Algoa Bus Company v SATAWU & others (2009) 18 LC 9.5.5

Mthembu AJ:

Judgment

Introduction
[1]
This is an application in terms of section 68(1)(b) of the Labour Relations Act 66 of 1995 (“the LRA”). The applicant seeks an order declaring that the third and fourth respondents (the “employees”) are indebted to it in the amount of R465 001,34 plus interest for damages arising from an unlawful strike and directing the employees to pay that amount.

[2]
The first and second respondents and the employees gave notice of their intention to oppose the application. The notice of opposition and supporting affidavits were filed outside the time limits prescribed by the roles.

[3]
In respect of the second respondent, condonation has not been sought. In respect of the first respondent and the listed SATAWU members, condonation has been sought.

[4]
The second respondent failed to prosecute its case nor did it bring an application for condonation

Background facts
[5]
Each of the employees embarked on an unlawful strike on either 30 or 31 January 2008.

[6]
The consequence of the strike was that many of the applicant’s buses did not operate on many routes on those days, resulting in a total reduction of passengers over the two days by about 60 000 below the normal number.

[7]
Leaving aside possible loss of goodwill, the applicant suffered a financial loss of R465 001,34 as a result of the strike.

Ad condonation
[8]
In respect of the listed SATAWU members, the founding affidavit of Tozamile Fumbeza (Fumbeza) and the confirmatory affidavit of Honest Sinama (Sinama) were filed.

[9]
Fumbeza in his affidavit submitted as follows on behalf of the listed SATAWU members:

9.1
If it accepted by this court that the applicant indeed served the application on each SATAWU respondent or attempted to do so (those respondents allegedly refused to accept service), it is submitted that the applicant’s notice was not effective service in that all of the SATAWU respondents are Xhosa speaking and the papers or at least the notices thereof are in English.
9.2
A signature of acknowledgment appears as proof of service on SATAWU’s Port Elizabeth office (PE office). Fumbeza states that he is not able to identify the signature and submit that whoever signed for the application and accepted service thereof could not have been an official of SATAWU. If the papers were served on the PE office of SATAWU, a SATAWU date stamp would have appeared thereon.
9.3
It is noteworthy that whilst the applicant placed the ultimatum and other notices of extreme impotence on the general notice board, the applicant whose not to bring the application to the attention of the third and fourth respondent, by this means. Shop steward of the listed SATAWU members met on a monthly basis with the management personnel of the applicant, and in not one of those meetings did the applicant hand a copy of the application to the listed SATAWU respondents, for service on the relevant employees.
9.4
Fumbeza avers that it was only when he received a call from Sinama, SATAWU’s provincial secretary, on 21 April 2009, that he came to learn of the present application. Sinama requested that he arrange a meeting with the applicant’s management and a meeting was arranged for 24 April 2009.
9.5
The purpose of the meeting was to arrange the applicant’s application. They attempted to persuade Mr Heimes (Heimes), of the applicant that there was no need for further action to be taken against the listed SATAWU respondents, as they had already been penalised on the basis of “no work no pay” principle and were issued with final written warnings. Their attempts to negotiate with Heimes were unsuccessful.
9.6
The listed SATAWU respondents then accepted that the first respondent would take the matter further with the applicant. As members, they left matters in the hands of the first respondent and accordingly did not file a notice of opposition and answering papers.
9.7
At approximately 2:30pm on Wednesday 6 May 2009, he received a call from Sinama. The latter informed him that the applicant was proceeding with its application on 7 May 2009. Sinama advised him that should the listed SATAWU respondents wish to challenge the applicant’s application, then they need to seek legal advice and assistance. He directed them to their present attorney of record to assist them.
9.8
On the 7 May 2009, the application was postponed to 18 May 2009.
9.9
He immediately notified all the listed SATAWU members that they would have an urgent meeting on Tuesday 12 May 2009 to discuss the matter. This was the first time the listed SATAWU respondents came to learn of the present application.
9.10
After consulting with the listed SATAWU respondents, they consulted with their attorneys on the afternoon of 12 May 2009 and the attorney began to draft the necessary papers.
9.11
Fumbeza submits that as the representative of the listed SATAWU respondents, he did not intentionally delay in prosecuting their opposition to the applicant’s application. It is evident from the action he has taken when it became apparent that SATAWU, as the union was not going to take up the listed respondent’s case that he took immediate steps that the latter’s interest were protected.
9.12
The listed SATAWU respondents’ prospects of success in challenging the calculations of the compensation claim by the applicant is more than reasonable. The amount sought as compensation by the applicant is not just and equitable as contemplated by the provisions of section 68(1)(b).
9.13
The listed SATAWU respondents do not challenge the applicant’s right to invoke the provisions of section 68(1)(b) of the LRA. However, it is not accepted that the applicant has suffered loss in the sum of R465 001,34.
9.14
The basis upon which the listed SATAWU respondents seeks to challenge the applicant’s calculation of its loss are as follows:

