Melomed Hospital Holdings (Pty) Ltd v Denosa obo Fourie and Others (C589/2020) [2023] ZALCCT 31 (21 June 2023)

THE LABOUR COURT OF SOUTH AFRICA,

HELD AT CAPE TOWN

case no:C589/2020

Not reportable

In the matter between:

MELOMED HOSPITAL HOLDINGS (PTY) LTD Applicant And DENOSA obo LEONARD FOURIE First Respondent COMMISSION FOR CONCILIATION MEDIATION AND ARBITRATION Second Respondent COMMISSIONER P PATHER Third Respondent

Date of Hearing: 20 June 2023

Date of Judgment: This judgment was handed down electronically by circulation to the parties’ legal representatives by email, publication on the Labour Court website and release to SAFLII. The date and time for handing down judgment is deemed to be 10h00 on 21 June 2023

Summary: (Application to review CCMA’s refusal of rescission application – Commissioner having regard to explanation for default and failing to consider prospects of success – ruling reviewed and substituted)

JUDGMENT

LESLIE AJ

Introduction

[1] This is an application to review and set aside the third respondent’s ruling (“the commissioner”), issued in his capacity as a commissioner of the CCMA, dated 21 October 2020, in which he refused an application to rescind an arbitration award.

[2] The arbitration award which was the subject of the rescission application was issued on 11 August 2020 by another commissioner, E Edwards. It was issued on a default basis after the employer had failed to appear at the arbitration on 29 July 2020. After hearing the employee’s (Mr Fourie’s) evidence, the arbitrating commissioner held that his dismissal was substantively

unfair and ordered compensation equal to five months’ salary in the amount of R155000.

Preliminary issues

[3] There are some preliminary issues to address at the outset.

[4] It appears that both parties proceeded on the basis that this review application was brought under section 145 of the Labour Relations Act 66 of 1995 (“the LRA”). That section applies to the review of arbitration awards.

[5] What is being sought in the present matter is the review of a rescission ruling. A rescission ruling involves the exercise of a commissioner’s powers under section 144 of the LRA. It is not an arbitration award within the meaning of section 145.

[6] As such a rescission ruling is susceptible to review under section 158(1)(g) of the LRA.[1] There is no question that the applicant’s papers disclose a cause of action – the review of a rescission ruling. The fact that section 158(1)(g) is not expressly referred to is not a bar to the matter being disposed of on the correct basis.

[7] Mr Carls, who appeared for the first respondent, raised a point in limine to the effect that the review application had been delivered beyond the six-week statutory time period applicable to section 145 reviews.

[8] The basis for this submission was that the award had been emailed to the parties on 28 October 2020 and that the review application ought to have accordingly been delivered by no later than 9 December 2020. However, it was only delivered on 15 December 2020. Since there is no application for condonation, it was submitted that this court has no jurisdiction to hear the review application.

[9] As set out above, this application falls to be determined under section 158(1)(g) of the LRA, not section 145. There is no statutory time limit for instituting review applications under section 158(1)(g) – they must be brought within a reasonable

time.

[10] In its replying affidavit, the applicant has furnished a full explanation as to what transpired. In short, although the CCMA appears to have emailed the ruling on 28 October 2020 to its Group Human Resources Manager (“Lemos”), it was not received by him.[2] Lemos in fact sent more than one follow-up emails to the CCMA enquiring as to the outcome of the rescission application, including on 3 November 2020. The rescission ruling was emailed by the CCMA and received on that date. The review application was delivered on 15 December 2020, within 6 weeks of receipt. In light of the explanation tendered, I regard this as a reasonable

period.

[11] I add that, even if section 145 was applicable to this application, the applicant has categorically stated under oath that it did not receive the CCMA’s email dated 28 October 2020 and that it was emailed the ruling for the first time on 3 November 2020. There was in either event no need to apply for condonation.

[12] Mr Hendricks, who appeared for the applicant, argued that the first respondent’s opposing papers, although they had been served on time, had been filed at court late. However, this point was not seriously pressed because the applicant had failed to file any notice of objection as contemplated by item 11.4.2 of the Practice Manuel.

The merits of the review application

[13] As set out above, the arbitration proceeded in the applicant’s absence on 29 July 2020.

[14] In the applicant’s rescission application, it was explained that Lemos had every intention of attending the arbitration on behalf of the applicant, but that his HR Consultant and Secretary, Ms Samuels, had mistakenly diarised the arbitration for 30 July and not 29 July.

[15] The applicant set out comprehensive submissions on its prospects of success in defending the unfair dismissal claim.

[16] The first respondent delivered opposing papers, to which the applicant replied.

[17] The commissioner acted under the mistaken belief that the matter was unopposed. He nevertheless dismissed the rescission

application.

[18] Mr Hendricks argued that the ruling should be set aside on the ground that the commissioner failed to have regard to the opposing and replying papers. I disagree. If the rescission application had been granted without recourse to the opposing papers, this would certainly have been reviewable in the hands of the first respondent, as the offended party. However, the failure to have regard to the opposing papers could not be said to be procedurally unfair to the applicant – after all this could only have possibly been to the applicant’s benefit. The applicant was required to make out its case on the founding papers.

