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[2023] ZAFSHC 456
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Silver Manor Prop (Pty) Ltd v Matjhabeng Local Municipality (630/2023) [2023] ZAFSHC 456 (22 November 2023)
IN THE HIGH COURT OF SOUTH
AFRICA
FREE STATE DIVISION,
BLOEMFONTEIN
Reportable: YES/NO
Of
Interest to other Judges: YES/NO
Circulate
to Magistrates: YES/NO
Case No: 630/2023
In
the matter between:
SILVER
MANOR PROP (PTY) LTD
Applicant
And
THE
MATJHABENG LOCAL MUNICIPALITY
Respondent
CORAM:
HEFER AJ
HEARD
ON
:
5 OCTOBER 2023
DELIVERED
ON:
22 NOVEMBER 2023
[1] The Applicant is
the registered owner of immovable property situated in Welkom, Free
State Province. This
property is a warehouse used mainly for storage
in respect of the Applicant’s day-to-day business operations.
[2] The electricity
supply to the aforesaid property is regulated through a pre-installed
metering system by the
Respondent, which the Respondent installed at
the property.
[3] It is common
cause that on the 10
th
of February 2023 Respondent
disconnected the electrical supply to the property. After the
Applicant approached the Court on an
urgent basis, a
Rule Nisi
was issued in the following terms:
“
4.1
That the Respondent is ordered to restore the electricity supply to
the Applicant’s immovable
property forthwith upon service of
the court order on the Respondent;
4.2
The Sheriff of the High Court is authorised to take any and all
actions as are necessary
to give effect to the reconnection of the
electrical supply to the premises should the Respondent fail to
adhere to the terms as
set out in the order;
4.3
The Respondent is interdicted and restrained from disconnecting the
electricity supply to
the premises pending the outcome of the dispute
resolution processes and/or declaratory proceedings envisaged in
paragraph 4.4
below;
4.4
The Applicant is ordered to lodge a formal dispute against the
electricity charges billed
on his tax invoice and/or electricity fees
bill in respect of such charges issued by the Respondent, in terms of
Section 11 of
the Respondent’s officially adopted debt and
credit control policy, as instituted from date of confirmation of the
Rule Nisi;
4.5
Alternatively, to 4.4 above, that the Applicant, within 30 days from
date of finalization
of this application, be ordered to institute
declaratory proceedings against the Respondent relevant to its
indebtedness to the
Respondent, failing which the relief granted in
paragraphs 4.1, 4.2 and 4.3 shall lapse; and
4.6
The Respondent is ordered to pay the costs of this application.”
[4] The matter now
served before me to confirm the above
Rule Nisi
.
Applicant’s
case
:
[5] According to the
Applicant, the disconnection of the electricity supply to the
property concerned, was done
without any prior notice by the
Respondent to the Applicant.
[6] According to the
Applicant, the Respondent is bound by its adopted Debt Control Policy
and By-laws. In terms
of these By-laws and Policy, a mandatory
pre-disconnection notice is prescribed in terms of which a period of
seven days is to
be given by the Respondent prior to the
disconnection of the electricity supply to a consumer.
[7] The Policy and
By-laws further set out the process to be followed by the Respondent
to rectify estimates contained
in its records and/or invoices. It is
Applicant’s case that the Respondent has failed to render any
tax invoices in respect
of electricity supply to the Applicant for
the past twelve months and was subsequently advised by the
Respondent’s officials
that the consumption of the property has
been estimated for the past months, the Respondent had failed to
physically obtain the
readings from the Applicant’s meter and
thus estimates its consumption on a monthly basis.
