IN THE CONSTITUTIONAL COURT OF THE REPUBLIC OF SOUTH AFRICA (Held at Johannesburg)
CC Case No: CCT 236 / 16 LAC Case no: JA 20 / 15
In the matter between:
FAWU obo JOB GAOSHUBELWE & OTHERS Applicant
and
PIEMANS PANTRY (PTY) LTD Respondent
RESPONDENT’S OPPOSING AFFIDAVIT TO THE APPLICANT’S APPLICATION FOR LEAVE TO APPEAL
I the undersigned
SEAN SNYMAN do hereby make oath and state:
1 I am a major male attorney of the High Court of South Africa, practicing as such with Snyman Attorneys, the attorneys of record of the respondent
in the above proceedings. I have at all material times and from inception represented the respondent in these proceedings.
2 The facts contained herein are, save where it is stated or clearly appears from the context to the contrary, within my personal knowledge and belief and are correctly stated. I am qualified to make the legal submissions contained herein.
3 The judgement of the Labour Appeal Court in respect of which leave to appeal is sought found that the claim for statutory relief in the form of reinstatement or compensation based on alleged unfair dismissal constitutes a debt as contemplated in the Prescription Act.
4 The Court furthermore found no repugnance between the time periods prescribed in the Labour Relations Act 66 of 1995 (“LRA”) for the referral of unfair dismissal claims subject to the court’s power to condone any late referral and the three-year prescription period applicable to such debts in the Prescription Act 68 of 1969.
5 Consequently, neither by virtue of section 210 of the LRA nor by virtue of section 16 (1) of the Prescription Act is extinctive prescription provided for in Chapter III the Prescription Act rendered inapplicable to labour disputes of this kind.
6 The respondent contends that the judgement of the Labour Appeal Court is founded on well-established authority and that this application does not involve any arguable constitutional or contentious legal issue of public importance.
7 For convenience I will refer to the Applicant as FAWU.
Structure of this affidavit
8 This affidavit is structured as follows:
8.1 I deal with the chronological background, which is common cause.
8.2 I then deal with this Court’s approach to applications for leave to appeal.
8.3 The question whether the Prescription Act applies to claims for statutory remedies based on alleged unfair dismissal is then dealt with.1
8.4 I then deal with the question whether the mere referral of a dispute for conciliation interrupts prescription.
8.5 Finally I deal with the contention that a purposive interpretation as prescribed by section 39 (2) read with sections 23 (1) and 34 of the Constitution may result in an interpretation of the Prescription Act which would exclude its application to claims for reinstatement or compensation based on unfair dismissal.
Background chronology
9 FAWU’s members who are represented in this application were dismissed on 1 August 2001 for participation in unprotected strike action.
10 FAWU contended that its members had not been on strike but that the respondent had unlawfully locked them out. An urgent application to the Labour Court seeking an interdict against the alleged lockout was dismissed.
1 The far broader issue as to whether the Prescription Act applies to labour disputes generally cannot properly be placed before this court as it would not be necessary for the Court to embark on such a broad enquiry in order to determine this matter.
11 Agreement was reached between the parties that employees would sign an undertaking on 20 July 2001 to put an end to the unprotected strike action and would return to work on 23 July 2001.
12 Despite this undertaking FAWU’s members did not return to work on 23 July 2001. Disciplinary proceedings resulted in their dismissal for their participation in the unprotected strike action.
13 On 7 August 2001 FAWU referred a dispute concerning its members alleged unfair dismissal to the CCMA.
14 On 3 September 2001 the CCMA issue a certificate to the effect that the dispute remained unresolved, in terms of section 135 of the LRA.
15 FAWU referred the dispute concerning the alleged unfair dismissal of its members to the CCMA for arbitration. The respondent objected in limine to the CCMA’s jurisdiction on the basis that such disputes have to be referred to the Labour Court for adjudication.2
16 On 15 March 2002 the CCMA Commissioner issued a written award upholding the point in limine and ruling that the CCMA had no jurisdiction to determine the matter.
