THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Reportable
Case no: 522/2021 & 523/2021

In the matter between:
MINISTER FOR TRANSPORT AND PUBLIC
WORKS: WESTERN CAPE FIRST APPELANT
PREMIER OF THE WESTERN CAPE
PROVINCE SECOND APPELLANT
THE PROVINCIAL GOVERNMENT
OF THE WESTERN CAPE THIRD APPELANT
MINISTER OF HUMAN SETTLEMENTS:
WESTERN CAPE FOURTH APPELANT
CITY OF CAPE TOWN FIFTH APPELANT
and
THOZAMA ANGELA ADONISI FIRST RESPONDENT
PHUMZA NTUTELA SECOND RESPONDENT
SHARONE DANIELS THIRD RESPONDENT
SELINA LA HAINE FOURTH RESPONDENT
RECLAIM THE CITY FIFTH RESPONDENT
TRUSTEES OF NDIFUNA UKWAZI
TRUST SIXTH RESPONDENT

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and in the matter between:
PREMIER OF THE WESTERN CAPE
PROVINCE FIRST APPELANT
MINISTER FOR TRANSPORT AND
PUBLIC WORKS: WESTERN CAPE SECOND APPELANT
CITY OF CAPE TOWN THIRD PPELLANT
and
MINISTER OF HUMAN SETTLEMENTS FIRST RESPONDENT
NATIONAL DEPARTMENT OF
HUMAN SETTLEMENTS SECOND RESPONDENT
SOCIAL HOUSING REGULATORY
AUTHORITY THIRD RESPONDENT

Neutral citation: Minister for Transport and Public Works: Western Cape &
others v Adonisi and Others (522/2021 & 523/2021) [2024]
ZASCA 47 (12 April 2024)
Coram: DAMBUZA AP, ZONDI, SCHIPPERS and MOLEFE JJA,
UNTERHALTER AJJA
Heard: 20 February 2023
Delivered: This judgment was handed down electronically by circulation to the
parties’ representatives by email, published on the Supreme Court of Appeal
website, and released to SAFLII. The date and time for hand-down is deemed to
be 11h00 on 12 April 2024.
Summary: Constitutional Law: principle of constitutional subsidiarity whether
the respondents, in asserting their right of access to land and adequate housing,
could rely directly on ss 25 and 26 of the Constitution – whether the Housing Act
107 of 1997 and the Social Housing Act 16 of 2008 giving effect to the

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constitutional right of access to adequate housing o bliges the state to provide
social housing at a specified location (Central Cape Town).
Regulations issued in terms of the W estern Cape Land Administration Act 6 of
1998 (WCLAA) – whether regulation 4(6) and the proviso in regulation 4(1) are
unconstitutional – whether conclusion of a conditional contract of sale of land
owned by the provincial government prior to the notice and comment process is
unlawful.
Government Immovable Asset Management Act 19 of 2007 (GIAMA) – whether
the Western Cape Provincial Government may sell provincial government
property in the absence of a custodian asset management plan or user asset
management plan prescribed in s 13 of the Act.
Intergovernmental Relations Framework Act 13 of 2005 (IGRFA) – whether the
Western Cape Provincial Government has an obligation to inform and consult the
National Minister of the Department of Human Settlement of an intention to
dispose of provincial land.
Designation of restructuring zones in terms of ss 3, 4 and 5 of the Social Housing
Act – whether Sea Point was designated as a restructuring zone in t erms of a
notice issued by the National Minister of the Department of Human Settlements
– principles applicable to interpretation of legal documents restated.

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ORDER

On appeal from: Western Cape Division of the High Court, Cape Town (Gamble
and Samela JJ, sitting as court of first instance):
1 The appeal is upheld with no order as to costs.
2 The order of the high court in Case No 7908/2017 is set aside and
replaced with the following order:
‘The application is dismissed with no order as to costs.’
3 The order of the high court in Case No 12327/2017 is set aside and
replaced with the following:
‘The application is dismissed with no order as to costs.’

JUDGMENT

Dambuza AP (Zondi, Schippers and Molefe JJA and Unterhalter AJJA
concurring)

Introduction
[1] At the heart of this appeal is a decision by the third appellant, the Provincial
Government of the Western Cape (the Province) to sell to the Phyllis Jowell
Jewish Day School (NPC) (the Day School)1 two properties, namely, Erf 1675,
an unregistered portion of Erf 1424 Sea Point, and the remainder of Erf 1424 Sea
Point (collectively referred to as the Tafelberg property). The respondents in this
appeal brought two applications in the Western Cape Division of the High Court
contesting the sale on the basis that it occurred in circumstances where the

1 The school was the third respondent in the first application before the high court. It did not participate in the
appeal in this court.

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Province and the fif th appellant,2 the City of Cape Town (the City) had failed ,
over a protracted period , to comply with their obligation to ‘reverse apartheid
special design’ and to provide social housing in the centre of Cape Town. The
two applications w ere heard together. The Western Cape Division of the High
Court (the high court, Gamble J , with Samela J concurring) , granted the order
sought in each of the two applications . T he main effect of the orders was to
declare the sale unlawful and to set it aside. Leave to appeal was granted by the
high court in part, and this court granted leave in respect of the remaining issues
on appeal.3 This appeal relates to the orders made in both applications.

The facts
The history of the property
[2] The Tafelberg property is located at 355 Main Road, in Sea Point, Cape
Town. It measures 1,7054 hectares (ha) in extent. It is registered in the name of
the Province. Its long history is set out in full in the judgment of the high court.
In brief, in 1899 a girls’ school was established on the property. Almost a century
later, the girls’ school was converted into a co-educational public school. At some
stage, the school building was used as a remedial school. A block of flats known
as Wynyard Mansions was built on a portion of the property and was managed
by the Western Cape Provincial Department of Transport and Public Works
(Department of Transport). In 2010, the remedial school was closed down.

[3] After the last group of scholars we re transferred elsewhere, the Province
started a process of determining the most suitable use of the property. The tenants
of Wynyard Mansions were given notice to vacate the pr operty. Following a
lengthy process of provincial inter-governmental discussions and procurement,

2 Third appellant in the second appeal.
3 In respect of the first order, the high court granted the Province and the departments leave to appeal against

orders 1 to 6, and 10 to 12. It also granted the City leave to appeal against orders 1 to 6 and 12.

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in January 2016 the property was so ld to the Day School for R135 million. It is
this sale that was challenged in two court applications launched in the high court.

The process that preceded the sale
[4] When the school was closed in 2010 , the Provincial Departme nt of
Transport was the custodian of the Tafelberg property , as provided in s 1 of the
Government Immovable Asset Management Act, 19 of 2007 (GIAMA). 4 The
Western Cape Department of Education made use of the school premises, and the
Provincial Department of Human Settlements made use of Wynyard Mansions.5
The latter continued to use the property until 30 May 2014, when the last tenant
was evicted from the Wynyard Mansions.

[5] From 2011, the Provincial Department of Human Settlements initiated an
investigation into the feasibility of social housing on certain land within the City,
including the Taf elberg Property , in line with the ‘Cape Town Central City
Regeneration Programme Strategic Framework’ (the Regeneration Programme)
and the Western Cape Property Development Process , adopted by the Province
in September and October 2010 respectively. The essence of the Regeneration
Programme is captured in the following extract from its executive summary:
‘The Western Cape Provincial Government aims through the Cape Town Central Regeneration
Programme (CT-CCRP) to:
 Unlock Cape Town’s potential to become a city that provides the needs of all its citizens
as one of the world’s greatest cities of the world;
 Leverage private sector investment, capacity and expertise;
 Refurbish and achieve savings in the operation and maintenance of the properties; and

4 Under s 1 read with s 4 of GIAMA a ‘custodian’ is a national or provincial department, as managed by the
National Minister, the Minister for Land reform, a Premier of a province, or an MEC of a province duly delegated
by the Minister.

by the Minister.
5 Under s 1 of GIAMA a ‘user ’ is defined as ‘a national or provincial department that uses or intends to use an
immovable asset in support of its service delivery objectives and includes a custodian in relation to an immovable
asset that it occupies or intends to occupy, represented by the Minister of such national department, Premier of a
province or MEC of such provincial department, so designated by the premier of that province’.

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 Generate an income stream to finance provincial property development and
maintenance.
Not only will this generate economic activity and create jobs and opportunities for
empowerment, provide access to the cities resources, facilitate social cohesion and well-being
and enable environmental sustainability and energy efficiency.
. . .
The CC-CCRP will achieve the following Strategic objectives:
 Mobilise new investments in the central city;
 Ensure that all significant components of the business premises are affordable for small
and micro enterprises;
 Achieve densification by developing a percentage of residential stock for affordable
housing;
 Provide access to green and vibrant public spaces within walking distance of residential
buildings;
 Develop exemplary social facilities for all age groups and cultural persuasions;
 Reinforce the vision of trans-oriented development; and
 Develop a fibre optic backbone for the central city.’

[6] Whilst th e Regeneration Programme was in progress , the Provincial
Department of Transport began implementing a ‘High Level Scoping’ exercise
that it had designed for the purpose of establishing development potential on the
Tafelberg p roperty. On 26 February 2013 th is department invited the other
provincial departments to make written represent ations as to whether they
required the Tafelberg property for infrastructure purposes to further government
objectives. In a written response , dated 13 March 2013 , Mr Tshangana, the
Manager, Property Planning in the Provincial Department of Human Settlements,
advised that his department was of the view that both erven 1424 and 1625 were
needed for development of ‘integrated and sustainable human settlements’, more
specifically, social housing for persons in the income bracket of R1 500 to
R7 500.

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[7] In a comprehensive response Mr Tshangana expressed his department’s
response as follows:
‘[T]he Tafelberg school property is well suited for residential use, Social Housing in particular.
It is well service d by public transport and engineering ser vices. It is recognised that careful
thought and design are required for an appropriate use and response to the existing school
buildings, which enjoy heritage protection and cannot be demolished or altered. The
opportunity for the development of some retail and commercial uses in the Main Road frontage
should be exploited as it has the potential to provide cross subsidization for Social Housing.
Refurbishment must also be considered for the conversion of the existing school buildings,
potentially to community facilities.’

[8] The first appellant, the Member of Executive Council for the Department
of Transport did not agree. In a meeting attended by the MECs of the departments,
on 15 May 2013, the MEC for Transport made it clear that the Tafelberg property
would not be considered for social housing. During March 2014, the Tafelberg
property was one of four properties in respect of which the Department of
Transport invited expressions of interest for development . The invitation was
contained in a 50-page document titled ‘Expression of Interest: Property
Development Opportunities in the Cape Town Central Regeneration
Programme’. The other properties included in the invitation were: the Alex Street
Complex, the Helen Bowden Nurses’ Home Site, and the ‘Top Yard’. In respect
of the Tafelberg property , the Department of Transport envisaged a mixed use
development which would include a residential component.

[9] In January 2015, the Province resolved to finance an anticipated shortfall
in a project initiated by the Department of Transport to establish a ‘public private
partnership’ (PPP) to relocate the head office of the Department of Education
from the Golden Acre/Grand Parade area in the City’s Central Business District

from the Golden Acre/Grand Parade area in the City’s Central Business District
(CBD) to the Provincial Office Precinct, in order to reduce rental costs. The idea
was to raise funds by selling provincial properties. At the time , no decision had

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yet been taken on the submission made by the Human Settlements Department
regarding the proposed sale of the Tafelberg Property. In March 2015 , the
Province resolved to sell the Tafelberg property to fund the shortfall anticipated
with the Provincial Department of Education office park development.

