Court name
Labour Court Main Division
Case number
43 of 2011
Title

Meatco Corporation of Namibia v Pragt and Another (43 of 2011) [2014] NALCMD 44 (27 October 2014);

Media neutral citation
[2014] NALCMD 44
Coram
Van Niekerk J










REPUBLIC OF NAMIBIA





LABOUR COURT OF
NAMIBIA, MAIN DIVISION, WINDHOEK





JUDGMENT





Case No: LCA43/2011





DATE: 27 OCTOBER 2014





REPORTABLE





In the matter between:





MEATCO CORPORATION OF
NAMIBIA...................................................................APPELLANT





And





REMOND
PRAGT.............................................................................................FIRST
RESPONDENT





MERIAM NICODEMUS,
N.O....................................................................SECOND
RESPONDENT








Neutral citation: Meatco Corporation
of Namibia v Pragt (LCA 43-2011) [2014] NALCMD 44 (27 October 2014)





Coram: VAN NIEKERK J


Heard: 1 March 2012


Delivered: 27 October 2014





Flynote: Labour law – Second
respondent as arbitrator found that first respondent an employee of
appellant and had been unfairly dismissed – In notice of appeal
appellant formulated what it called a question of law, namely
“Whether or not an employment or independent contractors’
relationship existed between Appellant and First Respondent?” –
The grounds upon which appeal based are that “The arbitrator
erred in law by concluding the First Respondent was an employee of
Appellant” - Court found that second respondent’s finding
of employment was one of fact and as such unassailable under section
89(1)(a) of Labour Act, 2007 (Act 11 of 2007), unless this finding
was such that no reasonable arbitrator could have made it – For
the purported question of law to disclose an error of law the
question should be framed clearly and properly – It should set
out the error of law, which is that the factual finding is one which
no reasonable arbitrator could have made – Another problem is
that grounds as set out are not proper grounds – As such notice
of appeal defective and a nullity – Appeal struck.





ORDER





The appeal is struck from the roll.





JUDGMENT





VAN NIEKERK J:




[1] This is an appeal from an award
given by the second respondent in which she recorded that the issues
to be determined are (i) whether the first respondent was an employee
of the respondent or not, and if so; (ii) whether the termination of
his services was fair or not, and if not; (iii) what the appropriate
relief would be. The second respondent found that the first
respondent was an employee of the appellant; that the first
respondent’s employment was terminated without a fair and valid
reason; and without following the correct procedure. She ordered
that the appellant should pay compensation to the first respondent.





[2] The appellant’s notice of
appeal on Form LC41 states, inter alia, as follows:





‘The questions of law appeal
(sic) against in the arbitrator’s award are as follows:





a. Whether an employment or independent
contractors relationship existed between Appellant and First
Respondent;





b. Whether compensation could be
awarded under the circumstances.





The grounds of appeal against the
arbitrator’s award are as follows:





1. The arbitrator erred in law by
concluding the First Respondent was an employee of Appellant;





2. The arbitrator erred in law by
concluding the Office of the Labour Commissioner has jurisdiction to
dispose of the dispute with Appellant lodged with that Office;





3. The arbitrator erred in law to
conclude First Respondent was unfairly dismissed;





4. The arbitrator erred in law to order
Appellant to pay compensation to First Respondent.’





[3] The appeal is unopposed. Argument
was heard in the matter on 1 March 2012 and judgment was reserved.
Subsequent thereto the Court invited the appellant to present written
argument on the following questions:





“1. Is the first question raised
in the notice of appeal namely, ‘Whether an employment or
independent contractor’s relationship existed between Appellant
and First Respondent’ a question of law?





2. If the answer to question no. 1 is
“No”, does this Court have the jurisdiction to consider
the first question raised in the notice of appeal?”’





[4] Mr de Beer for the appellant kindly
provided written argument, for which the Court expresses its
gratitude. As part of the argument counsel referred to the similar
case of Swarts v Tube-O-Flex Namibia (Pty) Ltd and Another NLLP 2014
(8) 44 LCN (27 March 2013). In this matter Smuts J had to determine,
inter alia, whether the arbitrator’s ruling that the appellant
was an employee of the respondent for purposes of the Labour Act,
2007 (Act 11 of 2007), was a question of law or not. During the
course of his judgment he noted that, in determining whether the
applicant was an employee or not, the arbitrator relied on the
factual circumstances surrounding the arrangement between the
appellant and the respondent. He further stated:





‘[16] The arbitrator further
relied on what is termed the ‘pragmatic approach’
discussed in the work by Parker, Labour Law in Namibia, where it is
stated:





‘In England, the issue of whether
a person is an employee is a question of fact.’





