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IN THE LABOUR COURT OF SOUTH AFRICA

HELD AT PORT ELIZABETH

CASE NO. P 125/97

In the matter between:

VENTURE MOTOR HOLDINGS LTD

t/a WILLIAMS HUNT DELTA Applicant

and

NOMBULELO THELMA BIYANA First Respondent

E A MAEPE N.O. Second Respondent

NATIONAL UNION OF METALWORKERS

OF SOUTH AFRICA Third Respondent

JUDGMENT

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TIP AJ

[1] Until her dismissal on 15 April 1997, the first

respondent had been employed by the applicant for some five

years as a petrol attendant. She was found to have been

involved in a fraudulent transaction on the garage

forecourt. The dismissal was disputed and referred to the

Bargaining Council of the Motor Industry for conciliation.

[2] The conciliation was unsuccessful and it was then

referred to the CCMA for arbitration. The arbitration was

conducted by the second respondent on 15 September 1997. On

the following day, the second respondent delivered his

award, in which he determined that the dismissal was

substantively unfair and ordered that the first respondent

be reinstated.

[3] The applicant seeks to have that award reviewed and set

aside. It relies on a number of grounds which may

conveniently be condensed into three categories:

1. the applicant contends that the second respondent ought to

have disclosed that he had previously been employed for a number

of years as a legal adviser of the third respondent, of which the

first respondent was a member and by which she was represented;

2. it contends that there were a number of irregularities in

the manner in which the second respondent conducted the

arbitration proceedings; and

3. it contends that the findings made by the second respondent

stand in such stark contrast to the clear evidence presented that

one must infer that he acted in a grossly irregular and/or biased

manner.

[4] In respect of the second category, being the conduct by

the second respondent of the proceedings, certain aspects

are common cause, whilst others are to varying degrees in

dispute. For the purpose of this judgment, it is unnecessary

for me to have regard to matters where disputes have been

raised, since I have concluded that the applicant must

succeed on the basis of what is common cause and on the

inferences to be drawn therefrom.

[5] For the reasons that will be set out later in this

judgment, the second respondent's award is to be reviewed

and set aside because he did not take into consideration

material evidence relating to the issue before him. That is

a sufficient ground and I decide the matter on that basis.

Nevertheless, it is apposite that I should address two other

aspects of the proceedings, without deciding whether or not

they are in themselves sufficient to warrant the review of

the award.

[6] In relation to the second respondent's employment

history, Mr Johns who is the applicant's financial manager

and deponent to its founding affidavit, averred that:

"If I had been made aware of second respondent's prior

involvement with third respondent, I would have

objected to him hearing the matter."

[7] Section 136 of the Labour Relations Act, No. 66 of 1995

("the Act") contains certain provisions relating to the

appointment of a commissioner for the purpose of arbitration

proceedings. In section 136(3) provision is made for a party

to object to the commissioner who conducted the conciliation

being the one to conduct the arbitration. Section 136(4)

stipulates that if such objection is made, the Commission

"must" appoint another commissioner. Section 136(5) makes

provision for parties to indicate a preference in respect of

the arbitrator.

[8] None of those sections specifically provides for an

objection to be made to the appointment of a particular

commissioner, in the circumstances of the present matter.

That, however, does not have the result that the capacity of

a party to raise such objection is thereby removed. Such

capacity has its origins in the common law. Where a party

has a reasonably well founded apprehension that it will not

receive an impartial and unbiased hearing, it will be

entitled to seek relief.

See: Sera v De Wet 1974 (2) SA 645 (T) at 655 in

fin-656B;

BTR Industries SA (Pty) Ltd v Metal & Allied

Workers Union [1992] ZASCA 85; 1992 (3) SA 673 (A) at 693I-J.

[9] The common law considerations relating to the

impartiality of the arbitrator and, consequentially, the

duty of disclosure, apply no less strongly where arbitration

is compulsory than they do where the entry into arbitration

is voluntary.