[8] It is
Applicant’s case that Respondent has not adhered to its own
policies by acting as described above
and that the disconnection
based on estimates is unlawful. The Respondent further contends that
the decision to disconnect the
supply is one of an administrative
nature. This implies that should a decision have been taken it should
have been effected in
a fair manner,
inter alia
, affording the
Applicant the seven days’ notice of such intent, supplying all
the relevant information necessary to evaluate
such intent and giving
the Applicant an opportunity to respond to such notice. Irrespective
of the aforesaid, it is Applicant’s
case that the Applicant in
any event still made its payment of R10,000.00 per month towards the
bill, irrespective of not being
furnished with accurate billing
figures. The Applicant then attached proof of payments by the
Applicant to the Respondent for the
preceding three months to its
founding affidavit.
Respondent’s
case
:
[9] It is the
Respondent’s case that in terms of the Respondent’s
Credit Control and Debt Collection
Policy, failure to receive tax
invoices does not absolve a ratepayer / customer from his/her payment
obligations. Further, according
to the Respondent, the policy further
provides the procedure to follow when a customer doesn’t
receive an account. It therefore
follows that the non-render of tax
invoices is of no consequence.
[10] The Respondent further
contends that the Respondent is allowed to estimate readings in
accordance with the said policy.
The Respondent in any event alleges
that the Applicant had their meters read and its account reconciled
on 25 January 2023 before
a disconnection notice was issued. Instead
of approaching the Municipality to lodge a dispute, the Applicant
waited until the supply
to its electricity was disconnected to
approach the Court, as per the Respondent.
[11] In respect of the
Applicant’s payment, relied upon by the Applicant itself, the
Respondent maintains that the said
policy has been implemented due to
the Applicant’s arrears account. The Applicant’s accounts
in respect of electricity,
water, sewage, tax and rates were
consolidated and are presently still in arrears.
[12] In respect of Applicant’s
allegation to the effect that the disconnection of the electricity
supply has been effected
without prior notice to the Applicant, the
Respondent denies such fact.
[13] The Respondent alleges that
the 2020/2021 document upon which the Applicant
relies in regards to the policy, has
been amended / revised and has therefore become absolute. In terms of
the latest revised policy,
it is dictated that in the event of
disconnected, notice must be given at least fourteen days prior to
disconnection. The Respondent
admits that it is bound by its
policies, but converse it is applicable to its residents including
the Applicant.
Respondent’s
authority to act – Rule 7
:
[14] Subsequent to the opposing
affidavit being filed by the Respondent, Applicant filed a notice in
terms of Rule 7 in terms
of which the Applicant disputed the
authority of the deponent to the Respondent’s answering
affidavit to oppose the application
on behalf of the Respondent and
to act on Respondent’s behalf. This challenge to the authority
of the deponent, needs to
be dealt with first.
[15] The deponent to the
Respondent’s answering affidavit is Adv L Ngoqo, the Municipal
Manager of the Respondent.
[16] In response to the
Applicant’s Rule 7 notice, the Respondent filed a document
containing certain resolutions taken
by the Council of the
Respondent, on 31 March 2015. In this document, it appears that on
the said date, it was resolved that the
Municipal Manager was given
the power to “
consider and take whatever action he MAY
DEEM(sic) necessary in all legal actions, legal applications and
arbitrations”
.
[17]
After the Respondent has filed its response to the Rule 7 notice,
Adv
Roux
,
on behalf of the Applicant, filed his Supplementary Heads of Argument
dealing with Respondent’s reply to the Rule 7 notice.
It is not
necessary at this point to deal fully with the submissions made by Mr
Roux in his Heads of Argument. What is important
at this stage is to
mention that in his Heads of Argument the submission, amongst others,
was made on behalf of Applicant on this
point, that in terms of
Section 59 of the Municipal Systems Act, 3 of 2000 dealing with
Council’s power of delegation, a
delegation or instruction,
inter
alia, “must be reviewed when a new council is elected or, if it
is district council, elected and appointed”
.
[1]
[18] The submissions on behalf
of the Applicant in this regard was that the provisions of Section
59(2)(f) are peremptory.
Thus, the 2015 Council Resolution
delegations relied upon by Respondent, lapsed after the 2021
Municipal Elections. The delegations
should have been reviewed.