The work continued, after reference to
English authority…





‘It is therefore submitted that
whether a person is an employee is a question to be resolved by the
determiner of fact. However, where the question a person is an
employee turns solely on the interpretation and application of a
written contract of employment then, the question is a question of
law.’’





[5] Later Smuts J continued:





‘[26] Section 89(1) of the Act
restricts appeals to this court against awards of arbitrators to any
question of the law alone. The question arises as to whether this
question is one of law or fact.





[27] …………………..





[28] On the question as to the
distinction between questions of fact and law, Scott, JA in Betha v
BTR Sarmcol [1998 (3) SA 349 (SCA) 405C-406E] with respect lucidly
explained the position thus (after referring to not dissimilar
provisions in the then applicable Labour Relations Act, 28 of 1956
which also essentially restricted further appeals to questions of
law):




‘Accordingly, the extent to which
it (then court of appeal) may interfere with such findings is far
more limited than the test set out above (to findings of fact in
criminal appeal). As has been frequently stated in other contexts, it
is only when the finding of fact made by the lower court is one which
no court could reasonably have made, that this Court would be
entitled to interfere with what would otherwise be an unassailable
finding. (See Commissioner for Inland Revenue v Strathmore
Consolidated Investments Ltd 1959 (1) SA 469 (A) at 475 et seq;
Secretary for Inland Revenue v Trust Bank of Africa Ltd 1975 (2) SA
652 (A) at 666B--D.) The inquiry by its very nature is a stringent
one. Its rationale is presumably that the finding in question is so
vitiated by lack of reason as to be tantamount to no finding at all.





The limitation on this Court's ordinary
appellate jurisdiction in cases of this nature applies not only to
the LAC's findings in relation to primary facts, ie those which are
directly established by evidence, but also to secondary facts, ie
those which are established by inference from the primary facts. The
reason is that the drawing of an inference for the purpose of
establishing a secondary fact is no less a finding of fact than a
finding in relation to a primary fact. (See Magmoed v Janse van
Rensburg and Others 1993 (1) SA 777 (A) at 810H--811G.)





It follows that it is not open to this
Court to depart from a finding of fact by the LAC merely on the
grounds that this Court considers the finding to be wrong or that the
LAC has misdirected itself in a material way or that it has based its
finding on a misconception. It is only when there is no evidence
which could reasonably support a finding of fact or where the
evidence is such that a proper evaluation of that evidence leads
inexorably to the conclusion that no reasonable court could have made
the finding that this Court will be entitled to interfere.





I do not understand the decision in
Atlantis Diesel Engines (Pty) Ltd v National Union of Metalworkers of
South Africa 1995 (3) SA 22 (A) to be inconsistent with the above
proposition. The 'finding' of the LAC referred to at 31I with which
this Court disagreed was not a finding of fact in the true sense but
a finding involving a value judgment. (Compare Media Workers
Association of South Africa and Others v Press Corporation of South
Africa Ltd ('Perskor') 1992 (4) SA 791 (A) at 795C--797J.)





The provision in s 17C(1)(a) limiting
the Court's jurisdiction in relation to findings of fact is somewhat
anomalous inasmuch as the LAC does not hear evidence and has before
it the same material which is before this Court. It does not
therefore have the advantages of a court of first instance and is in
no better position than this Court to make findings of fact. However,
Parliament in its wisdom decided to make the LAC the final arbiter on
issues of fact. It may well be that its reason for doing so is
related to the composition of the LAC or simply to limit the number
of appeals coming to this Court. But whatever the reason, this Court
is not entitled, because it disapproves of the wisdom of the
provision, simply to ignore it or apply some test different from the
well-established test which is to be applied when there is no appeal
on questions of fact.’





[29] It would follow that this court
would not interfere with findings of fact, even where these entail
drawing an inference for the purpose of establishing a secondary fact
– such as employment – unless they are findings which no
court could reasonably have made. As was stressed by Scott, JA in
relation to a similarly worded provision, the legislature has for its
own reasons – presumably primarily related to the need for
obtaining finality and certainty expeditiously in labour disputes,
also evident in the shorter peremptory prescriptive provisions –
decided that appeals from arbitrators are to be confined to questions
of law alone. This court is obliged to give effect to that
legislative choice made, even though arbitrators have frequently
shown in appeals to this court that they have some difficulty in
making proper factual determinations. This court is thus not free to
substitute its own findings of fact for those of the arbitrator,
unless no reasonable court could have made them.





[30] The arbitrator quoted both the
definition of employee and s 128A in his ruling. After referring to
the latter, he correctly acknowledged that a presumption of
employment would arise if one of the eventualities spelt out in the
section were to be established and also correctly, that this
presumption is rebuttable.





