the High Court of Swaziland
the matter between:
Chartered Bank Swaziland
of the Industrial Court 1st Respondent
Mahlalela 2nd Respondent
APPLICANT Mr. Flynn
SECOND RESPONDENT Mr. Kennedy
applicant is a bank and the second respondent was employed by it
formerly as a clerk, serving from time to time as a teller.
also had a personal account with the bank. In December of 1990, he
had bought a stove from a store in Manzini. Later, while still under
guarantee, it gave him problems. He took it back to be repaired. In
the meantime, he arranged with the store to give him a stand by gas
cylinder. It did so, but asked him for a post-dated cheque, as
security. He gave it a cheque for E147.30, post-dated 27th September
is important to emphasise, in passing, that it has not been suggested
that there was anything in itself wrong with this at all. It was a
legitimate transaction in the course of his personal affairs.
however, the second respondent was told by a colleague in the bank
that his account was overdrawn. At the time, he was at his post as a
teller. He went to check, and discovered that the cheque that he had
given to the stove had been deposited before its due date. It has not
suggested that his account had been overdrawn for any reason other
that the premature lodgement of the post-dated cheque. It therefore
follows, I think, that the bank itself was in the first instance at
fault in honouring the cheque before its due date, and thereby
causing the second respondent's account to become overdrawn.
the second respondent then did, however, was to remove the cheque
from the bank's records, replacing it with funds that he obtained
from the store's manager, to whom he had gone to explain the
position. He did not inform his own manager about this. His course of
action came to the attention of the bank. In the result he was
summarily dismissed for dishonesty - i.e. in respect of his removal
of the post-dated cheque from the bank's records, and the replacing
of it with other funds.
his application, the matter came before the Industrial Court, where
he claimed compensation for unlawful and unfair dismissal. At the
first hearing before that court, it found in his favour. It did so,
essentially, by holding that his actions were not dishonest.
bank appealed to this court. On 2nd December 1992, I held that the
Industrial Court had erred in law in holding that his actions were
not dishonest. I set aside the judgment and remitted the case to the
for it to determine whether or not the bank's dismissal of the second
respondent for dishonesty was reasonable and, if not, what award that
court should make.
matter came back before the Industrial Court accordingly. On 23rd
March 1993 it gave its judgment on those issues. It found that the
penalty of dismissal imposed by the bank was not reasonable, and it
made an award to the second respondent.
bank now applies to this court for an order setting aside, upon a
review, the second judgment of the Industrial Court. It does so on
three grounds, which are set out in paragraphs 8.1, 8.2 and 8.3 of
the affidavit of its managing director, filed in support of its
application. These are:
the Industrial Court failed to take into account relevant
considerations in deciding that the dismissal was not reasonable;
it took into account irrelevant considerations in reaching that
the decision of the Industrial Court was unreasonable in the light
of all the evidence that was led (i.e. before it).
the present hearing, the bank relied principally on the third ground.
It nevertheless maintained each of the other two grounds as well.
can conveniently summarise the grounds from the applicant's set, for
its own part, of the very helpful heads of argument that have been
filed by counsel for the parties.
Flynn submitted that the evidence showed that the bank had given the
second respondent every opportunity to be
on the allegations that he had acted dishonestly. He had taken that
opportunity. In doing, so he had admitted the substance of those
allegations. The bank had then gone on to consider what mitigating
circumstances weighed in his favour, including in that regard his
entire record of employment with the bank. The officer who conducted
the investigation and hearing had in due course recommended that the
second respondent should be dismissed. The bank had nevertheless
taken into account all relevant factors. Its decision to dismiss him
was one of a number of reasonable decisions that it could have made.
What Mr. Flynn was saying, in that regard, was that upon that
evidence, the Industrial Court could not reasonably have come to the
conclusion that the bank's action was unreasonable.
they are put as separate grounds for review, I think that it is also
appropriate to summarise at once Mr. Flynn's other two objections.
them in reverse order, he contended that the Industrial Court had
taken into account the fact that the bank had failed to ascertain
from the store's manager whether the second respondent's account as
to why he had interfered with the bank's records was true. Mr. Flynn
submitted that this was irrelevant to the decision to dismiss him for
a dishonest act that he had himself admitted.
the other hand, in arriving at its conclusion, the Industrial Court
had failed entirely to consider the bank's concerns that a teller in
a position of trust had acted dishonestly, and had failed to give any
consideration or weight to the importance that the bank attached to
the accuracy of its records.