[19] Subsequent to these Heads
being filed, and on 11 August 2023, the Respondent filed a further
response to the Applicant’s
Rule 7 notice. The further response
consisted of the following:
(a)
The Council Resolution pertaining to the
appointment of Adv LR Ngoqo as the Municipal Manager;
(b)
Excerpts of the system of delegation; and
(c)
Extracts of the Council Resolution dated 7
August 2023, regarding the adoption of the system of delegation of
power for Matjhabeng
Local Municipality.
[20] Although the Court does not
have the benefit of any explanatory affidavit pertaining to the
supplementary documents that
were filed, it is assumed that the
Respondent relied on paragraph 4 of the Council Resolution stating
that:
“
4.
All decisions taken under the previous delegation remain in force.”
[21]
On behalf of the Applicant, I was referred to a judgment by
Molitsoane J in the matter of
Matjhabeng
Local Municipality v MC Security & Investigations and Others
[2]
.
In that matter the Respondent also relied on a 2015 Council
Resolution, apparently the same Council Resolution which was now
placed before Court. In this regard, Molitsoane J held as follows:
[8] The
resolution of the Council of the delegation in terms of the Delegated
Systems of Powers in this case was clearly not intended
to be
indefinite. Such delegation was clearly tied to the term of the
Council. Section 159(1) of the Constitution provides that
the term of
office of the Municipal Council may not exceed five years. The
resolution was clearly in line with the Constitution.
The
next Council, post 2021, was at liberty to resolve and delegate some
of its powers in line with Section 59
.”
(my own emphasis). “
There
is no evidence before me indicating that such was done.
[9] I am of the
considered view that, in the absence of a Council Resolution, or
delegated powers, it cannot be said that the Municipal
Manager was
properly authorised to institute this application. It is unnecessary
in my view to deal with the arguments raised by
Applicant with regard
to the purported authorisation emanating from the Delegated Systems
of power in view of the finding I made
that there was non-compliance
with Section 59 of the Systems Act. The delegated systems of powers
relied upon by the Applicant
does not assist it as its period has
expired.”
[3]
[22]
Adv
Ngubeni
,
appearing on behalf of the Respondent, referred me to two authorities
dealing with ratification in the event of lack of
locus
standi
.
The first is the matter of
Robert
Thornton Smith v Kwanonqubela Town Council
[4]
.
In this matter, Harms JA held as follows:
“
It is a
general essential for a validated notification that there must have
been an intention on the part of the principal to confirm
and adopt
the authorised acts of the agent done on his behalf, and that
intention must be expressed either with full knowledge
of all the
material circumstances, or with the object of confirming the agent’s
actions in all events what ever the circumstances
may be (Reid and
Others v Warner
1907 TS 961
at 970 en fin – 972). Counsel for
Smith submitted that there is no evidence of councillors of the
transitional council acknowledge
of the fact that Dobson’s
action has been unauthorised and, consequently, that the purported
ratification was of no effect.
I do not think, on the wording of the
state of facts, that this argument is open to Smith. In any event,
the minutes of the meeting
stated that the matter was discussed in
full and, further the decision to proceed with the case evinces a
clear intention to ratify
whatever action was taken, irrespective of
the legal necessities involved.”
[23]
In the second matter referred to by Me Ngubeni, namely
Motlatsi
Barnabas Molefi v Dihlabeng Local Municipality and 5 Others
[5]
Hancke J, dealing with
ex
post facto
ratification, also referred to the matter of
Reid
and Others v Warner
(supra)
[24] The further notice filed by
the Respondent in terms of Rule 7 notice, dated 11 August 2023,
refers to an extract from
a Special Council Minutes, dated the 7
th
of August 2023 which shows that on the 7
th
of August 2023
Council resolved that:
“
1.
Council adopts the system of delegation for Matjhabeng Local
Municipality as reviewed.
2.
Council authorises the Municipal Manager to align a system of
delegation to the
macro structure of the Municipality
(sub-delegations to officials).
3.
