About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Supreme Court of Appeal
SAFLII
>>
Databases
>>
South Africa: Supreme Court of Appeal
>>
2011
>>
[2011] ZASCA 244
|
|
Rademan v Moqhaka Municipality and Others (173/11) [2011] ZASCA 244; 2012 (2) SA 387 (SCA) (1 December 2011)
Links to summary
THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Case no: 173/11
In the
matter between:
OLGA RADEMAN
….................................................................................................
Appellant
and
MOQHAKA MUNICIPALITY
…....................................................................
First
Respondent
M A MOKGOSI
…....................................................................................
Second
Respondent
M V DUMA
…..............................................................................................
Third
Respondent
JIMMY MASWANGANYI
…......................................................................
Fourth
Respondent
RUDOLPH MEYER
…..................................................................................
Fifth
Respondent
Neutral citation:
Rademan v Moqhaka Municipality & others
(173/11)
[2011] ZASCA 244
(01 December 2011)
Coram:
Lewis, Bosielo JJA and Petse AJA
Heard: 16 November 2011
Delivered: 01 December 2011
Summary:
Municipality – Powers of a municipality to discontinue supply
of electricity to defaulters – Appellant refusing
to pay rates
and taxes – Respondent justified in disconnecting appellant’s
electricity supply without a court order.
ORDER
On appeal from
: Free State High Court, Bloemfontein (Jordaan J
and Khan AJ sitting as court of appeal):
The appeal is dismissed with costs.
________________________________________________________________
JUDGMENT
________________________________________________________________
BOSIELO JA (Lewis JA and Petse AJA concurring):
[1] The appellant is a resident of No 1 Panorama Park, Kroonstad,
which falls within the first respondent’s jurisdiction.
The
first respondent is a municipality duly incorporated in terms of s 12
of the Local Government: Municipal Structures Act 117
of 1998 (the
Municipal Structures Act). The second to fifth respondents are
officials of the municipality. The appellant is a member
of an
association called Moqhaka Ratepayers and Residents Association. The
appellant failed to pay her taxes and levies. On 17
August 2009, the
municipality disconnected the electricity supply to the appellant
because of her failure to pay. This was done
without any court order.
The appellant successfully launched an urgent application for the
restoration of her electricity supply
which was granted by the
magistrates’ court, Kroonstad. The appeal against this order by
the first respondent to the Free
State High Court, Bloemfontein was
successful. The appeal to this court is with the leave of the high
court.
[2] A brief account of the salient facts will suffice. The appellant,
together with other residents of the municipality, are members
of the
Moqhaka Ratepayers and Residents Association. This is an organisation
which comprised residents who claimed to be unhappy
with the
municipal services rendered by the municipality. As a means of
getting the respondent to attend to their various complaints,
which
included alleged poor service delivery, they decided to withhold
payments of their rates and taxes. It is not clear from
the papers
when they stopped their payments. However, they continued to pay for
their other municipal services like water and sanitation,
electricity
and refuse removal. Notwithstanding various demands for payment, the
appellant persisted in her refusal to pay taxes
and levies.
Inevitably, this impasse culminated in the first respondent
discontinuing any further supply of electricity to her.
Hence this
case.
[3] In its answering affidavit, the municipality admitted having
disconnected the supply of electricity to the appellant. However,
it
denied that such disconnection was unlawful. The municipality cited
as legal justification for the disconnection the fact that,
notwithstanding lawful demand, the appellant refused to pay her rates
and taxes. These taxes were said to be in arrears in the
amount of R2
986.96. The municipality admitted that the appellant’s accounts
relating to other municipal services like electricity,
water,
sanitation, and refuse removal were up to date.
[4] Counsel for the appellant, contended that it is unlawful for a
municipality to discontinue the supply of electricity without
a court
order. The argument was that this amounts to self-help which is not
permissible in our law. The appellant relied on
Joseph &
others v City of Johannesburg & others
2010 (4) SA 55
(CC)
where it was held that tenants of a building were entitled to 14
days’ notice before the electricity supply to them
could be
discontinued. That case is not in point, however, since it did not
concern persons who had contracts with a municipality.
