Summary of Judgment

1. Introduction

The matter concerned an appeal to the Supreme Court of Appeal arising from proceedings in the KwaZulu-Natal High Court, Pietermaritzburg. Although the litigation originated as an urgent application to review and set aside a municipal appointment decision, the Supreme Court of Appeal characterised the appeal as being primarily about costs, with an additional issue created by the High Court’s grant of constitutional relief after the dispute had become moot.

The appellant was the Member of the KwaZulu-Natal Executive Council for Local Government, Housing and Traditional Affairs. The respondents included Mr M S Yengwa (the candidate appointed as municipal manager), the Umvoti Municipality, a group of municipal councillors (third to thirteenth respondents), and the Minister for Provincial and Local Government (joined because constitutional invalidity of a regulation was placed in issue).

Procedurally, the appellant launched an urgent application in May 2007 seeking to set aside the municipality’s resolution appointing Mr Yengwa as municipal manager and to obtain a costs order against the councillors who voted for the appointment (alternatively against the municipality). Shortly after the application was instituted, the appellant was informed that Mr Yengwa would not accept the appointment, and therefore the substantive dispute (the setting aside of the appointment) had fallen away. Despite that, the appellant persisted. The High Court dismissed the application with costs and went further by making an order declaring regulation 38(1) invalid and setting it aside. The appellant then appealed to the Supreme Court of Appeal.

The dispute therefore concerned, in substance, whether it was competent or appropriate for the High Court to grant constitutional relief after the substratum of the case had disappeared, and what the proper costs order should be in light of the parties’ conduct and the legal protections applicable to councillors and organs of state.

2. Material Facts

During February 2007 the Umvoti Municipality advertised the post of Municipal Manager. The advertisement stated, as a requirement, that prospective applicants should have “a recognised B degree in Public Administration, or relevant fields”. This requirement was derived from the job description prescribed by regulation 38(1) of the regulations made under the Local Government: Municipal Systems Act 32 of 2000.

Mr Yengwa did not hold the bachelor’s degree specified in regulation 38(1). Despite this, the Municipal Council resolved on 16 April 2007 to appoint him as municipal manager. The appellant opposed the appointment, but the Council considered Mr Yengwa to be appropriately qualified.

Before the vote was taken, the municipal Town Clerk (Mr Pienaar) drew the councillors’ attention to regulation 38(1) and its degree requirement. Nonetheless, the third to thirteenth respondents (councillors) voted in favour of the resolution appointing Mr Yengwa.

On 22 May 2007 the appellant launched an urgent application in the High Court seeking an order declaring the appointment resolution void and setting it aside. The appellant also sought a costs order against the councillors personally, alternatively against the municipality.

On 25 May 2007, the municipality’s notice of opposition informed the appellant that Mr Yengwa, for personal reasons, could not and did not accept the appointment, and that the necessity for the main relief had accordingly fallen away. The municipality indicated that if the application were withdrawn it would not seek costs of its opposition, but if the matter proceeded it would seek costs against the appellant. It also indicated, as a matter of law and principle, that it opposed the costs order sought against its councillors.

The municipality’s opposition also placed in dispute the constitutional validity of regulation 38(1) relied upon by the appellant, leading to the joinder of the Minister for Provincial and Local Government. The respondents filed a notice indicating an intention to seek relief under section 172(1) of the Constitution declaring regulation 38(1) invalid. The Minister elected to abide the court’s decision.

Despite the absence of a continuing dispute about the appointment (because Mr Yengwa would not take the post), the appellant persisted with the proceedings, effectively maintaining a dispute about costs.

3. Legal Issues

The Supreme Court of Appeal was required to determine, first, whether the High Court’s order declaring regulation 38(1) invalid was competent or appropriate where the substratum of the litigation had fallen away, and where the order would have no practical effect on the parties.

Secondly, the Court had to determine the appropriate costs outcome, including whether it was permissible or appropriate to seek personal costs orders against municipal councillors for votes cast in the performance of their municipal functions, and how costs should be approached where the contest was between organs of state and the dispute had effectively become moot shortly after launching.

These questions involved a combination of application of legal principle to established facts (mootness; constitutional avoidance; statutory protections for councillors; the court’s discretion in costs) and evaluative judgment in exercising the costs discretion in response to the appellant’s persistence after the main dispute ceased to exist.

4. Court’s Reasoning

The Supreme Court of Appeal noted that, in substance, the case was “about costs” and that section 21A of the Supreme Court Act 59 of 1959 limits the entertainment of appeals directed only at costs orders to exceptional circumstances. The Court indicated that, had it not been for the High Court’s additional order declaring regulation 38(1) invalid, the appeal would have been struck from the roll on the basis that it was essentially a costs appeal without exceptional circumstances.