Council authorises the Municipal Manager to publish the system of
delegation
on the Municipality’s internet.
4.
All decisions taken under the predecessor of delegations remain in
force.
5.
Council authorises the Municipal Manager to conduct workshops for
councillors
and staff members on the system of delegation.
6.
The Executive Mayor must report annually on all delegated authority.”
[25] It is important to note
that this resolution was now taken not only after the present
deponent to the opposing affidavit
deposed to such affidavit, but
also after Applicant’s filing of its first Supplementary Heads
in regards to the Rule 7 notice
as well as the judgment of Molitsoane
J (in which it had been held that the same Municipal Council’s
delegation of powers
was not effective for the term after 2021). The
finding by Moletsane J, means, effectively, that for the period 2021
up until 7
August 2023 there had not been any reviewed delegation of
powers for the period onwards, i.e. from 2021 till August 2023.
[26] Unlike however in the
judgment of Judge Molitsoane referred to, the Respondent has now
filed a further council resolution
approving or delegating powers
referred to the delegation of powers, after the year 2021. It is
highly unsatisfactory however,
that the Respondent has failed to
approve such reviewed delegation of powers for approximately two
years since the last Municipal
election. It was only after it was
confronted with the judgment of Molitsoane J as well as the present
Rule 7 notice, that the
Respondent has chosen to approve such
reviewed powers as envisaged in Section 59(2)(f). This is yet another
example of the manner
in which many of the spheres of local
government, conducts business.
[27] It must be accepted,
however that for purposes of ratification, the Respondent, on the 8
th
of August 2023, when it resolved as discussed above, must have had
knowledge of the present application and the present challenge
to the
deponent’s, being the Municipal Manager’s authority to
depose to the opposing affidavit. Therefore, as expressed
in the
matter of
Reid and Others v Warner (
supra)
, there must
have been an intention on the side of the Respondent to confirm and
adopt the unauthorised actions of the Municipal
Manager on its behalf
with the object of confirming the agent’s actions in all
events.
Merits
:
[28] It was the Applicant’s
case that the disconnection of the electrical supply to Applicant’s
property by the
Respondent was done without any notice whatsoever. In
answer to this, the Respondent denies such fact and in particular
alleges
that a disconnection notice was transmitted to the Applicant.
The Respondent then refers to a notice attached to the opposing
affidavit.
The notice referred to and appended to the opposing
affidavit relied upon by the Respondent is dated 26 January 2023 and
is addressed
to the Applicant at “
9 Keerom Street, PO Box
1770 Welkom”
. In terms of this notice the Applicant
was indeed “notified” that the electrical supply to the
property was to
be disconnected on the 9
th
of February
2023. However, in so far as the manner in which the Applicant was
notified of the intended disconnection of services,
the Respondent
further stated in the opposing affidavit that:
“
The
Respondent admits having disconnected its service to the Applicant
but it was done after having served the Applicant a fourteen-day
notice of such disconnection.”
The Respondent then further adds:
“
It is
clear that a notice was duly furnished and the Applicant elected not
to lodge a dispute but ran to Court for reasons known
only to it.”
[29] Mr Roux referred me to
Section 7 of the Debt Control Policy and By-laws, in terms of which
it is specified that the Respondent
has to give seven days’
notice, prior to the disconnection of electricity supply to an
account holder if an account has not
been paid on the due date by
delivering, by hand, the notice at the address of the debtor’s
domicilium citandi et executandi
. As indicated, Ms Ngubeni
referred to a new revised policy in terms of which the seven day
notice period has been amended to fourteen
days.
[30] Mr Roux, argued the
Respondent persists in its submission that a 14-days’ notice
has been given to the Applicant,
prior to the disconnection of
electrical supply, yet it does not bolster the alleged service.
[31] I was also referred to
Section 115
of the
Local Government: Municipal Systems Act 32 of 2000
which provides as follows:
“
115
Service of documents and process.
