Brief Summary

Municipal Law — Zoning and Building Regulations — Approval of Building Plans — Dispute over zoning classification and building height restrictions — Applicant, a developer, sought to construct three-storey units on property previously restricted to two storeys — Municipality initially approved amended plans but later reversed approval citing lapse of rezoning — Court found that due process was not followed by the Municipality in rescinding the approval, and that the developer was not afforded the opportunity to be heard — Municipality's actions deemed unlawful and the approval of the building plans reinstated.

Comprehensive Summary

Summary of Judgment

1. Introduction

The judgment concerned the determination of four inter-related applications arising from a residential housing development undertaken by a private developer in East London. The proceedings included, first, a contempt application brought by the developer against the municipal manager; second, a rescission application brought by the municipality to set aside an earlier High Court order granted in the developer’s favour; third, a self-review (legality review) application brought by the municipality seeking to set aside its own prior approval of amended building plans; and fourth, an urgent interlocutory interdict application by the municipality aimed at restraining further steps in the development (including registration steps under the sectional title scheme) pending finalisation of the rescission and review proceedings.

The parties were Petrus Biermann, a property developer and owner of Erf 5078, East London, as well as the Buffalo City Metropolitan Municipality. In one of the proceedings the Registrar of Deeds, King William’s Town was joined as a second respondent for purposes connected to sectional title registration. The municipal manager (Mr Sihlahla) featured prominently in the factual narrative and affidavits, and was cited in the contempt proceedings in his representative capacity.

Procedurally, the dispute was shaped by an earlier review application launched by Biermann under case number 1417/2018, which resulted in an order granted by Tokota J on 8 January 2019. That order reviewed and set aside municipal decisions relating to zoning and withdrawal of plan approval and directed the municipality to issue a zoning certificate reflecting Residential Zone 5 and to confirm the validity of amended building plans approved on 25 October 2018. The municipality did not oppose that application and did not appear at the hearing. After the order, further conflict arose regarding compliance, leading to the contempt application, followed by the municipality’s later rescission and self-review applications (both instituted on 24 May 2019), and an urgent interdict application in October 2019.

The general subject-matter of the dispute was the lawfulness and consequences of municipal decision-making in relation to rezoning conditions, building plan approvals (including height/storey restrictions), and the municipality’s attempt to reverse an earlier approval said to have been granted “by mistake”, together with the procedural fairness and legality implications of those steps and the enforceability and finality of court orders granted against an organ of state.

2. Material Facts

Biermann owned Erf 5078, East London, which contained an existing dwelling. His intention was to develop the property into sectional title residential units. The property’s title deed originally contained restrictive conditions, including a limitation to one dwelling, a two-storey height restriction, and density restrictions. Biermann successfully obtained a court order removing those title deed restrictions (Hartle J, rule nisi issued 21 June 2016 and confirmed 19 July 2016), and that order was served on the municipality.

The property’s zoning position required attention. The property was initially zoned Residential Zone 3B, and a rezoning to Residential Zone 5 was required. The judgment recorded that under the municipal zoning scheme, it was common cause at argument that flats/townhouses/units of up to three storeys could be approved within the zoning scheme regulations applicable to Residential Zone 5. When the rezoning to Residential Zone 5 was granted (the approval having been communicated by letter dated 1 February 2016), it included various conditions, one of which stated that a height restriction of “2 storeys only” applied to the proposed development. The approval letter referred to an attached approved site development plan depicting two-storey units.

In July 2016 amended plans were submitted to provide for additional units, and the municipality approved those amended plans on 17 August 2016. In August 2017 Biermann requested an extension of the approval for a further 24 months due to delays; this request was not responded to by the municipality.

On 7 June 2018 Biermann submitted another set of amended building plans which included a detailed site development plan showing three-storey buildings. The plans were received and processed by municipal departments, and plan approval fees were paid and accepted. It was common cause that the municipality approved these amended building plans on 25 October 2018.

Subsequently, and following an alleged complaint from a neighbour, a municipal official, K Naidoo, informed Biermann that building work had to stop and queried the three-storey height. On 20 November 2018, an email was sent referring to an attached “zoning certificate” which stated that the property was zoned Residential Zone 3B and that the rezoning approval to Residential Zone 5 had lapsed because the use had not been acted upon within the stipulated two-year period. The document recorded a maximum height of two storeys and reflected “Information by: K Naidoo” and “checked by K Chettiar”. The judgment noted that neither Naidoo nor Chettiar deposed to affidavits to explain their authority or the basis for issuing such a document, and no council minutes or authorising resolutions were produced.

On 22 November 2018, the Head of Spatial Planning and Development issued a letter stating that the approval of building plans was “reversed” because it had been discovered the proposed building would contravene the zoning scheme due to a two-floor height restriction, and that the earlier approval was invalid; it instructed that no building work must commence. The court regarded the municipality’s explanation as unclear and seemingly premised on title deed restrictions that had already been removed by court order, and it noted that the municipal zoning scheme regulations did not themselves impose a two-storey height restriction for Residential Zone 5.

Biermann then brought an application under case number 1417/2018 to review and set aside the municipal decisions that (i) the Residential Zone 5 rezoning had lapsed, (ii) the municipality refused to issue a Residential Zone 5 zoning certificate, (iii) the municipality issued the 20 November 2018 certificate reflecting Residential Zone 3B, and (iv) the municipality withdrew the 25 October 2018 building plan approval. Biermann also sought directory relief compelling issuance of a Residential Zone 5 zoning certificate and confirmation of the validity of the 25 October 2018 approval. The municipality did not oppose that application. Proper service of the application and the notice of set down was common cause in the later proceedings.

