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2023
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[2023] ZAFSHC 71
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Brandfort Forum and Others v Masilonyana Local Municipality and Others (5520/2021) [2023] ZAFSHC 71 (10 March 2023)
IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Case
number: 5520/2021
Reportable:
YES/NO
Of
Interest to other Judges: YES/NO
Circulate
to Magistrates: YES/NO
In
the matter between:
BRANDFORT
FORUM
First
Applicant
INA
BEUKES N.O.
Second
Applicant
FRANS
BESTER POSTHUMUS N.O.
Third
Applicant
JOHAN
ALBERTUS FOURIE N.O.
Fourth
Applicant
and
MASILONYANA
LOCAL MUNICIPALITY
First
Respondent
LEJWELEPUTSWA DISTRICT
MUNICIPALITY
Second
Respondent
MAFUMA
CONSULTING (PTY) LTD
Third
Respondent
CORAM:
LOUBSER, J et JONASE, AJ
HEARD
ON:
20
FEBRUARY 2023
JUDGEMENT
BY:
LOUBSER, J
DELIVERED
ON:
The judgment was handed down
electronically by circulation to the parties’ legal
representatives by email
and release to SAFLII on 10 MARCH 2023. The
date and time for hand-down is deemed to be 10 MARCH 2023 at 14:00
[1]
This is in essence an application for the reviewing and setting aside
of the first respondent’s decision
to install prepaid
electricity meters and to distribute electricity by means of such
meters, and for the reviewing and setting
aside of the appointment of
the third respondent to install the said meters and to administer the
supply and sale of prepaid electricity
to consumers in the town of
Brandfort. Certain ancillary relief is also sought by the applicants.
[2]
The application is premised on the proposition that the
first respondent failed to act in accordance with the law
when it
made the impugned decision, and in doing so, that it violated the
rule of law, being a founding value of the Constitution.
It is
further contended by the applicants that the first respondent
procured the services of the third respondent for the installation
of
the prepaid meters without complying with the terms of its own supply
chain management policy or with the provisions of The
Local
Government: Municipal System Act.
[1]
[3]
The first applicant in the application is an association which
conducts its activities in Brandfort with the
objective,
inter
alia
, to serve the interest of the residents of Brandfort and to
act as a mouthpiece for all taxpayers and residents of Brandfort. The
second, third and fourth applicants are cited in their capacities as
trustees of the Masilonyana Brandfort Forum Trust. The first
respondent resorts under the second respondent district municipality.
[4]
The position adopted by the first respondent in this application is
precarious, to put it softly. The notice
of motion was served on the
first respondent and on its attorneys as long ago as 26 November
2021. On 7 December 2021 a notice
of intention to oppose was filed on
behalf of the first and third respondents by their attorneys, Kruger
Venter attorneys incorporated
of Welkom. However, answering
affidavits were never filed by the first and third respondent ever
since. On 10 August 2022 the record
in terms of Rule 53(1)(b) was
filed by the respondents with the registrar of this court. On 28
October 2022 the abovementioned
attorneys of the first respondent
filed a notice on its behalf to the effect that the first respondent
does not oppose the application
and that “they will abide by
the decision of the above Honourable Court”. After receipt of
this notice to abide, the
attorney for the applicants filed a notice
of set down of the application for 20 February 2023. This notice was
served on the respondents’
attorneys on 4 November 2022.
[5]
Following the notice of set down, the attorneys for the first and
second respondents withdraw as their attorneys
of record on 20
December 2022. This notice of withdrawal was only filed with the
registrar of this court on 18 January 2023.
[6]
As could be expected in the circumstances, no heads of argument were
filed on behalf of the respondents prior
to the hearing of the
application on 20 February 2023, as it is required by the practice
directives of this Court. Comprehensive
heads of argument were indeed
filed on behalf of the applicants. On the date of the hearing, namely
20 February 2023, mr. Grewar
appeared for the third respondent. There
was no appearance for any of the other respondents in the courtroom,
nor were any of the
respondents present themselves. It was clear to
the court that the matter was indeed unopposed. Mr. Grewar informed
the court that
he is not opposing the application on behalf of the
third respondent. I therefore proceeded to hear counsel appearing for
the applicants,
and decided to reserve judgement since I regard the
matter to be in the public interest.
[7]
Before I even started with the writing of this judgement, and on 1
st
March 2023, a notice of withdrawal of the notice to abide and notice
to oppose was filed with the registrar by the very same attorneys
who
had received the notice of set down and who had withdrawn as
attorneys of record of the respondents earlier. This notice reads
as
follows: “Kindly take notice that the first respondent hereby
withdraws its notice to abide by the decision of the court
and
herewith affords their intention to oppose the review application”.