I have already dealt with it in my own previous judgment in this
matter, I think it is desirable to recall again the circumstances in
which the second respondent came to interfere with the bank's
concern, in doing so, was to avoid getting himself into trouble with
his employer. The bank had an internal rule that its staff were not
to issue post-dated cheques, and it appears from the second judgment
of the Industrial Court that there was also an internal rule that
they were not to overdraw their accounts. Even though he was not
responsible for the fact that his account went into overdraft, I
think that it is clear enough that he was concerned for that
combination of reasons not to get into trouble with his superiors. He
had previously had problems in respect of his employment, for which
he had been warned.
approach adopted by the Industrial Court to the issue is found on
page 3 of its judgment.
applicant before it (the bank teller) had argued that the fact that
the bank may have ignored relevant factors or had regard to
irrelevant factors would itself establish that it had acted
bank submitted that the Court should not take into account that it,
the Court, might have decided the matter differently. It should
consider whether or not a reasonable employer could have acted as the
bank had done.
Court itself indicated its approach in these words:
believe the question to be determined by this court is did the
employer take into account all factors that it ought to have taken
into account before making its decision. Did the employer act
Industrial Court, in reaching its decision, stated that the bank had
found no mitigating factors in favour of the second respondent; that
the bank had rejected outright his written explanation to it for his
conduct; that it had considered him a security risk because of his
previous record; that his annual performance assessment had not been
into account; that because of a collective agreement, the bank had
decided that it had no discretion as to what disciplinary action it
should take; that it decided that his written explanation was untrue;
that it did not call the store manager to find out whether it was
true; that it did not tell the second respondent that it regarded the
explanation as false; that it disregarded his long service as
irrelevant; that it considered him a security risk because he had,
five years previously, allowed his account to become overdrawn by
E90; that it had not shown why it had regarded his, written
explanation as false; that it decided to dismiss him to stop him from
committing something worse than dishonesty; that it took into account
the fact that his financial affairs left a lot to be desired; and
that it did not take into account his previous satisfactory
I read the judgment those are, comprehensively and in the sequence in
which they are expressed, the factors that the Industrial Court
explicitly considered in arriving at its finding - as it did - that
in dismissing the second respondent summarily, the bank had acted
unreasonably. No other factors are explicitly referred to in the
or not a course of action is reasonable is a question of fact. By
virtue of section 5 of the Industrial Relations Act, 1980, which with
the Employment Act, 1980, governs the proceedings that the bank here
seeks to review, the Industrial Court has exclusive jurisdiction on
questions of fact, subject to the right of the higher courts to
review its proceedings on grounds permissible at common Law.
the Employment Act, 1980, (by virtue of section 42(2)), the bank had
the onus of proving in the proceedings before the Industrial Court
that its action in dismissing the second respondent summarily was
under the Industrial Relations Act 1980, the Industrial Court has
exclusive jurisdiction on matters of
this Court may (as I have indicated already) review its decisions on
grounds permissible at common Law.
Johannesburg Stock Exchange v. Witwatersrand Nigel Limited 1988 3 SA
132 (AD)(at paragraphs A-E on page 152) (cited in argument) Corbett,
J.A. (as he then was) said:
in order to establish review grounds it must be shown that the
President failed to apply his mind to the relevant issues in
accordance with the 'behests of the statute and the tenets of natural
went on to say that such failure could be shown, inter alia, by proof
that the decision was arrived at because the body had misconceived
the nature of a discretion conferred on it, ana taken into account
irrelevant considerations or ignored relevant ones; or where the
decision was so grossly unreasonable as to warrant the inference that
the body had failed to apply its mind to the matter, in the sense
Susan Dlamini v. President of the Industrial Court and Melman's
Pharmacy Pty Limited (Industrial Court Appeal 13/88), a decision of
Hannah C.J. in this court, also cited in argument, the learned Chief
Justice at page 12 adopted the criteria of gross unreasonability as
the correct test on the third ground of review. With respect, I also
think that is the proper test.
reaching my own conclusion in this case, I wish to make some general
Industrial Court has an exclusive jurisdiction (subject only to the
common law right of review of this court) on questions of fact. It
also has a considerable measure of leeway as to the formality of its
proceedings. There are good reasons for these things. Nevertheless it
is entrusted with wide powers.
also has a duty to act judicially. It is a court; at the risk of
apparent tautology, I will add that it enjoys the status of a court.
