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[2010] ZAWCHC 533
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Overberg District Municipality and Others v Premier Of Western Cape and Others (16166/2010) [2010] ZAWCHC 533 (8 November 2010)
IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE HIGH COURT, CAPE TOWN)
CASE
NUMBER
:
16166/2010
DATE
:
8
NOVEMBER 2010
In
the matter between:
OVERBERG
DISTRICT MUNICIPALITY
AND
VARIOUS OTHERS
…..........................................................
Applicants
and
PREMIER
OF THE WESTERN CAPE &
THREE
OTHERS
…..................................................................
Respondents
JUDGMENT
Application
for leave to appeal and for leave to execute judgment
BOZALEK,J
The
applicants in this application for leave to appeal were the
respondents in an application for urgent relief brought by the
Overberg District Municipality and its sitting councillors, following
its dissolution by the third respondent with effect from 16
July
2010, the appointment of an administrator and the
approval
of a temporary budget. The relief sought included the reinstatement
of the councillors and the municipal council. I shall
refer to the
parties as they were in the main application.
On
12 October, the Court found in favour of the applicants and made an
order effectively reinstating the Council, the councillors
and
affording them a 10 week period within which to pass a budget for
the municipality but leaving the temporary budget passed
by the
third respondent partially extant, so as to avoid a budgetary
vacuum. A notice of appeal was filed the following day thereby
suspending the effect of the Court's order. The applicants oppose
the granting of leave to appeal and have in addition brought
an
application in terms of Rule 49(11) for the implementation of the
Court's order pending the outcome of any appeal.
The
leave to appeal application
:
The
written application for leave to appeal cites numerous errors of
reasoning and omissions on the part of the Court in arriving
at its
conclusion. No point is served in attempting to address these
criticisms since the Court gave a comprehensive and reasoned
judgment. The simple and basic question is whether there are
reasonable prospects of another court finding that the correct
interpretation of section 139(4) of the Constitution is that once a
municipality has failed to approve a budget by the statutory
deadline, the provincial executive is obliged to dissolve the
Council, appoint an administrator and approve a temporary budget
or
whether it can take other steps short of these in order to resolve
the problem.
In
the course of his lengthy argument in seeking leave, Mr
Heunis
quoted
further academic writing which supports his interpretation of the
section as mandating the dissolution of a defaulting
council.
Somewhat surprisingly, he did not rely on this additional authority
at the original hearing. Be that as it may it cannot
be disputed
that the interpretation for which he contends enjoys support amongst
certain academic commentators. I am mindful
of the fact,
furthermore, that the correct interpretation of section 139(4) is,
potentially at least, a matter of some importance
to those engaged
in the field of local government administration and is a question
which may well arise in different circumstances
in future.
Thus,
although I am satisfied with the correctness of the decision given
in this matter, I do not consider that there are no reasonable
prospects that another court may arrive at a different conclusion.
The parties were
ad
idem
that
any appeal should be heard by the SCA and the circumstances of the
matter are such that that court would be the appropriate
forum for
any appeal. I do have a concern that, in view of the nationwide
municipal elections which will take place by mid 2011,
unless the
appeal is heard before then, this appeal may well become moot. This
concern is, however, no reason to refuse leave
to appeal,
particularly since the respondents have indicated that they intend
to petition for an expedited hearing.
Leave
to implement the Court's Order
:
I
turn to the application to implement the order of the Court pending
the outcome of any appeal. The relevant background is that
the
existing, directly or indirectly elected 20 person council will
continue to hold office until approximately May or June 2011
when
national municipal elections will be held. To clarify, they will
continue to hold office if the order to the application
to implement
the order is granted. If the application is not granted, the
Overberg District Municipality will be administered
until then by
the administrator appointed by the respondents. He is accountable to
the respondents alone. Democratic governance
of the municipality
will be suspended whilst all 20 councillors, including 11 of the
applicants in the main application, will
be divested of their
positions, responsibilities and powers as well as the salaries and
allowances which accrue to them by virtue
of the positions which
they hold. It does appear, however, that only four of the
applicants, those directly elected to the Council,
will entirely
lose their incomes, the balance of the applicant councillors, being
members of local municipal councils, are designated
by those
municipal councils to represent them on the Overberg District
Municipal Council. To those four councillors must be added
another
four, from the opposition so to speak, who are also directly elected
and will lose their income. Although there was mention
in the
original application of the IEC holding fresh elections within 60
days of the dissolution of the Council, according to
all parties
this is no longer a prospect.