[8]
I regard the filing of this last mentioned notice as preposterous and
a gross abuse of the process of this
court. The attorneys concerned
and the respondents themselves very well knew that the application
had already served before the
court and that their notice was filed
far too late and out of time. Notwithstanding, they did not even deem
it appropriate to file
an application for condonation for the late
filing of the notice. There is consequently no explanation for the
late filing before
me. I regard this as highly irregular, especially
in view of the fact that the first respondent had indicated that it
does not
oppose and that it abides by the decision of the court as
far back as 28 October 2022. In the premises, the judgement is
prepared
on the basis that the application remains unopposed.
[9]
I now turn to the substance of the application. The
applicants’ main cause of concern is that the first respondent
never adopted a bylaw for the sale of electricity or for the supply
and sale of prepaid electricity. No resolution was taken by
the
municipal council to such effect, and there was no resolution that
the municipality would migrate from conventional electricity
metering
to prepaid metering. To make matters worse, no proper procurement
process was followed in the appointment of the third
respondent as a
service provider for either the installation of prepaid meters or for
the sale of prepaid electricity. It is further
alleged in the
founding papers that the community of Brandfort were informed that
the installation of the prepaid meters is voluntary,
but the meters
were installed even against their wishes.
[10]
None of these allegations were disputed by the respondents on the
papers before me, and it must be accepted as common cause
between the
parties. In the process of this litigation so far the first
respondent has not produced any resolution by its council
authorising
the steps allowed to above, nor has it produced any proof that due
process was followed in the appointment of the third
respondent.
[11]
Sections 12 to 15 of the Systems Act
[2]
contains the requirements for the valid adoption and coming into
effect of a bylaw. Such bylaw must be published for public comment,
for instance. In this case no bylaws were even adopted by the council
relating to the issues here in question.
[12]
To this end Khampepe J held in
Liebenberg
NO v Bergrivier Municipality
[3]
“
If
we are to give cognisance to the fact that the Constitution now
empowers municipalities to exercise original legislative powers,
we
must also accept that municipal authorities may no longer adopt an
informal approach to the exercise of their powers. Similarly,
it
cannot be the case that municipalities are empowered to extract taxes
pursuant to “laws” that they devise, when
citizens are
unable to find those laws anywhere in the statute books. That is
wholly inconsistent with a State founded on the principle
of
legality.”
[13]
In this respect it needs mentioning that the first respondent also
failed to determine tariffs for the supply and sale
of electricity by
prepaid meters. In failing to do so, the first respondent failed to
comply with the peremptory provisions of
amongst others, the Systems
Act. This Act provides
[4]
that the executive and legislative authority of a municipality is
exercised by the council of the municipality, by
inter
alia
administering and regulating its internal affairs and the local
government affairs of the local community. In the present case
there
is no indication at all that the council of the first respondent had
exercised its powers to implement the installation of
prepaid meters
by the publication of a bylaw to that effect.
[14]
For this reason alone, the appointment of the third respondent as a
service provider was inherently irregular, apart
from the fact that
the correct procedure for the appointment was not followed as
provided for in the Systems Act.
[15]
In the premises, the application ought to be granted. Mr.
Snellenburg, appearing for the applicants, has provided me
with a
draft order. The draft order will be made an order of this court, as
amended in certain respects.
[16]
As for costs, this court has to be mindful of the fact that the costs
in the earlier interdict proceedings against the
respondents under
case no. 4949/2021 were reserved for later adjudication. In those
proceedings the applicants moved for orders
compelling the first
respondent to provide information and documentation underscoring its
decision to install prepaid meters and
to appoint the third
respondent. This application was successful. This court is also
mindful of the fact that the present application
remains uncontested,
as set out above. In the circumstances, the first respondent should
pay the costs of the interdict proceedings,
while the first
respondent should also pay the costs of this review application.
[17]
In presenting argument before this court, mr. Snellenburg made out a
strong case for the costs to be on the attorney
and client scale.
Although I agree with his submission in this respect, such orders of
costs will ultimately impact on the taxpayers
of Brandfort, and
therefore I view such orders on a party and party scale more
appropriate.
[18]
Having due regard to all the circumstances of this application, the
following orders are made:
1.
