Court name
Supreme Court
Case name
National Housing Enterprise v Beukes and Others
Media neutral citation
[2015] NASC 3
Judge
Garwe AJA










IN THE SUPREME COURT OF
NAMIBIA





CASE NO: SA 21/2013





DATE: 02 MARCH 2015





REPORTABLE





In the matter between:





NATIONAL HOUSING
ENTERPRISE.................................................................................Appellant



And



EDWIN
BEUKES.........................................................................................................First
Respondent





SIMON PHILLEMON
NUUJOMA.......................................................................Second
Respondent





GOTTFRIED MBAHIMUA
UAENDERE...............................................................Third
Respondent





EVELYNE
UANIVI..................................................................................................Fourth
Respondent





GUSTAV HANGANEE
MUPURUA..........................................................................Fifth
Respondent





CATHLEEN EILEEN
MULLER...............................................................................Sixth
Respondent





LORETTE
PHILANDER.......................................................................................Seventh
Respondent





Coram: MAINGA JA, ZIYAMBI AJA and
GARWE AJA





Heard: 8 July 2014





Delivered: 2 March 2015





APPEAL JUDGMENT





GARWE AJA (MAINGA JA and ZIYAMBI AJA
concurring):





Introduction





[1] This is an appeal against the
judgment of the Labour Court (per Kauta AJ, as he then was) handed
down on 27 February 2013. Pursuant to certain findings made in that
judgment, the Labour Court dismissed with costs an urgent application
filed by the appellant seeking an order setting aside proceedings
that were due to commence in the District Labour Court.





[2] The background to those proceedings
is aptly captured in the review judgment of Smuts J dated 13 May 2011
in a matter involving the same parties. In summary it was the
finding of Smuts J that the proceedings that had taken place before
the District Labour Court, at the end of which an order had been made
in favour of the respondents, were so replete with numerous
irregularities that such proceedings could not be allowed to stand.
In the event the learned judge set aside the entire proceedings,
including the judgments and orders made by the District Labour Court,
and further ordered that in the event that any of the parties decided
to proceed with the complaint, such proceedings were to take place
before a different chairperson of the District Labour Court.





[3] Following the review judgment of
Smuts J, the respondents approached the District Labour Court and
sought a new date for the hearing of the matter. On 29 June 2012 the
appellant filed an application, on a certificate of urgency, in which
it sought an order setting aside the proceedings before the District
Labour Court and dismissing the relief sought by the respondents. The
gravamen of the application was that the proceedings were frivolous
and vexatious and ‘obviously unsustainable’. It was
further contended that the proceedings amounted to an abuse of the
process of the court. In the alternative, an order was sought, in the
event that the main relief was refused, directing the respondent
Edwin Beukes, to provide security in the sum of N$350 000 for the
appellant’s costs in the proceedings that were to take place
before the District Labour Court and in the event of failure to
provide such security by 20 July 2012, permitting the appellant, on
the same papers, to apply for the setting aside of the proceedings
before the District Labour Court.





[4] The urgent application was set down
before Kauta AJ. In his judgment, Kauta AJ accepted the general
principle that a court has an inherent right to control its process
and in particular to prevent an abuse of its process in the form of
frivolous and vexatious litigation. He further accepted the position
that in a proper case, the court retains the power to strike out such
a claim.





[5] Having considered a number of
authorities on the subject, Kauta AJ came to the conclusion that this
was not a proper case for the exercise of such a power. In particular
the learned judge was of the view that whilst such a power can be
exercised in proceedings involving the same parties in the same forum
in which the litigation would have commenced, the exercise of such
power was unprecedented in a case in which a superior court, on
application, is asked to stay the proceedings taking place before a
lower court on the basis that such proceedings were frivolous,
vexatious and ‘obviously unsustainable’.





[6] On the alternative prayer for an
order for the respondents to furnish security for costs, the learned
judge was of the view that, there being no requirement for the
provision of security in the applicable rules in a case where payment
of security is sought in respect of frivolous and vexatious
litigation, such relief was not available to the appellant. The Rules
are the Magistrates’ Court Rules which also apply to the
District Labour Court.





[7] In the result, the learned judge
dismissed the application, but made no order as to costs.





[8] Dissatisfied, the appellant
appealed to this court against the decision of the court a quo and
now seeks the setting aside of the order of the court a quo and the
substitution thereof with an order as prayed for in the court a quo.