(i)
the bus service of the applicant on a normal working day would cover a 20 (twenty) hour period which commences at 4am and ends at 12pm.
(ii)
On 30 January 2008, the bus service of the applicant was disrupted for a period of 9 (nine) hours. The applicant’s bus service continued to be operated between 4am until 3pm ie for eleven (eleven) hours.
(iii)
The bus service resumed for the remainder of the days from 11am until 12pm.

[10]
In addition, there was limited service provided by the applicant company during the period of the strike, particularly from the Uitenhage depot where none of the applicant’s employees took part in the strike. The applicant has in the calculation of its loss failed to take into account these factors.

[11]
It is, accordingly, overly simplistic of the applicant to allege that it has suffered loss on the basis of calculations as set out in annexure “E” to its papers.

[12]
He submits that the delay in filing the listed SATAWU respondents’ opposing papers occasioned the applicant little, if any prejudice. The only prejudice of this matter is the financial prejudice which the individual SATAWU respondents will suffer should the applicant succeed with its application for compensation in the amount claimed.

[13]
In the circumstances, the applicant has failed to show that it has suffered loss (in the sum of R465 001,34), which is just and equitable as contemplated in section 68(1) of the LRA.

[14]
The applicant opposed the respondent’s condonation application in the following terms:

(a)
Fumbeza merely states that he is “duly authorised to depose to this answering affidavit in opposition to the applicant’s notice of application.” He does not state by whom he is “duly authorised”, or on behalf of whom does he purport to oppose the application.
(b)
Should the answering affidavit be admitted, it is deemed to have been filed on behalf of Fumbeza alone and that none of the other respondents, save the second respondent, have opposed this application.
(c)
The delay in the present case is by any standards, considerable. The papers were served on the individual respondents in May and June 2008. At best for them their answering papers should have been filed by mid-July 2008.
(d)
Fumbeza then states that in any event, service was not effective because all the SATAWU respondents are Xhosa-speaking, while the papers are in English. In any event, language was never raised as a basis for rejecting the notices.
(e)
There is no rule that requires service to be certified by a stamp. SATAWU has not confirmed this allegation.
(f)
Fumbeza attributed the delay between 21 April 2009 and the filing of his notice and affidavit on 14 May 2009 to an assumption on his part that SATAWU was handling the matter. He fails to explain why SATAWU has not opposed the application.
(g)
Fumbeza claims that the first time the individual SATAWU members (other than himself) “came to learn of the present application” was on 12 May 2009. He omits to state that the individual SATAWU members had refused to accept service of the papers in May and June 2008.
(h)
Fumbeza attempted to explain the delay of nearly 10 (ten) months by the respondents’ concern in filing their opposing papers is at best unsatisfactory and at worst implausible. On this basis alone, condonation should not be granted.
(i)
The respondents’ defence is hopelessly confused and is flawed.
(j)
It is noteworthy that the respondents rely on a range of factors that must be taken into account cumulatively in determining whether the compensation sought is “just and equitable” that is, their alleged “financial position.”
(k)
Fumbeza does not even make an attempt to deal with the factors mentioned in section 68(1)(b)(ii) to (iii).
(l)
That the court may possibly decide to reduce the compensation claimed by the applicant cannot mean that the respondents have prospects of success in the main application, which seems to turn on the claim that the applicant has failed to quantify the loss.
(m)
The basis for Fumbeza’s attack on the manner in which the applicant has quantified its loss is premised on the argument that the applicant assumed that the strike lasted two full days.
(n)
Even if this criticism were true, it has nothing to do with the manner in which the loss was calculated. The loss was calculated by simply comparing the revenue generated during the same days in the previous normal weeks, and comparing it to the revenue generated on the same days of the strike. On that basis, it is irrelevant whether the strike lasted two days or two hours.
(o)
More importantly, however, is the fact that Fumbeza does not challenge the basis on which the applicant quantified its loss.
It is submitted there is, therefore, no real basis for the alleged dispute regarding the applicant's calculation of its loss.
(p)
Fumbeza’s vague assertion that some of the listed SATAWU members were on leave or off duty on the days in questions is both unsubstantiated and irrelevant, because employees may engage in strike action while on leave or when they are not on duty.
(q)
In particular, Fumbeza does not:

(1)
Explain how the proposed deduction will affect his personal finances or the finances of the individual respondents;
(2)
State that the applicant is a non-profit utility that provides a public service, and that its losses must be passed on to the public in the form of increased fares;
(3)
States that the strike was premeditated and over a dispute for which their union had an alternative lawful remedy;
(4)
States that the individual respondents are being held personally liable, so that will not be indirectly passed on other members of their union;
(5)
Suggest an amount short of the applicant’s claim that he considers just and equitable.