(1)
A notice or other document that is
served on a person in terms of this act or by the Municipality in
terms of any legislation is
regarded as having been served –
(a)
when it has been delivered to that
person personally;
(b)
when it has been left at that
person’s place of residence or business in the Republic with a
person apparently over the age
of 16 years;
(c)
when it has been posted by
registered or certified mail to that person’s last known
residential or business address in the
Republic and an
acknowledgement of the posting thereof from the postal service is
obtained.”
[32] I must agree with the
submissions on behalf of the Applicant. In regards to the notice to
the Applicant, the Respondent
uses vague terms such as “
transmitted
to the Applicant”
, “
having served the Applicant a
four day notice”
, and “
a notice was duly
furnished”
. As indicated to Ms Ngubeni during argument, one
would expect some particularity of how this notice was brought to the
attention
of the Applicant, which the Respondent has failed to
provide. Proof of how the relevant notice was dealt with to bring it
to a
consumer’s attention, although not by sheriff, is similar
to that of serving Court processes in terms of the Uniform Rules
of
Court. I say this in view of the particular manner of service
provided for in Section 115 of the Local Government Systems Act.
A
Court should at least be satisfied that,
prima facie
, the
required notice had been brought to the attention of the consumer
prior to the disconnection of services. Therefore, whereas,
the
Respondent has failed to provide any details in this regard, I am not
satisfied that proper notice had been given to the Applicant.
[33]
In
Joseph
and Others v City of Johannesburg and Others
[6]
the Constitutional Court said the following in regards to such notice
to a consumer of electrical supply rendered by a local authority:
“…
It
must afford the applicants sufficient time to make any necessary
enquiries and investigations, to seek legal advice and to organise
themselves collectively if they so wish.”
[34] If the Applicant has not
received such notice, it was not afforded the opportunities referred
to. The Respondent had
failed to give due notice of its intention to
disconnect the electricity supply and therefore the Applicant was
justified in bringing
an urgent application for the reconnection of
its electricity supply and the ancillary relief. I am further
satisfied that the
Applicant has made out a case for a final
interdict.
Therefore, I make the following order:
The
Rule
Nisi
dated 13 February 2023 is
confirmed to read as follows:
1.
The Respondent is ordered to restore the
electricity supply to the Applicant’s immovable property at 9
Keerom Street, Welkom
(the premises) forthwith upon service of this
Court Order on the Respondent;
2.
The Sheriff of the High Court is authorised
to take any and all actions as are necessary to give effect to the
reconnection of electrical
supply to the premises should the
Respondent fail to adhere to the terms of paragraph 1 hereof.
3.
The Respondent is interdicted and
restrained from disconnecting the electricity supply to the premises
pending the outcome of the
dispute resolution processes and/or
declaratory proceedings envisaged in paragraphs 4 and 5 hereof;
4.
Applicant is ordered to lodge a formal
dispute against the electricity charges billed on its tax invoice
and/or electricity fees
bill in respect of such charges issued to it
by the Respondent, in terms of Section 11 of the Respondent’s
officially adopted
debt and credit control policy,
alternatively
,
to institute declaratory proceedings against the Respondent relevant
to its indebtedness, within 30 days from the date of the
order
herein, failing which the relief granted in paragraph 3 shall lapse;
5.
The Respondent is ordered to pay the costs
of the application.
J J F HEFER, AJ
Appearances
on behalf of the Applicant:
Adv L
A Roux
Instructed
by: Kruger Venter Incorporated
Bloemfontein
On
behalf of the Respondent:
Adv K
Ngubeni
Instructed
by: Tshangana & Associates Inc.
Bloemfontein
[1]
Section 59(2)(f), Act 3 of 2000.
[2]
(962/2023) ZAFSHC 284 (24 July 2023)
[3]
par. [8] and [9]
[4]
Unreported read on 19 August 1999, delivered on 10 September 1999
(SCA)
[5]
Unreported (Case no. 1885/2003) heard on 31 July 2003, delivered on
14 August 2003 (FS)
[6]
2010 (4) SA 55
(CC)