[5] On the other hand, counsel for the municipality submitted that it
acted lawfully in disconnecting the electricity supply to
the
appellant as she refused to pay her rates and taxes. Counsel
contended that the fact that the appellant was up to date with
her
payments regarding other municipal services including electricity is
irrelevant, as the respondent is empowered by statute,
in execution
of its obligations to levy and collect rates and levies, (including
other consumption charges) to consolidate the
various accounts, and
upon failure by a resident to pay
any
account, to discontinue
any other municipal service. Responding to the argument about the
absence of a court order, the municipality’s
counsel argued
that a court order is not a statutory requirement.
[6] In a comprehensive and well-reasoned judgment, the court below
held that the appellant had failed to prove that the disconnection
of
her electricity supply was unlawful. It found expressly that the
disconnection was statutorily authorised.
[7] It is common cause that the first respondent is a local authority
duly established in terms of the Local Government: Municipal
Systems
Act 32 of 2000 (the Systems Act). In terms of the Constitution
municipalities play a pivotal role in facilitating and ensuring
efficient public administration at local government level. Section
151 of the Constitution provides that:
‘
(1)
The local sphere of government consists of municipalities, which must
be established for the whole of the territory of the Republic.
(2) The executive and
legislative authority of a municipality is vested in its Municipal
Council.
(3) A municipality has the right
to govern, on its own initiative, the local government affairs of its
community, subject to national
and provincial legislation, as
provided for in the Constitution.
(4) The national or a provincial
government may not compromise or impede a municipality’s
ability or right to exercise its
powers or perform its functions.’
[8] As a local sphere of government with the right to govern the
local government affairs of its community, a municipality has
wide-ranging duties and obligations. Essentially every municipality
stands at the coal-face of delivery of various municipal services
for
its communities. Service delivery has become the core if not the
primary function of every municipality in line with its objects
as
set out in s 152 of the Constitution which provides:
‘
(1)
The objects of local government are –
to provide democratic and
accountable government for local communities;
to ensure the provision of
services to communities in a sustainable manner;
to promote social and economic
development;
to promote a safe and healthy
environment; and
to encourage the involvement of
communities and community organisations in the matters of local
government.
(2) A municipality must strive,
within its financial and administrative capacity, to achieve the
objects set out in subsection (1).’
[9] It follows that for a municipality to be able properly and
efficiently to execute its constitutional and statutory obligations
to deliver municipal services to its residents it requires sufficient
resources and revenue. In order to put the municipality in
a position
to render the required municipal services, the ratepayers must make
regular payments of taxes and levies and consumption
charges. There
is in fact a duty on ratepayers that, inasmuch as they are entitled
to demand that the municipality should deliver
municipal services to
them, they must also make corresponding payment for such municipal
services. See ss 5(1)
(g)
and 5(2)
(b)
of the Systems
Act. This is part of their civic and contractual responsibilities.
[10] To ensure regular payment of fees for municipal services
rendered, every municipality is required by law to have a credit
control and debt collection policy. Section 96 of the Systems Act
provides:
‘
A
municipality –
must collect all money that is
due and payable to it, subject to this Act and any other applicable
legislation; and
for this purpose, must adopt,
maintain and implement a credit control and debt collection policy
which is consistent with its
rates and tariff policies and complies
with the provisions of this Act.’
[11] It follows that for municipalities to be able efficiently to
deliver the multiplicity of municipal services which they have
to in
terms of the Constitution and various statutes, it is important that
they are able to levy and collect their rates and taxes
and payments
for other municipal services from the ratepayers falling within their
jurisdiction. Municipalities are obliged to
levy and collect rates
and taxes from their residents as authorised by s 229 of the
Constitution.