[10] The first respondent, Ms Adonis i, the sixth respondent, Ndifuna Ukwazi,
and the Social Justice Coalition (SJC) objected to the sale of the Tafelberg
property as part of the Regeneration Programme. Their objections were dismissed
by the Department of Transport. So were proposals by other objectors that the
MEC of th is Department should first consult with the local and national
government before making the decision to sell the Tafelberg property. Similarly,
a proposal by a Social Housing Institution, 6 Communicare, that a project
consisting of a social housing and market related rental housing should be
implemented found no favour with the Provincial Department of Transport.

[11] Following the decision to sell the Tafelberg Property, the Department of
Transport had it valu ed. It obtained a valuation of R107,3 million. The
Department then invited bids from prospective purchasers, stipulating that only
offers above the market value would be considered. The tender document
provided that the scoring system would be 90:10 for price as against Broad-based
Black Economic Empowerment (BBEE). Of the five offers received only two
were above the market valuation. The scoring resulted in the Day School winning
the tender for the sale price of R135 million. On 3 July 2015, the Department of
Transport recommended Provincial Property Committee (PPC), that the property
be sold to the Day School. The Provincial Cabinet approved the proposal as

6 In terms of s 1 of the Social Housing Act a social housing Institution is an institution accredited or provisionally

accredited under the Social Housing Act, and carries or intends to carry on the business of providing rental or co-
operative housing options for low to medium income households (excluding immediate individual ownership and
a contract as defined as defined under the Alienation of Land Act, 1981 (Act No 68 of 1981), on an affordable
basis, ensuring quality and maximum benefits for residents, and managing its housing stock over a long term.

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provided in Reg 4(5) of the regulations promulgated in terms of the Western Cape
Land Administration Act 6 of 1998.

[12] The Department of Human Settlements was duly informed that a decision
had been taken to dispose of the property in order to create an income stream for
an Asset Reserve Fund that would be used for the construction and maintenance
of social infrastructure. It agreed to withdraw its request to have the property
made available for social ho using, albeit grudgingly, highlighting that the
property had been found to be suitable for human settlement development. Mr
Thando Mguli, the Head of Departm ent (HOD) of the Department of Human
Settlements remarked that whereas his department had released hundreds of
hectares of land under its custodianship for human settlement development, the
Department of Transport had never released any land under its custodianship for
that purpose. He expressed his frustration with what he considered to be an
incorrect interpretation of s 5(1)(a) of GIAMA by the officials in the Department
of Transport, to the effect that only ‘surplus’ land that is not needed for Provincial
functions, may be made available for human settlement development.7

[13] On 11 November 2015 , the Provincial Cabinet approved the sale , and on
20 November 2015 the MEC for Transport accepted and signed the offer made
by the Day School. However, about six months later, the respondents launched
the first application , challenging the lawfulness of the sale. They maintained,
amongst other things, that there had been no compliance with the procedural and
substantive requirements prescribed in s 3 of the WCLAA , in that the notice of
the intended sale by the Provincial Premier was never published in an IsiXhosa

7 In terms of s 5(1)(a) of GIAMA one of the principles of management of government immovable assets is that

an immovable asset must be used efficiently. It becomes surplus to a user if it does not support the user’s service
delivery objectives at an efficient level and if it can not be upgraded to that level. In terms of s 5 (f) of GIAMA
when a custodian intends disposing of a government immovable asset he or she must consider whether that asset
can be used by another user, or jointly by different users, in relation to other specif ied government objectives.

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newspaper, circulating within the Province , prior to the notice and comment
process. This led to the court granting an order that the notice and comment
process be re-opened. The Province invited comments from the public on whether
it should resile from the sale.8

[14] The reopening of the notice and comment process led to numerous
submissions. As a result , the Province resolved that work should be done on a
financial model for development of social housing on the Tafelberg property.
Thirty-seven comments were received in respect of the newly proposed financial
model. On 22 March 2017 the Province published, on its website, a minute of its
decision not to resile from the sale. The minute reads:
‘CABINET DECISION IN RESPECT OF WHETHER TO RESILE OR NOT FROM THE
SALE AGREEMENT PERTAINING TO THE TAFELBERG SITE
Department of Transport and Public Works
Department of Human Settlements
Department of the Premier
RESOLVED that –
1 Having taken into account the comments submitted o ut of the public participation
process applied in this matter to date, along with the recommendation of the custodian, the
legal advice received and the presentations by the various officials, the Cabinet considered the
following factors to be material during the course of its deliberations on whether or not to resile
from the Tafelberg sale agreement:
1.1 The current proposed and future initiatives b eing undertaken by the DOHS in relation
to the progressive realization of the right to adequate housing by the citizens of the Western
Cape, and specifically the pipeline of 40 000 affordable housing opportunities reported to the
Cabinet by DOHS in this regard. In relation to social housing, specifically the pipeline includes
10 810 units at a cost of R1,2 billion over the next 10 years- in the metro and 14 008 units at a
cost of R1.57 billion, in the non-metro area of the Western Cape.

8 In terms of the sale agreement the Province had an option of resiling from the sale .

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1.2 The Memorandum of Undertaking between DOHS and DOTPW, and the result thereof,
i.e. the identification of 18 parcels of land by DOHS for human settlement purposes, including
but not limited to land within the City of Cape Town.
1.3 The prior decisions of Cabinet on 22 March 2017 in relation to the proposed use and/or
disposal of the Woodstock hospital site and the Helen Bowden Nurses Home site (both within
the metro) as contained in the presentation by DOTPW in this regard. More specifically the
request by Cabinet that any prop osed disposal of the Woodstock hospital site (in whole or in
part) be referred to Cabinet so as to enable it to ensure that affordable housing is best achieved
on that site given its locality and size. Similarly with respect to Green Point Helen Bowden
site, that any RFP that is developed contain within it the requirement for the maximum quantum
of affordable housing as will make the development of the site viable.
1.4 The identified legal risks in a social housing development under the auspices of the
Social Housing Act on this site currently, including, inter alia:
1.4.1 The legal advice received from senior counsel pertaining to the comment made by the
Phyllis Jowel Jewish Day School, in relation to the definition of a “Restructuring Zone” in the
Social Housing Act, re ad with the National Minister’s designations and the City’s currently
identified Restructuring Zones. Counsel’s advice is that the Tafelberg site does not currently
fall within such a Zone as defined, rendering the availability of the restructuring capital grant
unavailable to any social housing institution for a proj ect on that site currently. All social
housing proposals received to date as part of the public participation process presume a
restructuring capital grant is available. Ca binet notes that the National Minister may be
approached to amend the Restructuring Zone designations but, as of 22 March 2017, counsel’s

approached to amend the Restructuring Zone designations but, as of 22 March 2017, counsel’s
advice is that Sea Point does not fall within such a designated area.
1.4.2 That the current income bands and associated grants applicable to social housing
projects are in the process of amendment. Such amendments have not, to date come into
operation. Necessary legislative amendments, to enable any social housing project in Sea Point
or Green Point to benefit from a restructuring Capital grant and increased income bands are
required and probable but as of date this cabinet deci sion, neither of the necessary suite of
amendments is in operation.
1.5 While Cabinet accepts that social housing is notionally an option on any piece of land
owned by the Western Cape Government, in addition to what has been set out above, the value
of the land which has been achieved in this sale, the high construction costs acknowledged in
the public participation process, the acknowledgment out of the public participation process
that extensive cross-subsidisation is required to render the project financially feasible and the

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inherent land use restrictions which apply to this site, including, inter alia, heritage and zoning
requirements, render this specific site sub-optimal for social housing.
1.6 The loss of injection of revenue of R135 million earned for other infrastructure required
for the provincial government, in a climate of fiscal austerity and under a direct instruction
from National Treasury to optimize the use of its assets for inter, alia, revenue raising measures.
RESOLVED further that –
2 Accepting that –
 A rational approach to a policy-laden decision of this nature, encompasses a basket of
legal and policy considerations;
 The expertise and comment of the administration are necessary;
 Cabinet is entitled to accord its interpretation of the facts and the law to the matter at
hand, subject to no fraud, corruption or mala fides being in evidence,
The Cabinet is of the view that a holistic approach to the utilization of provincial assets and the
methods by which the Western Cape Government is pursuing its legislative obligations and
policies in that regard, is preferable to an ad hoc site -by-site determination, i.e. of trying to
achieve all its objectives on eve ry site. The recommendation in this regard, by the custodian,
that an integrated angle approach be adopted is one which is rational and accepted.
RESOLVED further that –
Cabinet is accordingly of the view that a decision to uphold the contract of sale is rational,
prudent and appropriate, and accordingly decides not to resile from the current contract of sale
concluded with the Phyllis Jowell Jewish Day School.’
It is this decision that lies at the centre of the dispute between the parties to this
appeal.

[15] On 30 March 2017 , the National Minister of the Department of Human
Settlements wrote to the Province advising that she intended to ‘pursue the
development of social housing on the Tafelberg property ’. She invoked s 41 of
the Intergovernmental Relations Framework Act 13 of 2005 ( IGRFA) advising

the Intergovernmental Relations Framework Act 13 of 2005 ( IGRFA) advising
that a dispute had arisen as a result of the sale of the property. S he warned that
she would be referring the dispute for inter-governmental dispute resolution. The
Premier denied that there was a dispute between the National Department of
Human Settlements and the Province. She asserted that I GRFA found no

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application in the circumstances, but indicated her willingness for engagement to
take place between members of the respective offices about the sale.

[16] In the ensuing correspondence , the National Minister insisted that she
would be referring for resolution four aspects of an intergovernmental dispute for
resolution. These related to whether, in concluding the sale , the Province: (a)
complied with the s 5 of GIAMA; (b) disregarded its obligation to provide social
housing in terms of the Social Housing Act (c) provided rational reasons for its
decision not to resile from the sale , taking into account the constitutional and
legislative requirements to provide social housing; and (d) whether the property
fell within a restructuring zone; and if not, whether it was ‘rational’ for the
Province not to approach the National Minister for a designation declaring it to
be a restructuring zone.

[17] In addition to maintaining that there was no merit in the alleged disputes ,
the Premier argued that the Province was functus officio in relation to the sale ,
and that IGRFA was not applicable to the sale, particularly as a private entity was
involved.

The high court applications
The first application
[18] In the first application (High Court Case no 7908/17), the first respondent,
Ms Thozama Angela Adonisi (Ms Adonisi) and five other applicants (the second
to sixth respondents in this appeal), sought an order declaring that the Province
and the City, had failed to comply with their obligations under the Constitution
and the legislation enacted to give effect to the ir rights of access to land and
adequate housing. The Provincial Minister of the Department Transport was cited

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as the official responsible under the WCLAA and GIAMA, for disposal of land
owned by the government.

[19] When the first high court application was launched, the first to fourth
respondents9 were residents of various suburbs, in and around the City. Ms
Adonis resided in a basement of a block of flats in Sea Point. She sat on the
leadership committee of the Sea Point Chapter of the fifth respondent, ‘Reclaim
the City ’, a voluntary organisation with about 3000 ‘w orking class’ members
within the City. Reclaim The City was instrumental in launching the firs t
application in the high court.10 The second respondent, Ms Phumza Ntutela, lived
in Nyanga Township, about 25km from Sea Poin t. The third respondent Ms
Sharone Daniels lived in Ocean View and worked in the City. The fourth
respondent Ms Selina La Hane resided in Sandrift, Milnerton. The trustees for the
time being of Ndifuna Ukwazi Trust, were the sixth applicant.