17 Instead of referring the dispute to the Labour Court, FAWU sought to challenge this award on review to the Labour Court. The application for review was dismissed on 9 December 2003.
18 At that stage no issue of prescription could have arisen as the “debt was due” at the earliest in mid-2001 and would only prescribe in mid-2004.
2 Section 191 (5) (b) (iii) of the LRA
19 However, FAWU delayed the matter further, eventually referring the dispute to the Labour Court by filing a statement of claim on 16 March 2005, some 15 months after the review application had been dismissed.
20 In response to FAWU’s statement of claim the respondent raised a special plea of prescription, placing reliance on the provisions of the Prescription Act. FAWU contended that the Prescription Act did not apply to employment law disputes under the LRA and that even if it did, the running of prescription had been interrupted by virtue of the application of section 15 (1) of the Prescription Act by virtue of FAWU’s referral of the dispute to the CCMA for conciliation, on 7 August 2001.
21 The Labour Court rejected FAWU’s contentions and upheld the special plea of prescription. The ensuing appeal to the Labour Appeal Court was dismissed, hence the present application.
No case for leave to appeal
22 I submit that this application fails to raise any arguable constitutional issue or point of law of general public importance.
23 Constitutional issues raised by FAWU are dealt with under their separate headings below. It is submitted that each is strained and not worthy of serious consideration.
24 Section 167(3) (b) (ii) of the Constitution3 provides that this Court can consider matters other than constitutional matters, “if the Constitutional Court grants leave to appeal on the grounds that the matter an arguable point of law of general public importance which ought to be considered by that Court.”
3 Added by the Constitution Seventeenth Amendment Act 72 of 2012.
25 Section 167(3)(b)(ii) has been dealt with in Paulsen and Another v Slip Knot Investments 777 (Pty) Ltd4. The Court first dealt with the concept of an “arguable point of law” and said:5
“To summarise, a holding that a matter raises an arguable point of law of general public importance does not inexorably lead to a conclusion that the matter must be entertained. Whether the matter will, in fact, receive our attention will depend on the interests of justice …”
26 The Court further said:6
“…. It cannot be any and every argument that renders a point of law arguable for purposes of s 167(3)(b)(ii). Surely, a point of law which, upon scrutiny, is totally unmeritorious cannot be said to be arguable. Indeed, in Baloi Centlivres JA said 'there are very few cases which are not arguable in the wide meaning of that word'.
The notion that a point of law is arguable entails some degree of merit in the argument.
I make bold to say in order to be arguable, a point of law must have some prospects of success. ….”
27 Finally, and as to the issue of “general public importance”, the Court in Paulsen held:7
28 “…. In sum, for a matter to be of general public importance, it must transcend the narrow interests of the litigants and implicate the interest of asignificant part of the general public.”
4 2015 (3) SA 479 (CC).
5 Id at para 18. See also para 30.
6 Id at paras 21 – 22
7 Id at para 26
Application of the Prescription Act to Unfair Dismissal Disputes
29 FAWU confines its argument on this score to the possible application of section 16 (1) of the Prescription Act and section 210 of the LRA.
30 This court has already decided on several occasions that the application of the principle of prescription does not per se infringe the constitutional right of access to justice.8
31 FAWU in essence contends that because section 191 of the LRA prescribes the period within which unfair dismissal claims must be referred for adjudication by the Labour Court and allows for condonation for non-compliance with these time periods, this constitutes a scheme which is inconsistent with the application of the Prescription Act. FAWU contends that section 16 (1)9 of the Prescription Act read in conjunction with section 210 of the LRA10 effectively excludes the application of the Prescription Act to LRA disputes.
32 In advancing this argument, FAWU invokes the LRA’s emphasis on the importance of the resolution of industrial disputes. Although mentioned, absent from this analysis is the emphasis in the LRA on the speedy
8 See Mohlomi v Minister of Defence 1997 (1) SA 124 (CC) at para 11; Road Accident Fund and Another v Mdeyide 2011 (2) SA 26 (CC) at para 8.