The
overall onus in an application for leave to execute a judgment,
pending an appeal, rests on the applicant, i.e. the applicants
in
the main application in this case. See
South
Cape Corporation (Ptv) Limited v Engineering Management Services
Limited
1997(3)
SALR 534 (A), where the approach to be adopted by a Court was set
out by
Corbett
,
JA as he then was as follows at page 545c-g:
"The
Court to which an application for leave to execute is made, has a
wide general discretion to grant or refuse leave and,
if leave be
granted, to determine the conditions upon which the right to execute
shall be exercised ... This discretion is part
and parcel of the
inherent jurisdiction which the Court has to control its own
judgements ... In exercising this discretion,
the
Court
should, in my view, determine what is just and equitable in all the
circumstances and, in doing so, would normally have
regard,
inter
alia,
to
the following factors:
the
potentiality of irreparable harm or prejudice being sustained by
the appellant on appeal (respondent in the application)
if leave to
execute were to be granted;
the
potentiality of irreparable harm or prejudice being sustained by the
respondent on appeal (applicant in the application) if
leave to
execute were to be refused;
the
prospects of success on appeal, including more particularly the
question as to whether the appeal is frivolous of vexatious
or has
been noted not with a
bona
fide
intention
of seeking to reverse the judgment, but for some indirect purpose,
for example to gain time or to harass the other party;
and
where
there is potentiality of irreparable harm or prejudice to both
appellant and respondent, the balance of hardship or convenience
as
the case may be."
I
am prepared to accept that the respondents' appeal is neither
frivolous nor vexatious and has some prospects of success, although
not that a successful result is virtually inevitable, as Mr
Heunis
seemed
at times to contend.
The
question then is what is the irreparable harm or prejudice which the
appellant will suffer if leave to execute is granted.
Mr
Heunis
could
point to no substantive prejudice in this regard, save that should
the appeal be successful, then the Overberg District
Municipality
would have been run in accordance with a budget which, for at least
part of the period between now and mid 2011
when elections are held,
would be
prima
facie
invalid
and would have to be revisited by a new council and ratified. Of
course, if leave to implement is not granted and the
appeal is
unsuccessful, then the Overberg District Municipality would have
been administered in terms of a budget which would
also be
prima
facie
invalid
and would have to be ratified in due course. The balance of Mr
Heunis
'
arguments in regard to prejudice similarly rest upon the assumption
that the appeal will be successful. There is no suggestion
of any
other substantive prejudice to the respondents.
The
terms of the court order made on 12 October allows, and by
implication requires, the Council to pass a budget for the remainder
of the financial year within a stipulated period of 10 weeks. There
is no suggestion that the Council, will not now or cannot,
take this
step nor is it suggested that the Council will not henceforth
properly administer the affairs of the Municipality.
In
the event that the applicants might again fail to fulfil their
responsibilities in terms of the Constitution or the applicable
legislation, the provincial executive retains its powers of
intervention in the affairs of the Municipality in terms of section
139 of the Constitution or other relevant legislation.
On
the other hand, if leave to implement is not granted, there is
substantial prejudice to the applicants. Apart from losing their
elected or designated positions as councillors and the remuneration
attendant thereon, the applicants will carry the stigma of
representatives divested of their office for having failed to fulfil
their responsibilities. If any appeal process is not completed
by
mid-2011, they will carry this stigma into any election which they
may see fit to contest. There is moreover prejudice of
another type
which in my view is just as material, if not more material, namely
the fact that democratic processes will be suspended
in the Overberg
District Municipality until mid 2011. This is prejudice which cannot
be repaired if the appeal proves to be unsuccessful.
Taking
these factors into account, I consider that the applicants have
established that the balance of convenience favours them
and that if
leave to implement is not granted, they will, on balance, suffer
undue hardship. Accordingly, in my view, in the
particular
circumstances of this matter it would be just and equitable to grant
the application for leave to implement the Court's
order of 12
October 2010. Notwithstanding the applicants' success in the Rule
49(11) application, I propose to make the costs
therein costs in the
overall matter. For these reasons the following order is made:
1.
The respondents are granted leave to appeal to the Supreme Court of
Appeal against the decision of this Court dated 12 October
2010 on
the grounds set out in their notice of application for leave to
appeal dated 13 October 2010.
2.
Pending the outcome of such appeal, or any further appeal, the order
of this Court dated 12 October 2010 may be implemented.
3.
The costs of the application for leave to appeal and the Rule 49(11)
application shall stand over for determination in the
appeal.
BOZALEK, J