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IN THE HIGH COURT OF SWAZILAND

JUDGMENT

Case No. 1510/15

In the matter between:

NDZ CONSULTING COMPANY (PTY) LTD 1st Applicant

TRENCOR INVESTMENTS (PTY) LTD 2nd Applicant

VS

SIBUSISO MOHAMMED 1st Respondent

CMAC 2nd Respondent

FANILE GININDZA N.O. 3rd Respondent

Neutral citation: NDZ Consulting Company (Pty) Ltd & Another VS Sibusiso

Mohammed & Others [1510/15] [2017] SZHC 146 (25th July,

2017)

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Coram: FAKUDZE, J

Heard: 17/07/2017

Delivered: 25/07/2017

Summary: Civil Procedure – 1st Respondent claims for costs at Attorney –

own client scale – Applicant resists same on basis that matter

was settled out of court – there was a compromise between the

parties – 1st Respondent not entitled to costs – principles

governing award of costs. Costs follow the event – successful

party entitled to costs – granting of costs discretion of court –

such discretion to be exercised judiciously – since matter settled

between parties, each party to bear its own costs – Application

for costs dismissed.

JUDGEMENT

Background

[1] The 1st Respondent was employed by the 2nd Applicant in April, 2011 as a

mechanic. On or about 2013, the 2nd Applicant came on board and made

employees of the 1st Respondent to sign contracts of employment. No

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terminal benefits were paid to these employees. The 1st Respondent alleges

that he did not sign any contract with the 2nd Applicant. The 1st Respondent

was charged for failing to account for a sum of Two Hundred Emalangeni

(200.00) given to him by the 1st Respondent. He was found not guilty in a

hearing convened by the 2nd Applicant. However, the 1st Applicant did not

allow him to resume his normal duties. He then filed a claim for

compensation for unfair dismissal and terminal benefits. The claim was

filed with the 2nd Respondent, CMAC.

[2] The 3rd Respondent made an Arbitration Award in favour of the 1st

Respondent. The Award specifically provided that payment of the amounts

due to the 1st Respondent should be on or before the 30th June, 2015.

Parties’ contention

The 1st Respondent’s Case

[3] The 1st Respondent argues that following the registration of the Arbitration

Award, the matter was set down on the 28th August, 2015 under Industrial

Court Case No. 380/15. After the matter had been set down, the Applicants

then moved an Application at the High Court for Review of the proceedings

of the Arbitration. The Application for Review was filed by the 1st and 2nd

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Applicants out of time as envisaged by Section 85(4)(b) of the Industrial

Relations Amendment Act, 2010. The Applicants, so argues the 1st

Respondent, should have filed the Review Application within a period of

Twenty One (21) days from the date of issuance of the Arbitration Award.

[4] After the Review Application was filed at the High Court, the Industrial

Court ordered that it be removed from its Roll. When the proceedings were at the

High Court, the parties exchanged pleadings. They were closed. The 1st

Respondent filed its Heads of Argument and the Applicants never filed

theirs causing the matter to be postponed time and again. The 1st Respondent then

alleges that the Applicants have decided to abandon the Review Application

and the matter was then settled out of court. Notwithstanding the

abandonment, the Applicants are refusing to pay the 1st Respondent’s costs,

hence the matter has been left to the court to decide on it. The costs the 1st

Respondent is paying for are at an attorney and own client scale. This has

always been the 1st Respondent’s prayer since the litigation started, so

alleges the 1st Respondent.

[5] The reason why the 1st Respondent claims that it is entitled to costs is that

the Applicants have unjustly compelled the 1st Respondent to engage in

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litigation. If the Applicants had complied with the Arbitration Award the matter

would have reached finality unless the Applicants seek to challenge it by

way of review and within the 21 days period as stipulated in the Industrial

Relations Act, 2000. By failing to prosecute its case on time, the Applicants are

abusing the court process and are also purposely frustrating the 1st Respondent

in whose favour the award was made.