[20] The application was brought on substantially the same basis on which the
Ms Adonisi and Ndifuna Ukwazi had objected to the sale during the notice and
comment process - that when deciding to sell the Tafelberg property to a private
entity, the Day S chool, the Province failed to take into consideration various
constitutional and legislative imperatives, to take reasonable measures to enable
black and coloured working class residents of the City, to access land and housing
within the CBD of the City and its surrounds, on an equitable basis. The
respondents contended that the availability of the Tafelberg property for sale
presented the Provincial Government, as an entity charged with the task of
urgently re-engineering spatial inequality in the Province and the City, with an
opportunity to improve the availability of affordable housing within the City.


9 Ms Adonisi, Ms Ntutela, Ms Daniels, and Ms Hane.

9 Ms Adonisi, Ms Ntutela, Ms Daniels, and Ms Hane.
10 Hence the reference in the high court judgment to the first application as the RTC application.

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[21] The respondents argued that the conception and implementation of the
urban regeneration objective of the City was skewed. They maintained that since
the late 1990’s, buildings in the City centre had been renovated and new buildings
had been constructed to provide residential accommodation to households with
income brackets i n the top 20% of income earners in the City. In addition ,
gentrification of areas such as the BO -Kaap, Woodstock and Salt River ha d
resulted in rental properties which accommodate d the poor and working class
people being sold to property developers, who converted them into residential
accommodation unaffordable for the poor and low income earners. As a result ,
people who could least afford the cost of transport were forced to move further
to the outskirts of the city. All of this resulted in increased demand , and a
corresponding increase in the price of acquiring land for social housing. They
contended that because the State cannot acquire land at market related prices it
must use the pockets of land that it still owns in and around the CBD to provide
social housing.

[22] More specifically, with regard to residents who live and work in Sea Point,
the respondents maintained that instead of considering the Tafelberg property for
social housing, the Province gave priority to purely financial considerations. They
sought orders to the effect that that the Province, the MECs for the Departments
of Public Transport , and Human Settlements had failed to meet their
Constitutional and statutory obligations; and that they be ordered to comply with
such obligations, and report to the court the steps take n to comply; and that the
decisions taken to sell the Tafelberg property be reviewed and set aside.

[23] The Province denied that it had acted in breach of its constitutional and
statutory duties in selling the property. It contended that it was doing its best with
the limited resources at its disposal to provide affordable housing generally and

the limited resources at its disposal to provide affordable housing generally and
social housing in particular. It acknowledged, however, that spatial apartheid i s

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far from being redressed in Cape Town , but highlighted that an appropriate
balance had to be struck between delivery of spatially-integrated housing, on the
one hand, and ensuring delivery in respect of other constitutional imperatives, on
the other hand. In the answering affidavit, the Head of the Provincial Department
of Transport, Ms Jacqueline Gooch, explained the budgetary constraints under
which the Province was operating, particularly following the 2015 public servants
wage agreements, the reduction in the provincial equitable share revenue
allocation in the 2016/17 financial year , and the instruction from the Deputy
Minister of Finance that MECs should reprioritize their budgets.

[24] The Province also emphasi sed that the 2014 Western Cape Provincial
Spatial Development Framework (provincial SDF) showed a considered
commitment to ensure spatial integration. However, that notwithstanding, spatial
integration could not be effected in respect of every available property in central
Cape Town.

[25] The City asserted that as far back as 1996 it had acknowledged the
historical legacy of under -development, deprivation, and it designed it s own
spatial development framework, the City’s Spatial Development Framework of
2012 (City SDF). That framework is also aimed at increasing affordable housing
that is located in close proximity to the City’s economic opportunities , the City
argued.11

The second application
[26] In the second application (high court case no 12327/17) , which was
launched two months after the first application, the National Minister of the
Department of Human Settlements together with the Social Housing Regulatory

11 City SDF at 77.

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Authority (SHRA) sought an order that the decision to sell the Tafelberg property
be review ed and set aside. The application was brought on the basis that the
Provincial Government had failed to comply with its obligation under IGRFA, to
consult the two respondents about its intention to dispose of government land.

[27] The Province denied the existence of any constitutional and statutory
obligation to consult the National Government when disposing of its property.
However, it did respond to inquiries from the National Minister about the sale ,
until the lines of communication ended. The City also contended that the
respondents were not entitled in law to demand social housing in central Cape
Town or a specific location. Both the Province and City contended that, the
respondents should assert the obligations owed to them under the social housing
legal framework comprising the Housing Act, the Social Housing Act and the
Spatial Land Use Management Act 16 of 2013 (SPLUMA).

The high court orders
[28] The orders granted by the high court in the two application s are lengthy.
However, it is necessary to set them out in full for a clear appreciation of the
issues that arise in this appeal. The order in the first application reads as follows:
‘1. That it is declared that the fourth and sixth respondents have the followi ng obligations
in terms of the Constitution of the Republic, 1996:
(i) Under s 25(1) the said respondents are obliged to take reasonable and other measures,
within their available resources, to foster conditions which enable citizens to gain access
to land on an equitable basis;
(ii) Under s 26(2) the said respondents are obliged to take reasonable and other legislative
measures, within their available sources, to achieve the progressive realization of the right
of the citizens to have adequate housing as contemplated in s 26(1) of the Constitution.
2. It is declared that the fourth and the sixth respondents have failed to comply with their

2. It is declared that the fourth and the sixth respondents have failed to comply with their
respective obligations under the legislation enacted to give effect to the said rights, namely, the

19

Housing Act 107 of 1997 and the Social Housing Act, 16 o f 2008, and have accordingly
breached their respective duties under the Constitution.
3. It is declared that in so failing to comply with their obligations as aforesaid, the fourth
and sixth respondents have failed to take adequate steps to redress spatial apartheid in central
Cape Town (the boundaries of which were in 2017 as depicted on the map annexed hereto
marked “A”);
4. The fourth and sixth respondents are directed to comply with their constitutional and
statutory obligations as set out in paras 1 to 3 above.
5. The fourth and sixth respondents are directed to jointly file a comprehensive report
under oath, by 31 May 2021, stating what steps they have taken to comply with their
constitutional and statutory obligations as set out above, what future steps they will take in that
regard and when such future steps will be taken. Without derogating from the generality of the
aforegoing, the fourth and sixth respondents are specifically directed to:
(i) consult with all departments of State and organs necessary to discharge their duty in so
reporting to the court; and
(ii) include in their report their respective policies and integration thereof in regard to the
provision of social housing as contemplated in the Social Housing Act within the area of
central Cape Town as depicted on annexure “A” hereto.
6. The applicants are granted leave to file an affidavit (or affidavits) responding to the
reports filed by the fourth and sixth respondents in terms of paragraph 5 above within one
month of them having been served on their attorneys of record.
7. The November 2015 decision of the Premier of the Western Cape Province, acting
together with other members of the Provincial Cabinet to sell Erf 1675, an unregistered portion
of Erf 1424 Sea Point, and the remainder of Erf 1424 Sea Point (hereinafter collectively referred
to as “the Tafelberg Property”) to the third respondent, together with the deed of sale in respect

of the Tafelberg Property entered into between the third and si xth respondents is hereby
reviewed and set aside.
8. The 22 March 2017 decision of the Premier of the Western Cape Province, acting
together with the other memb ers of the Provincial Cabinet, not to resile from the contract of
sale concluded with the third respondent is hereby reviewed and set aside.
9. It is declared that Sea Point falls within the restructuring zone ‘“CBD and surrounds
Salt River, Woodstock and Observatory) ”’ as contemplated in sub -regulation 6.1 of the
Provincial Restructuring Zone Regulations published under General Notice 848 in Government
Gazette 34788 of 2 December 2011.

20

10. It is declared that Regulation 4 (6), and the proviso in Regulation 4(1), of the
Regulations made under section 10 of the Western Cape Land Administration Act, 6 of 1998
by Provincial Notice No 595 publi shed in Provincial Gazette No. 5296 on 16 October 1988
(hereinafter referred to as “the Regulations”) are unconstitutional and invalid.’
11. It is declared that the disposal of the Tafelberg Property in accordance with Regulation
(4(6), and the proviso in Regulation 4(1), of the Regulations is unlawful. This declaration shall
operate prospectively and will not affect any right s which have accrued to any party as at the
date of this judgment.
12. The applicants’ costs of suit (which are to include the costs of two counsel where
employed), are to be borne by the fourth and sixth respondents, jointly and severally.
13. Save as aforesaid, each party is to bear its own costs of suit in relation to this
application’.

[29] In the second application the high court granted the following order:
‘1. It is declared that the failure of the Western Cape Provincial Govern ment (hereinafter
“the Province”) to inform the National Government (represented by the first and second
applicants herein) of its intention to dispose of Erf 1675, an unregistered portion of Erf 1424
Sea Point, and the remainder of Erf 1424 Sea Point (hereinafter collectively referred to as “the
Tafelberg Property”) and to consult and engage with National Government (represented as
aforesaid) in this regard, constitutes a contravention of the Province’s obligations in terms of
Chapter 3 of the Constitution, and the Intergovernmental Relations Framework Act, 13 of 2005
2. The November 2015 D ecision of the Premier of the Western Cape Province, acting
together with other members of the Provincial Cabinet, to sell the Tafelberg Property to the
fifth respondent, together with the deed of sale in respect of the Tafelberg Property entered into
between the first and fifth respondents are hereby reviewed and set aside.

between the first and fifth respondents are hereby reviewed and set aside.
3. The 22 March 2017 decision of the Premier of the Western Cape Province, act ing
together with the other mem bers of the Provincial Cabinet, not to resile from the contract of
sale concluded in respect of the Tafelberg Property with the fifth respondent is hereby set aside.
4. It is hereby declared that the deed of sale between the Province and the fifth respondent
in respect of the Tafelberg Property is void, of no force and effect and is hereby set aside.
5. It is declared that Regulation 4(6) and the Proviso in Regulation 4(1), of the
Regulations made under section 10 of the Western Cape Land and Administration Act, 6 of
1998 by Provincial Notice No. 595 published in Government Gazette No 5296 on 16 October

21

1998, are unconstitutional and invalid. This declaration shall operate prospectively and will not
affect any rights which have accrued to any party as at the date of this judgment.
6. The first and third applicants’ costs of suit (which are to include the costs of two counsel
where employed) are to be borne by the first respondent.
7. Save as aforesaid, each party is to bear its own costs of suit in relation this application.’

[30] Subsequent to the granting of the court orders , the sale of the property
(which had already been set aside by the court), was cancelled, at the instance of
the Day School. The parties are in agreement, and I agree, that although the sale
was cancelled the issues pertaining to the provision social housing and the role of
the different spheres of government are very important and require cla rification.
They are of considerable public interest.

The appeal
Constitutional subsidiarity
[31] The appellants accept that they bear the responsibilities set out in para 1 of
the first order. They assert , however that their responsibilities flow from the
Housing Act and the Social Housing Act, these being the statutes enacted to give
effect from the rights and obligations that are provided for in ss 25 and 26 of the
Constitution. They contest the rest of the first order and the whole of the second
order. The high court traversed the guiding principles relevant to interpretation of
socio-economic rights , set out in the judgments of the Constitutional Court,
including Mazibuko,12 Grootboom,13 and TAC.14 It discussed the established
principles of legislative interpretation – that courts must promote the spirit,
purport and objects of the Bill of Rights as required under the s 39(2) of the

12 Mazibuko and Others v City of Johannesburg and Others 2010 (4) SA 1 (CC) at 87-88.
13 Government of the Republic of South Africa and Others v Grootboom and others 2001 (1) SA 46.

