Case Note: Uneasy Lies the Head that Wears a Crown: Moyo v Old Mutual Limited (22791/2019) [2019] ZAGPJHC 229 (30 July 2019) and Old Mutual Limited v Moyo (2020) 41 ILJ 1985 (GJ)

• Author: van Staden, M.
• Citation: (2021) 33 SA Merc LJ 137
• Date: 22 October 2021
• DOI: https://doi.org/10.47348/SAMLJ/v33/i1a6
• Published date: 22 October 2021
• Pages: 137-152

137

https://doi.org/10.47348/SAMLJ/v33/i1a6

Case Note

UNEASY LIES THE HEAD THAT WEARS A

CROWN: MOYO v OLD MUTUAL LIMITED

(22791/2019) [2019] ZAGPJHC 229 (30 JULY

2019) AND OLD MUTUAL LIMITED v MOYO

(2020) 41 ILJ 1085 (GJ)

MARIUS VAN STADEN

Associate Professor in the Department of Public Law, University of

Johannesburg

KATHLEEN VAN DER LINDE

Professor in the Department of Mercantile Law, University of

Johannesburg

I INTRODUCTION

e matter of Moyo concerned the important question whether it is an

implied term of a common-law contract of employment that a pre-dis-

missal hearing should take place when an employer seeks to terminate

the services of an employee. e answer depends on the extent to which

the common law needs to be developed in order to give eect to the

constitutional right to fair labour practices. In addition to this constitu-

tional issue, aspects of labour law and company law are relevant. In two

separate judgments, the South Gauteng High Court and a full bench

of the same court dealt with the suspension of a chief executive ocer,

primarily from the perspective of labour law.

e South Gauteng High Court held in Moyo v Old Mutual Limited

(22791/2019) [2019] ZAGPJHC 229 (30 July 2019) (the rst judgment)

that an employee had to be reinstated because there was no compli-

ance with the disciplinary steps set out in the employee’s contract of

employment. On appeal to the full bench of the court in Old Mutual

Limited v Moyo (2020) 41 ILJ 1085 (GJ) (the second judgment), it was

however found that the contract of employment required no such disci-

plinary steps and that, in any event, there was no realistic prospect of an

(2021) 33 SA Merc LJ 137

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138 (2021) 33 SA MERC LJ

employee obtaining reinstatement where the special relationship of trust

and condence that should exist between the employee and the employer

had broken down. Reversing the order of the court a quo, the full bench

thus held that the interim interdict had been granted inappropriately.

e Supreme Court of Appeal dismissed the employee’s application for

leave to appeal on 23 March 2020 (available at https://www.oldmutual.

com/docs/default-source/investor-relations-les/news/2020-03-23-su-

preme-court-of-appeal-dismisses-peter-moyo-s-application-for-spe-

cial-leave-to-appeal.pdf, accessed on 22 July 2020).

II FACTS OF THE CASE

e facts of the case appear from paragraphs 1 to 35 of the rst judg-

ment (paragraph references are to this judgment unless otherwise indi-

cated). Moyo was the chief executive ocer of Old Mutual Limited. He

was appointed in terms of a permanent contract that was to endure until

his retirement at the age of 61, which, at the time of the rst judgment,

was still approximately four-and-a-half years away. However, he was

suspended and subsequently dismissed. He then, on an urgent basis,

launched an application in the South Gauteng High Court, Johannes-

burg, seeking interim relief pending the institution of a damages claim.

Moyo wanted to be reinstated to his position of chief executive ocer

and wanted to interdict his employer from taking any steps towards the

appointment of a new chief executive ocer.

In addition to providing for termination by notice, retirement, or

grounds specied in the Labour Relations Act 55 of 1996 (LRA), the

employment contract stipulated that it could be terminated ‘for any l aw-

ful and fair reason, including being guilty of misconduct’ (clause 24,

see para 39). Clause 25.1 stated that ‘where allegations of misconduct

or incapacity have been raised against the employee, the employer will

be entitled, within its sole discretion, to decide whether or not to hold

an internal disciplinary enquiry or to proceed instead via the pre-dis-

missal arbitration procedure contemplated in section 188A of the LRA’

(para 12).

e employer contended that it was not compelled to follow the prior

hearing procedure laid down in clause 25, because even though the

dismissal was prompted by the employee’s misconduct and conict of

interest, the contract had been terminated by notice (para 28).

e employee averred that the employer was contractually obliged

to follow the specic process in clause 25 prior to termination of his

employment (para 31). is was because the employer alleged that the

relationship of trust and condence between the two parties had broken

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