[31] After referring to the facts, the
arbitrator found that, although the appellant assisted the respondent
in its business, he was not an employee of the respondent and set
aside his complaint which would need to be based upon an employment
relationship. Although the arbitrator did not expressly find that the
respondent discharged the onus upon it of establishing that there was
not an employment relationship, his finding after a reference to this
presumption and his treatment of the facts would indicate that he
found that the respondent had rebutted the presumption.





[32] The finding that the appellant was
an employee is in my view a finding of fact of the kind described by
Scott JA as a secondary fact, established by inference from the
primary facts. As he stressed, it is no less a finding of fact than a
finding in relation to a primary fact.





[33] The finding reached by the
arbitrator on what was a tricky factual question before him was not
in my view one which no reasonable court could have reached in the
circumstances. He had prefaced his analysis of the facts with the
applicable statutory test in the light of the presumption brought
about by s 128A. He then referred to authorities before approaching
the facts in finally reaching his conclusion on the question. It is
thus not open to me to substitute a finding of fact (of employment)
for that of the arbitrator (of no employment), even if I were
inclined to reach a different conclusion. That course is not open to
me by virtue of s 89 of the Act which has limited appeals to his
court on questions of law alone.





[34] The question raised by this
appeal, thus not being one of law alone, means that it is not open to
me to interfere with the factual ruling made by the arbitrator. This
court does not have jurisdiction to do so. The appeal is accordingly
dismissed for this reason. No order as to costs is made.’





[6] I respectfully agree with the
reasoning in the above extract. Although, as Mr de Beer pointed out,
section 128A was not yet in operation at the time the present appeal
was heard, the statement of the law as expressed in Swarts v
Tube-O-Flex nevertheless finds application in the present matter.





[7] The first respondent’s case
before the second respondent was that he was an employee who had been
unfairly dismissed. The appellant’s case was that the first
respondent was an independent contractor. The first respondent
testified in support of his claim and the appellant presented
evidence by several witnesses.





[8] The facts are, to a large extent,
common cause. It emerged that the appellant orally engaged the first
respondent as a marketing consultant during April 2008. He was paid
an amount of N$35 000 per month in consultation fees on presentation
of an invoice. A draft employment agreement was drawn up by the
appellant, but it was never signed. On 16 February 2009 the parties
entered into a written memorandum of agreement in terms of which the
first respondent would act as a ‘service provider’ and
independent contractor in his capacity as consultant. The first
respondent had to provide certain services for which he would be paid
N$1600 per day up to a maximum of N$35 000 per month within 10 days
of delivery of an invoice. It was a special condition of the
agreement that specific projects ‘as spelt out’ by the
appellant’s representative and the appellant’s marketing
manager would form the basis of the services to be provided by the
first respondent during the contract period. The agreement expired
on 31 May 2009 and was not renewed in writing.





[9] While this agreement was still in
force, the appellant’s canning manager was suspended. The
first respondent was shifted from the appellant’s head office
to the canning department where he performed the duties of canning
manager with overall responsibility for the canning department.
During this time the first respondent assisted with the day to day
running of the canning department and organised the staff. He acted
as supervisor when the suspended manager returned to work and
assessed the latter’s work performance, completed assessment
reports and approved the latter’s leave application. The first
respondent took daily instructions from the factory manager and fell
under the latter’s supervision and control.





[10] During September 2010 the first
respondent received a letter stating that his service agreement with
the appellant was to be terminated on 30 September 2010.





[11] It is common cause that the
appellant did not at any stage deduct PAYE of social security
contributions from the first respondent’s remuneration.





[12] The second respondent analysed the
evidence presented in light of the differences between a contract of
employment and a contract of work as independent contractor
summarized in SA Broadcasting Corporation v Mckenzie (1999) 20 ILJ
585 (LAC). Bearing in mind the definition of ‘employee’
as used in the Labour Act, 2007 (Act 11 of 2007), she also used the
factor of the exercise of control over the first respondent (as
discussed in Paxton v Namib Rand Desert Trails (Pty) Ltd NLLP 1998
(1) 105 (NLC) and in Engelbrecht and others v Hennes 2007 (1) NR 236
LC) and the dominant impression test (as discussed in Engelbrecht v
Hennes (supra)) to conclude on the facts that the first respondent
was the employee of the appellant when his services were terminated.





[13] The second respondent’s
finding was thus one of fact. As such it is unassailable on appeal
by virtue of the provisions of section 89(1)(a) of the Labour Act,
unless the finding is such that no reasonable arbitrator could have
made it.