14 Minister of Health and Others v Treatment Action Campaign and Others (No 2) 2002 (5) SA 721 (CC).

22

Constitution, 15 and accord to statutory provision s a contextual, purposive
meaning which is consistent with these objectives.

[32] It is necessary , first, to highlight that the principle of constitutional
subsidiarity is part of our Constitutional framework. The foundational norms of
the Constitution are expressed in general terms. Where legislative and other
measures have been enacted to realise the rights and obligations in the
Constitution, the foundational norms espoused in the Constitution should find
expression in such legislative measures. By way of example, the preamble to
SPLUMA recognises that many people in South Africa continue to live and work
in places defined and influenced by past spatial planning , land use laws , and
practices, which were based on racial inequality, segregation, and unsustainable
settlement patterns. It provides that it is the obligation of the State to realise the
constitutional imperatives in ss 24, 25, 26, and 27(1) of the Constitution. Section
12(1) of SPLUMA imposes an obligation on the national, provincial and local
governments to prepare spatial development frameworks. The statute, rather than
the Constitution , is therefore the direct source of the rights and obligations
relating to preparation of spatial development frameworks . It is to its statutory
provisions that litigants must look in asserting their rights and the obligations
owed to them.

[33] In My Vote Counts,16 Cameron J (writing for the minority) re-affirmed the
principle of constitutional subsidiarity as follows:
‘[52] The Constitution is primary, but its influence is mostly indirect. It is perceived through
its effects on the legislation and the common law - to which one must look first.

15 Makate v Vodacom Ltd 2016 (4) SA 121 (CC).
16 My Vote Counts NPC v Speaker of the National Assembly and Others 2015 (12) BCLR 1407 (CC). Although

the Court was split as to whether the statute in question gave effect to the rights in question all the judges agreed
that the principle remains part of our law.

23

[53] These considerations yield the norm that a litigant cannot directly invoke the
Constitution to extract a right he or she seeks to enforce without first relying on, or attacking
the constitutionality of, legislation enacted to give effect to that right. This is the form of
constitutional subsidiarity Parliament invokes here. Once legisla tion to fulfil a constitutional
right exists, the Constitution's embodiment of that right is no longer the prime mechanism for
its enforcement. The legislation is primary. The right in the Constitution plays only a subsidiary
or supporting role.
[54] Over the past 10 years, this Court has often affirmed this. It has done so in a range of
cases. First, in cases involving social and economic rights, which the Bill of Rights obliges the
state to take reasonable legislative and other measures, within its availa ble resources, to
progressively realise, the Court has emphasised the need for litigants to premise their claims
on, or challenge, legislation Parliament has enacted. In Mazibuko, the right to have access to
sufficient water guaranteed by section 27(1)(b) was in issue. The applicant sought a declaration
that a local authority's water policy was unreasonable. But it did so without challenging a
regulation, issued in terms of the Water Services Act, that specified a minimum standard for
basic water supply services. This, the Court said, raised "the difficult question of the principle
of constitutional subsidiarity". O'Regan J, on behalf of the Court, pointed out that the Court
had repeatedly held "that where legislation has been enacted to give effect to a right, a litigant
should rely on that legislation in order to give effect to the right or alternatively challenge the
legislation as being inconsistent with the Constitution". The litigant could not invoke the
constitutional entitlement to access to water without attacking the regulation and, if necessary,
the statute.’

[34] The majority agreed. At paragraph 160 of the judgment Judges

the statute.’

[34] The majority agreed. At paragraph 160 of the judgment Judges
Khampepe, Mad langa, Nkabinde and Acting Judge Theron said:
‘The minority judgment correctly identifies the “inter-related reasons from which the notion of
subsidiarity springs”. First, allowing a litigant to rely directly on a fundamental right contained
in the Constitution, rather than on legislation enacted in terms of the Constitution to give effect
to that right, “would d efeat the purpose of the Constitution in requiring the right to be given
effect by means of national legislation”. Second, comity between the arms of government
enjoins courts to respect the efforts of other arms of government in fulfilling constitutional

24

rights. Third, “allowing reliance directly on constitutional rights, in defiance of their statutory
embodiment, would encourage the development of 'two parallel systems of law”.’17

[35] To realise the rights in s 26 of the Constitution t he legislature enacted the
Housing Act, the Social Housing Act and SPLUMA. The preamble to the
Housing Act acknowledges the right, under s 26(1) of the Constitution to have
access to adequat e housing, and the obligation on the State to take reasonable
legislative and other measures, within its available resources, to give effect to this
right. The Act then sets out, as its objectives, the establishment and promotion of
a sustainable social housing environment, the definition of the f unctions of
national, provincial and local governments, and the establishment of the Social
Housing Regulatory Authority.

[36] Part 1 of the Act sets out the general principles which all spheres of
government must take into account when implementing the objectives of the Act.
These include giving priority to the needs of the poor, consulting meaningfully
with individuals and communities affected by housing development, ensuring
that housing developments provide a wide choice of housing and tenure options,
are economically affordable and sustainable, are based on integrated development
planning, and are administered in a transparent manner. Specific ‘roles and
responsibilities’ of the national, provincial and local government s are set out in
Parts 2, 3, and 4, of the Act. The Social Housing Act is formulated similarly, with
the roles and responsibilities of the different spheres of government, and those of
other role players set out in ss 3, 4, 5, and 6 of that Act. 18 Evidently, a

17 See also Clutchco (Pty) Ltd v Davis [2005] 2 All SA 225; [2005] ZASCA 16; 2005 (3) SA 486) (SCA);
NAPTOSA and others v Minister of Education, Western Cape and others 2001 (4) BCLR 388; [2000]

NAPTOSA and others v Minister of Education, Western Cape and others 2001 (4) BCLR 388; [2000]
ZAWCHC 9; 2001 (2) SA 112, and Member of the Executive Council for Development Planning
and Local Government, Gauteng v Democratic Party and others [1998] ZACC 9; 1998 (4) SA
1157 (CC) ; 1998 (7) BCLR 855 (CC) at para 62.
18 Other role players include the National Housing Finance Corporation, and the Social Housing Regulatory
Authority, which bears the responsibility of promoting awareness of social housing and advising the Department
of Human Settlements in its development of policy for the social housing sector, amongst other things.

25

comprehensive statutory r egime is in place as implementation of the
constitutional rights under s 26 of the Constitution is in progress. It is upon that
statutory regime, rather than the Constitution, that the source of any right or
obligation sought to be enforced must be located.

The obligation to provide soci al housing in central Cape Town
[37] Recently, in City of Cape Town v Commando and Others 19 this Court
considered whether the State has an obligation to provide emergency residential
accommodation at a specific location, as an extension of the obligation to provide
access to adequate housing entrenched in s 26 of the Constitution. Occupiers of
properties within the City, including Woodstock and Salt River, had asserted that
the City’s housing programme was deficient in that i t did not provide for access
to emergency housing and accommodation in the immediate inner city and
surrounds in order to meet their urgent emergency housing needs. The high court
had ordered the City to make emergency housing in the inner city. Ironically, in
that case the high court ‘suggested’ 20 that City’s implementation of its housing
programme in the inner City gave undue preference to social housing at the
expense of its constitutional obligation to provide emergency housing.

[38] This Court emphasised that it is within the domain of the executive to
determine how public resources are drawn upon and re-ordered. It held that:
‘Having failed to identify the source of the constitutional duty in the Constitution or the
Housing Act, the occupiers r esorted to relying on s 26 of the Constitution in general terms.
However the principle of subsidiary prohibits direct reliance on the Constitution where specific
and detailed legislation giving effect to a right sought to be enforced has been passed’.21

[39] More importantly, it also held that:

19 City of Cape Town v Commando and Others [2023] ZASCA 7.

19 City of Cape Town v Commando and Others [2023] ZASCA 7.
20 See para 59 of the judgment of this Court.
21 At para 56.

26

‘For this contention [that the State has an obligation to provide emergency residential
accommodation at a specified location] to withstand scrutiny, a source of the duty had to be
identified. The legislative measures and programmes taken by the government giving effect to
s 26 of the Constitution do not impose a duty on it to provide temporary emergency
accommodation at a specific locality. Nor have line of cases since Grootboom interpreted the
duties flowing from s 26 to oblige the government to provide emergency housing at a specific
location. In fact the opposite is suggested. In Thubelitsha Ngcobo J observed that ‘the
Constitution does not guarantee a person a right to housing at government expense at a locality
of his or her choice. Locality is determined by a number of factors including availability of
land. However, in deciding on the locality, the government must have regard to the relationship
between the location of residents and their places of employ ment’.22 (emphasis supplied)
(footnotes omitted)

[40] In this case too, the respondents did not plead, and the high court did not
identify, any statutory provision that requires the provision of social housing at a
specified location. Apart from relying on provisions of ss 25 and 26 of the
Constitution, the respondents placed reliance, generally, on obligations created in
the Housing Act and Social Housing Act. The high court accepted that the two
pieces of legislation, together with SPLUMA, are components of the legislative
framework enacted to give effects to the rights created in the Constitution. It went
to great lengths to describe the racial and class aligned patterns of segregated
residential settlement and socio economic exclusion in the landscape of the City
that still derive from apartheid. It highlighted the plight of the poor and working
class, and black majority that live on the periphery of the City, far from places of
employment, and in overcrowded conditions , with hardly any amenities and

employment, and in overcrowded conditions , with hardly any amenities and
services, while the predominantly white middle class residents are located in
well-located areas with access to ‘excellent’ amenities, services and employment
opportunities.


22 At para 53.

27

[41] That historical context does find expression in s 2 of the Housing Act ,
which sets out the relevant factors for determination of the extent of the right of
access to adequate housing. The country’s history of racial inequality, segregation
and unsustainable settlement patterns are acknowledged. So are the obligations
on the state to respe ct, protect, promote and fulfil the social, economic and
environmental rights of everyone , and to strive to meet the basic needs of
previously disadvantaged communities.

[42] The specific roles and responsibilities of provincial governments are listed
in s 4 of the Social Housing Act as to:
‘(a) ensure fairness, equity and compliance with national and provincial social housing
norms and standards;
(b) ensure the protection of consumers by creating awareness of consumer’s rights and
obligations;
(c) facilitate sustainability and growth in the social housing sector;
(d) mediate in cases of conflict between a social housing institution or other delivery agent
and a municipality, if required;
(e) submit proposed restructuring zones to the Minister;
(f) monitor social housing projects to ascertain that relevant prescripts, norms and standard
are being complied with;
(g) approve, allocate and administer capital grants, in the manner contemplated in the social
housing investment plan, in approved projects;
(h) ensure that the process contemplated in paragraph (g) is conducted efficiently;
(i) administer the social housing programme, and may for this purpose approve-
(i) any projects in respect thereof; and
(ii) the financing thereof out of money paid into the accredited bank account of the
province as contemplated in section 18(3); and
(j) develop the capacity of municipalities to fulfill the roles and responsibilities
contemplated in section 5’.

