her assumption that her inaccurate and incomplete disclosure was sufficient, defy reasonable belief. Her version that she handed the report to Ford, told him it was OK and did not mention the damning comments because she wanted him to bring an objective opinion to bear, is improbable; and, were it to be believed, revealing of exceptionally poor judgment for a person in her position. Her stance reveals a notable lack of appreciation of her fiduciary duties in the due diligence process.

By the same token, the representation of the information about the security or guarantee requirement in the recommendation is equally indicative of a serious lack of judgment on the part of Roscher. The document is replete with misleading and ambiguous statements about the nature of the security on offer. The communication of the true position was way below par, especially in the light of the fact that Roscher would or should have known the true position (as conveyed by Chavarika) after the meeting with Walmart in the USA. What was in fact conveyed to the credit committee, if not deceitful, reflects a disturbing lack of understanding of Walmart’s commitment, the basics of the due diligence process and the quality of the security required. The fact that Chavarika’s email resulted in the credit committee ultimately not being misled on the security issue does not help Roscher. The email disclosed the true situation that Roscher should or must have known. Its obvious variance with the version she put forward in the recommendation was at the very least a grossly negligent and misleading breach of fiduciary duty, confirming her unreliability in undertaking the task at hand. Her attitude reflected a lack of concern or insight about the possibility that her misrepresentations and non-disclosure had significant potential to cause the IDC reputational and financial prejudice.’

[100] In the arbitration, the first respondent led testimony by the City Manager, Imogen Mashazi (Mashazi), about the destruction of the trust relationship.[67] Mashazi explained that the applicant was in charge of a budget of R600 million, and had to be completely trusted, but this trust was destroyed. She was adamant that considering the seniority of the position of the applicant and having due regard to what she did, dismissal was the only appropriate sanction. Mashazi finally referred to the unjustified derogatory statements made by the applicant in her suspension submissions about Mashazi, which equally did not do the trust relationship any favours. The second respondent believed this evidence by Mashazi to be important, and accepted the same, for which he cannot be faulted. It is certainly well within the parameters of him discharging his duties, where it comes to deciding an appropriate sanction.

[101] The applicant placed some emphasis on the fact that the first respondent suffered no prejudice. The approach, in my view, once again shows her lack of appreciation for she actually did. This was recognized by the second respondent as well. As the first respondent pointed out, it had been certified up front that work that had not even been done, had been correctly and properly done. It followed that when the work was ultimately done, and was substandard, there was nothing the first respondent could do about it, as the false invoice and certificate approved by the applicant stood in the way of it. Normally, the first respondent would have assessed the work after it was done, and payment would only be certified for work properly done. Also, and considering the evidence set out above, the work that had purportedly been completed on the asphalt was not properly completed at all, and required major remedial work, however Kubwa was paid in full for it. In this context, the first respondent undoubtedly suffered prejudice. In any event, and at the very least, there was potential prejudice, because Kubwa would always have a contractual claim simply based on the certified invoice and payment certificate, if it did the work or not. In Malaka v General Public Service Sectoral Bargaining Council and Others[68] it was held as follows:

‘In an employment relationship, it is an implied term of the contract of employment that the employee will act in good faith towards, and serve, her employer with honesty. As a deputy director in the Department of Justice, the appellant occupied a position of trust which enjoined her to conduct herself honestly towards the department, which has a zero-tolerance policy to cases of dishonesty. The deliberate falsification of documents to secure a vehicle for her own personal use is a serious offence that implicated the appellant’s honesty. That the value of the loss suffered by the employer was negligible is not a mitigating factor. This court has taken a strict approach to dishonest conduct, even where the loss to the employer has been relatively small.’

[102] This only leaves the issue of inconsistency to deal with. The applicant, in the arbitration, raised two issues of inconsistency. The first related to one Obed Nhlapo (Nhlapo), another senior manager that had faced similar misconduct charges than those the applicant faced, but was not dismissed following disciplinary proceedings, and received a final written warning. The second instance related to Sema, the applicant’s subordinate, who according to her was intimately involved in the entire transaction of backdating the invoices and arranging for payment, but was not disciplined.