[12] In addition, s 73 of the Systems Act provides that:
‘
(1) A
municipality must give effect to the provisions of the Constitution
and –
(a)
give
priority to the basic needs of the local community;
(b)
promote
the development of the local community; and
(c)
ensure
that all members of the local community have access to at least the
minimum level of basic municipal services.
(2) Municipal services must –
(a)
be
equitable and accessible;
(b)
be
provided in a manner that is conducive to –
(i) the prudent, economic,
efficient and effective use of available resources; and
(ii) the improvement of
standards of quality over time;
(c)
be
financially sustainable;
(d)
be
environmentally sustainable; and
(e)
be
regularly reviewed with a view to upgrading, extension and
improvement.’
[13] Appreciating the difficulties experienced by municipalities when
ratepayers protest and refuse to pay for municipal services,
the
Legislature has provided in s 96 (set out above) for every
municipality to have a credit control and debt collection policy.
Furthermore municipalities are mandated by s 96(1)
(a)
to
collect all money that is due and payable. Section 97(1)
(g)
of
the Systems Act in turn decrees that provision should be made for
termination of municipal services or restriction of the provision
of
municipal services when payments of ratepayers are in arrears. In
addition, s 25 of the Credit Control and Debt Collection by-laws
of
14 May 2004 (the by-laws) gives a municipality the power to restrict
and disconnect supply of municipal services. It provides:
‘
(1)
The Municipality may restrict or disconnect the supply of water and
electricity or discontinue any other service to any premises
whenever
a user of any service –
(a) Fails to make full payment
on the due date or fails to make acceptable arrangements for the
repayments of any amount for services,
rates or taxes.’
[14] Section 25(3) of the by-laws provides as follows:
‘
The
right to restrict, disconnect or terminate service due to non-payment
shall be in respect of any service rendered by the Municipality
and
shall prevail notwithstanding the fact that payment has been made in
respect of any specific service and shall prevail notwithstanding
the
fact that the person who entered into an agreement for supply of
services with the municipality and the owner are different
entities
or persons, as the case may be.’
[15] For a proper understanding of the legal issue facing us in this
appeal, one should ask: what is a municipality expected to
do when
faced with a number of its residents who steadfastly refuse to pay
their taxes and levies? Is a municipality expected to
approach the
court each time a ratepayer defaults to seek a court order
authorising discontinuation of services?
[16] Such a proposition is both unrealistic and untenable. Given the
rate of the protests and demonstrations for delivery across
the
country concomitant with the refusal by ratepayers to pay their rates
and taxes and fees for municipal services, I am of the
view that it
would not be practical for municipalities to pursue these matters in
court. It cannot be gainsaid that such a step
would result in the
municipalities being mired in such cases, losing precious time in the
process and incurring high legal bills
unnecessarily.
[17] I have no doubt these powers were given to municipalities to
enable them to collect all moneys that are due and payable to
them in
the most cost-effective manner. Commenting on the power of a
municipality to discontinue municipal service as a means of
getting
the ratepayers to pay their accounts, Yacoob J remarked as follows in
Mkontwana v Nelson Mandela Metropolitan Municipality,
Bisset
& others v Buffalo City Municipality & others; Transfer
Rights Action Campaign & others v MEC, Local Government
and
Housing, Gauteng & others (Kwazulu-Natal Law Society and Msunduzi
Municipality
as
Amici Curiae
)
2005 (1) SA 530
(CC) para
52:
‘
It is
emphasised that municipalities are obliged to provide water and
electricity and that it is therefore important for unpaid
municipal
debt to be reduced by all legitimate means. It bears repeating that
the purpose is laudable, has the potential to encourage
regular
payments of consumption charges, contributes to the effective
discharge by municipalities of their obligations and encourages
owners of property to fulfil their civic responsibility.’
[18] The central dispute in this matter is whether the municipality
was justified in disconnecting the electricity supply to the
appellant whilst her account for electricity was up to date. The
answer to this question is to be found in 102 of the Systems Act
which provides:
‘
(1) A
municipality may –
consolidate any separate
accounts of persons liable for payments to the municipality;
credit a payment by such a
person against any account of that person; and
implement any of the debt
collection and credit control measures provided for in this Chapter
in relation to any arrears of any
of the accounts of such a person.’