[19] However, that is not the end of the matter. The sole basis for the commissioner’s rescission ruling was that he was not satisfied that there was an acceptable explanation for the applicant’s default. The commissioner referred to an email in which Mr Lemos had recorded the correct arbitration date (29 July). On this basis, the commissioner essentially rejected the applicant’s explanation that the incorrect date had been diarised by the applicant. (Since the matter was decided on the papers and there was no opportunity for the parties to argue the case, this discrepancy was never put to the applicant and it had no opportunity to address it).

[20] The commissioner did not assess, or make any determination on, the applicant’s prospects of success in the main dispute.

This was a material misdirection. Under section 144(d) of the LRA an award is to be rescinded on good cause shown. Good cause

includes not only an assessment of the explanation for default but also whether there is a bona fide defence to the claim.

[21] In Shoprite Checkers (Pty) Ltd v CCMA [2007] 10 BLLR 917 (LAC), the Labour Appeal Court considered a strikingly similar matter. The employer in that case had received proper notice of an arbitration but had mistakenly mis-diarised the date. The CCMA commissioner refused a rescission application on the sole basis that proper notice had been received. The LAC held, in these circumstances, that the ruling fell to be reviewed, reasoning as follows:[3]

“In considering good cause, the second respondent took into account only one aspect of the test. That is to say he only considered the fact that Booysen had mis-diarized the date of the arbitration hearing. He clearly did not consider the appellant’s defence to the third respondent’s claim as he made no mention of it in his decision. In my view, the second respondent, failed to weigh together all the relevant factors in determining whether it was just and fair and therefore, whether good cause had been shown for the rescission of the arbitration award. It follows that the second respondent did not apply his mind to all the issues before him and if he did, he ought to, in the circumstances of this case, to have rescinded his earlier default award.”

[22] Similarly, here, the commissioner considered only one aspect of the test for good cause. He completely failed to have regard to the applicant’s prospects of success in defending the unfair dismissal claim.

[23] Assessed overall, although there is some discrepancy in the applicant’s explanation for its default (to which the applicant

was never given an opportunity to respond), there was no basis on which it could have been rejected out of hand.

[24] On the undisputed facts, the arbitration had been mis-diarised. The applicant had every intention of attending the arbitration and defending the matter, as evidenced by Lemos’ correspondence with the CCMA regarding the attendance of witnesses.

[25] Equally, having regard to the full record (including the opposing and replying papers) had the commissioner made any assessment of the applicant’s prospects of success these would certainly have been regarded as cogent.

[26] I am mindful that, in showing good cause, an applicant for rescission is not required to prove its case on a balance of probabilities and that discursiveness is to be discouraged. All that is required is that the applicant show that it has a bona fide defence to the claim in the sense of setting out averments which, if established at the trial, would entitle it to succeed.[4]

[27] In the present matter, the main reason for Fourie’s dismissal was that he disparaged and undermined his employer in a communication with a prospective employee, Mr G Konnight. Mr Fourie disputes this and denies that he knew Mr Konnight at all prior to his disciplinary hearing.

[28] In its application for rescission, the applicant went to some lengths to set out the evidence which it intended to present in due course. This included evidence by Mr Konnight who, it was alleged, would confirm that Mr Fourie had indeed called him and made the disparaging comments in question.

[29] I reiterate that, at this stage it is not necessary or desirable to make any firm pronouncements on the merits of the unfair dismissal dispute. Suffice it to say that the applicant at least made out a prima facie case in the sense that it has put up facts which, if proven at arbitration, would entitle it to succeed in its defence.

[30] Had a reasonable commissioner weighed this up as part of the rescission enquiry, there can be little doubt that rescission would have been granted. Put differently, no reasonable decision-maker would have refused condonation having regard to the

full conspectus of relevant factors.

[31] In the premises, the recission ruling falls to be reviewed and set aside. Since this court is apprised of the full record and is in as good a position as the CCMA to make a rescission ruling and the result is essentially a foregone conclusion, there is no reason why the ruling should not be substituted with a ruling granting rescission. It would merely delay the resolution of the dispute to remit the rescission application to be determined by another CCMA commissioner.

[32] Finally, the applicant made certain submissions regarding the incorrect citation of the parties in the CCMA referral documents.

These can be readily addressed by the arbitrating commissioner in due course, as is routinely done in matters of this nature.

Order

[1] The third respondent’s rescission ruling under CCMA case number WECT 25131-20 (“the Ruling”) is reviewed and set aside.

[2] The Ruling is substituted with the following ruling:

“The arbitration award issued by Commissioner Elridge Edwards on 11 August 2020 under case number WECT 25131-20 is rescinded.”

[3] The second respondent is directed to enrol the unfair dismissal dispute under case number WECT 25131-20 for arbitration.

[4] There is no order as to costs.

Leslie AJ

Acting Judge of the Labour Court of South Africa

Representatives - For the Applicant: M Hendricks For the Third Respondent: D Carls, Carls Attorneys

[1] This empowers the Labour Court to review the performance of any function provided for in the LRA on any grounds that are permissible in law. See SACCAWU v CCMA [2000] 10 BLLR 1215 (LC); Urban Africa Security CC v Hlatshwayo [2011] 11 BLLR 1131 (LC).

[2] As an alternative, the applicant pleads that Lemos was not aware of the email and it was not opened by him.

[3] Para 37.

[4] See for example Grant v Plumbers (Pty) Ltd 1949 (2) SA 470 (O) 476-7.