[14] The error of law which would form
the basis of a question of law in this regard is that the factual
finding that the first respondent was an employee of the appellant is
one which no reasonable arbitrator could have made. The notice of
appeal does not, however, disclose such a question of law. The
question under discussion states: ‘Whether an employment or
independent contractors (sic) relationship existed between Appellant
and First Respondent.’ As pointed out earlier in this
judgment, this is not a question of law, but a question of fact. In
this regard it should be remembered that the second respondent’s
finding was not based only on the interpretation and application of a
written contract between the parties (see Swarts v Tube-O-Flex
(supra), at para. [16]).





[15] In President of the Republic of
Namibia and Others v Vlasiu 1996 NR 36 (LC) O’Linn J held that
where a party wishes to appeal on the ground that a decision of fact
is such that no reasonable Court could have made it, the ground of
appeal should be properly formulated in order to constitute a
question of law. He stated (at 47E-G):





‘It follows from the above that
when a party to a Labour Court proceeding wishes to appeal on the
latter ground, such ground must be properly formulated in order to
constitute a question of law.





In the present case for instance, the
question of law should read:





'Whether or not there was evidence on
the record from which the Labour Court could reasonably have come to
the decision which it did.'





There is no such ground formulated in
the notice of the application for leave to appeal.’





[16] The learned judge dealt with a
series of appeal grounds on the facts, and rejected them as not being
questions of law. He pointed out that that where the appellant bases
its appeal grounds on facts which the appellant contends the Court
should have found, this would in fact be a purported question of law
on which the appellant cannot appeal (at 47I). The clear implication
is that, if the appeal grounds had been framed along the lines he
suggested, they would have constituted properly formulated questions
of law.





[17] There is however, one aspect which
is somewhat troublesome. It is this. It would appear that the
approach in some cases (e.g. Visagie v Namibia Development
Corporation 1999 NR 219 (HC) is to take what would prima facie be a
question of fact contained in the notice of appeal and then to
consider the evidence, where after the test of whether the
finding/conclusion of fact is such that no reasonable court could
have made it, is applied. If the test so applied leads to a positive
answer, the question is then considered to be a question of law. It
would appear that, in following this approach, the court was being
generous towards the appellant.





[18] In my respectful view it should
ordinarily be required of an appellant to frame questions of law
clearly and properly (see also Shilongo v Vector Logistics (Pty) Ltd
(LCA 27/2012 [2014] NALCMD 33 (7 August 2014) at paras. [8] –
[9]). Where factual findings or conclusions are attacked on the
basis that no reasonable court could have made them, it is, as was
stated in President of The Republic of Namibia and Others v Vlasiu
(supra), necessary to properly formulate the question in order for it
to be a question of law. Proper formulation has the added advantage
that it focuses the mind of the framer of the question which should
assist in answering another question which should be uppermost and
that is, whether are there reasonable prospects of success on the
stringent test of whether there is no evidence on which a reasonable
court could have made the particular factual finding or, in other
words, whether no reasonable court could have made the particular
factual finding. In many of the labour appeals serving before this
Court the notices of appeal in my view do not pass this scrutiny.
The notices are frequently actually aimed at merely raising the
prospect that certain factual findings may have been wrong or based
on a misdirection and that, as has been clearly stated in Betha v BTR
Sarmcol (see quotation in Swarts v Tube-O-Flex (supra)), is not the
test. It is, in any event, a general requirement that a notice of
appeal should be clearly framed so that the court and the respondent
may be properly informed on what basis the appeal is brought.





[19] There is a further problem for the
appellant. The grounds for the first question appealed on are not
adequately set out. The only ‘grounds’ relevant to the
first question are set out in paragraph 1 of the notice of appeal and
it states that ‘The arbitrator erred in law by concluding the
First Respondent was an employee of Appellant.’ These are not
proper grounds at all. The framer of the notice of appeal should
have set out all the reasons why it should be held that no reasonable
arbitrator could have come to the conclusion that the appellant was
the first respondent’s employee, or, put differently, why it
should be held that no reasonable arbitrator could have come to the
conclusion that there existed an employment relationship and not an
independent contractor’s relationship between the parties. The
notice of appeal is therefore defective and is a nullity (Wimmerth v
Meatco Namibia (LCA 15/2008, Unreported – 10 June 2011); First
National Bank Namibia Ltd v Van Der Westhuizen and Another 2012 (1)
NR 195 (LC); Namibia Dairies (Pty) Ltd v Alfeus (LCA 4/2014 [2014]
NALCMD (18 September 2014)).





[20] Having come to this conclusion, it
is not necessary to consider the other question on which the appeal
is brought, or the grounds set out for it, because the second
question on appeal is based on the assumption that the first question
is decided in favour of the appellant.





[21] The result is that the appeal is
struck from the roll.





K van Niekerk





Judge





APPEARANCE:





For the appellant: Mr P J de Beer of
De Beer Law Chambers