9Section 16 - Application of this Chapter [Chapter III, Prescription of Debts (sections 10 –
16)]
(1) The provisions of this Chapter shall, save in so far as they are inconsistent with the provisions of any Act of Parliament which prescribes a specified period within which a claim is to be made or an action is to be instituted in respect of a debt or imposes conditions on the institution of an action for the recovery of a debt, apply to any debt arising after the
commencement of this Act.
10210 Application of Act when in conflict with other laws
(1) If any conflict, relating to the matters dealt with in this Act, arises between this Act and the provisions of any other law save the Constitution or any Act expressly amending this Act, the provisions of this Act will prevail.
resolution of industrial disputes, which applies with much greater cogency than it does to many other commercial disputes. 11
33 The need to resolve industrial disputes expeditiously arises from the ongoing relationship between the employer and its employees and the resultant disruption to the workplace if industrial disputes are allowed to fester.
34 The corollary to this principle is that if employees are dismissed, they must exercise their remedies, particularly in relation to possible reinstatement, expeditiously. The reason is self-evident. A dismissed employee is usually replaced by another employee. Reinstatement of the former is likely to result in retrenchment of the latter.
35 Even large compensation awards made years after the employer had reasonably believed that a dispute concerning a mass dismissal was not being pursued, can prove disruptive and even fatal to the viability of an employer, thus potentially threatening the jobs of existing employees.
36 Therefore, far from extinctive prescription constituting a statutory measure out of step with the main objects of the LRA, it is in the present context entirely in step with those objects.
37 Indeed, whereas the LRA requires the initial referral of a dismissal dispute to conciliation within 30 days of the dismissal12 and the commencement of legal proceedings within 90 days of the date on which conciliation fails or is deemed to have failed13 (subject to condonation on good cause shown) the three-year prescription period ought in most instances not to arise for consideration because a party guilty of such
11 See Billiton Aluminium SA Ltd t/a Hillside Aluminium v Khanyile and Others (2010) 31 ILJ 273 (CC) at para 46;
Strategic Liquor Services v Mvumbi NO and Others (2009) 30 ILJ 1526 (CC) at paras 12–13
12 Section 191 (1) (b) (i)
13 Section 191 (11) (a)
extreme delay relative to the time periods in the LRA would, absent extraordinary circumstances, fail to satisfy the test for condonation.
38 More significant, however is the fact that the time periods laid down in the LRA and the Labour Court’s power to condone non-compliance have to do with the speedy resolution of industrial disputes subject to the court’s power to regulate its own procedures, whereas the Prescription Act deals with the prescription of a debt because a litigant has remained supine for a period deemed by the legislature to warrant the more extreme sanction of prescription.
39 Since this Court has upheld the constitutionality of prescription per se, there is no basis on which to contend that the Labour Court’s power to grant condonation relative to far shorter periods, gives rise to any tension between these two statutory instruments.14
40 The policy consideration underlying prescription is that extreme delay in the commencement of legal proceedings results in prejudice to the debtor inter alia in that the older the dispute, the more difficult it is to produce reliable evidence relevant thereto. Debtors are also entitled to arrange their affairs in the belief that a debt which remains unclaimed over an appreciable period will not be pursued.15
41 Once legal proceedings have commenced, the pace of the matter can be dictated by the creditor or the debtor by insisting on compliance with the rules of court.
42 It is thus apparent that the time periods laid down in the LRA neither serve the same purpose nor operate in the same way as extinctive prescription under the Prescription Act.
14 Cf Road Accident Fund and Another v Mdeyide 2011 (2) SA 26 (CC) at para 82
15 Mohlomi v Minister of Defence 1997 (1) SA 124 (CC) at paragraph 11
43 In the circumstances it cannot cogently be argued that section 16 (1) of the Prescription Act is applicable to the time periods laid down in LRA.