There are good reasons for that, too. One, undoubtedly, is to invest
its proceedings and its decisions with the requirements for fairness,
consistency of principle and openess of process which are
characteristic features of courts of law - and thereby to foster
confidence in its own functions.
is in those circumstances important, in my view, that it should be
perceived by those who have business before it to fulfill those
requirements in its proceedings.
particular, notwithstanding that two of its members are assessors, it
should as far as is reasonably possible give reasons for its
decisions, which reasons should as far as possible demonstrate that
it has duly considered both sides of the issue. Of course it has its
own discretion (subject to the conclusions that higher courts may
draw on appeal or review) as to how far it needs to go in those
respects. Every judge knows that, as in the case of a summing up in a
criminal trial to a jury, that is necessarily a matter of judgment in
the end, and the court's decision is always to be weighed in the
context of its own judgment, read as a whole, and of the record of
evidence and argument.
the basic point is in my view an important one. The court should
strive, by its reasoned judgment, to demonstrate that it has
considered - and weighed - both sides of the issue in arriving at its
this present case, I think that there are three significant aspects
of the matter.
first is the importance, to a bank, of ensuring that its staff are
persons who are honest, and that the records of its financial
transactions are strictly kept. In my judgment on the appeal, I
sought to emphasise this. In its own judgment
under review, the Industrial Court does not indicate, overtly, that
it has in any way turned its mind to that issue. That is in my view a
shortcoming in the judgment, and a serious one. I say that not
because of my own earlier remarks as such, because they were not
necessary for that decision. Reasonableness is a question of fact,
and questions of fact are matters for the Industrial Court.
say it because I think it is, in anyone's language, a matter of very
obvious common sense that the integrity of its staff members, and
also of its records, are extremely important matters for any bank.
every allowance for the Industrial Court's own discretion as to the
way in which it thought fit to express its decision, I think myself
that this was a case in which (apart from any other consideration) it
ought to have demonstrated explicitly that it had given full weight
to that consideration. It has not done so at all. In that respect,
the judgment is, in my view, open to serious criticism.
issue before the Industrial Court was whether the bank had proved, on
a balance of probabilities, that its action in dismissing the second
respondent summarily was reasonable.
issue before this court is whether the Industrial Court's own
conclusion, upon the evidence and the submissions, that the bank had
acted unreasonably, is itself grossly unreasonable.
is a stricter test. There is a reason why it is stricter, and because
of the apparent similarity of the issue in each forum - i.e., in the
one which the Industrial Court had to consider it, and in the one
which this court has to consider it on review - it is perhaps
important, too, to explain it. The question before the court below
-namely, whether the bank had proved that it probably acted
reasonably in dismissing the second respondent summarily -reflected
policy in respect of industrial relations. The question before me -
whether it is shown that the Industrial Court's conclusion, that the
bank did not act reasonably, was itself grossly unreasonable -
reflects a legal principle relating to the respective roles of
judicial or administrative tribunals vested with jurisdiction or
functions at first instance, and judicial bodies with powers of
the apparent similarities, the governing considerations in each case
are quite different.
second thing that is in my view important is this. What the second
respondent did was dishonest, in the sense that it involved a
subterfuge, or element of concealment, that was calculated to
to the gravity of the deception, however, although in certain
respects Mr. Flynn did in my view show that the Industrial Court drew
incorrect conclusions from the evidence, I also think that there were
undoubtedly mitigating circumstances. The second respondent was not
concerned, on the facts as determined by the court below, to achieve
dishonest financial gain. He was concerned - by subterfuge - to avoid
being embarrassed, and possibly disciplined, in his employment. In
some instances, that motive may be just as culpable, if I may put it
that way, as a dishonest intention to obtain a direct financial gain,
of course - but my point is that it is a question of fact, in the
particular circumstances of a case, as to how serious a transgression
it really is. In this case, given that it was the Industrial Court
itself that had the responsibility for weighing it, and the bank the
burden of proving that its action was reasonable, I consider that it
was open to that court, in principle, to decide that it was not such
a serious matter as to justify dismissal.
brings me to the third point. Another tribunal might very well have
concluded that a bank, in the circumstances, had proved that it had
acted reasonably in dismissing
a teller. But that decision was a matter for the Industrial Court. It
decided that the bank in this case had not shown that it acted
reasonably. Although I consider that its failure to demonstrate, in
its reasons, that it had duly weighed the bank's need to ensure the
integrity of its staff and of its financial records, is open to
serious criticism, I am not satisfied that the grounds for review
have been made out. There was in my view a basis for the Industrial
Court, as the arbiter of fact, to have decided as it did that the
second respondent's action was not so serious as to justify
dismissal. It is not, as my predecessor Hannah C.J., said in Dlamini,
the function of this court simply to substitute its own judgment for
that of the Industrial Court. The test of gross unreasonableness is a
high one: I am not persuaded, as he was not, that it can properly be
said that the Industrial Court's decision was grossly unreasonable. I
am not persuaded, either, that the fact that its judgment does not
demonstrate overtly that it did consider the importance to the bank
of the integrity of its staff and of its records is sufficient to
justify this court in intervening in a review.
application is therefore dismissed, with costs to the second