(r)
In the final analysis, Fumbeza belated opposition amounts to nothing more than an attempt to assist the third respondent’s escape responsibility for the consequences of their unlawful conduct.

Analysis

Ad Condonation

Degree of lateness and explanation thereof
[15]
It bears mention at the outset that the present application was filed on 4 August 2008 and that service was affected on the individual respondents during May and June of that year.

[16]
It is trite that in an application for condonation, the court will consider the extent of the delay, whether the applicant has provided a reasonable explanation for the delay, whether the defence is bona fide and has reasonable prospects of succeeding, and whether the balance of convenience favour the applicant.

[17]
To the extent that the deponents purport to speak on behalf of the second respondent’s members there is no indication on the papers as to who those individuals may be. They provide no authority for their right of opposing on behalf of the third and further respondents.

[18]
At best, the answering affidavits serve to convey the allegations relevant to the deponents only. There being no confirmatory affidavit by the remainder of the second respondent’s members and no basis for distinguishing them from the first respondent’s members. It must then be assumed that none of them has chosen to oppose this applicant’s version as set out in the founding affidavit.

[19]
On that version the uncontested facts are:

19.1
That each of those employees embarked on an unlawful strike on either 30 or 31 January 2008.
19.2
That the consequence of the strike was that many buses did not operate on most routes on those dates resulting in a reduction of passengers.
19.3
The applicant suffered a financial loss that it alleges amounted to R465 001,34.

[20]
The delay in the present case is by any standards considerable. The papers were served on the individual employees in May and June 2008. At best for them, therefore, their answering papers should have been filed by mid-July 2008.

[21]
Fumbeza states in his affidavit filed for purposes of the postponement application that neither he nor the listed SATAWU members received prior notification of the application, and that the application was served only on the SATAWU offices. He omits to mention that notice of application was served on each and every one of the individual respondents, the majority if not all of whom refused to accept the documents.

[22]
Fumbeza further states that the person who accepted service at the SATAWU offices was not a duly authorised employee, because a SATAWU stamp does not on it (sic). There is no rule that requires service to be certified by a stamp, SATAWU has not confirmed this allegation.

[23]
Fumbeza claims that the first time the individual SATAWU members (other than himself) came to learn of the present application was on 12 May 2009. He omits to state that the individual members had refused to accept service of the papers in May and June 2008.

[24]
I respectfully submit that Fumbeza attempts to explain the delay of nearly ten months by the respondent’s concerned in filing their opposing papers is at best unsatisfactory, at worst implausible.

Prospects of success
[25]
Section 68(1)(b) of the LRA empowers this Court:
“to order the payment of just and equitable compensation for any loss attributable to the strike or lock-out, or conduct, having regard to –

whether –

(a)
attempts were made to comply with the provisions of this chapter and the extent of those attempts;
(b)
the strike or lock-out or conduct was pre meditated;
(c)
the strike or lock-out or conduct was in response to unjustified conduct by another party to the dispute; and
(d)
there was compliance with an order granted in terms of paragraph (a);
(ii)
the interest of orderly collective bargaining;
(iii)
the duration of the strike or lock-out; and
(iv)
the financial position of the employer, trade union or employees respectively.”

[26]
The listed SATAWU members do not challenge the applicant’s right to invoke the provision of section 68(1)(b) of the Act. However, they do not accept that the applicant has suffered loss in sum of R465 001,34.

[27]
The listed SATAWU respondents seek to challenge the accuracy of the applicant’s calculations of its loss, on the following grounds:

27.1
     The strike did not endure for the entire two-day period;
27.2
     The bus service of the applicant on a normal working day would cover a
      twenty hour period which commences at 4am and ends at 12pm;
27.3
     On 30 January 2008, the bus service of the applicant was disrupted by the
     strike for a period of nine hours. The applicant bus service continued to be
     operated between 4am until 3pm ie for eleven hours;
27.4
     On 31 January 2008, the strike took place for a seven-hour period from
     4am until 11am. The bus service resumed for the remainder of the day
     from 11am until 12pm.