44 Nor can it cogently be argued on the basis of section 210 of the LRA that there is any tension between the Prescription Act and provisions in the LRA which permit the Labour Court to condone non-compliance with the 30 or 90 day periods prescribed by section 191 (1) (b) of the LRA.
45 Although in theory the Labour Court is competent to grant condonation for a referral made more than three years after the debt was due (or in the nomenclature of the LRA, the date of dismissal), this does not render these provisions of the LRA inconsistent with the Prescription Act.
46 A debt which has not prescribed may nevertheless effectively be rendered unenforceable because of the Labour Court’s refusal to grant condonation for a lapse of time less than the three-year prescription period. The debt is unenforceable not because it has prescribed but because of non- compliance with provisions of the LRA which are aimed at the proper administration of justice and the expeditious resolution of industrial disputes.
47 Conversely, it would not avail an applicant in the Labour Court to seek and obtain condonation if the respondent has successfully been able to raise a special plea of prescription, as indeed occurred in the Labour Court in the present matter.
48 Prescription has to be raised expressly by the respondent and the respondent bears the onus to prove that the debt has prescribed.
Condonation on the other hand requires the applicant to make out a case of good cause. Each has its own requirements, none of which is inconsistent with the other.
49 There is furthermore a difference between a provision in a statute providing for an expiry period for bringing a claim on the one hand, and prescription of a claim itself on the other. Generally, in the case of a time period being provided for the expiry of a claim in a statute, the existence of such a provision would be inconsistent with the application of the Prescription Act, because the expiry provision would extinguish the claim, which is also what the Prescription Act seeks to do.
50 A pertinent example is found in the judgment of Commissioner for Customs and Excise v Standard General Insurance Company Limited16 where the Court, in dealing with the Customs and Excise Act, held that Section 99(5) which provided that any liability in terms of certain sections of that Act shall cease after the expiration of a period of two years from the date on which it was incurred, was inconsistent with the Prescription Act. The Court held:17
“….In our law there is a difference between limitation periods and prescription periods. The term “prescribe” (or in Afrikaans
“verjaar”) is a well-known and juristically well understood term.
So too is the concept of a “limitation or expiry period” (in Afrikaans a “vervaltermyn”). …. limitation or expiry periods are encountered in statutes dealing with subjects as diverse, to mention but a few, as Compensation for Occupational Injuries and Diseases (Act 130 of 1993); Education and Training (Act 90 of 1979);
Intelligence Services (Act 38 of 1994).
A question which often arises (as it does in this case) is whether and to what extent such provisions are to be reconciled with the
16 2001 (1) SA 978 (SCA)
17 Id at paras 10 – 11
Prescription Act. What is called for in each instance is a determination of the intention of the legislature in enacting the particular limitation or expiry period. ….’
51 The Court further held in so finding, as a basis of distinction, and of particular relevance in casu:18
“…. One is not in this case concerned with an Act which prescribes a specific period within which a claim must be made or an action instituted …”
which would of course be a time bar.
52 A further apposite comparison is the judgment in Mnyaka v Minister of Safety and Security19 where the Court was dealing with Section 57(1) of the Police Service Act which provided for a general period of limitation of 12 months for the institution of legal proceedings against the police services. The Court said:20
“Although the nature and effect of a limitation period coincides with that of extinctive prescription, they have been held to be separate concepts …. The practical importance of the distinction between a limitation period and prescription period is that save for certain common-law rules such as lex non cogit ad impossibilia, the general principles relating to prescription do not find application to a limitation period (see Hartman v Minister van Polisie 1983 (2) SA 489 (A) and Montsisi v Minister van Polisie 1984 (1) SA 619 (A)). The reason is to be found in the provisions of
18 Id at para 14.
19 [2014] JOL 32131 (ECM)
20 Id at para 9.
section 16(1) of the Prescription Act 68 of 1969 ("the Prescription Act"). In terms thereof the provisions of Chapter III of that Act will apply to all debts save where they are ousted by the provisions of an Act of Parliament which is inconsistent and then only to the extent of the inconsistency.”