[10] In Butler & Finsen Arbitration in South Africa : Law

and Practice (Juta 1993) at page 72, the learned authors

identify "a business or social relationship, either present

or past" as holding the potential that an arbitrator might

be prejudiced one way or the other. They cite a passage from

Mustill and Boyd The Law in Practice of Commercial

Arbitration in England (Butterworths 1989) at 252, which

sentiment I consider applicable in the present matter:

"A person who is approached with a request to act, and

knows that he has some kind of relationship with one of

the parties, should remember that there is no keener

sense of injustice than is felt by someone who has

doubts about whether the arbitrator is doing his honest

best. He should also bear in mind that the question is

not just whether he really is impartial, but whether a

reasonable outsider might consider that there is a risk

that he is not ... If he considers that the case is on

the borderline, he should disclose the circumstances

which may give rise to suspicion; and he will very

often find that no objection is taken to his

appointment: candour is always the best way to prevent

misunderstandings."

[11] In response to the review application, the second

respondent has filed a handwritten affidavit. In relation to

the complaint that he should have disclosed his previous

employment relationship with the third respondent, the

second respondent states:"

"There is no provision in the Act for a commissioner to

disclose where he comes from by way of disclosing his

background. It is not practice in any CCMA arbitration

proceedings for an arbitrator to disclose his/her

background prior to commencing arbitration proceedings.

... The CCMA has appointed commissioners from various

fields and professions ... This background did not

influence my decision ... It has never occurred to me

in any arbitration proceedings that I have to disclose

my previous involvement. Neither is it a requirement as

indicated above."

[12] The tenor of this response does nothing to advance the

view that the second respondent approached his task with a

proper understanding of the importance of both real and

perceived impartiality. Simply to aver that the Act does not

require disclosure and that it is neither his practice nor

that of the CCMA to do so, reinforces the sense that the

second respondent conducted himself in an insensitive and

inappropriate manner.

[13] It is by no means required of a CCMA commissioner who

undertakes a conciliation or arbitration that he or she

should in each and every case preface proceedings with an

exposition of his or her background. But where, as in the

present case, there was a lengthy and close relationship

between the commissioner and one of the parties, then a

clear duty arises to make disclosure of such fact.

[14] In the circumstances, I find there to be considerable

merit in the complaint raised by the applicant.

[15] I turn now to a consideration of the facts relating to

this matter, in the course of which I will deal with the

second disturbing aspect of the approach by the second

respondent to the matter before him.

[16] The first respondent's dismissal arose out of a

transaction conducted by her on 17 January 1997, in which

she processed a Speedpoint debit against an Auto Card.

Approximately two months later, the applicant received a

letter and transaction report from the First Auto divisional

office, setting out that the transaction in question was one

of a series of fraudulent transactions involving a

particular Auto Card. The applicant was informed that it

would therefore not be paid out for the amount transacted by

it, being R161,82.

[17] It is common cause that the second respondent was fully

informed of the procedures on the applicant's forecourt,

where petrol is dispensed. It is common cause also that part

of the process involved checks by a supervisor before and

after every shift, which inter alia established that the

amount of takings (reflected in Speedpoint vouchers and

cash) was in balance with the amount of petrol which had

been pumped out. This had been done in respect of the shift

in question. The amounts were in balance.

[18] The crisp question before the second respondent was

whether or not the transaction in question was genuine or

fraudulent. If it were genuine, it would mean that petrol

was dispensed in the amount shown on the voucher. If

fraudulent, in consequence of the fact that takings were in

balance with the amount of petrol dispensed, it would mean

that the first respondent had substituted a false Speedpoint

voucher for an equivalent amount of cash. That amount of

cash would necessarily have been extracted from the cash

takings in respect of petrol which had in fact been

dispensed.