The appellant’s submissions on
appeal





[9] In submissions made before this
court the appellant contended that the conclusions arrived at by
Kauta AJ evidenced a number of substantial errors. Amongst these was
the failure to consider certain contentions relied upon by the
appellant, such as the suggestion that the respondents, in accepting
retrenchment packages, had perempted the right to be re-instated,
that reinstatement was sought in respect of an employee who was now
deceased and that any possible claim for compensation would be
time-barred and prescribed.





[10] The appellant further contended –





(a) That the submissions previously
made before Smuts J had not been made in the context of an
application to permanently stay proceedings that amounted to an abuse
of process.





(b) That the court a quo had failed to
consider the merits of the relief sought by the respondents or the
grounds upon which the appellant contended that such relief was
obviously unsustainable. Any claim for compensation on behalf of any
of the respondents would have become time barred and since a period
of eight (8) years had lapsed since their retrenchment, reinstatement
was effectively impossible.





(c) That s 117(1)(h) and 117(1)(i) of
the Labour Act 11 of 2007 (the Act) empowers the Labour Court to make
any order which the circumstances may require in order to give effect
to the objects of the Act and further the Labour Court may generally
deal with all matters, necessary or incidental to its functions under
the Act. In other words the Labour Court is at liberty to make any
order which the circumstances may require in order to give effect to
the objects of the Act, one of which is to achieve a fair
determination and disposal of issues between the litigants in labour
proceedings.





(d) That in order to obviate the
patently unfair results that would ensue were the District Labour
Court proceedings to continue, particularly in view of the fact that
the respondents are likely to continue with the hearing of the
proceedings and appellant is likely to be subjected to meritless and
obviously unsustainable but expensive proceedings in which
substantial irrecoverable costs would be incurred, the Labour Court
has jurisdiction to grant the relief sought ‘in order to give
effect to the objects of the Act’ as provided in s117(1)(h) of
the Act.





(e) That in terms of s 117 of the Act,
the Labour Court can compel the furnishing of security for costs as
it has jurisdiction to deal ‘with all matters necessary or
incidental to its functions under this Act concerning any labour
matter’.





The respondents’ submissions
on appeal





[11] The respondents accept that the
Labour Court has the inherent power to set aside proceedings that
amount to an abuse of the process of the Court. However, they argue
that such power must relate to proceedings between the same parties
in the same forum in which the litigation emanates and not to
proceedings pending before a lower court, which are sought to be set
aside on the basis that such proceedings constitute an abuse of the
process of that lower court.





In this regard they further submit the
following:





(a) That the invitation to the Labour
Court to stay the proceedings of the District Labour Court on the
basis that such proceedings are an abuse of court process would mean
that the Labour Court would have to deal with the merits of a matter
not pending before it.





(b) That the Labour Court correctly
refused to grant the request for security for costs because the
proceedings in respect of which such security for costs was sought
were not pending before it.





(c) That matters pending before a
District Labour Court can only be dealt with by the Labour Court on
appeal or as an interlocutory matter incidental to the proceedings
but ‘which does not deal with the merits of the matter’.





Issues for determination





[12] Although both sides have raised
various issues in their submissions, it is clear that there is one
central issue that falls for determination. That issue is whether the
Labour Court has the inherent jurisdiction to stay proceedings that
are pending before a lower court on the basis that such proceedings
are frivolous and vexatious and obviously unsustainable. In the
alternative, the issue that falls for determination is whether the
Labour Court has jurisdiction to require a party appearing before a
District Labour Court to provide security for costs in respect of
proceedings taking place before that court.





The other issues raised by the
appellant would depend on whether the Labour Court has the necessary
power or jurisdiction to intervene in unterminated proceedings before
a lower court. If it does not, then that would be the end of the
matter. If it does, the question that would then arise is whether the
proceedings before the District Labour Court stand to be dismissed on
the basis that they are frivolous and vexatious and obviously
unsustainable.





The powers of the Labour Court





[13] It is a correct statement of the
law that at common law, our superior courts have inherent
jurisdiction to prevent an abuse of their process by either staying
proceedings in certain circumstances or even dismissing them
altogether, but the power to do so will be exercised sparingly and
only in exceptional circumstances. Proceedings will be stayed when
they are vexatious or frivolous or when their continuance, in all the
circumstances of the case, is, or may prove to be, an injustice or
serious embarrassment to one or other of the parties - The Civil
Practice of the Supreme Court of South Africa, 4 ed, by Herbstein and
Van Winsen at p 245; see also Namibia Financial Institutions
Supervisory Authority v Christian and Another 2011 (2) NR 537 (HC).