[103] In his award on sanction, the second respondent only dealt with the inconsistency complaint relating to Nhlapo. He held that even though it may have been recommended in the disciplinary proceedings that Nhlapo receive a final written warning, the Council had taken a decision to terminate his services. The second respondent also referred to the legal principles relating to inconsistency, and found that the decision taken in the disciplinary proceedings of Nhlapo did not bind him, and that a wrong decision in one case cannot give rise to an inconsistency finding in another case. He also reasoned that in the absence of ulterior motives or a discriminating management policy, mere differentiation cannot give rise to inconsistency, and in the current case, there was no such state of affairs. This reasoning of the second respondent in my view shows that he had a proper appreciation of the legal principles and what he needed to consider and apply, where it came to inconsistency. His reasoning cannot be faulted. It is perhaps for this reason that the applicant never pursued the second respondent’s findings on inconsistency relating to Nhlapo on review.

[104] On review, the applicant instead focussed on the issue of inconsistency relating to Sema. It is true that the second respondent made no refence to Sema, even though it was raised by the applicant in evidence in the course of the arbitration. Assuming, without deciding this is so, that the second respondent committed an irregularity in failing to consider the issue of inconsistency relating to Sema, does that open up his award to review? I do not believe that this would be so. A proper consideration of the legal principles relating to inconsistency, as applied to the facts evident from the transcript, leave me convinced that there is no case of inconsistency where it came to the failure to discipline Sema, for the reasons to follow.

[105] First, and on the legal principles, the second respondent correctly summarized, in his award, what these are. I will suffice by saying that the Code of Good Practice in the LRA provides for consistency as a consideration in deciding the issue of the fairness of the sanction of dismissal.[69] Where instances of inconsistency are raised as a defence to dismissal as an appropriate sanction, this would form part of the value judgment that must be exercised in deciding whether dismissal is fair.[70] The well-known judgment of SA Commercial Catering and Allied Workers Union and Others v Irvin and Johnson Ltd,[71] aptly determined the principles applicable to deciding inconsistency, as being: (1) Employees must be measured against the same standards (like for like comparison); (2) Did the chairperson of the disciplinary enquiry conscientiously and honestly determine the misconduct; (3) The decision by the employer not to dismiss other employees involved in the same misconduct must not be capricious, or induced by improper motives or by a discriminating management policy (in other words this conduct must be bona fide); and (4) A value judgment must always be exercised[72]. In general, inconsistency as a consideration is intended to protect employees against arbitrary conduct by the employer. Objective difference in circumstances is thus an important consideration.[73] As described by the Court in Bidserv Industrial Products (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others[74]:

‘… A generalised allegation of inconsistency is not sufficient. A concrete allegation identifying who the persons are who were treated differently and the basis upon which they ought not to have been treated differently or that no distinction should have been made must be set out clearly.’

[106] Applying these principles to the facts, the testimony by Mashazi on this issue is important. She stated that the applicant is the accounting officer for the Department of Transport she was head of, the one responsible for financial integrity, and that Sema reported to her. According to Mashazi, the applicant, as responsible accounting officer and in charge of the finances of the Department, cannot be led and advised by a subordinate, and for her to accept the recommendations of Sema on the transaction was not acceptable. According to Mashazi, as she put it: ‘… I cannot be advised by a junior official to in-advise me to do wrong things …’ (sic). This distinction articulated by Mashazi is important. It is clear that Sema and the other lower level officials in the first respondent came up with what they saw was a solution to the problem of budget unavailability to complete the Bluegum Contract. It was the duty of the applicant, as accounting officer and responsible to apply good corporate governance where it comes to financial management, to call them to order, and state that providing false information on financial source documents, no matter what the motivation, is not acceptable, and that she will not allow it. By her instead accepting this proposal, and trying to escape responsibility by stating it because Sema was dismissed, she should not be, is simply not acceptable. It is, in simple terms, not a like for like comparison, and that should be the end of any inconsistency challenge. I am in any event not convinced that the failure to have disciplined Sema is founded on some or other capricious or mala fide conduct on the part of the first respondent, which needs to exist to establish a case of inconsistency. Finally, a value judgment, for all the reasons already given, would work against the applicant.