[19] In the proceedings before the second respondent, four

of the five vouchers and the First Auto transaction report

were submitted in evidence. They show that in the space of

less than 11/2 hours and at five different garages in and

around central Port Elizabeth, the driver of a vehicle with

registration number CB 75329 had conducted five transactions

on an Auto Card. The fourth of these was the one transacted

by the first respondent.

[20] In each case, the voucher purports to reflect that a

substantial quantity of petrol had been dispensed. It is

manifestly clear that they could not all have been genuine

transactions conducted in the course of normal use of the

vehicle in question.

[21] It is a striking and material feature of these five

transactions that they were all made in virtually identical

amounts: the first was in an amount of R161,81, the second

in an amount of R161,81, the third in an amount of R161,80,

the fourth (involving the first respondent) in an amount of

R161,82 and the fifth and last in an amount of R160,00.

[22] The virtual identity of these amounts and their time

frame raises as an overwhelming probability, the inference

that the transactions could not have been genuine ones. The

processing by the first respondent of the fourth of these

transactions had to be evaluated in the context of them all.

The same inference arises.

[23] It is common cause that the applicant's representative

in the arbitration proceedings outlined to the second

respondent the virtual identity of all the transactions

conducted that evening with the card in question and that

the link between these transactions was explained.

Notwithstanding that, the second respondent took the

following view:

"I am not satisfied that the documents obtained from

other filling stations could be used to justify the

dismissal of the applicant given the fact that she has

no links with those particular filling stations."

[24] That approach on the part of the second respondent

shows, at best, a complete failure on his part to grasp the

significance of the similarity in transactions and the

implications of the fact that the first respondent had

carried one out during that sequence.

[25] During the arbitration, the applicant also presented in

evidence a printout of the vehicle specifications for CB

75239. It reflects that its fuel capacity was 65 litres. The

Speedpoint voucher transacted by the first respondent

purports to show that 74,2 litres were dispensed. Clearly,

the specifications also point strongly towards the

transaction in question not having been a genuine one. In

his award, the second respondent noted that the company had

"stated that the capacity of the vehicle on which the card

was registered i.e. CB 75239 was 65 litres ...". He noted

also that the employee's representative had "stated that the

witness had no knowledge of vehicle capacity". He did not in

any way evaluate those submissions or the evidential value

and significance of the specifications. He proceeded simply

to find that the suggestion by the employer that "money may

have been issued, which would have been shared between the

[employee] and the owner of the vehicle" was an "assumption"

which the second respondent found was "rather outrageous and

unfair in the absence of evidence to substantiate it".

[26] What this amounts to is that the second respondent has

in no significant way applied himself to highly relevant

evidence which had been placed before him. In the affidavit

filed by him in these proceedings, he added nothing by way

of reasoning, merely stating that his reasons were set out

in the award. Whether one examines this in terms of the

grounds contained in section 145 of the Act or those

implicit in section 158(1)(g) of the Act, the conclusion is

the same. A fundamental requirement in any arbitration

proceedings has not been met, namely that relevant evidence

must be taken into account and reasonably assessed and that

the outcome should be reasonably connected. That is not the

position in this matter and the award cannot stand.

[27] It should be remarked here also that the first

respondent had recorded the registration number as CB 15239

and not CB 75239. She alleged that this was nothing more

than an innocent error. In context, I consider it more

likely that it was a deliberate attempt to obfuscate.

[28] I turn now to a brief consideration of one of the

procedural aspects complained of by the applicant. As

already indicated in the above summary of the facts, a

matter of fundamental importance was whether or not the

first respondent had indeed dispensed petrol. The prima

facie contradiction between the specification suggesting

that the vehicle in question had a fuel tank capacity of 65

litres, and the data recorded on the Speedpoint voucher that

over 74 litres had been put into it, was accordingly a vital

matter which the first respondent had to address. It was

correspondingly a matter to which the second respondent

should have accorded keen but impartial attention.