[19] This section makes it clear that in pursuit of its obligation to
charge and receive payments for municipal services, a municipality
has the option to consolidate the accounts for various services it
provides. This is intended to circumvent the very problem confronting
us in this appeal, that is, allowing residents to choose which
account they wish to pay and which they will not pay. Such tactics
should not be allowed as they have the potential to frustrate a
municipality in governing its area and, importantly meeting its
constitutional obligations. It should be borne in mind that water and
electricity are not the only municipal services that a municipality
is responsible for. There is a plethora of other municipal services
for which a municipality is responsible like building of roads
and
their maintenance, sewerage systems, refuse collection, recreational
facilities. All these services are financed amongst others,
by the
revenue which a municipality collects from ratepayers as payment for
these various municipal services. Such money is split
and used to
provide the various essential municipal services. Thus a failure to
pay rates and taxes is likely to have very serious
consequences. I
say this conscious of ratepayers’ rights to protest and
demonstrate whenever they have valid complaints against
the
municipality. However, we live in a democracy where there are various
lawful methods that ratepayers can use to ensure proper
municipal
services. The unilateral refusal by ratepayers to pay for services
which they enjoy cannot be condoned.
[20] One of the primary obligations and responsibilities a
municipality bears is to ensure that there is provision of municipal
services to communities in a sustainable manner. A municipality can
only provide essential municipal services like water and electricity
if it has sufficient revenue to do so, particularly because it has to
purchase some of these services from other suppliers, like
Eskom and
the Water Board. It is therefore imperative that ratepayers
understand this inter-relationship and their obligations
to pay for
their services. Sadly, in the past few years, public demonstrations
and protests by communities complaining of failure
by municipalities
to provide municipal services or the provision of poor municipal
services have become a common feature in our
print and electronic
media. In many instances these public demonstrations and protests
arise because the residents fail to appreciate
that for a
municipality to supply such municipal services, they must pay their
levies, taxes and duties as responsible residents.
As the
Constitutional Court aptly held in
Pretoria City Council v Walker
[1998] ZACC 1
;
1998 (2) SA 363
(CC) para 93:
‘
Local
government is as important a tier of public administration as any. It
has to continue functioning for the common good; it,
however, cannot
to do so efficiently and effectively if every person who has a
grievance about the conduct of a public official
or a governmental
structure were to take the law into his or her own hands or resort to
self-help by withholding payment for services
rendered. That conduct
carries with it the potential for chaos and anarchy and can therefore
not be appropriate.’
[21] Having considered all the relevant legislation, it is clear to
me that there is no statutory instrument which requires a
municipality to obtain a court order authorising the discontinuation
of a municipal service. With regard to the argument of a letter
of
demand preceding discontinuance, there is incontrovertible evidence
that such a letter was sent to the appellant but that, in
line with
resolutions taken by the Moqhaka Ratepayers and Residents
Association, she decided not to pay. In any event s 21(2) of
the
by-laws provides that failure to deliver or send a final demand
within seven working days does not relieve a customer from
paying
arrears.
[22] The nature of the application by the appellant was not clear.
The magistrate regarded it as a
mandament van spolie.
The high
court considered that a
mandament
was inappropriate having
regard to the statutory framework. It is not necessary for this court
to decide whether a
mandament
is possible where the supply of
municipal services is regulated by statute and by the contract
between the parties.
[23] In the circumstances, the appeal is dismissed with costs.
____________
L O BOSIELO
JUDGE OF APPEAL
APPEARANCES:
For
Appellant: C F Van Rooyen SC
Instructed
by:
Grimbeek
Van Rooyen, Kroonstad
Symington
& De Kok, Bloemfontein
For
Respondent: J Y Claasen SC
Instructed
by:
Du Randt &
Louw, Kroonstad
Rosendorff
Reitz Barry, Bloemfontein