[107] Overall considered, the award of the second respondent to the effect that dismissal of the applicant was an appropriate sanction is unassailable. The second respondent knew what he had to decide, and properly decided it. He had regard to all the legal principles and pertinent facts in this regard. It is not about whether the conclusion he arrived at was correct or reasonable, or whether someone else could have decided that dismissal was too harsh. The applicant, of her own volition, entrusted this task the second respondent, and must live with the outcome, whether it is wrong or right.

[108] It follows from all of the above that the arbitration awards of the second respondent are simply not reviewable in terms of the Arbitration Act.[75]

Conclusion

[109] For all the reasons as set out above, it is my conclusion that the applicant has failed to make out a case as contemplated by section 33(1) of the Arbitration Act to justify the reviewing and setting aside of the arbitration awards of the second respondent on the issues of both the misconduct and the sanction. The applicant has failed to establish any gross irregularities or misconduct on the part of the second respondent that would substantiate such intervention.

[110] Accordingly, the applicant’s review application must fail, and the arbitration awards of the second respondent must be upheld. The applicant’s review application is therefore dismissed.

[111] This then only leaves the issue of costs. In terms of the provisions of section 162(1) of the LRA, I have a wide discretion where it comes to the issue of costs. Even though the applicant was not successful, I do not intend to burden her with a costs order, especially considering the opportunity afforded to me to bring this matter finally to an end. I am also mindful of the dictum of the Constitutional Court in Zungu v Premier of the Province of Kwa-Zulu Natal and Others[76] where it comes to costs awards in employment disputes before this Court. Both parties submitted that costs in this case should follow the result, but that does not mean I must accept this, and I am always required to exercise a discretion as to whether costs should be awarded to the successful party.[77] Overall considered, I do not consider there to be sufficient reason to depart from the general principle set out in Zungu supra, and in the interest of fairness, I accordingly exercise my discretion as to costs in this matter by making no order as to costs

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

Order

1. The applicant’s review application is dismissed.

2. There is no order as to costs.

S Snyman

Acting Judge of the Labour Court of South Africa

Appearances:

For the Applicant: Adv H Barnes SC with Adv R Itzkin

Instructed by: DM5 Inc Attorneys

For the First Respondent: Adv G Hulley SC with Adv M Tshivhase

Instructed by: Mogaswa Inc Attorneys

[1] Act 42 of 1965.

[2] Act 66 of 1995 (as amended).

[3] Act 56 of 2003 (as amended).

[4] See Section 145(4), which reads: ‘: ‘If the award is set aside, the Labour Court may – (a) determine the dispute in the manner it considers appropriate …’

[5] Act 117 of 1998.

[6] The section reads: ‘Subject to the Constitution and section 173, and except where this Act provides otherwise, the Labour Court has exclusive jurisdiction in respect of all matters that elsewhere in terms of this Act or in terms of any other law are to be determined by the Labour Court …’.

[7] (2010) 31 ILJ 296 (CC) at para 70.

[8] The section reads: ‘The Labour Court has concurrent jurisdiction with the High Court in respect of any alleged or threatened violation of any fundamental right entrenched in Chapter 2 of the Constitution of the Republic of South Africa, 1996, and arising from — (a) employment and from labour relations …’.

[9] Id at para 72.

[10] Jurisdiction is determined by the case as pleaded - see Gcaba (supra) at para 75; Mbatha v University of Zululand (2014) 35 ILJ 349 (CC) at para 157; Ekurhuleni Metropolitan Municipality v SA Municipal Workers Union on behalf of Members (2015) 36 ILJ 624 (LAC) at para 21; Moodley v Department of National Treasury and Others (2017) 38 ILJ 1098 (LAC) at para 37; Du Plessis v Public Protector and Others (2020) 41 ILJ 919 (LC) at para 21.

[11] Compare Vodacom (Pty) Ltd and Others v National Association of SA Workers and Another (2019) 40 ILJ 1882 (LC) at paras 23 – 25.

[12] (2015) 36 ILJ 163 (LAC) at para 20. See also Merafong City Local Municipality v SA Municipal Workers Union and Another (2016) 37 ILJ 1857 (LAC) at para 38.

[13] Promotion of Administrative Justice Act 3 of 2000.

[14] Id at para 28.

[15] (2014) 35 ILJ 613 (CC) at para 28.

[16] (2014) 35 ILJ 2131 (LAC) at para 33.