28

In s 7 of the H ousing Act similar roles and responsibiliti es are referred to as
functions of the Province.23

[43] Under s 5 of the Social Housing Act, municipalities have an obligation –
‘where there is a demand for social housing within its municipal area, [to] . . . take all
reasonable and necessary steps, within the national and provincia l legislative, regulatory and
policy framework-
(a) to facilitate social housing delivery in its area of jurisdiction;
(b) to encourage the development of new social housing stock and the upgrading of existing
stock or the conversion of existing non-residential stock
(c) to provide access-
(i) to land and buildings for social housing development in designated structured zones;
(ii) for social housing institutions to acquire municipal rental stock;
(iii) to municipal infrastructure and services for approved projects in designated
restructuring zones; and
(d) to the extent permitted under the Local Government: Municipal Finance Management
Act, 2003 (Act 53 of 2003),
(i) (initiate and motivate the identification of restructuring zones; and
(ii) enter into performance agreements with social housing institutions’.
The functions of municipalities under the Housing Act are listed in s 9.24

23 Under the Social Housing Act the functions of provincial governments are set out in s 7 as follows:
(1) Every provincial government through its MEC, must, after consultation with the provincial organisations
representing municipalities as contemplated in s163 (a) of the Constitution, do everything in its power to promote
and facilitate the provision of adequate housing in its province within the framework of national policy.
(2) For the purpose of subsection (1) every provincial government must, through its MEC -
(a) determine provincial policy in respect of housing development;
(b) promote the adoption of provincial legislation to ensure effective housing delivery;

(b) promote the adoption of provincial legislation to ensure effective housing delivery;
(c) take all reasonable and necessary steps to support and strengthen the capacities of municipalities to
effectively exercise their powers and perform their duties in respect of housing development;
(d) when a mun icipality cannot or does not perform a duty imposed by this Act, intervene by taking any
appropriate steps in accordance with section 139 of the Constitution to ensure the performance of such duty; and
(e) prepare and maintain a multi -year plan in respect of t he execution in the province of every national
housing programme and every provincial housing programme, which is consistent with national housing policy
and section 3 (2) (b), in accordance with the guidelines that the Minister approves for the financing of such a plan
with money from the Fund.
Other functions listed under this section relate to the MEC.
24 Section 9 of the Social Housing Act stated:
‘Functions of municipalities. -(1) Every municipality must, as part of the municipality’s process of integr ated
development planning, take all reasonable steps within the framework of national and provincial housing
legislation and policy to-
(a) ensure that-
(i) the inhabitants of its area of jurisdiction have access to adequate housing on a progressive basis;

29


[44] The Province and the City cannot be allowed to shun the obligation to
consider racial, social, economic, and physical integration, and the location of the
residents’ places of employment , when implementing social housing
programmes. The respondents had to demonstrate that the Province and the City
had failed to consider the s 2 obligations (under both or either of the Housing Act
and the Social Housing Act ) in performing one or more of the roles and
responsibilities or functions specified in relevant legislation.

[45] In relation to the Province t he respondents acknowledge d that the
provincial S patial Design Framework addresses the relationship between
planning for future land use and affordable housing strategies. In that framework
the Province admits, amongst other things, that:
‘Exclusionary land markets mitigate against spatial integration of socio -economic groups and
limit affordable housing to well -located land. At the same time, government sits on well -
located under-utilised land buildings. . .’ .
They also acknowledge d the shortage of state -owned land that can be used for
affordable housing, especially social housing, in the CBD. The respondents also
refer to the City’s acknowledgment, in its 2017/2018 Built Environment
Performance Plan, that the availability of and dev elopment of affordable rental
accommodation in central areas of the city must play a key role in the future
development of the City and that no site that meets that meets the criteria for

(ii) conditions not conducive to the health and safety of the inhabitants of its area of jurisdiction are prevented
or removed;
(iii) services in respect of water, sanitation, electricity, roads storm-water drainage and transport are provided
in a manner which is economically efficient;
(b) set housing delivery goals in respect of its area of jurisdiction;
(c) identify and designate land for housing development;

(c) identify and designate land for housing development;
(d) create and maintain a public environment conducive to housing development which is financially and
socially viable;
(e) promote the resolution of conflicts arising in the development process;
(f) initiate, plan co-ordinate, facilitate, promote and enable appropriate housing development in its area of
jurisdiction;
(g) provide bulk engineering services, and revenue generating servi ces in so far as such services are not
provided by specialist utility suppliers; and
(h) plan and manage land use and development’.

30

providing afford able housing should be excluded from being realis ed as an
opportunity to reverse the legacy of apartheid by providing affordable housing to
lower income families.

[46] The City admits that its housing delivery strategy was initially focused on
delivering as many houses as possible. This resulted in the implementation of
social housing programmes on the periphery of the city where land is cheaper,
with the unintended consequence of entrenching the old apartheid spatial patterns.
The pipeline programme is a plan of action or a strategy for housing delivery, and
in that sense a government policy. It was an adjustment from the regeneration
programme. However, the Province and the City had to also consider the higher
cost of housing delivery in the inner City. The Province explained that the driving
factors include the cost of land, the economies of scale in respect of building costs
because of land availability, and the high cost of rates and taxes in the inner City.
These were relevant factors in their decision-making-process.

[47] The high court made no reference, in its judgment, to the evidence relating
to the social housing pipeline programme. This factor was listed prominently as
one of the considerations that led to the decision not to resile from the sale. The
respondents contended that ‘the single most important – and damning – aspect of
the context which should be taken into account is the complete failure to deliver
affordable housing in central Cape Town’. They argued that neither the Province,
nor the City could claim to have completed a sin gle affordable housing
programme in central Cape Town in the 24 year period between the end of
apartheid and the finalization of their answering affidavits in 2018’. However,
there was evidence of a number of soci al housing projects in the City which
yielded 2 168 social housing units at a cost of R686 489 804. By March 2017, the
number of social housing units in the metropolitan pipeline programme was

number of social housing units in the metropolitan pipeline programme was
10 810. In addition, as at 25 April 2018 , the total number of houses planned for

31

the Cape Metropole was 11 007, with an additional 3 844 units under discussion.
The appellants describe the social housing pipeline as ‘a working document,
which is updated as projects progress in terms of readiness planning’.

[48] The reasons for the decision not to resile from the sale of the Tafelberg
property included consideration of the planned development on the Helen
Bowden site (10 hectares), as part of the Somerset Precinct development, in close
proximity to the V&A Waterfront, the natural amenities, the Cape Town Stadium
and the CBD. Social housing would constitute 20 percent of the Helen Bowden
site development. The Provincial Department of Transport had already applied
for rezoning, consolidation and sub division of several erven in Green Point,
‘approximately two kilometres north-west of the CBD’. In addition the Province
had approved disposal of 12 erven to the City at a price of R5,1 million (a price
below the market value of R9 million) for provision of social housing.

[49] The other projects listed as part of the social pipeline project included the
Woodstock Hospital site development, in which provision had been made for a
minimum of 700 social housing units. The respondents did not give much
consideration to the appellants’ evidence relating to the social housing pipeline.
However this factual context cannot be ignored. Their case was built around the
unacceptability of the Regeneration programme and an alleged total disregard by
the Province and the City of their constitutional obligations. Against the detailed
evidence tendered by the appellants on ongoing provision of social housing
within the City , I do not agree with the submission made on behalf of the
respondents that the arguments made by the Province was without context. The
evidence of the appellants’ policy formulation and implementation disproved the
allegations that they had no coherent housing delivery strategy, and that the

allegations that they had no coherent housing delivery strategy, and that the
Province remained intent on not providing any social housing in the CBD.

32

[50] Much was made of the denial by the Province and the City of any
obligation resting on them to ‘reverse apartheid spatial design’. I do not think this
issue requires extensive consideration. The history of the spatial design in urban
and rural spaces of this country is well known. And, despite this denial, the
Province and the City acknowledged that spatial apartheid is far from redress in
the City. In their respective Spatial Design Frameworks they acknowledged their
responsibility to achieve equitable spatial integration.25 The real questions are (1)
whether the Province and City had an obligation to provide social housing at a
specified location - central Cape Town, and (2) whether they failed to meet this
obligation. As apparent from the roles and responsibilities, and functions of the
provincial and local governments set out above, there is no such obligation. Apart
from the roles and responsibilities set out in the Housing Act and Social Housing
Act, the Province and the City were obliged to apply the general principles
applicable to the Housing Act and the Social Housing Act26. This legal framework
entails no obligation to provide social housing in a specific location. Social
legislation of this kind, by its very nature, must give a broad measure of
optionality to the Province and the City as to how to achieve the general principles
the legislation lays down. To interpret the legislation otherwise would render it
incapable of practical implementat ion because the courts would become the
arbiters of detailed implementation, an outcome we should be careful to avoid.

[51] As demonstrated the Province and the City have put in place policies that
are consistent with the principles applicable to social housing under the relevant
statutory framework. In addition, they are in the process of implementing social
housing in their areas of jurisdiction , particularly through the pipeline
programme. To this extent the Province was recognised by the national

programme. To this extent the Province was recognised by the national
government in 2013 and 2015 as the leading province for delivery of social

25 See paras 43 and 44 above.
26 Section 2 of Social Housing Act.

33

housing.27 Furthermore, in 2016 and 2017 the Province wrote to the national
Department of Public Works requesting that 29 national government properties
identified in various areas, incl uding Bellville, Constantia, and Somerset West ,
be released for social housing development. Their letters went unanswered.
Consequently, the contention that the Province and the City have, in general, not
met their constitutional obligations regarding soci al housing delivery finds no
support in the evidence.

Failure to comply with the provisions of GIAMA
[52] The high court concluded that the disposal of the property was unlawfu l
because the Province did not take the requisite steps to procure the status of the
land as surplus under GIAMA, before disposing of it as provided in s 5 of
GIAMA. Furthermore, both the Province, as the custodian of the property, and
the departments of Transport and Human Settlements, as users, did not have asset
management plans when the property was sold. The context is this: GIAMA
provides the framework for the management of immovable assets held or used by
national and/or provincial governments.28 The Act sets out the management roles
of the two spheres of government in relation to immovable assets owned by these
spheres of government.

[53] In terms of s 4(1) of GIAMA national and provincial government
departments are custodians and users of immovable assets that vest in them. The
national government Ministers perform a ‘caretaker’ role as custodians of
immovable assets that vest in the national government (except where specific
custodial functions are assigned to other Ministers by specific legislation).
Premiers of provinces or MECs designated by Premiers are in a similar position

27 This award has since been discontinued.
28 See preamble to GIAMA.

34

with regard to immovable assets that vest in provincial government. Section 1
defines a ‘custodian’ as the:
‘national or provincial department referred to in section 4 represented by the Minister of such
national department, Premier of a Province or MEC of provincial department, so designated by
the Premier of that Province’.
A ‘user’ is the:
‘national or provincial department that uses or intends to use an immovable asset in support of
its service delivery objectives and includes a custodian in relation to an immovable asset that
it occupies or intends to occupy, represented by the Minister of such national department,
Premier of the province or MEC of such provincial department, so designated by the Premier
of that province’.

[54] Section 4(2)(b)(ii) of GIAMA provides that custodians acquire, manage,
and dispose of immovable assets as prescribed in s 13. Section 13(1) provides
that the accounting officer of a custodian must compile asset management plans
for all immovable assets for which the custodian is responsible. Asset
management plans become part of the strategic plan of a custodian.29 In terms of
s 7 asset management plans must consist of:
‘(a) a portfolio strategy and management plan;
(b) a management plan for each moveable asset throughout its life cycle;
(c) a performance assessment of the immovable asset;
(c) subject to section 13(1)(d)(iii), a condition assessment of the immovable asset;
(d) the maintenance activities required and the total and true cost of the maintenan ce
activities identified; and
(e) a disposal strategy and management plan’. (emphasis supplied)

[55] The high court reasoned that the Province did not purport to act in terms of
either a custodian or user asset management plan, when taking the decision to
dispose of the T afelberg property in 2010 . Nor was there an internal policy

29 Section 9 of GIAMA.

35

document by which the province ‘might have been guided’ in its thinking. It was
of the view that if there had been a user asset management plan at the time of the
initial decision, the Province ‘might’ have dealt differently with the use of the
whole site by each of the different users.