53 Again, and in Mnyaka, the Court concluded that these provisions of the Police Service Act was inconsistent with the Prescription Act, because it in itself finally barred the claim and prevented the claimant from enforcing his claim.21
54 The notion that there is no repugnancy between the LRA and the Prescription Act in this context is not new. Virtually every Labour Court judge over a decade has consistently decided the issue of the application of the Prescription Act in the context of the LRA.22 The position has properly been enunciated by Van Niekerk J in the Labour Court23, as follows:
“…. the LRA, in its design, is not inconsistent with the application of the Prescription Act. On the contrary, there is a relationship of compatibility between the two statutes.”24
55 I therefore submit that there is no inconsistency in these two legislative provisions; there is no scope for the application of either section 210 of the LRA or section 16 (1) of the Prescription Act. I furthermore submit that FAWU’s argument to the contrary with respect, particularly strained.
21 See para 12 of the judgment.
22 The first judgment on this issue dates back to 2000 - Mpanzama v Fidelity Guards Holdings (Pty) Ltd [2000]
12 BLLR 1459 (LC).
23 Chemical Energy Paper Printing Wood and Allied Workers Union on behalf of Le Fleur v Rotolabel—A Division of Bidpaper Plus (Pty) Ltd (2015) 36 ILJ 700 (LC) at para 14.
24 See also Investec Employee Benefits Ltd v Marais and Others [2012] 3 All SA 622 (SCA) at para 31 which deals with section 30P of the Pension Funds Act and referrals of complaints to the Pension Funds Adjudicator.
Interruption by referral to conciliation
56 The case of FAWU is that, if the provisions of the Prescription Act apply, prescription was interrupted by the referral made by FAWU of the employees’ unfair dismissal dispute to conciliation. This argument is founded on Section 15(1) of the Prescription Act, which reads:
“[t]he running of prescription shall, subject to the provisions of subsection (2) be interrupted by the service on the debtor of any process whereby the creditor claims payment of the debt.”
57 FAWU contends that the conciliation referral is such ‘process’. For the reasons as set out hereunder, the respondent submits that this contention has no substance.
58 It is a specific requirement of the LRA that the applicant must first pursue conciliation under the auspices of the CCMA (or bargaining council) before referring a dispute for arbitration (under the auspices of the CCMA or a Bargaining Council) or for adjudication in the Labour Court. A referral for conciliation is thus a jurisdictional fact and is thus a precondition to adjudication, rather than the equivalent of the institution of proceedings to vindicate a claim.25
59 In Solidarity and Others v Eskom Holdings Ltd the Court said:26
“A debt is due in this sense, when the creditor acquires a complete cause of action for the recovery of the debt, that is when the entire
25 National Union of Metalworkers of SA v Intervalve (Pty) Ltd and Others(2015) 36 ILJ 363 (CC) at para 32
26 (2008) 29 ILJ 1450 (LAC) at para 25 – 26
set of facts which the creditor must prove in order to succeed with his or her claim against the debtor is in place or in other words when everything has happened which would entitle the creditor to institute action and to pursue his or her claim”
60 The perfection of a cause of action by referring it to conciliation cannot simultaneously constitute part of the cause of action and part of the act of instituting the legal process in order to vindicate the claim.
61 It is furthermore clear that the unsuccessful conciliation of a dispute does not mean that the matter is automatically destined for adjudication. It is only when the applicant elects to resort to litigation (and with it exposure to an adverse costs order), by referring the unresolved dispute for adjudication, that legal process in the Labour Court is commenced.27
62 FAWU invokes the dictum in Cape Town Municipality and others v Allianz Insurance Co Ltd 1990 (1) SA 311 (C) in support of its argument that referral for conciliation constitutes a step in the institution of legal proceedings which has the effect of interrupting prescription. That case is however of no assistance to FAWU.