[29] His conduct was entirely the reverse of what was

required of him. It is common cause that when the matter was

raised, it was the second respondent who reacted; the

applicant describes it thus in its founding affidavit and

its account is confirmed by the first respondent to be true:

"Second respondent asked first respondent whether it

was not possible that she had put fuel into containers

instead of the tank of the motor vehicle."

The first respondent avers that "nothing turns on the fact

that the second respondent asked me this question".

[30] I do not share the first respondent's view of the

import of the second respondent's suggestion to her. There

can be no explanation for the second respondent's

intervention, other than that he was concerned to come to

the assistance of the first respondent, by suggesting a

possible explanation for what on the face of it would

otherwise be a telling piece of evidence against her. It is

strongly suggestive of actual bias on the part of the second

respondent in favour of the first respondent. Even if it

falls short of that, it was a grossly irregular intervention

by the second respondent. It was certain to and in fact did

fuel the belief held by the applicant that it was not

receiving a fair hearing.

[31] In the course of argument, I raised with the parties

issues relating to procedural fairness in respect of the

disciplinary proceedings conducted by the applicant. Mr

Vally, who appeared on behalf of the first respondent, did

not seek to relocate his case from substantive to procedural

matters. He properly pointed out that procedural aspects had

been expressly eschewed at the very beginning of the

arbitration proceedings. In any event, I am satisfied that

the first respondent was at all times confronted with a

charge involving the conduct of a fraudulent transaction and

that no prejudice in this regard has been demonstrated.

[32] Mr Van der Linde on behalf of the applicant argued that

an order of costs should be made against the second

respondent. Generally speaking, a court will be reluctant to

order costs against commissioners of the CCMA. They play a

vital role in the dispute resolution mechanisms created by

the Act. The prospect of personal costs orders may have the

effect of deterring able and experienced persons from taking

up such positions. Similar views were set out in relation to

shop stewards in Callguard Security Services (Pty) Ltd v

Transport and General Workers Union & Others (1997) 18 ILJ

380 (LC) at 391D-F.

[33] Although there are doubtless circumstances where such

an order would be warranted, I am of the view that the

present matter falls short of that point. I have regard also

to the fact that the notice of motion seeks an order against

the second respondent only in the event of opposition by

him. There is no substantive prayer for a costs order on the

basis purely of the conduct by him of the arbitration

proceedings. Mr Van der Linde argued that the second

respondent had in effect opposed the application, in

consequence of the affidavit filed by him. I am unpersuaded

that this is so. Allegations of improper conduct were made

against him and I do not accept that a commissioner in such

circumstance should not respond thereto, to an extent that

goes beyond the conventional affidavit declaring merely that

the commissioner will abide the decision of the court. The

second respondent has not appeared in these proceedings and

seeks no order.

[34] As to the position of the first respondent, I am

satisfied that the evidence presented overwhelmingly

establishes that she was involved in a fraudulent

transaction. She has maintained the position that she did no

more than make a mistake in respect of the recording of the

registration number of the vehicle. She could not at any

stage have honestly believed in her innocence and I see no

reason why the fate of this application should not be

accompanied by an order of costs.

[35] There is no need in the present matter for the issues

to be remitted to the CCMA for fresh determination. The

evidence is in my view clear and this Court is in as good a

position to determine the matter as would be a commissioner

appointed for a fresh hearing.

[36] In the result, I make the following order:

1. The award made by the second respondent under CCMA Case No.

EC 2000 on 16 September 1997 is hereby reviewed and is set aside.

2. There is substituted for the award the following:

"The dismissal by the employer of the employee is

determined to have been fair and is upheld."

36.3 The first respondent is ordered to pay the

applicant's costs in these proceedings.

____________________________________

K S TIP

Acting Judge

Date of Hearing : 26 March 1998

Date of Judgment : 8 April 1998

For the Applicant : Advocate Van der Linde

Instructed By : Claude Tee & Associates

For the First Respondent : Advocate Vally

Instructed By : Gray & Moodliar

This judgment is available on the Internet:

http://www.law.wits.ac.za/labourcrt

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