[56] It is not clear from the record why the details of the intended disposal of
the Tafelberg property, first as part of the regeneration programme, and later as
part of the development of the four identified p roperties within the city, did not
constitute an acceptable asset management strat egy that fulfilled the purpose of
s 7 of GIAMA. In any event, Ms Gooch explained, on behalf of the Province, that
the requirements of GIAMA in relation to asset management plans were being
implemented incrementally by all organs of state under the guidance of the
GIAMA Implementation Technical Committee which was co -ordinated by the
National Department of Public Works, with concurrence of National Treasury. It
was not yet completed in 2010.

[57] It was not in dispute that the Province and the relevant provincial
departments had no custodian or user asset management plans in place at the time
of the initial decision to dispose of the property. Furthermore, although there were
assets management plans when the Province resolved not to resi le from sale in
2017, the Tafelberg property was not included in them.

[58] It is important to understand that the source of the power of the Province
to acquire and dispose of provincial immovable property is not GIAMA. This
statute only regulates disposal of immovable assets , and requires asset disposal
strategy as part of its asset management objective.

[59] The WCLAA is the legislation that was enacted for effective exercise of
the powers concerning matters listed under Schedule 4 of the Constitution .

36

Section 3(1) of the WCLAA empowers the Premier to ‘dispose of provincial state
land on such conditions as are deemed fit’. The procedure for doing so is
prescribed under s 3(2) of WCLAA, which provides that:
‘The Premier mu st publish in the Provincial Gazette in the three official languages of the
province and in an Afrikaans, an English and an isiXhosa newspaper circulating in those
respective languages, a notice of any proposed disposal in terms of subsection (1), calling upon
interested parties to submit, within 21 days of the date of the notice, any representations which
they wish to make regarding such proposed disposal . . .’.
Therefore, the source of power for acquisition and disposal of immovable
property by the Province is the WCLAA.

[60] The provisions of GIAMA , on which the respondents rely , in contesting
the decision to sell the Tafelberg property must be interpreted harmoniously with
s 3 of the WCLAA which empowers provinces to dispose of State property. A
sensible interpretation requires consideration of the fact that the Tafelberg
property had not been in use since 2013, and from 2010 its disposal had been
under consideration. It is in that context that its exclusion from the custodian and
user asset management plans should be considered.

[61] The absence of a custodian management plan in 2010 must also be viewed
within the context that GIAMA became effective on 30 April 2009. In addition,
as stated, and as the preamble to GIAMA indicates, the legislation is primarily
intended to introduce a uniform framework for management of government
immovable assets. It is not the empowering legislation in respect of acquisition
and disposal of immovable assets by provinces. It is in that context that the
references in the Act to inclusion of immovable asset disposal strategy in the
management plan must be viewed.

[62] With regard to the high court’s view that under GIAMA and the WCLAA,
the Province was required to inquire not only into whether the property could be

37

of use to another department within the Province, but also at national government
level, again the court did not identify any specific provision in the legislation as
the source for this requirement. Neithe r did it identify a legislative provision in
relation to its finding that the Province could consider disposal of the Tafelberg
property only in exceptional circumstances, and even then, in order to meet
compelling social needs.

[63] The procedure for disposal of immovable assets by the Province is
provided in s 3(3) of the WCLAA. The Premier is required to cause copies of the
notices of the impending disposal of provincial state land to be delivered to
occupants of the land to be disposed of (if any), the chief executive officer of the
local government of the area in which the land is situated, the Western Cape
provincial directors of the National Departments of Land Affairs and Public
Works, and the Western Cape provincial Director of the National Department of
Agriculture, if the provincial state land is applied or intended to be applied for
agricultural purposes. Except in so far as the first published notices of disposal
were not published in an isiXhosa newspaper, it was not the respondents’ case
that the Province did not meet these requirements under s 3 of WCLAA.
Consequently, compliance with the prescribed manner of notification to the
relevant national departments was not an issue between the parties.

[64] With regard to the respondents’ contention that the sale of the property was
inconsistent with the provisions of ss 5(1)(f) and 13(3) of GIAMA in that it was
not surplus property, on the facts, the property became surplus to the Department
of Education when the remedial school vacated it in 2010. The impending action,
which was finalised in 2013, would have been known to the Department of
Transport prior to its happening. The Province would have known that the tenants
of Wynyard Mansions were in the process of vacating the property long befor e

of Wynyard Mansions were in the process of vacating the property long befor e
the last tenant left. As already stated, in terms of s 5 of GIAMA an immovable

38

asset must be used efficiently. It becomes surplus to a user if it does not support
its service delivery objectives at an efficient level and if it cannot be upgraded to
that level. In terms of s 5(f) of GIAMA, when contemplating the disposal of an
asset, the custodian must consider whether it can be used:
‘(i) by another user or jointly by different users;
(ii) in relation to social development initiatives of government; and
(iii) in relation to government’s socio-economic objectives; including land reform, black
economic empowerment, alleviation of poverty, job creation and redistribution of wealth’.30
As the facts outlined above show, the Department of Transport complied with the
provisions of s 5(f). The Provincial Department of Human Settlements later
withdrew its objection to the disposal of the property.

Does Sea Point fall within a restructuring zone?
[65] The status of Sea Point became an issue because one of the aspects
considered by the Province in its decision not to resile from the sale was that It
was not a designated restructuring zone. This meant that no restructuring capital
grant would be awarded in respect of a social housing development in Sea Point.
The high court declared Sea Point to be a restructuring zone. In addition, it found
that the Province should have approached the National Minister for either
clarification of the designation of Sea Point as a restructuring zone, or to request
that the area be designated as such.

[66] A ‘restructuring zone’ is defined in s 1 of the Social Housing Act as:
‘. . . a geographic area that has been-
(a) identified by the municipality, with the concurrence of the provincial government, for
purposes of social housing; and
(b) has been designated by the Minister in the Gazette for approved projects’.


30 Section 5(1)(f).

39

[67] In order for a restructuring zone to be established, th e municipality must
identify the specif ic geographic area that it intends to have designated as such.
The municipality then advises the provincial government under whose authority
it falls accordingly , and if the P rovince concurs , it submits the details of the
identified geographic area to the national Minister of the Department of Human
Settlements.

[68] The high court considered two notices issued by the National Department
of Human Settlements in respect of restructuring zones. Sea Point was not listed
in either notice. The respondents contend that on a proper interpretation of the
notices, Sea Point was designated as a restructuring area. The first, Notice No 848
of 2011, titled ‘Provisional Restructuring Zones’, was publ ished in Government
Gazette 34788 of 2 December 2011. It read:
‘The Department of Human Settlements hereby publishes for public information the following
restructuring zones in terms of the Social Housing Policy, the Guidelines and the Social
Housing Act, 2008 (Act No. 16 of 2008)’.

[69] With respect to the City the five provisional restructuring zones established
were:
(a) ‘CBD and surrounds (Salt River, Woodstock and Observatory)
(b) Southern Near (Claremont, Kenilworth and Rondebosch,
(c) Southern Central (Westlake - Steenberg)
(d) Northern Near (Milnerton)
(e) Northern Central (Belville, Bothasig, Goodwood and surrounds)’.

[70] The second notice (Notice No 900 of 2011) was a ‘Correction Notice’
published in Government Gazette No 38439 of 15 December 2011 , to correct
Notice 848. In the later notice the restructuring zones were listed as follows:
(a) ‘CBD and surrounds (Salt River, Woodstock and Observatory)
(b) Southern Near (Claremont, Kenilworth and Rondebosch,

40

(c) Southern Central (Westlake - Steenberg)
(d) Northern Near (Milnerton)
(e) Northern Central (Belville, Bothasig, Goodwood and surrounds)
(f) South Eastern (Somerset West, Strand, and Gordons Bay)
(g) (Southern (Strandfontein, Mitchells Plain, Mandalay and surrounds)
(h) Eastern (Brackenfell, Durbanville, Kraaifontein, and Kuils River)
(i) (Cape Flats (Athlone and surrounds (Pinelands to Ottery)
(j) Far South (Fishoek and Simonstown).’

[71] The contested geographic area is defined in both notices as ‘CBD and
surrounds (Sal t R iver, Woodstock and Observatory)’. Given that the second
notice was a correction of the first one, it is to the corrective notice that I will
direct my attention. The City maintains that it had always intended that all areas
surrounding economic hubs, such as the CBD would be included in th e specific
hubs for purposes of designation of restructuring zones . T he City would then
enjoy the flexibility of identifying land in the surrounds, in respect of which to
access restructuring capital grant funding. The specific reference to Salt River,
Woodstock and Observatory was intended to be illustrative rather than exclusive,
the City argued . As a result, when the dispute arose in this case regarding the
interpretation of the designation as set out in the Notices , the City informed the
Province and Na tional government that it intended to have the whole City
designated as a restructuring zone.

[72] I do not agree with the argument by the Province that , because the notice
was provisional or was published ‘for public information’ the designation was
not effective. The notice expressly referred to the areas listed as ‘restructuring
zones’. It also provided that ‘[t]hese shall remain in force as designated areas until
and unless re -designated . . .’. There is no evidence that the areas under
consideration were re-designated during the period under consideration.

41

[73] On the other hand I do not agree that Sea Point was desig nated as a
restructuring zone in terms of the notice. The respondents (Reclaim the City and
Ndifuna Ukwazi) contend that given that Sea Point is situated approximately 5
kilometers from the city centre, it is therefore located within the “surrounds” in
relation to the CBD . The reference to Woodstock, Observatory , and Salt River
was merely intended to give examples of areas falling within the meaning of
surrounds, they maintained. And because the purpose of the social housing policy
is to house poor people, the restructuring zone of ‘CBD and surrounds (Salt River,
Woodstock and Obser vatory)’must be generously interpreted to include Sea
Point.

[74] In interpreting the notice the high court first considered the dictionary
meaning of ‘surround’ in the New Shorter Oxford Dictionary.31 It considered that
the meaning of the word includes ‘the area or place around a place or thing; the
vicinity, the surroundings, the environ ment . . .’. The court also considered the
definition of ‘environs’, which is ‘[t]he district surrounding a place, an ur ban
area’. It then applied these defini tions to the geographical locati on of Sea Point
as depicted on the map referred to in paragraph 3 of the first order and reasoned
as follows:
‘. . . if one were to look at a plan of the city centre, the Sea Point area in which the property is
located is closer (distance wise, as the proverbial crow flies) to the CBD than, for example,
Observatory. But one cannot access the Sea Point area directly from the city centre because of
the geography presented by the mountain along Ocean View Drive, High Level Road or Main
Road to reach Sea Point. So I suppose it might be argued that Sea Point cannot be regarded as
a “surrounding suburb ” in the same manner as Woodsto ck (which is the first suburb one
encounters when travelling eastwards out of the city centre) because it is not contiguous to the

CBD. But then neither is Observatory which is located beyond Salt River and University Estate,
neither of which is contiguous to the city centre either.

