Board of Executors Ltd v McCafferty

• Jurisdiction: South Africa

Board of Executors Ltd v McCafferty
2000 (1) SA 848 (SCA)

2000 (1) SA p848

Citation	2000 (1) SA 848 (SCA)
Case No	442/99
Court	Supreme Court of Appeal
Judge	Mahomed CJ, Grosskopf JA, Zulman JA, Streicher JA, Farlam AJA
Heard	November 16, 1999
Judgment	November 29, 1999
Counsel	JJ Gauntlett (with him EW Fagan) for the appellant; PR Jammy for the respondent

Flynote : Sleutelwoorde

Employment law — Employer — Who is — Respondent employed by company forming part of group owned by appellant company — First company paying respondent's salary and attending to all administrative matters G relating to his employment — Respondent's employment terminated by means of letter written on letterhead of appellant and signed by group regional director of appellant — Respondent advised that employment terminated by appellant and that appellant obliged to retrench respondent because of operational requirements — Letter also H offering respondent retrenchment package — Clear from use of appellant's letterhead and contents of letter that appellant considered itself to be respondent's employer and as such entitled to terminate respondent's employment — Respondent having accepted that employment terminated by letter but contending that retrenchment and package offered to him unfair — Respondent and appellant having tacitly I agreed that appellant could terminate respondent's employment within group — Appellant thus having had direct control over respondent's activities within group — Appellant at least co-employer, together with first company, of respondent.

Labour law — Labour Relations Act 28 of 1956 — Labour Appeal Court — Appeal to Supreme Court of Appeal — Appeal in terms of s 17C(1)(a) from decision or order of Labour Appeal Court 'except a decision on a J

2000 (1) SA p849

question of fact' — Reiterated that appeal to A be decided on facts found by Labour Appeal Court and that such findings of fact comprising (1) actual findings of fact made by Labour Appeal Court and (2) findings of fact of industrial court either expressly or tacitly approved by Labour Appeal Court and consequently incorporated in its judgment — In addition, Supreme Court of Appeal entitled to have regard to facts appearing from record of proceedings of industrial B court insofar as not inconsistent with facts found by Labour Appeal Court.

Headnote : Kopnota

In terms of s 17C(1)(a) of the Labour Relations Act 28 of 1956 there is no appeal against the Labour Appeal Court's decisions of fact. In National Union of Metalworkers of SA v Vetsak Co-operative and Others 1996 (4) SA 577 (A) at 583J - 584A it was C held that findings of fact comprise (1) actual findings made by the Labour Appeal Court and (2) any factual findings of the industrial court which were either expressly or tacitly approved by the Labour Appeal Court and thus incorporated in its judgment. In Performing Arts Council of the Transvaal v Paper Printing Wood and Allied Workers Union and Others 1994 (2) SA 204 (A) at 214F it was held that the D Supreme Court of Appeal may also have regard to the facts which appear from the record of the industrial court insofar as they are not inconsistent with the facts found by the Labour Appeal Court. (Paragraph [2] at 853I - 854A/B.)

The respondent applied to the industrial court for the determination of a dispute between himself and the Board of Executors E Merchant Bank Ltd (BOE - MB). He sought an order declaring that his retrenchment from the employ of BOE - MB constituted an unfair labour practice. Before any evidence was led the industrial court ordered that the appellant be substituted for BOE - MB. The appellant thereupon denied that the respondent had been employed by it or that it had dismissed the respondent. By agreement between the parties the question whether the respondent had been employed by the appellant was determined separately from the other issues. The industrial court held F that he had been so employed. The Labour Appeal Court dismissed an appeal to it but granted the appellant leave to appeal to the Supreme Court of Appeal. The only issue on appeal was thus whether the respondent had at the relevant time been employed by the appellant. The Labour Appeal Court based its findings on the following facts. The appellant held all the issued shares in the Board of Executors (BOE G 1838), the company originally established by an Act of the Cape Parliament, and in BOE - MB. The money market operations and all other banking operations of BOE 1838 had been taken over by BOE - MB after the name of an existing company had been changed to 'Board of Executors Merchant Bank Ltd'. All these companies fell within what was known as the BOE group of companies. The group had an executive committee H consisting of the appellant's managing, deputy managing and financial directors, as well as the managing directors of the separate companies within the group. This committee reported to the appellant and controlled the running of the companies within the group. The respondent was initially (with effect from February 1990) employed by BOE 1838. According to his salary slip his employer was the 'Board of Executors'. A year later one B, an executive director of the I appellant and the managing director of BOE - MB, wrote a letter to the respondent on the letterhead of BOE - MB in which his appointment to the position of 'Manager - BOE Merchant Bank Ltd' was confirmed. The respondent worked in the 'financial innovation unit', a one-person unit run by himself. He submitted reports and plans to BOE - MB and carried out his daily tasks subject to their supervision. The J