[17] Id at para 34.

[18] (2010) 31 ILJ 296 (CC) at para 74.

[19] (2016) 37 ILJ 1857 (LAC) at para 36.

[20] See Ascendis Animal Health (Pty) Ltd v Merck Sharp Dohme Corporation and Others 2020 (1) SA 327 (CC) at para 108; Guardian National Insurance Co Ltd Vsearle NO 1999 (3) SA 296 (SCA) 301A-B; SGT Pepper's Knitwear and Another v SA Clothing and Textile Workers Union and Others (2012) 33 ILJ 2178 (LC) at para 28; Du Plessis (supra) at para 36; Southern Sun Hotel Interests (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others (2011) 32 ILJ 2756 (LC) at para 36.

[21] (2020) 41 ILJ 2051 (LAC) at para 16.

[22] (2007) 28 ILJ 2405 (CC).

[23] Id at para 110. See also CUSA v Tao Ying Metal Industries and Others (2008) 29 ILJ 2461 (CC) at para 134; Fidelity Cash Management Service v Commission for Conciliation, Mediation and Arbitration and Others (2008) 29 ILJ 964 (LAC) at para 96.

[24] See Duncanmec (Pty) Ltd v Gaylard NO and Others (2018) 39 ILJ 2633 (CC) at para 43.

[25] Id at para 41.

[26] (2013) 34 ILJ 2795 (SCA) at para 25. See also Gold Fields Mining South Africa (Pty) Ltd (Kloof Gold Mine) v Commission for Conciliation, Mediation and Arbitration and Others (2014) 35 ILJ 943 (LAC) at para 14; Monare v SA Tourism and Others (2016) 37 ILJ 394 (LAC) at para 59; Quest Flexible Staffing Solutions (Pty) Ltd (A Division of Adcorp Fulfilment Services (Pty) Ltd) v Legobate (2015) 36 ILJ 968 (LAC) at paras 15 – 17; National Union of Mineworkers and Another v Commission for Conciliation, Mediation and Arbitration and Others (2015) 36 ILJ 2038 (LAC) at para 16.

[27] In Lufuno Mphaphuli & Associates (Pty) Ltd v Andrews and Another 2009 (4) SA 529 (CC) at para 234, it was said that: ‘… I do not think that the reasoning in Sidumo can, without more, be of great assistance in determining the proper constitutional approach to the interpretation of section 33 of the Arbitration Act in the context of private arbitration …’. See also Volkswagen SA (Pty) Ltd v Koorts No and Others (2011) 32 ILJ 1892 (LAC) at paras 9 – 10; Clear Channel Independent (Pty) Ltd v Savage No and Another (2009) 30 ILJ 1593 (LC) at para 36.

[28] (2010) 31 ILJ 1618 (LAC) at para 33; see also Pikitup Johannesburg Soc Limited v Tokiso Dispute Settlement (Pty) Ltd and Others (JR173/2014) [2016] ZALCJHB 179 (17 May 2016) at para 26; Dlamini v Tshwane University of Technology and Others (JR1909/12) [2019] ZALCJHB 104 (15 May 2019) at para 45.

[29] [2006] ZASCA 112; 2007 (3) SA 266 (SCA) at para 51. See also paras 59 and 67 of the judgment. See further Transnet National Ports Authority v Reit Investments (Pty) Limited 2020 JDR 2104 (SCA) at para 37; UASA v Impala Platinum Ltd and Others (2010) 31 ILJ 1702 (LC) at para 43; Standard Bank of SA Ltd v Mosime NO and Another (2008) 29 ILJ 3078 (LC) at para 34.

[30] Mohlomi v Ventersdorp/Tlokwe Municipality and Another (2018) 39 ILJ 1096 (LC) at para 29.

[31] See Naidoo v EP Property Projects (Pty) Ltd 2014 JDR 1509 (SCA) at para 36; Gutsche Family Investments (Pty) Ltd v Mettle Equity Group (Pty) Ltd 2012 JDR 0358 (SCA) at para 19.

[32] [2002] ZASCA 14; 2002 (4) SA 661 (SCA) at para 21.

[33] Id at fn 29.

[34] 1915 AD 166.

[35] Id at para 55. See also para 57 of the judgment.