A court also has inherent jurisdiction
to dismiss proceedings altogether as being frivolous or vexatious in
order to prevent an abuse of its powers but the elementary right of
free access to the courts will not be interfered with by the summary
dismissal of an action without hearing evidence, on the ground of
vexatiousness, unless it is manifest that the action is so unfounded
that it could not possibly be sustained and it is clear that the
failure of the action is a foregone conclusion – The Civil
Practice of the Supreme Court of South Africa, op cit, at pp 247-248.





Inherent jurisdiction is the reserve or
fund of powers, a residual source of powers, which the court may draw
upon as necessary whenever it is just or equitable to do so, and in
particular to ensure the observance of the due process of law, to
prevent improper vexation or oppression, to do justice between the
parties and to secure a fair trial between them – Montreal
Trust Co v Churchill Forest Industries (Manitoba) Ltd (1971) 2 DLR
(3rd) 75.





[14] An action may be held to be
vexatious if it is ‘obviously unsustainable’ or
‘frivolous, improper, instituted without sufficient ground, to
serve solely as an annoyance to the defendant’ – Golden
International Navigation SA v ZEBA Maritime Company Limited; ZEBA
Maritime Company Limited v MV Visvliet 2008 (3) SA 10 (C).





[15] A court will grant a stay where
the case ‘stands outside the region of probability altogether
and becomes vexatious because it is impossible’ – Ravden
v Beeten 1935 CPD 269, 275-276.





The District Labour Court





[16] At the relevant time the District
Labour Court exercised the powers of a Magistrates’ Court. The
use of the word ‘exercised’ is deliberate because it is
common cause it no longer exists as such. It is also not in dispute
that it is not a superior court and that it can only exercise such
powers as are given to it in terms of statute. A Magistrates’
Court has no inherent jurisdiction to control its own process or to
develop the common law – The Civil Practice of the Magistrates’
Court in South Africa by Jones and Buckle, 10 ed, Vol 2; the Rules
at Rule 5.





Whether the Labour Court has the power
to interfere in uncompleted proceedings of a lower court





[17] Whilst there can be no doubt that
the Labour Court does enjoy the inherent jurisdiction to control its
own process, the issue that arises in this appeal is whether, it has
similar jurisdiction to control process in a lower court.





[18] There is a plethora of decided
cases which are authority for the proposition that it is
inappropriate for a superior court to intervene in unterminated
proceedings of a lower court.





[19] In Masedza and Others v Magistrate
Rusape and Another 1998 (1) ZLR 36 Devittie J remarked at p 39G-40A:





‘The position has always been
that the right of appeal against an interlocutory decision of a
magistrate’s court is limited to cases where there has been a
conviction. The justification has been stated in several case
authorities. In Ellis v Visser and Another 1956 (2) SA 117 (W),
Murray J stated at p 124:





“If the applicant’s
contention in this case is correct, then in every one of these cases
where a decision is taken by a magistrate there would be just as much
reason as in the present case for the accused person to claim that
this matter be decided in limine without awaiting the results of the
merits of the case. The result would, I think, create chaos –
one envisages a succession of appeals from the Local Division to the
Provincial Division and the Appellate Division, whereas it is
desirable that the actual merits should be speedily disposed of; and
any decisions which are wrong in law should be corrected in the
ordinary way by appeals, as there can be no miscarriage of justice,
no abuse of process of the court, if the ordinary procedure is
followed.”’





At p 40C the learned judge continued:





‘But it is not every type of
irregularity that will justify the court intervening by way of
review. McComb v Assistant Resident Magistrate and Attorney General
1917 TPD 717 was a case where the magistrate had refused to allow
certain questions to be put to a State witness. The matter was
postponed in order to allow an application to be made for a mandamus
that the magistrate allows the questions. This is what the court said
at 718:





“Moreover, as pointed out by my
brother Gregorowski, if the court is called upon to intervene
whenever a magistrate disallows a question in cross-examination, it
might protract the hearing of the case indefinitely. After having got
the court’s ruling on the question, when the matter comes up
before the magistrate again, the attorney may wish to put other
questions which the magistrate deems wholly irrelevant and the
magistrate may disallow them, and an application may again be made to
this court for a mandamus to compel the magistrate to allow the
questions. That only shows how undesirable it is for the court, in
the absence of good reasons, to intervene in the middle of (or
rather, as in this case, at the beginning) of criminal proceedings
upon an application of this nature.”’