63 In Allianz the plaintiff claimed an order to the effect that the defendant was obliged to indemnify it in relation to an insurance claim that the defendant had repudiated. This relief was granted. The plaintiff’s demand for payment of the loss suffered was not met and it consequently instituted fresh proceedings in the High Court in which it claimed quantification of the claim and judgement sounding in money. The defendant raised prescription on the basis that the debt represented by the
27 Peter Taylor and Associates v Bell Estates (Pty) Ltd and Another 2014 (2) SA 312 (SCA) at para 16 is analogous, in the context of joinder.
insurance claim had become due more than three years before institution of the second action.
64 The High Court per Howie J as he then was held that when the pronouncement on the defendant’s liability to indemnify was claimed, this amounted to the institution of legal proceedings for the recovery of the debt. The fact that no amount sounding in money was claimed was held not to detract from the fact that summons was issued and prosecuted in pursuit of the recovery of the debt due. Its effect was to interrupt prescription of the debt. The claim for quantification and payment was not a new debt. It was the same debt as had been claimed in the initial proceedings.
65 That is an entirely different matter to a referral to conciliation which, although a necessary prerequisite to the institution of legal proceedings to claim the statutory remedies of reinstatement or compensation, does not itself amount to the institution of such proceedings.
66 I therefore submit that FAWU has failed to raise an arguable issue relating to interruption of prescription which has any reasonable prospect of success.
Purposive Interpretation
67 Finally, FAWU contends that a purposive interpretation of the LRA and the Prescription Act must be applied, which entails subscribing to the case FAWU seeks to make out, as this would to the least extent limit FAWU’s rights under ssections 23(1) and 34 of the Constitution.
68 FAWU proceeds from the premise that if a claim for reinstatement or compensation consequent upon dismissal is susceptible to prescription
after three years, this would amount to an infringement on the right not to be unfairly dismissed and to access to justice.
69 Whilst in theory there would be a measure of curtailment of those rights, this Court has, as I have shown above, upheld extinctive prescription per se as constitutional. FAWU fails to provide any basis on which this Court ought to hold that the general acceptance of prescription as a measure to facilitate the proper and timeous adjudication of disputes ought not to apply in the case of dismissal disputes. If anything, the opposite is true for the reasons mentioned above.
70 Nor does FAWU make out any case that a three year prescriptive period is likely to operate oppressively to a vulnerable section of society such that the curtailment of section 34 rights is not justified.
71 There has been no successful attack on the far more stringent time periods imposed by the LRA, albeit subject to the power of the Labour Court to condone non-compliance.
72 Whilst many workers fall into a relatively indigent and thus vulnerable group, they are also virtually unique in their ability to join and enjoy the protection of trade unions which litigate on their behalf at no cost to them. In most cases they are also entitled adequately to prosecute their claims without legal representation in the CCMA.
73 FAWU does not attack the Constitutionality of the Prescription Act insofar as it applies to dismissal disputes. Nor does FAWU refer to any ambiguity in the wording of section 16 (1) which would incline this Court to interpret it in accordance with one of its possible meanings, in a manner which would render the Prescription Act inapplicable on the basis
of the time periods laid down I the LRA. I submit that for this reason too, this application must fail.
Conclusion
74 FAWU’s application thus has no prospects of success.
75 The judgement of the Labour Appeal Court is with respect cogent and thorough and FAWU has failed to identify any material flaw in the reasoning of that Court.
76 In the premises, FAWU’ application for leave to appeal falls to be dismissed, with costs.
______________________________
S SNYMAN
I certify that this affidavit was signed and sworn to by the deponent on this the
day of October 2016 at _______________ subsequent to the deponent having acknowledged to me that he knows and understands the content of this affidavit, that he has no objection to taking the prescribed oath and that he considers the prescribed oath to be binding on his conscience.
___________________________
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