2000 (1) SA p850

salary slips issued to the respondent continued to reflect BOE A 1838 as his employer and the date of his engagement as February 1990. His salary was in fact paid by BOE 1838 who on behalf of BOE - MB attended to all administrative matters relating to his employment and recovered the sum paid to the respondent from BOE - MB. During December 1991 the managing director of the appellant wrote to the B respondent on the appellant's letterhead informing him of the so-called 'BOE executive share option scheme'. The respondent was offered 10 000 shares 'in the company' at 1 250 cents per share. The offer was accepted. In August 1992 one T, the managing director of the BOE - MB and the group regional director of the appellant, informed the respondent by a letter written on the letterhead of BOE - MB C that he saw no alternative but to close the financial innovation unit; that there was no other area within BOE - MB where the respondent's skills could gainfully be employed; and that he recommended that respondent accept a retrenchment package. The respondent's employment was eventually terminated in September 1992 by a letter written on the letterhead of the appellant and signed by T in his capacity as group regional director. In it the respondent was D advised that his employment had been terminated because the operational requirements of the organisation were such that the financial innovation unit had to be closed. It also referred to the above-mentioned retrenchment package. It further appeared that the appellant was not registered as an employer, that the respondent was not registered as an employee of BOE - MB and that everyone in the group was employed by BOE 1838.

In terms of s 1 of the Labour Relations Act 28 of 1956 'employer' E means 'any person . . . who employs or provides work for any person and remunerates or expressly undertakes to remunerate him or who . . . permits any person . . . in any manner to assist him in the carrying on or conducting of his business . . .'.

Held, that, interpreted in the light of the letterhead used, the letter of September 1992 had advised the respondent that the F appellant had terminated his employment. The August 1992 letter, which was written on the letterhead of BOE - MB, did not purport to terminate the respondent's employment but recommended only that the respondent accept a retrenchment package. There was no evidence to support the appellant's contention that letterheads were used indiscriminately and, in the absence of evidence to the contrary, the use of another letterhead when it came to the termination of the G respondent's employment created the impression that deliberate use had been made of the appellant's letterhead. There was also no evidence that the wrong letterhead had been used in this particular case or that T did not have the authority to write the letter of dismissal on behalf of the appellant. In addition, the contents of the letter would have been carefully drafted and it was unlikely that the same care would not H have been taken with the selection of the letterhead. (Paragraph [14] at 856G/H - I and 857A - D.)

Held, further, that it was accordingly clear that it was the appellant who had purported to terminate the respondent's employment; who had stated that it would not be possible to employ the respondent any longer; and who had offered the respondent a I retrenchment package. Letters terminating an employee's employment were normally written by or on behalf of the employer. The appellant tendered no evidence to the effect that there was an explanation for the letter of termination of employment other than that the appellant had considered itself to be the employer of the respondent and as such entitled to terminate the respondent's employment. The respondent had accepted that his employment had been terminated by this letter. The inference could thus be drawn that the respondent and the appellant had J

2000 (1) SA p851

tacitly agreed that the appellant had been A entitled to terminate the respondent's employment...