[20] There is however an exception to
this rule. In a proper case a superior court can grant relief –
before completion of the proceedings in a lower court – in
order to obviate a grave injustice. In general a superior court
should be slow to intervene in unterminated proceedings in a court
below and should confine the exercise of such powers to rare cases
where grave injustice might otherwise result or where justice might
not by any other way be attained. In Mantzaris v University of
Durban–Westville and Others (2000) 10 BLLR 1203 (LC), Lyster AJ
remarked at 1210H-J and 1211A:





‘This approach arises from
principles which have long been established by our courts, that as a
general rule a superior court will not entertain an application for
review, when such review seeks to interfere with uncompleted
proceedings in an inferior court (Lawrence v Assistant Magistrate,
Johannesburg 1908 TS 525; Ginsberg v Additional Magistrate, Cape Town
1933 CPD 357 at 361; Ellis v Visser 1956 (2) SA 117 (W) at 120-121;
Sita v Olivier 1967 (2) SA 442 (A); Haysom v Additional Magistrate
Cape Town 1979 (3) SA 155 (C) at 160; Mendes v Kitchings NO 1996 (1)
SA 259 (E) at 260).


In the matter of Wahlhaus v Additional
Magistrate, Johannesburg 1959 (3) SA 113 (A) the court held that a
superior court would be slow to exercise any power upon the
unterminated course of criminal proceedings in a court below, but it
would do so in rare cases where grave injustice might otherwise
result or where justice might not by other means be attained.’





[21] On a consideration of all the
above authorities, I take the view that a superior court can, but
only in very exceptional circumstances, intervene in uncompleted
proceedings, be they civil or criminal, in order to prevent or
obviate a clear miscarriage of justice. The process for achieving
such intervention may be an appeal or a review application.





[22] Coming back to the facts of the
present case, it is clear that the proceedings before Kauta AJ were
neither an appeal nor a review. Rather they were proceedings based on
the inherent jurisdiction of the Labour Court to interfere in
unterminated proceedings of a lower court.





[23] In general, the position must, I
think, be accepted as correct that the exercise of inherent
jurisdiction by a court must be limited to matters coming before it
and not another court.





[24] In Nyaguwa v Gwinyayi 1981 ZLR 25,
the petitioner filed an urgent chamber application in the High Court
of Zimbabwe for the issuance of a rule nisi, calling on the
respondent to show cause on the return day why he should not be
allowed to regain occupation of premises pending the outcome of an
application to be filed in the Magistrates’ Court for the
rescission of the default judgment pursuant to which an order of
ejectment had been granted. Counsel for the petitioner in that case
stressed in his submissions that he was relying on the inherent
jurisdiction of the High Court to remedy an injustice.





[25] In dismissing the application,
Pittman J remarked at 27D-G:





‘I understand Mr Jagger’s
submissions to be that this court has an inherent jurisdiction to
remedy injustice, that the obtaining and enforcement of the ejectment
order had been unjust, and that unless this court granted the
petitioner the right to reoccupy the premises, pending the outcome of
his application for rescission, there would be no way in which he
could avoid the loss he would suffer through having to remain out of
the premises until the ejectment order had been rescinded. According
to paragraph 13 of the petition, his application for rescission
“cannot be heard for some weeks by virtue of the Rules of
the Magistrates’ Court . . .”





For the purposes of this judgment, I
shall accept that the ejectment order was unjustly granted, but,
despite the forceful eloquence with which Mr Jagger presented his
argument, I remain of the opinion that the relief sought by the
petitioner, if granted, would constitute an unauthorised interference
by this court with the proceedings in the magistrates’ court.
Mr Jagger was unable to refer me to any authority for such
interference, and I have been unable to find any subsequently. For
this reason alone, I would dismiss the application.’





