Taku v Sekhanisa and Others (JR1242/2016)  ZALCJHB 13 (22 January 2019)
Before hearsay evidence can be admitted as evidence, all the factors listed in section 3(1)(c) of the Law of Evidence Amendment Act must be assessed according to the circumstances of the case.
The employee, a SAA customer service agent, was dismissed on three counts of misconduct, all relating to an incident involving a passenger who was travelling on a flight to Lagos. The charges were soliciting a bribe, corruption and bringing the name of the SAA into disrepute.
The passenger gave evidence at SAA's internal disciplinary hearing, but, despite SAA representing that she would be a witness, she was not present at the CCMA arbitration. SAA relied on her evidence in affidavit form, together with that of 3 witnesses, none of whom heard the employee asking for a bribe but who were told about it by the passenger. The passenger told them that she knew that she had two pieces of extra luggage and was prepared to pay for both of them, but the employee at the check-in counter has only written on the receipt that she had to pay for one piece. She told them he had said she should pay for one piece of excess luggage and to put R 200 or R 250 in her passport when she brought it back to him. The passenger sent an e-mail on the following day complaining about the incident.
The employee's explanation as to why he wrote one piece of luggage on the slip when the passenger had indicated that she had two pieces of excess luggage, was that the passenger had said she did not have enough money to pay for two pieces, and would leave one behind with someone who had accompanied her to the airport. The arbitrator found that the employee's version was improbable as the passenger ultimately paid for two pieces of luggage, which contradicted the version that she only had funds to pay for one piece.
The Labour Court was critical of the CCMA arbitrator's approach in that, whilst being aware that the evidence was hearsay evidence, looked at the evidence in its totality, finding the employee's version highly improbable compared to the probable, coherent and unambiguous of SAA's witnesses. Instead the commissioner should have strictly followed the approach required in the Law of Evidence Amendment Act. There was, in the absence of the passenger as a witness, no direct evidence at all to support the SAA's case that the employee had solicited a bribe or was involved in corruption.
The fact that the employee had the opportunity to cross-examine the passenger at the disciplinary hearing was regarded as of no consequence because the arbitration was a hearing de novo. This difficulty could have been overcome if the transcript of the disciplinary hearing was presented and the parties had agreed that the entire transcript should be regarded as evidence before the arbitrator, in which event the entire record could be considered and accepted as if it were evidence that was adduced before the arbitrator.
The Labour Court ordered that the arbitration award be set aside but the dispute was remitted to the CCMA for a hearing de novo before a different arbitrator.
This case is a reminder that before hearsay evidence can be admitted as evidence, all the factors listed in section 3(1)(c) of the Law of Evidence Amendment Act must be assessed according to the circumstances of the case. Despite s138(1) of the LRA saying that arbitrators must determine disputes fairly and quickly and with a minimum of legal formalities, this case is a further example of the courts requiring arbitrators to adhere to strict rules of evidence.
Extract from the judgment:
 The arbitrator was to determine the substantive and procedural fairness of the Applicant's dismissal. In respect of substantive fairness, the Applicant's case was that he was not guilty of the misconduct he was dismissed for and in respect of procedural fairness, his challenge was the fact that he was not afforded the right to be represented at his disciplinary hearing and the fact that he was not afforded an opportunity to plead in mitigation.
 In his analysis of the evidence, the arbitrator recorded that regarding the complaint from Ms Hughes, the SAA adduced the evidence of Ms Masombuka, Nxalati and Pinkie. Ms Hughes did not testify and as a result there was no primary or first-hand testimony of what had transpired at the check-in counter, except what the Applicant said had happened and what had transpired. The SAA's evidence was bolstered with the baggage slip issued by the Applicant.
 The arbitrator accepted that the evidence of the aforesaid SAA witnesses amounted to hearsay evidence because the witnesses only testified about what Ms Hughes told them. The arbitrator correctly stated that for hearsay evidence to carry weight and to be admitted as such, it has to be corroborated by the testimony of the primary witness. The SAA did not adduce the evidence of the passenger to corroborate the evidence of its witnesses.
 Instead of dealing with the issue of hearsay evidence and considering the weight that could be attached to it, the arbitrator simply jumped to a point where he held that, notwithstanding the fact that the SAA's evidence was nothing more than hearsay evidence, he should consider the evidence in its totality in order to arrive at an appropriate decision.
 The arbitrator briefly referred to the Applicant's evidence and found that, 'in view of the above-mentioned factors', the Applicant's version was highly improbable whilst the SAA's version was probable, coherent and unambiguous. This is so because the SAA's witnesses corroborated each other's testimony and they gave clear, simple and coherent evidence. The witnesses had no motive to fabricate something against the Applicant and the arbitrator found that there was clear and convincing evidence that the Applicant was guilty of the misconduct he was dismissed for and therefore, the sanction of dismissal was warranted.