[28]
As in terms of section 68(1)(b), the court has a discretion to order the payment of just and equitable compensation for any loss attributable to the strike, it cannot be said that the listed SATAWU members have raised a defence and have good prospects of success should condonation be granted.

[29]
They admit the loss suffered by the applicant and all they are asking this court to do is to reduce the amount of the loss allegedly suffered by the applicant.

Prejudice
[30]
Fumbeza states that the applicant has suffered little, if any, prejudice. He omits to mention that as an employer, the applicant has suffered financial prejudice.

[31]
In Melane v Santam Insurance Company 1962 (4) SA 531 (AD) [also reported at [1962] 4 All SA 442 (AD) – Ed], the court held that in deciding whether sufficient cause has been shown in a condonation application, the court has a discretion, to be exercised judicially upon a consideration of all the facts in essence it is a matter of fairness to both sides.

[32]
In casu, the listed SATAWU members did not show sufficient cause warranting the exercise of the court discretion condoning the late filling of their opposing papers. Therefore, the condonation application falls to be dismissed.

Ad the merits
[33]
The applicant has in support of its financial loss tendered the affidavit of one Mr Deenadayal Alan Govender (“Govender”), its financial director.

[34]
Govender states that he arrived at the figure of R465 001,34 by comparing the figure for the corresponding days in the previous week which reflect the then current norm for passengers carried and kilometres travelled on the routes travelled by the applicant buses.

[35]
The total number of passengers on the respective Wednesdays dropped from 85 998 to 72 999 and on the respective Thursday from 82 685 to 35 621, reflecting a total loss of seats for the two days of 60 064.

[36]
An average ticket seat of R9,50 per passenger, the loss of 60 063 passengers represent a loss of R570 958,50. Losses of contract trips paid per trip by clients was R101 562,10.

[37]
On the saving side, the variation in kilometres travelled over the two-day period was 38 434. When broken down into normal expenditure per kilometre (drivers’ wage, fuel oils, tyres and maintenance), this represents a saving of R207 159, 26.

[38]
Therefore the total loss of revenue arising from the strike was R465 001,34.

[39]
However, the strike did not endure for a full two days. If endured for nine hours on 30 January 2008 and for seven hours on 31 January 2008, I cannot therefore, accept the applicant’s submission that it is immaterial that the strike lasted less than two days.

[40]
I submit that in the absence of any explanation by the employees, the Court is with respect obliged to find that:

40.1
  The strike was premeditated, that neither the employees nor the union made   
  any attempts whatsoever to comply with the provisions of the LRA, that the  
  strike was not in the interests of orderly collective bargaining and that the
  strike was not in response to unjustified conduct by the applicant.
40.2
  The strike was not only unprocedural but for a reason prescribed by the
   LRA.
40.3
   While the strike was for a relatively brief duration, it caused loss to the
   applicant and inconvenience to the public.

[41]
The court must also consider that the applicant applied the principles of “no work no pay” during the strike.

[42]
In Mangaung Local Municipality v SAMWU [2000] JOL 10582 (LC), the applicant claimed the amount of R272 541, 84 as a result of loss suffered as a result of a strike. The court awarded the applicant compensation in the sum of R25 000.

[43]
In Rustenburg Platinum Mines Ltd v Mouthpiece Workers Union [2002] 1 BLLR 84 (LC), the applicant claimed that it suffered losses of at least R15 million as a result of a strike. However, the applicant subsequently reduced its claim to R100 000.

[44]
In my view, the words “just and equitable” in the Act means no more than that compensation awarded must be fair. Section 68(1)(b) providing for compensation for unprotected strike action was designed to compensate an aggrieved party for losses actually suffered. However, compensation need not necessarily do so.

[45]
In totality, the strike lasted for sixteen hours and not for two days as submitted by the applicant.

Order
In the result, I make the following order:
[1]
The application is dismissed as against the second respondent.
[2]
The condonation application by the third and fourth respondent is dismissed.
[3]
The second respondent and the third and further respondents must pay the applicant the sum of R100 000 in monthly instalment of R50 jointly and severally, the one paying the other to be absolved.
[4]
Payment of the instalment referred to in paragraph (3) shall commence on the 2 November 2009 and shall thereafter be paid consecutively on the second of each succeeding month.
[5]
The second respondent and the third and further respondent's shall pay the applicant’s cost of suit.