31 As the dictionary did not have a definition of ‘surrounds’.

42

On the other hand, the inner su burbs of BO-Kaap (also known as Schotschekloof and on the
southern slopes of the Signal Hill), Gardens, Tamboerskloof, Oranjezicht, District Six,
Vredehoek and Devils Peak (all of which nestle between the foothills of Table Mountain and
the Southern side o f the CBD) undoubtedly surround the City Centre – in fact, they are
colloquially referred to as the City Bowl.’

[75] Having reached this ‘conundrum’ the high court went on to consider the
evidence of Mr Pogiso Molapo, a manager in the Social Housing and Land
Restitution unit within the City’s Transport and Urban Development Authority .
In the relevant part of his affidavit Mr Molapo explained that the words “‘and
surrounds” were used by the City to ensure that no area surrounding an economic
hub, for example, the CBD, would be specifically excluded [from the
restructuring zone]’ . . . In other words, the City would have the flexibility to
identify land for purposes of being able to apply for RCG funding in relation to
development that falls into the ‘surrounds’ as identified above.

[76] The difficulty with the approach used by the high court is that it used Mr
Molapo’s evidence to shore up the inclusion of Sea Point as a designated
restructuring area, when it was clear that such interpretation found no support in
the text of the notice. Such interpretation is impermissible. While it is true that
the present state of our law on interpretation of legal documents is that context in
which the document came i nto existence is always part of the interpretative
process, there are limits to such use of extrinsic e vidence. In University of
Johannesburg v Auckland Park Theological Seminary and Another ( ATS),32 the
Constitutional Court, while emphasizing that contextu al evidence forms part of
every interpretative exercise, also warned that the admission of such evidence is
not limitless. At paragraph 68 Khampepe J said:

32 University of Johannesburg v Auckland Park Theological Seminary and Another [2021] ZACC 13; 2021 (8)
BCLR 807 (CC); 2021 (6) SA 1 (CC).

43

‘Let me clarify that what I say here does not mean that extrinsic evidence is always admissible.
It is true that a court’s recourse to extrinsic evidence is not limitless because “interpretation is
a matter of law and not of fact and, accordingly, interpretation is a matter for the court and not
for witnesses”. It is also true that “to the extent that evidence may be admissible to contextualise
the document (since ‘context is everything’) to establish its factual matrix or purpose or for
purposes of identification, one must use it as conservatively as possible”. 33 I must, however,
make it clear that this d oes not detract from the injunction on courts to consider e vidence of
context and purpose. Where, in a given case, reasonable people may disagree on the
admissibility of the contextual evidence in question, the unitary approach to contractual
interpretation enjoins a court to err on the side of admitting the evidence. There would, of
course, still be sufficient checks against any undue reach of such evidence because the court
dealing with the evidence could still disregard it on the basis that it lacks weight. When dealing
with evidence in this context, it is important not to conflate admissibility and weight’. (footnote
references omitted)
It is instructive that , while compelling the consideration of contextual evidence
in interpretation of all legal documents , in ATS, the Constitutional Court still
affirmed the judgments of this court in Novartis,34 Endumeni,35 KPMG36 and
others.

[77] In Capitec Bank Holdings and Another v Coral Lagoon Investments 19437
(Coral Lagoon Investments) this court admitted extrinsic evidence relating to
conduct of the parties but found that the conduct of one of the parties lent context
that displaced the clear meaning to the clause of the contract under consideration,
and the context of the structure of the agreement as a whole , and its proclaimed
purpose. The Court held:

33 Ibid.

33 Ibid.
34 Ibid para 67; see also Novartis SA (Pty) Ltd v Maphil Trading (Pty) Ltd [2015] ZASCA 111; 2016 (1) SA 518
(SCA) para 27.
35 Ibid para 64; see also Natal Joint Municipal Pension Fund v Endumeni Municipality [2012] ZASCA 13;
[2012] 2 All SA 262 (SCA); 2012 (4) SA 593 para 18.
36 KPMG Chartered Accountants (SA) v Securefin Ltd and Another 2009 (4) SA 399 (SCA) at para 39;
37 In Capitec Bank Holdings and Another v Coral Lagoon Investments 194 [2021] ZASCA 99.

44

‘The issue is this. Under the expansive approach to interpretation laid down in Endumeni
extrinsic evidence is admissible to understand the meaning of the words used in a contract.
Such evidence may be relevant to the context within which the contract was concluded and its
purpose, and this is so whether or not the text of the contract ambiguous, either patently or
latently. On the other hand, the parol evidence rule is an important principle that remains part
of our law’.38 (emphasis supplied)
Significantly, both the Constitutional Court in ATS and this court in Coral Lagoon
Holdings maintained the crucial guiding principle articulated in KPMG, that,
‘Interpretation is a matter of law and not of fact, accordingly, interpretation is a matter for the
court and not for the witnesses (or, as said in common -law jurisprudence, it is not a jury
question . . .). 39

[78] I do not think that Mr Molapo’s evidence of the City’s in tention should
have been admitted. It is not evidence of context. And the attempt to disguise it
as such by referring to social housing grants that were secured by the City in
respect of undesignated suburbs does not assist the respondents. If the intention
of the City had to be admitted, it could not trump the meaning of the clear
language used in the notice, together with the legislative context and purpose.

[79] Consequently, the notices had to be interpreted as they were. Meaning had
to be given to the words used, considered within the context in which the
documents was generated, and its purpose. The high court’s interpretation, in as
far as it was based on its own analysis of the location of various suburbs within
the City, is not permissible. On the language used in the notice, the CBD, together
with identified geographical areas within the surrounds, were designated as a
restructuring zone. The word ‘surrounds’ was restricted to the identified areas,
‘Salt River, Woodstock and Observatory’ in the brackets to identify with

‘Salt River, Woodstock and Observatory’ in the brackets to identify with
certainty, a geographic zone. Had this not been done the notices would not

38 At 38.
39 At para 39.

45

achieve the purpose of identifying with certainty, the specific geographical area
identified and designated as a restructuring zone.

[80] The contention that Sea Poin t is included in the area designated as a
restructuring zone in the notices does not find support in the words used in the
notice. It does not account for all the words used in the notice, and the context
and purpose served by the notice – to define a geographical area designated as a
restructuring zone. It renders the notice vague. The ‘preamble’ to the notice put
paid to this contention. It states that:
‘In accordance with the resolutions:
1 of MEC
2 Of the MAYCO of the City of Cape Town
3 And endorsement by the National Department of Housing
The areas in the Table below are designated as within Provisional Restructuring zones as
defined in the interim policy. All three parties in signing this part of the agreement acknowledge
that these areas are the only areas which can access available Social Rental Housing subsidy
in accordance with the interim social housing policy. These shall remain in force as
Restructuring Zones until and unless all three parties sign re -designation of the areas or the
social housing policy on Restructuring zones is super seded by other relevant legislation or
policy’. (emphasis supplied)
Against the background that s 3(1)(f) of the Social Housing Act which prescribes
that restructuring zones be specifically provided for in the municipality’s
integrated plan, restructuring zones must be clearly identified in the relevant
Government Gazettes.

[81] The submission on behalf of the respondents, that the Province should have
sought the advice of the National Minister for proper interpretation of the notice
cannot be sustained. The Province was entitled to interpret the notice and make
(decisions) accordingly. Consideration of legal advice was a reasonable step in
that process. Any decision made by the Province based on th e notice was an

46

administrative decision. However, the conclusion that the error on the part of the
Province in not approaching national government, rendered its decision
reviewable under ss 6(2)(d) of PAJA, is unsustainable. So too is the finding that
the conduct of the Province was mala fide in so far it did not seek clarification
from the national Department of Human Settlements on the uncertainty about the
status of Sea Point.

[82] This finding ignores the long history of correspondence between the
Province and the National Minister, and the delays experienced by the Province
with designation of restructuring zones. Extensive correspondence, dating as far
back as 29 June 2010 , had bee n addressed by the Provincial De partment of
Housing Settlements to its national counterpart, requesting designation of
additional restructuring zones for the City. In most of this correspondence , the
Province urged the national department to respond to cor respondence on
designation of restructuring zones . In correspondence that preceded the two
notices, the Provincial Department had to remind its national counterpart that ‘the
current restructuring zones were only intended: no restructuring zones had
actually been designated by the National Minister of Human Settlements.’

[83] Similar delays were experienced with amendments to limitations on the
income bands of households that could be accommodated in a housing project. A
maximum of 70 percent of the units in a project had to support households earning
R3 501 to R7 500 per month. The low income bands meant that rental income
(which was limited to 33 percent of monthly household income) was not a large
part of funding the housing project. The income bands we re only increased in
2018 to include households earning between R1 500 to R5 000 per month
(referred to as the ‘primary market’). By that time t he Social Housing Institutes
had advised that the social housing projects were not financially viable without

had advised that the social housing projects were not financially viable without
capital grant funding, which was dependent on designation of restructuring zones.

47

They withdrew as delivery partners on their own land parcels in favour of private
development initiatives which were financially viable.

[84] The Province referred to four projects where 1 512 units were lost from the
pipeline. It demonstrated that the delays in the designation of restructuring zones
and revision of the income bands had a significantly negative impact on the
pipeline programme. Nevertheless, despite the impact of these delays, the
Province and the City proceeded to with some of the social housing projects.
Against this background , the suggestion that the Province and the City were
dragging their feet is unfounded. So is t he conclusion that the conduct of the
Province was mala fide in its interactions with National Department or in failing
to communicate with that Department.

[85] It must also be stressed that the issue whether Sea Point was a restructuring
zone was one of many factors considered by the Province. As discussed , the
Premier had considered the social housing unit s that had been constructed , and
the housing projects that were in the pipeline programme. It also considered the
social housing units that were to be part of the Helen Bowden Nurses home site,
the social housing project that was part of the Woodstock Hospital development,
the extens ive cross-subsidisation that was required for development on the
Tafelberg property to be sustainable , the loss of the capital injection of R13 5
million amidst the budget cuts implemented by National Treasury, and the high
construction costs of a social housing development on the Tafelberg property that
was acknowledged during the notice and comment process.

The obligation on the Province to inform and consult National Government on
the decision to dispose of the property.
[86] In the second application the Minister had argued that a dispute arose
between her and the Premier on whether there was an obligation to consult her

48

prior to making the decision to dispose of the property. The high court reasoned
that:
‘To the extent that the national minister may have been in a position to address the areas of
concern or uncertainty raised by the Province on behalf of her Department, she could, and
should, have been consulted by the Province. After all the injunction in the [Social Housing
Act] required both the national Minister and the Province to act in the interests of the parties
who were the subject of that Act, as contemplated under ss 5(b) and (c) of IGRFA, an act, as I
have said which envisages comity rather than shunning the other aside. And, such an approach
may have afforded an opportunity to resolve the conundrum I posed earlier – But why didn’t
you ask?’

[87] The court found that the failure by the Province to inform the national
Minister of the Department of Human Settlement s of its intention to sell the
Tafelberg properties was a breach of Chapter 3 of the Constitution and the
Intergovernmental Relations Framework Act (IGRFA). It held that:
‘Section 41(1)(g) [of IRGFA] is concerned with the way power is exercised, not with whether
or not a power exists. That is determined by the provisions of the Constitution. In the present
case what is relevant is that the constitutional power to structure the public service vests in the
national sphere of government’.