 The arbitrator found that the SAA proved, on a balance of probabilities, that a fair reason existed to justify the Applicant's dismissal.
 The central event that led to the Applicant's dismissal, was the conversation that took place between the Applicant and Ms Hughes at the check in counter on 19 April 2015. The veracity and probability of the evidence in respect of the said event, depended upon the credibility of the Applicant and Ms Hughes respectively.
 The gist of the Applicant's complaint and ground for review is the manner in which the arbitrator dealt with the evidence placed before him, and more specifically, the hearsay evidence. The question is whether the arbitrator committed a reviewable irregularity by placing reliance upon hearsay evidence in the manner that he did.
 It is evident from the transcribed record that the arbitrator was made aware from the onset that the evidence of the SAA witnesses was hearsay evidence and that an issue was taken with such evidence, which was provisionally allowed on the basis and understanding that the primary witness, Ms Hughes, would testify to corroborate the SAA's version of events.
 Hearsay evidence is defined as evidence, whether oral or in writing, the probative value of which depends on the credibility of any person other than the person giving such evidence.
 In terms of section 3(1) of the Law of Evidence Amendment Act hearsay evidence shall not be admitted as evidence unless the parties agreed to the admission thereof as evidence, or the person upon whose credibility the probative value of such evidence depends, testifies at the proceedings or where the evidence is admitted in the interest of justice, having regard to seven specified factors.
 In casu, there was no agreement between the parties that hearsay evidence be admitted.
 Ms Hughes, the primary witness, never testified in the arbitration proceedings, thus, apart from the Applicant, there were no direct witnesses to the conversation between the Applicant and Ms Hughes.
 The arbitrator found SAA's evidence to be hearsay and held that for the hearsay evidence to carry weight and be admitted as such, it had to be corroborated by the testimony of the primary witness. This finding is indeed correct and in accordance with the principles applicable to hearsay evidence.
 Section 3(1)(3) of the Law of Evidence Amendment Act provides that hearsay evidence may be provisionally admitted if the court is informed that the person upon whose credibility the probative value of such evidence depends, will testify later in the proceedings. Provided that if such person does not later testify in the proceedings, the hearsay evidence should be left out of account, unless the hearsay evidence is admitted by agreement or is admitted in terms of section 3(1)(c) in the interest of justice.
 However, after finding the SAA's evidence to be hearsay, the arbitrator found that the SAA proved on a balance of probabilities that the Applicant's dismissal was fair. On the strength of nothing more than hearsay evidence, the arbitrator found that the Applicant's version was highly improbable and the SAA's version to be probable, coherent and unambiguous.
 Effectively the arbitrator found that what the SAA's witnesses were told by Ms Hughes and what constituted nothing more than hearsay evidence, was more probable and coherent than the direct evidence presented by the Applicant, who was present and involved with Ms Hughes at the check in counter and whose version of events as to what transpired between him and Ms Hughes at the check in counter could not and was not disputed.
 The Applicant's case is that he was denied a fair hearing as the arbitrator took into consideration Ms Hughes written statement, notwithstanding the fact that she did not testify. The Applicant submitted that there was no way that he could have had a fair hearing as his evidence would have been improbable, regardless of what he tried to present at the arbitration hearing.
 There was, in the absence of Ms Hughes as a witness, no evidence at all to support the SAA's case that the Applicant had solicited a bribe or was involved in corruption. Not a single witness of the SAA could testify to this issue and their versions were limited to what they were told by Ms Hughes. How the arbitrator could make the finding that the SAA proved, on a balance of probabilities, that a fair reason existed to justify the Applicant's dismissal, is astonishing.
 The only evidence in respect of the events at the check in counter, is the Applicant's evidence and his version in that regard remained unchallenged.
 The arbitrator completely ignored the fact that Ms Hughes complained about the Applicant, but subsequently refused to confront the issue with the relevant supervisors as she did not want to interact with the Applicant again, yet after paying for her excess luggage, Ms Hughes returned to the Applicant to complete her check in procedure.
 It is evident from the transcript that Ms Hughes in her e-mail complaint referred to one 'Lindiwe' and nobody who testified at the arbitration, knew who Lindiwe was. The arbitrator made it clear during the proceedings that Ms Hughes would testify to explain who Lindiwe was and to clear other discrepancies which were raised during the proceedings. This never happened.
 There is merit in the Applicant's complaint that the arbitrator had failed to properly asses the evidence placed before him and to reasonably determine the issues.
 The arbitrator made no assessment of the probative value of the evidence presented and he attached no weight to the Applicant's direct evidence and made no finding on what weight could be attached to the SAA's hearsay evidence. Notwithstanding these obvious misdirections and failures, the arbitrator accepted the SAA's version and rejected the Applicant's version.