[6] The 1st Respondent finally submits that the circumstances in the present case

warrant the granting of costs in favor of the 1st Respondent in that he was

unfairly dismissed from work by the Applicants, was summoned by the

Applicants to appear for purposes of a disciplinary hearing in which he was

found not guilty, but was nevertheless fired. The 1st Respondent also

appeared before the Arbitrator who ruled in his favor and granted him the

Award which the Applicants failed to timeously honour. The 1st Respondent

approached the Industrial Court for the endorsement of the Award and same was

opposed by the Applicants. They then filed a Review Application in the High

Court, which they failed to pursue. All these facts show that the

Applicants were abusing the court process and the 1st Respondent has been put

out of pocket.

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The Applicants’ case

[7] The Applicants allege that the matter to be resolved by this court pertains to

costs which the 1st Respondent claims for opposing the Review Application.

In resisting the claim for costs, the Applicants state that since the parties

concluded the issue by mutual agreement between them, this signifies that

the parties ignored the merits and the demerits of the Review Application.

Focus was then placed on the quantum of the Arbitration Award to get the

matter amicably settled and put to rest.

[8] The Applicants further contend that the reason it challenged the Arbitration

Award was that there was a glaring irrational disconnect between the

evidence adduced during the hearing and proved information before the

arbitrator. Other factors were also alleged in the Founding Affidavit to the

Review Application. The Applicants aver that it is common cause, that

despite several set downs made before this Honourable Court and a chance

never availed for the parties to be heard in arguments with respect to the points of

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law raised by the 1st Respondent, it was in March, 2017 wherein a spirit of

settlement prevailed upon the parties.

[9] Since the dispute between the parties was compromised in that the merits

and demerits of the matter were not adjudicated upon, the dispute between the

parties extinguished. In support of its proposition the Applicants made

reference to the wise words of Rooney J. in the Botswana case of Township

Rollers Football Club V Botswana Football Association 1974(1) B.L.R.

20 at p. 23, where His Lordship said that:-

“I am by no means convinced that where an action had been

compromised, the Plaintiff might proceed with the action for costs

only. A compromise implies something more than either the abandonment

of an action or a consent order to judgment. It involves the mutual

adjustment of conflicting claims and interests without regard to their

merits and the rights and obligations of the parties thereto.”

His Lordship further observed that

“……… the dispute between the parties having been compromised

could not be revived merely to settle the question of costs.”

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The Applicable law

[10] The basic rule pertaining the award of costs is that costs are awarded based

on the discretion of the court. Such discretion should be exercised judiciously.

In the case of Nedbank Swaziland V Sandile Dlamini NO Civil Case No.

144/2010, His Lordship Maphalala M.C.B. J (as He then was), cited with

approval at page 10, the case of Kruger Brothers and Wasserman V

Ruskin 1918 A.D. 63 at 69 where Innes C.J. stated the basic rule as follows:

“…………. the rule of our law is that all costs unless expressly

otherwise enacted, are in the discretion of the judge. His discretion

must be exercised judicially.”

[11] In Fripp V Gibbon and Company 1913 A.D. at 363, His Lordship De

Villiers P pointed out the difficulty courts face in deciding the award of

costs when the Learned Judge said:

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“It is common cause that while, as a rule, there is no room for the

discretion of a Magistrate or a Judge on the merits of a case as he is

bound to decide the issues between the parties in accordance with

their rights as established at the trial, on the matter of costs, the law allows

him a discretion, which of course is a judicial discretion. Questions

of costs are always important and sometimes complex and difficult to

determine and in leaving the Magistrate a discretion the law

contemplates that he should take into consideration the circumstances

of each case carefully weighing the various issues inducing the

conduct of the parties and any other circumstance which may have a

bearing upon the question of costs, and then make such order as to

costs as would be fair and just between the parties………”

[12] The Learned authors, Herbstein and Van Winsen, The Civil Practice of the

Supreme Court in South Africa (3rd Edition at pages 477 to 478, deal with

the fundamental rules relating to the award of costs. They observe that:

“The award of costs is a matter wholly within the discretion of the

Court. But this is a judicial discretion and must be exercised upon

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grounds on which a reasonable man could have come to the

conclusion arrived at…….”