[36] Id at paras 85 – 86. See also Beukes v Ten Four Consulting (Pty) Ltd 2021 JDR 1209 (SCA) at para 25; Gutsche (supra) at para 18.

[37] 2009 (4) SA 529 (CC) at para 235.

[38] 2018 (5) SA 462 (SCA) at para 8. As also said in Lufuno Mphaphuli (supra) at para at para 260: ‘… In each case, the question will be whether the procedure followed afforded both parties a fair opportunity to present their case …’.

[39] Volkswagen SA (Pty) Ltd v Koorts NO and Others (2011) 32 ILJ 1892 (LAC) at paras 8 – 9; SA Police Service v Erasmus and Another (2018) 39 ILJ 460 (LC) at para 28; National Union of Metalworkers of South Africa v Tokiso Dispute Settlement 2014 JDR 1539 (LC) at para 19; Mxalisa and Others v Dominium Uranium and Another (2013) 34 ILJ 2052 (LC) at paras 30 – 31; SA Commercial Catering and Allied Workers Union and Others v Pick 'n Pay Retailers (Pty) Ltd and Others (2012) 33 ILJ 279 (LC) at para 13; Member of the Executive Council: Department of Health (Eastern Cape) v Van der Walt NO & Others (2011) 32 ILJ 944 (LC) at para 28; Impala Platinum (supra) at para 42; Steyn v Middelburg Ferrochrome (A Division of Samcor Ltd) and Others (2009) 30 ILJ 1637 (LC) at paras 38 – 41; Clear Channel (supra) at paras 37 – 38.

[40] (JA77/2014) [2016] ZALAC 45 (15 September 2016) at para 21.

[41] See Rule 7A(8) of the Labour Court Rules; Brodie v Commission for Conciliation, Mediation and Arbitration and Others (2013) 34 ILJ 608 (LC) at para 33; Sonqoba Security Services MP (Pty) Ltd v Motor Transport Workers Union (2011) 32 ILJ 730 (LC) at para 9; De Beer v Minister of Safety and Security and Another (2011) 32 ILJ 2506 (LC) at para 27.

[42] See Telcordia (supra) at para 32; Termico (Pty) Ltd v SPX Technologies (Pty) Ltd and Others 2020 (2) SA 295 (SCA) at para 11.

[43] See Pikitup Johannesburg Soc Limited v Tokiso Dispute Settlement (Pty) Ltd and Others (JR173/2014) [2016] ZALCJHB 179 (17 May 2016) at para 29, where it was said: ‘… It does not suffice to simply make general submissions or allegations of gross irregularities on the part of the Second Respondent …’ (referring to the arbitrator).

[44] This refers to the Local Government: Disciplinary Regulations for Senior Managers.

[45] Long v SA Breweries (Pty) Ltd and Others (2019) 40 ILJ 965 (CC) at para 24.

[46] As published in GN 344 as contained in GG No 34213 dated 21 April 2011.

[47] [1984] ZASCA 51; 1984 (3) SA 623 (A) at 634E 635C. See also Jooste v Staatspresident en Andere 1988 (4) SA 224 (A) at 259C – 263D; National Director of Public Prosecutions v Zuma [2009] ZASCA 1; 2009 (2) SA 277 (SCA) paras 26 – 27; Molapo Technology (Pty) Ltd v Schreuder and Others (2002) 23 ILJ 2031 (LAC) para 38.

[48] See Thebe Ya Bophelo Healthcare Administrators (Pty) Ltd and Others v National Bargaining Council for the Road Freight Industry and Another 2009 (3) SA 187 (W) at para 19; Rail Commuters Action Group and Others v Transnet Ltd t/a Metrorail and Others [2004] ZACC 20; 2005 (2) SA 359 (CC) at para 53.

[49] (2017) 38 ILJ 2721 (LAC) at para 29.

[50] Act 32 of 2000.

[51] Section 56(1) of the Systems Act.

[52] See clauses 5(3) to 5(6) of the Regulations.

[53] See Schwartz v Sasol Polymers and Others (2017) 38 ILJ 915 (LAC) at para 20.

[54] (1998) 19 ILJ 784 (LAC) at para 7.

[55] [2002] 7 BLLR 600 (LAC) at para 15.