[26] On whether the High Court, being a
superior court, had the power to interfere in proceedings pending
before the Magistrates’ Court on the basis that the court had
the inherent jurisdiction to remedy an injustice, the learned judge
remarked at 27A-B as follows:





‘I was of the opinion that, in
this country, each court is a creature of statute, and its powers are
created and defined by statute. The function of every civil court is
to recognise what it believes to be the rights of the parties before
it. Once a civil court has given such recognition, that recognition
must be accepted by each of the other courts, whatever its relative
position in the hierarchy of courts may be, unless authority to
overrule such recognition has been conferred upon it by statute. If
one court were to claim that it has some inherent power to overrule
another court, instead of a power specifically created by statute, in
effect it would be claiming the power to nullify the body of statute,
which specifically relates to the establishment and powers of each of
the civil courts in the country. . .’





I agree entirely with the above remarks
which apply squarely to the facts of this case.





[27] The conclusion I reach is that a
Labour Court has no inherent jurisdiction to intervene in the
unterminated proceedings of the District Labour Court on the basis
that such proceedings are frivolous and vexatious and obviously
unsustainable.





[28] Inherent jurisdiction cannot
possibly be invoked in proceedings that are not before the Labour
Court and are in the province of another forum. The essence of
inherent jurisdiction is that a superior court hearing a particular
matter must be enabled to control the conduct of such proceedings
before it. Such control cannot possibly apply to proceedings taking
place in lower courts. The proceedings can only be subjected to
scrutiny by a superior court if they are the subject of an appeal or
review before such court.




Whether the Labour Act allows the
exercise of inherent jurisdiction in proceedings in a lower court





[29] The appellant has cited various
sections in the Labour Act as empowering the Labour Court to
interfere in labour proceedings. In particular the appellant has
referred to:





(a) Section 117(1)(h) of the Labour
Act, 11 of 2007 which provides that the Labour Court may make any
order which the circumstances may require in order to give effect to
the objects of the Act.





(b) Section 117(1)(i) of the same Act
which provides that the Labour Court may generally deal with all
matters necessary or incidental to its functions under the Act,
irrespective of the fact that such issues may be governed by the
Labour Act, any other law or the common law.





(c) Section 119(3) which provides that
the purpose of the rules of the court, is, inter alia, to achieve a
fair disposal of the proceedings.





[30] My considered view is that the
above cited sections must be read in context. The interpretation
suggested by the appellant that the sections must be interpreted to
mean that the Labour Court can do virtually anything to give effect
to the objects of the Act, or to deal with all matters necessary or
incidental to its functions under the Act, or to achieve a fair
disposal of the proceedings including interference with proceedings
pending in a lower court, is untenable. The Labour Court remains a
creature of statute and, unlike the High Court, can only do that
which the law allows. The provisions cited by the appellant in my
view relate to proceedings that are properly before the Labour Court
itself. Those provisions cannot be authority for the proposition that
the Labour Court can intervene at any stage in proceedings taking
place before a subordinate court.





[31] I find therefore that the sections
relied upon by the appellant do not confer jurisdiction on the Labour
Court to intervene in the manner suggested by the appellant. Whilst
it is clear that proceedings from the District Labour Court may, in
appropriate circumstances, be the subject of an appeal or a review
before the Labour Court, such proceedings cannot be subject to
interference by the Labour Court on the basis contended for by the
appellant in this case.





Security for costs





[32] It is common cause that the
District Labour Court has no jurisdiction to order payment of
security for costs on the basis that the proceedings before it are
frivolous, vexatious or obviously unsustainable.





[33] Consequent upon the finding that
the Labour Court has no inherent jurisdiction to interfere in
proceedings before the District Labour Court on the basis that they
are frivolous, vexatious or obviously unsustainable, it follows that
the Labour Court has no authority to order the payment of security
for costs in proceedings taking place in the District Labour Court.





Disposition




[34] The alternative relief must, like
the main, fail.





[35] In the result the following order
is made:





The appeal is dismissed with costs,
such costs to include the costs of one instructing and one instructed
counsel.





GARWE AJA





MAINGA JA





ZIYAMBI AJA





APPEARANCES





APPELLANT: T A Barnard





Instructed by Koep & Partners



FIRST, FOURTH, TENTH and ELEVENTH
RESPONDENTS: S Rukoro





Instructed by Diedericks Inc



SECOND, THIRD, FIFTH, SIXTH SEVENTH,
EIGHTH AND NINTH RESPONDENTS: S Rukoro





Instructed by Director of Legal Aid