[88] It took the view that the ‘dual competencies’ in respect of housing granted
by the Constitution to both the national and the provincial spheres of government
emphasises the necessity for co -operative governance as held in Grootboom.
Therefore, once the Province communicated its decision not to cancel the contract
the National Minister was entitled ‘inquire’ about the decision, given her statutory
obligations under the s 2(1)(i)(iv) of the Social Housing Act and the broader
umbrella of the Housing Act, including the duty to promote social, physical and
economic integration of housing development into existing urban and inner city

economic integration of housing development into existing urban and inner city
areas through the creation of quality living environments.

49

[89] At the hearing of the appeal, counsel for the National Minister clarified that
it is not the Minister’s stance that she must be consulted in respect of every
disposal. Although the explanation reduces the scope of the dispute on this issue,
it remains unclear which disposals, according to the Minister, she must be
consulted on and where the source of the asserted obligation to consult lies.
Section 4(1) of the WCLAA on which the National Minister seemed to also rely,
is not a source of power for the alleged obligation to inform and consult. The
section merely provides that:
The Premier must co-ordinate the provincial government’s actions regarding the administration
of provincial State land with the national and local spheres of government as contemplated in
Chapter 3 of the Constitution and section 7 of the Constitution of the Western Cape’.

[90] In as far as the court located the source of the obligation to inform and
consult in Chapter 3 of the Constitution, the two sections in that chapter provide
for consultation between three spheres of government40 and outline the principles
for co -operative g overnment and intergovernmental relations. 41 IGRFA is the
legislation enacted to give effect to Chapter 3 s 41(2) of the Constitution.

[91] Subsections 5(b) and (c) of IGRFA provide that-
‘In conducting their affairs the national government, provincial governments and local
governments must seek to achieve the object of this Act, including by-
(a) . . .
(b) Consulting other affected organs of the state in accordance with formal procedures, as
determined by any applicable legislation, or accepted convention or as agreed with them or, in
the absence of formal procedures, consulting them in a manner best suited to the circumstances,
including by way of =
(i) Direct contact; or
(ii) Any relevant intergovernmental structures;

40 Section 40.
41 Section 41.

50

(c) Co-ordinating their actions when implementing policy or legislation affecting the
material interests of other governments’. (emphasis supplied)

[92] The formal procedure determined for notification of affected organs of
state in this instance is to be found in ss 3(2) and 3(3) of the WCLAA. It entails
publication of the intended disposal of property in the Provincial Gazette and
delivery of the notice of the intended disposal on occ upants of the property and
the provincial offices of the National Departments of Land Affairs and Public
Works. It was not the respondents’ case that these determined procedures were
not complied with.42

[93] Even within the context of co -operative governance and the framework
established in I GRFA, for the promotion and facilitation of intergovernmental
relations, the status, powers and functions of the different spheres of government
must be maintained. The preamble to I GRFA highlights co -operation and
integration of actions in government and the necessity to establish a legislative
framework applicable to all spheres of government, to ensure intergovernmental
relations, in the spirit of the Constitution. Section 41 of the Constitution sets out
the principles of co-operative government and intergovernmental relations. In
terms of s 41(1)(g) all spheres of government an d organs of state within each
sphere must exercise their powers and perform their functions in a manner that
does not encroach on the geographical, functional, or institutional integrity of
government in another sphere. In any event, once the National Minister of Human
Settlement conceded that there was no obligation to consult her on every
proposed disposal her case caved in, as the issue had been pleaded as an across
the board obligation to inform and consult.



42 See paras 53 and 56 above.

51

Constitutionality of regulation 4(6) and the proviso to regulation 4(1)
[94] Regulation 4 (1) regulates the procedure of acquisition and disposal o f
provincial state land as follows:
‘4(1) An offeror shall:
(a) Complete and sign a written offer, and
(b) Submit that offer to the Head of Component as a formal offer;
Provided that all offers of disposal shall contain a provision to the effect that the offeror
acknowledges that –
(i) The Provincial Cabinet, after consulting the Committee, may, within 21 days of the
receipt of written representations received pursuant to section 3(3) of the Act, or such longer
period not exceeding 3 months as the Provincial Cabinet may determine in writing prior to the
expiry of that 21 day period, resile from any contract resulting from the offer, and
(ii) In the event of the Provincial Government so resiling the offeror will have no right of
recourse against the Province or any of its organs or functionaries, but if the Province intends
to sell the land at a higher price than that specified in the formal offer within a period of three
months from the date when it resiled, the Province must first offer to sell the land to the offeror
at that price.’ (Emphasis in original text)

[95] Ndifuna Ukwazi maintained the argument that the procedure provided for
in these regulations is irreconcilable with a meaningful public participation that
could influence the decision not to dispose of the property in the first place .
Furthermore, the p rocedure favours commercial interests over constitutional
considerations. The respondents also maintained that there is an ‘inconsistency’
between the regulations and s 10 of WCLAA. This section empowers the Premier
to:
‘(a) … make regulations regarding the norms and standards, including procedures
applicable to the acquisition, exchange, disposal and letting of provincial state lan d, the
demolition of buildings on provincial state land, donations of provincial state land and th e

demolition of buildings on provincial state land, donations of provincial state land and th e
general space and cost norms applicable in the Provincial Administration: Western Cape, and
(b) … make any other regulations considered necessary or expedient for the achievement
of the purpose or objectives of this Act’.

52


[96] The high court’s decision on this issue was based on an interpretation of ss
3(2) of the WCLAA. The subsection provides that:
‘The Minister must publish in the Provincial Gazette in the three official languages of the
province and in an Afrikaans, an English, and an IsiXhosa newspaper circulating in the
province in those respective languages, a notice of any proposed disposal in terms of subsection
(1)43 calling upon interested parties to submit, within 21 days of the date of the notice, any
representations which they wish to make regarding such proposed disposal; provided that the
aforegoing provision does not apply to any disposal concerning the leasing of provincial state
land for a period not exceeding twelve months without an option to renew.’

[97] The high court correctly found that the words ‘proposed disposal’ in ss 3(2)
envisaged an intention to conclude a written contract of sale. It also found, and I
agree, that the subsection contemplated that the public would be afforded the
opportunity to comment before a decision was finally taken. This is an essential
requirement of both an administrative decision making process.44 The high court
then reasoned that the sale of the Tafelberg property did not allow for a fair
opportunity to make representations; a fair procedure would allow for objections
at an early stage of the process, ‘providing a clean slate for t he evaluation of
competing views.

[98] The inquiry into the constitutionality of the impugned regulations requires
(an) interpretation of the regulations and a determination of whether they provide
for meaningful public participation. As set out above, the impugned regulations
govern the process that follows after a decision to dispose of provincial land.
Regulation 4(1) provides for the making and acceptance of an offer to purchase
the land. At first glance , and if Regulation 4(1) is viewed in isolation from the
rest of the regulation, the offer and acceptance process may appear complete,

rest of the regulation, the offer and acceptance process may appear complete,

43 Which empowers the province to dispose of provincial state land.
44 Section 3 of the Promotion of Administrative Justice Act 3 of 2000.

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final, and having an external effect.45 However, the provisions of the Regulation
4 must be read and interpreted comprehensibly, and harmoniously.

[99] Regulation 4(6) provides that;
‘If a written contract has been duly signed on behalf of the Province, that contract shall be a
proposed disposal, or proposed acquisition and, in the case of proposed disposals, the Minister
shall exercise the powers and comply with the duties conferred on the Premier by section 3(2),
(3) and (4) of the Act’.
Importantly this portion of Regulation 4 is written in peremptory language. In
providing that a signed written offer signed shall be a proposed disposal (or
proposed acquisition) the sub-regulation renders the transaction incomplete. The
transaction remains a proposed disposal until the Minister has complied with the
requirements of s 3(2), (3), and (4) of the WCLAA - the notice and comment
procedure.

[100] As to the nature of the notice and comment process, whilst the transaction
remains a proposed disposal, ss 3(2), (3), and (4) of the WCLAA regulate that
process as follows:
‘The premier must, in addition to the notices to be published in terms of subsection (2), cause
to be delivered to –
(a) The occupants, if any, of the provincial state land to be disposed of;
(b) The chief executive officer of the local government for the area in which the provincial
state land to be disposed of is situated;
(c) The Western Cape provincial directors of the National Department of Land Affairs and
Public Works, and
(d) The Western Cape provincial director of the National Dep artments of Agriculture, if
the provincial state land is applied or intended to be applied for agricultural purposes,
A copy of the notice referred to in subsection (1), and must advise those persons that they may,
within 21 days of the receipt of such not ice, make written representations regarding the
proposed disposal.

proposed disposal.

45 See the definition of ‘administrative action’ in s 1 of PAJA.

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(4) (a) The notices referred to in subsections (2) and (3) must include the following
information regarding the provincial state land concerned:
(i) the full title deed description of such land, including the title deed number, the
administrative district in which the provincial state land is situated and, if applicable, the nature
of any right in or over such land;
(ii) the current zoning of such land, and
(iii) the actual current use of such land.’
(b) The notice referred to in paragraph (a) must include an office address at which full
details concerning the provincial state land in question and the proposed disposal may be
obtained’.

[101] These subsections of the WCLAA, read together with Regulation 4, mean
that, while the Province s olicits and considers written representations received,
the transaction remains a proposal. It is only completed and becomes a disposal
once the Province, after consideration of the representations as provided in
Regulation 1 (b), makes a decision as to whether to resile from the proposed
disposition of not.

[102] Our courts have approached the assessment of procedural fairness
flexibly, on a case by case basis, taking into account the facts and circumstances
peculiar to each case. 46 It is difficult to imagine a more fair and balanced
procedure in terms of which an intended disposal of State land can be conducted.
Interested parties are afforded opportunity to comment on a comprehensive
proposal, which includes not only the description of the property intended to be
disposed of, but also the identity of the prospective purchaser, the value of the
land, its current and intended use, the reasons why the offer has been accepted for
further consideration, and the proposed purchase price, amongst other details. All
this while government is able to execute its responsibilities in relation to the land

46 Janse Van Rensburg v Minister of Trade and Industry 2000 11 BCLR 1235 (CC); 2001 (1) SA 29 (CC) para
24.

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efficiently, transparently, and cost effectively. The contention that the procedure
is ultra vires and/ or inconsistent with the requirements of s 4 of PAJA is
unfounded.

[103] Having considered the above issues the appeal must succeed. In the result,
the following order is made:
1 The appeal is upheld with no order as to costs.
2 The order of the high court in high court Case No7908/2017 is set aside
and replaced with the following order:
‘The application is dismissed with no order as to costs.’
3 The order of the high court in Case No 12327/2017 is set aside and replaced
with the following:
‘The application is dismissed with no order as to costs.’



___________________
N DAMBUZA
ACTING PRESIDENT

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Appearances

For the first to fourth appellants: E Fagan SC with him K Pillay SC, A Du
Toit and M Mokhoaetsi
Instructed by: State Attorney, Cape Town
State Attorney, Bloemfontein

For the fifth appellant: N Bawa SC with him T Mayosi
Instructed by: Riley Inc, Cape Town
Webbers Attorneys, Bloemfontein

For the first and second respondents: I Jamie SC with him T Masuku SC and L
Stansfield
Instructed by: State Attorney, Cape Town
State Attorney, Bloemfontein

For the third respondent: S Budlender SC with him E Webber
Instructed by: MF Jassat Dhlamini Inc, Johannesburg
Symington De Kok Inc, Bloemfontein.
For the fourth to sixth respondents: P Hathorn SC with him C De Villiers,
Instructed by: Ndifuna Ukwazi Law Centre, Cape Town
Phatshoane Henney, Bloemfontein.