On the High Court’s declaration of invalidity, the Court held that once the substratum of the application had fallen away (because Mr Yengwa had not accepted the appointment), it was no longer necessary to determine constitutional validity or to grant an order setting aside regulation 38(1). The Court emphasised the established policy against deciding issues that have no practical effect on the parties, and it reiterated the principle that constitutional issues should generally be decided only when necessary to resolve a live dispute. In this regard, it rejected the suggestion that leaving the invalidity order in place could be justified on the basis that it might provide general guidance to municipalities, stating that it was not the function of the court to provide advice divorced from a practical controversy. On this reasoning, the declaration of invalidity was set aside.

Turning to costs, the Court accepted that a court deciding costs may have regard to the merits, but it considered the appellant’s persistence after the dispute became moot to be decisive in the exercise of the costs discretion.

As to the attempted personal costs orders against councillors, the Court held that the appellant’s insistence was “futile and ill-conceived” in light of Swartbooi and Others v Brink and Others, which established that councillors cannot be held personally liable for costs incurred in the performance of their functions as councillors. The Court further noted the statutory protection afforded by section 28(1)(b) of the Local Government: Municipal Structures Act 117 of 1998, which protects councillors from personal liability for costs in legal proceedings arising from their municipal functions. Given that the appellant had persisted despite these protections and despite access to legal advice, the Court concluded there was no reason not to order the appellant to pay the councillors’ costs, even though the appeal succeeded in setting aside the invalidity order.

Regarding costs as between the appellant and the municipality, the Court acknowledged that this was a contest between two state entities, with costs ultimately borne by the public purse. It referred to authority cautioning that organs of state should avoid litigation against one another and should make reasonable efforts to resolve intergovernmental disputes before going to court. However, it found that an order that each party pay its own costs would not be appropriate because the appellant had, after being told within three days that the main relief had fallen away, persisted in a futile mission, causing further costs to be incurred. The Court considered it necessary to mark its disapproval of this conduct and therefore departed from a “neutral” costs outcome, ordering the appellant to pay the municipality’s costs as well.

5. Outcome and Relief

The Supreme Court of Appeal upheld the appeal only to the extent of setting aside the High Court’s constitutional order. It set aside the order declaring regulation 38(1) invalid.

The Court ordered the appellant to pay the costs of the second to thirteenth respondents, which included the municipality and the councillors.

No separate or additional relief was granted beyond the partial success on the invalidity order and the substitution of the costs position as reflected in the Supreme Court of Appeal’s order.

Cases Cited

Trustees for the Time Being of the Biowatch Trust v Registrar, Genetic Resources and Others 2009 (6) SA 232 (CC); [2009] ZACC 14.

President, Ordinary Court Martial and Others v Freedom of Expression Institute and Others 1999 (4) SA 682 (CC); [1999] ZACC 10.

S v Dlamini; S v Dladla and Others; S v Joubert; S v Schietekat 1999 (4) SA 623 (CC); [1999] ZACC 8.

Uthukela District Municipality and Others v President of the Republic of South Africa and Others 2003 (1) SA 678 (CC); [2002] ZACC 11.

Independent Electoral Commission v Langeberg Municipality 2001 (3) SA 925 (CC); [2001] ZACC 23.

Swartbooi and Others v Brink and Others 2006 (1) SA 203 (CC).

Legislation Cited

Supreme Court Act 59 of 1959, section 21A.

Constitution of the Republic of South Africa, 1996, section 172(1).

Local Government: Municipal Systems Act 32 of 2000.

Local Government: Municipal Structures Act 117 of 1998, section 28(1)(b).

Rules of Court Cited

No rules of court were cited in the judgment.

Held

The Supreme Court of Appeal held that where the substratum of litigation has fallen away, it is generally inappropriate to determine constitutional issues or to make orders that have no practical effect on the parties, and that the High Court’s declaration of invalidity of regulation 38(1) should therefore be set aside.

It further held that municipal councillors are protected from personal costs orders incurred in the performance of their functions, both as a matter of constitutional-court authority and by statutory protection, and that the appellant’s persistence in seeking such costs (and in continuing the litigation after mootness arose) warranted adverse costs orders against the appellant.

LEGAL PRINCIPLES

The judgment applied the principle that appellate courts should generally not entertain appeals directed only at costs unless exceptional circumstances exist, as reflected in section 21A of the Supreme Court Act 59 of 1959, while recognising that an additional substantive order (here, a constitutional invalidity declaration) may supply a basis for the appeal to proceed.

It reaffirmed the policy that courts should avoid deciding issues, particularly constitutional validity, where there is no longer a live dispute and the decision would have no practical effect for the parties, and that constitutional questions should be decided only when necessary for the resolution of the case.

It applied the principle that municipal councillors are generally not to be held personally liable for costs arising from actions taken in the performance of their official functions, relying on Swartbooi and Others v Brink and Others and the protection in section 28(1)(b) of the Local Government: Municipal Structures Act 117 of 1998.

It further applied the discretionary nature of costs orders, including the court’s power to depart from a neutral approach between state entities where one party’s conduct—such as persisting with litigation after mootness is established—justifies a punitive or disapproving costs response.