 In opposing this application, the SAA submitted that the Applicant laboured under the misapprehension that evidence should be excluded simply because it is hearsay. SAA's case is that the arbitrator identified the evidence as hearsay and formed the view that it would be in the interest of justice to admit such evidence. This is so because the proceedings arose in a labour context and the nature of the proceedings required the arbitrator to eschew formality, the nature of the evidence was essentially Ms Hughes e-mail complaint, which was direct evidence, corroborated by the SAA's other witnesses, that the probative value of the evidence was high as it directly implicated the Applicant in corruption and that there were strong reasons why the evidence was not tendered by Ms Hughes. Furthermore, the Applicant has not alleged that he suffered prejudice and he suffered minimal prejudice from not being afforded an opportunity to cross-examine Ms Hughes. In fact, the Applicant failed to take advantage of several opportunities to interrogate Ms Hughes' statement and he had the opportunity to cross-examine her at the disciplinary hearing.
 It is evident that the SAA considered the provisions of section 3(1)(c) of the Law of Evidence Amendment Act and made every effort to justify the arbitrator's acceptance of hearsay evidence in view of the provisions of the said section.
 The difficulty with the SAA's submission is obvious. Firstly, it was indicated at the commencement of the arbitration that there was an objection to hearsay evidence, that it was made clear that Ms Hughes would testify and that the evidence of the other witnesses would be allowed provisionally and in anticipation of Ms Hughes' testimony. When she did not testify, the hearsay evidence should be left out of account, unless the hearsay evidence was admitted by agreement, which was not the case, or was admitted in terms of section 3(1)(c) in the interest of justice.
 The SAA's argument is that the hearsay evidence was admitted in the interest of justice. The difficulty however is that before hearsay evidence could be admitted as evidence because the interests of justice demands its admission, all the factors listed in section 3(1)(c) must be assessed according to the circumstances of the case. It is the combined assessment of all the factors that will result in a proper application of section 3(1)(c). It is evident from the arbitration award that the arbitrator had no regard to the provisions of the Law of Evidence Amendment Act, let alone an assessment of the factors listed in section 3(1)(c) and that the interest of justice was not a justification for accepting hearsay evidence, as submitted by the SAA. The arbitrator accepted hearsay evidence because he was of the view that he had to consider the totality of the evidence in order to arrive at an appropriate decision.
 Secondly, the fact that the Applicant had the opportunity to cross-examine Ms Hughes at the disciplinary hearing is of no moment because the arbitration was a hearing de novo. This difficulty could have been overcome if the transcript of the disciplinary hearing was presented and the parties had agreed that the entire transcript should be regarded as evidence before the arbitrator, in which event the entire record could be considered and accepted as if it were evidence that was adduced before the arbitrator. The evidence given at the disciplinary hearing could then be regarded as evidence at the arbitration. This is not what happened in casu, and the SAA's reliance on the fact that the Applicant had the opportunity to cross-examine Ms Hughes at the disciplinary hearing, is misplaced.
The test on review
 I have to deal with the grounds for review within the context of the test this Court must apply in deciding whether the arbitrator's decision is reviewable. The test has been set out in Sidumo and Another v Rustenburg Platinum Mines Ltd and Others as whether the decision reached by the commissioner is one that a reasonable decision maker could not reach. The Constitutional Court very clearly held that the arbitrator's conclusion must fall within a range of decisions that a reasonable decision maker could make.
 I must ascertain whether the arbitrator considered the principal issue before him, evaluated the facts presented and came to a conclusion that is reasonable. Viewed cumulatively, the arbitrator's failure to apply his mind to the issues and his acceptance of hearsay evidence in the manner he did, were material to the determination of the dispute and it distorted the ultimate decision made by the arbitrator. It cannot therefore be said that the arbitrator's decision was one that a reasonable arbitrator could have reached on the full conspectus of all the facts before him.
 Based on the above, I am persuaded that this award cannot stand and should be interfered with on review.
 The Applicant seeks for the arbitration award to be reviewed and set aside and to be substituted with an order that his dismissal was unfair, alternatively, the Applicant seeks an order remitting the matter for a hearing de novo.
 In the event the award is set aside on review, this Court has a discretion whether or not to finally determine the matter.
 In casu, the Applicant's complaint is that he was not afforded a fair hearing. Where the complaint is that a party was deprived of a fair hearing, it is not appropriate to substitute the award, but rather to remit the matter for a hearing de novo. I am of the view that it would be in the best interest of the parties and of justice to have the matter properly ventilated and decided de novo.
 This Court has a wide discretion in respect of costs and in my view this is a matter where the interest of justice will be best served by making no order as to cost.
 In the premises, I make the following order:
- The late filing of the application for review is condoned;
- The arbitration award issued on 8 May 2016 under case number GAEK10374-15 is reviewed and set aside;
- The dispute is remitted to the Second Respondent for a hearing de novo before an arbitrator other than the First Respondent;
- There is no order as to costs.