Bloem Water Board v Nthako NO and Others (JA83/2016) [2017] ZALAC 42 (28 June 2017)

Principle:

Where an arbitrator is late for a scheduled arbitration causing one of the parties to leave, the arbitrator may not continue with the arbitration with the other party on the basis that the parties were required to wait the whole day for the arbitrator to arrive.

Facts:

The Council scheduled an arbitration for hearing at 10:00. The employer's representatives, the employee and a union representative were in attendance. The arbitrator was not there at the appointed time. He had caused a previous arbitration to be postponed because of his unpunctuality. After 45 minutes, the arbitrator had still not arrived nor had he communicated with the parties. The employer's representatives then left the venue.

On the same day the employer's CEO directed a complaint to SALGBC that its representatives had waited longer than 30 minutes for the arbitrator and there was no word from the Council whether a commissioner would be in attendance. The CEO also cautioned that the arbitration should notproceed it its absence.

The employee and his representative did not leave. They waited until the arbitrator arrived at some unspecified time. The arbitrator inquiredwhether the employer's representative had been in attendance at the venue. On receiving a positive answer, he took the view that they had left prematurely as the arbitration had been set down for the whole day. He heard evidence and issued an award dated 23 January.

The employer did not seek to rescind the award in terms of section 144 of the LRA but instead launched an application to review the alleged misconduct of the arbitrator. The Labour Court refused to condone the late delivery of the review application.

On appeal to the LAC, the Labour Court's decision was set aside, as was the arbitrator's award. The LAC ordered the matter to be remitted to the SALGBC for arbitration de novo before an arbitrator other than the first arbitrator.

Extract from the judgment:

Landman JA

[23]   In this case, the appellant must show that the arbitrator exercised his discretion irregularly and should not have proceeded with the matter in its absence and that it has a prima facie defence to the employee's case. As to the former, the record of the appellant's internal disciplinary proceedings that was followed by an internal appeal demonstrate that the appellant has a defence to the employee's claim that he was unfairly dismissed.

[24]   The arbitrator was confronted with the fact that the appellant's representative had arrived for the arbitration and had waited for the arbitrator without any information as to whether the arbitrator would be arriving late or not at all. This situation required the arbitrator to exercise a discretion to stand the matter down and attempt to secure the return of those absent or to postpone the arbitration or to proceed with the arbitration. In considering the issue, the arbitrator should have been mindful that his failure to attend at the appointed hour (regardless of the reason for this) was the proximate cause of the appellant's representative leaving when they did.

[25]   Instead, the arbitrator put the blame on the appellant. He investigated whether the appellant had abandoned the arbitration ie waived its rights and found that it had done so. The fact that the appellant attended the arbitration and waited for the arbitrator even though he had not arrived timeously and also had previously arrived late for an arbitration, does not signify that the appellant abandoned the arbitration. In LufunoMphaphuli and Associates (Pty) Ltd v Andrews and Another, the Court remarked that:

'Waiver is first and foremost a matter of intention; the test to determine intention to waive is objective, the alleged intention being judged by its outward manifestations adjudicated from the perspective of the other party, as a reasonable person. Our Courts take cognisance of the fact that persons do not as a rule lightly abandon their rights. Waiver is not presumed; it must be alleged and proved; not only must the acts allegedly constituting the waiver be shown to have occurred, but it must also appear clearly and unequivocally from those facts or otherwise that there was an intention to waive. The onus is strictly on the party asserting waiver; it must be shown that the other party with full knowledge of the right decided to abandon it, whether expressly or by conduct plainly inconsistent with the intention to enforce it. Waiver is a question of fact and it is difficult to establish.'

[26]   I am satisfied that there was no ground for the finding by the arbitrator that the appellant had abandoned its right to participate in the arbitration.

[27]   There is nothing to show that the arbitrator even considered contacting the appellant that day. There is no merit in the submission that the parties were required to wait the whole day for the arbitrator to arrive. It does seem that the arbitrator took into account that the second and third respondents were anxious to proceed with the arbitration in the absence of the appellant and to avoid a postponement. They must have known that any award that they secured would be challenged. This puts paid to their submission that they are innocent bystanders.

[28]   I am of the view that the arbitrator did not exercise his discretion judicially and that he committed misconduct in the exercise of his powers. This would have justified the intervention of the Labour Court in the proceedings. There is no cause to investigate any other aspect. The result is that the appellant had good prospects of success so that the appellant's application for condonation should have been granted. It follows that the appeal should be upheld. The matter must be remitted to the Council for hearing before another arbitrator.

Costs

[29]   The usual approach to costs in labour matters, where the parties are engaged in an ongoing relationship, should be applied. I would not make an order for costs in this Court or in the court a quo.

[30]   I make the following order:

  1. The appeal is upheld.
  2. The order of the Labour Court is set aside and replaced with the following order:

    1. 'The late delivery of the application to review the award is condoned.
    2. The award is reviewed and set aside and remitted to the fourth respondent for arbitration de novo before an arbitrator other than the first respondent.
    3. There is no order as to costs.'

  3. There is no order as to costs of the appeal.