The first and/or second respondents are interdicted and restrained
from installing any prepaid electricity
meters in its jurisdiction,
including Brandfort, Free State Province, and from selling
electricity by means of prepaid metering
before:
1.1 Duly and
lawfully adopting bylaws authorising the supply and sale of
electricity by means of prepaid metering, alternatively
duly amending
or supplementing the existing bylaw to authorise the supply and sale
of electricity by prepaid metering, and/or
1.2 The first
respondent’s council duly and in transparent manner adopts a
resolution to supply and sell electricity
by means of prepaid meters
and metering to consumers in Brandfort, and/or
1.3 The
transparent determination of tariffs/charges for the distribution and
sale of electricity through or by means
of prepaid meters and
metering, and/or
1.4 If an
external service provider is to be appointed to render service to the
first respondent, then the appointment
of a service provider(s) in
terms of a competitive bidding process in terms of the first
respondent’s Supply Chain Management
Policy, alternatively a
lawful procurement process to install prepaid electricity meters;
and/or to sell the prepaid electricity
and/or to administer the
payment of prepaid electricity in Brandfort must be complied with,
and/or
1.5 Compliance by
the appointed service provider(s) and, insofar as relevant the first
respondent, with the registration
requirements for the supply and/or
sale, alternatively resale of electricity in terms of the Electricity
Regulation Act, alternatively
due and proper compliance with the
provisions of section 7 read with Schedule 2 of the ERA for exemption
of the service provider
for the supply and sale, alternatively
resale, alternatively trading in the supply and/or sale in
electricity.
2. The
first respondent is ordered to forthwith remove prepaid meters
already installed and/or to convert the
supply and sale of
electricity to the conventional metering basis until such time as the
first respondent has complied with the
content of paragraph 1.1 to
1.5 above.
3.
The appointment by the first respondent of the third respondent to
install and administer the supply,
alternative sale, alternatively
the supply and sale of prepaid electricity to consumers in Brandfort
is reviewed and set aside.
4.
It is declared that the service level agreement concluded between the
first and third respondent is invalid,
void and unlawful and the
aforesaid service level agreement is set aside;
5.
The following actions and omissions (conduct) of the first respondent
are declared to be unconstitutional:
5.1 Implementing
steps to migrate from conventional electricity supply and metering to
prepaid supply and metering of electricity
by inter alia installing
prepaid meters and selling electricity on prepaid basis without a
resolution to that effect being duly
adopted by the first
respondent’s council,
5.2
appointing the third respondent to install prepaid meters in absence
of a proper procurement process, and
5.3
Appointing and allowing the third respondent to trade in electricity
without complying with the requirements for
exemption in terms of the
provisions of Schedule 2 of the Electricity Regulation Act, 2006, and
5.4
Installing prepaid meters in absence of a duly adopted bylaw, and
5.5
Installing prepaid meters and compelling the purchase of electricity
through prepaid metering in absence of transparent
and lawful
determination of tariffs and charges for the distribution and sale of
electricity by prepaid metering, and
5.6 Sale of
electricity by means of prepaid metering against charges/tariffs
exceeding the charge/tariffs determined
and published for the
2021/2022 financial year for the distribution and sale of electricity
by means of conventional metering to
consumers in Brandfort, and
5.7
Installing prepaid meters against the consumers election not to have
the prepaid meters installed when the Brandfort
community were
informed that they have an election to have the prepaid meters
installed or not, and
5.8
Distributing, alternatively allowing the resale of electricity
through the third respondent without the requirements
in terms of
paragraph 7 read with Schedule 2 of the ERA for exemption of a
person/entity to resell electricity being complied with,
and
5.9 The first
respondent’s failure to comply with the provisions of the
Local
Government: Municipal Systems Act 32 of 2000
when deciding to appoint
an external service provider and after conclusion of a service level
agreement, and
5.10 Failing to
follow a proper public participation process before deciding to
migrate from conventional electricity supply
and metering to prepaid
electricity supply and metering, and
5.11 Failing to
give prompt responses to written or oral communications from the
first respondent’s community, including
complaints to the
municipal council, and
5.12 Failing to
inform the first respondent’s community of decisions of the
municipal council which affects their rights,
property and reasonable
expectations.
6.
The first respondent shall pay the reserved costs of case number
4949/2021 on the party and party scale.
7.
The first respondent shall pay the costs of this application on the
party and party scale.
P.
J. LOUBSER, J
I
concur:
S.S.
JONASE, AJ
For
the applicants:
Adv. N. Snellenburg SC
Instructed
by:
Symington and De Kok
Bloemfontein
/roosthuizen
[1]
Act 32
of 2000
[2]
Supra
[3]
2013(5)
SA 246 (CC)
[4]
Section
11