[56] See paras 11 – 12 of the judgment.

[57] (2016) 37 ILJ 394 (LAC) at para 53.

[58] [2020] 12 BLLR 1229 (LAC) at para 18.

[59] In Brink v Humphries & Jewell (Pty) Ltd 2005 (2) SA 419 (SCA) at para 3, the Court held: ‘In deciding whether a misrepresentation was made, all the relevant circumstances must be taken into account and each case will depend on its own facts. For present purposes, all that need be said in this regard is that the furnishing of a document misleading in its terms can, without more, constitute such a misrepresentation.’

[60] Compare Anglo Platinum (Pty) Ltd (Bafokeng Rasemone Mine) v De Beer (2015) 36 ILJ 1453 (LAC) at para 19; Mutual Construction Co Tvl (Pty) Ltd v Ntombela NO and Others (2010) 31 ILJ 901 (LAC) at para 38.

[61] (2017) 38 ILJ 2517 (LAC) at para 39.

[62] In this regard see Sidumo (supra) at para 78; National Commissioner of the SA Police Service v Myers and Others (2012) 33 ILJ 1417 (LAC) at para 82; Bridgestone SA (Pty) Ltd v National Union of Metalworkers of SA and Others (2016) 37 ILJ 2277 (LAC) at paras 17 – 18; Woolworths (Pty) Ltd v SA Commercial Catering and Allied Workers Union and Others (2016) 37 ILJ 2831 (LAC) at para 14; Msunduzi Municipality v Hoskins (2017) 38 ILJ 582 (LAC) at para 30; Eskom Holdings Ltd v Fipaza and Others (2013) 34 ILJ 549 (LAC) at para 54; Samancor Chrome Ltd (Tubatse Ferrochrome) v Metal and Engineering Industries Bargaining Council and Others (2011) 32 ILJ 1057 (LAC) at para 34; Mutual Construction Co Tvl (Pty) Ltd v Ntombela NO and Others (2010) 31 ILJ 901 (LAC) at paras 37 – 38.

[63] This phrase was first published in Henry G. Bohn's A Hand-book of Proverbs in 1855.

[64] Compare Department of Health (North West Province) v Strydom and Others (2020) 41 ILJ 619 (LAC) at paras 5 – 8.

[65] In De Beers Consolidated Mines Ltd v Commission for Conciliation, Mediation and Arbitration and Others (2000) 21 ILJ 1051 (LAC) at para 25 it was held that: ‘… Acknowledgment of wrong doing is the first step towards rehabilitation. In the absence of a re-commitment to the employer's workplace values, an employee cannot hope to re-establish the trust which he himself has broken’.

[66] (2018) 39 ILJ 2489 (LAC) at paras 72 – 73

[67] See Edcon Ltd v Pillemer NO and Others (2009) 30 ILJ 2642 (SCA) at para 19.

[68] (2020) 41 ILJ 2783 (LAC) at para 33.

[69] See Schedule 8 Item 3(6) which reads: ‘The employer should apply the penalty of dismissal consistently with the way in which it has been applied to the same and other employees in the past, and consistently as between two or more employees who participate in the misconduct under consideration.’

[70] See Absa Bank Ltd v Naidu and Others (2015) 36 ILJ 602 (LAC) at paras 36 – 37; Consani Engineering (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others (2004) 25 ILJ 1707 (LC) at para 19.

[71] (1999) 20 ILJ 2302 (LAC) at para 29.

[72] See SRV Mill Services (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others (2004) 25 ILJ 135 (LC) at para 23.

[73] See Southern Sun Hotel Interests (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others (2010) 31 ILJ 452 (LC) at para 10

[74] (2017) 38 ILJ 860 (LAC) at para 31. See also Grindrod Logistics (Pty) Ltd v SA Transport and Allied Workers Union on behalf of Kgwele and Others (2018) 39 ILJ 144 (LAC) at para 47; Botsane v Anglo Platinum Mine (Rustenburg Section) (2014) 35 ILJ 2406 (LAC) at para 39.

[75] Compare the conclusions reached in Telcordia (supra) at paras 90 – 91.

[76] (2018) 39 ILJ 523 (CC) at para 25.

[77] See Long (supra) at para 29.