[13] On the issue of costs on Attorney and own client basis, the Superior Courts

in our jurisdiction have provided some guidelines. In the High Court Case of

Sikhumbuzo Thwala V Pholile Thwala (nee Dlamini) Case No. 101/12,

the Learned Justice Ota said:

“Now the award of costs of and Incidental to any proceedings is at

the discretion of the court. This discretion, like any other discretion must

be exercised judicially on fixed principles, that is according to rules of

reason and justice, not according to private opinion. Similarly the

exercise of the discretion must not be effected by questions of

benevolence and sympathy. In exercising this discretion, the court

looks at the result of the action itself as well as the conduct of the

parties to see whether either of them had in any way involved the other

unnecessarily in the expense of litigation. The court looks at all

the facts of the case. It is imperative for me to observe here that

the attorney and client costs sought by the Respondent is one that

the court approaches with caution. The judicial accord is that this scale

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of costs is only awarded where there are compelling circumstances that

would justify same. The cautious approach is underscored by the fact

that the court is loath to penalise a party who has lawfully exercised his

right to obtain a judicial decision in any complaint he might have.”

Court’s Analysis and Conclusion

[14] The 1st Respondent’s contention is that the Applicants filed the Review

Application out of time and contrary to the provisions of the Industrial

Relations Act, 2000 especially Section 85 (4)(b). This is the first reason

why costs at attorney and own client scale should be awarded to it. The court’s

observation on this point is that it was initially raised by the 1st Respondent

as a point of law when this party was filing its Answering Affidavit. Page

43 of the Book of Pleadings reflects this. If same had been fully

argued before the High Court, the court would have made its finding on it.

Unfortunately, the whole case was not fully argued because the parties then

opted to settle out of court all the issues around the Review Application.

This court cannot therefore pronounce that the 1st Respondent is entitled

to costs at attorney and own client basis with respect to a point of law that

was never argued by the parties.

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[15] The 1st Respondent further justifies the entitlement to costs at attorney and

own client basing it on the fact that after the Review Application had been

filed at the High Court, the Applicants did not prosecute it speedily and

timeously notwithstanding that the pleadings had been filed. The pleadings

included the filing of Heads of Argument by the 1st Respondent. There were

also various postponements. All these seek to prove that the Applicants

filed the Review Application for purposes of frustrating the implementation of the

Arbitration Award.

In response to this allegation, the Applicants state that as of right they had

to defend their interests by whatever available legal processes. The

Arbitration Award Review Application was filed in good faith with a view

to establishing some shortcomings in the manner in which the Award was

granted. The matter was resolved amicably between the parties through a

negotiated process. The merits and demerits of the Review were not dealt

with by a court of law. The court’s view is that there is no merit in what

the 1st Respondent is saying to establish and justify him being granted costs at

attorney and own client basis. The 1st Respondent has failed to produce

anything to establish that he was the successful party. It is common cause

that costs follow the event. This court holds the view that in all honesty,

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the Applicants were on a mission to exercise their right even if they did so

out of time. The High Court Judge’s file reflects that on two occasions the

matter was postponed at the instance of the 1st Respondent for non-

appearance by the Applicants. On these occasions, the 1st Respondent was

granted wasted costs for the day. The other consideration is that the matter

was settled out of court between the parties. As the Applicants rightly pointed

out, it is difficult to tell who the successful party was. The dispute between

the parties was compromised and the merits and the de merits of the case were

not dealt with.

[16] In light of the foregoing I hereby order as follows:

(a) The matter for determination between the 1st Respondent and the

Applicants is hereby dismissed and the 1st Respondent is not entitled

to the costs prayed for.

(b) Each party shall bear its own costs with respect to this Application.

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APPLICANT: Z. MAGAGULA

1ST RESPONDENT: S.G. DLAMINI