On 8 January 2019, Tokota J granted an order reviewing and setting aside the impugned municipal decisions and directing the municipality to issue the Residential Zone 5 zoning certificate and to confirm the validity of the 25 October 2018 building plan approval and withdrawal of the 22 November 2018 letter, with costs. Although the order referred in one paragraph to “1 April 2016” (instead of February 2016), the judgment later held that the order read as a whole was clear and its purpose was unambiguous.

Following service of the Tokota J order on 10 January 2019, the municipality did not comply timeously. Biermann threatened contempt proceedings. On 13 February 2019, Biermann instituted contempt proceedings against the municipal manager cited only in his representative capacity. A rule nisi was obtained on 5 March 2019. In the answering affidavit, the municipal manager raised a point in limine that he had not been joined in his personal capacity. Ultimately, Biermann withdrew the contempt application and tendered costs.

The municipality launched a rescission application to set aside the Tokota J order, and a self-review application to set aside its own approval decision of 25 October 2018. Both applications were only instituted on 24 May 2019, several months after the Tokota J order and seven months after the plan approval decision. The municipality also brought an urgent interdict application in October 2019 seeking to restrain further construction, occupation without occupation certificates, and the opening of a sectional title register pending the rescission and review applications. By the time of the interdict proceedings, Biermann contended (with supporting documents) that many units were substantially complete, that occupation certificates had been issued in respect of a number of units, and that the municipality had approved and accepted payments for upgraded electrical and water supply and issued rates clearance certificates.

3. Legal Issues

The court was required to determine, first, whether Biermann’s contempt proceedings were competent against the municipal manager as cited, which raised a legal question concerning joinder and the requirements for contempt proceedings against public officials. This aspect turned predominantly on legal principle rather than disputed factual evaluation, and it was resolved on a procedural basis.

Second, the court had to decide whether the municipality had made out a proper case for rescission of the Tokota J order. This required determining whether rescission was available under Uniform Rule 31(2)(b) (default judgments), Uniform Rule 42(1)(a) (orders erroneously sought or granted in the absence of an affected party), or the common law, and whether the factual explanation for the municipality’s default and the merits advanced constituted “good cause” or met the common-law requirements. This dispute involved the application of established legal tests to the municipality’s explanation for default, its delay, and the adequacy of its evidential case.

Third, the court had to determine whether the municipality’s self-review (legality review) application to set aside its own plan approval decision of 25 October 2018 should succeed. This raised questions about the requirements of a legality review, including whether the delay was unreasonable and, in any event, whether the municipality had placed before court a sufficient evidential basis (including the decision-making record and admissible evidence) to establish the alleged “mistake” and unlawfulness.

Fourth, the court had to decide whether the municipality was entitled to the interim interdictory relief sought, which required applying the requirements for an interlocutory interdict and resolving aspects of the matter under the Plascon-Evans approach to factual disputes in motion proceedings, in circumstances where the interdict’s foundation was tied to the outcome of the rescission and review applications.

4. Court’s Reasoning

On the contempt application, the court accepted that the municipality’s point in limine had merit. It held, with reference to Mathabeng Local Municipality v Eskom Holdings Ltd and Others 2018 (1) SA 1 (CC), that where contempt proceedings are contemplated against public officials with potential criminal sanction, the officials should be joined in their personal capacities by name, and not merely cited in nominal or representative capacities. In light of that authority, Biermann withdrew the contempt application and tendered costs, and the court did not proceed to determine contempt on the merits.

On rescission, the court considered whether the Tokota J order was unclear or invalid due to an incorrect reference to the month of the rezoning approval (“April” instead of “February”) in one paragraph of the order. Applying the interpretive approach to court orders, the court held that orders must be read as a whole to ascertain their intention, and found that the order was clear, unequivocal, and enforceable. It reasoned that the incorrect month did not detract from the unambiguous directory relief in the operative paragraphs requiring issuance of a Residential Zone 5 zoning certificate and confirmation of the validity of the 25 October 2018 approval.

The court then evaluated rescission under Rule 31(2)(b). It held that the municipality’s explanation for its failure to oppose the original application and its subsequent inaction was inadequate. The municipality’s founding case was characterised by bureaucratic failures, internal buck-passing, and an absence of a reasonable explanation for default. The court emphasised that the municipality’s conduct, on the papers, reflected a disregard for constitutional values governing public administration and the performance of constitutional obligations diligently and without delay. It also noted that the rescission application was brought well outside the 20-day period contemplated in Rule 31(2)(b), and that no reasonable explanation justified that delay.

In assessing whether “good cause” had been shown, the court found that the purported defence was essentially an assertion by the municipal manager that the approval of the three-storey plans was an “obvious mistake”, without proper, admissible, first-hand evidence from the officials responsible for the decision and without documentary proof such as minutes or records of decision-making. The court considered that the evidential inadequacy and lack of candour in the municipality’s papers were fatal to a belated rescission application seeking to undo a duly granted court order obtained after proper service.

The court also addressed reliance on Rule 42(1)(a). It held that the order of Tokota J could not be said to have been “erroneously sought” or “erroneously granted” where Biermann had been procedurally entitled to the relief due to proper service and the municipality’s failure to oppose. It adopted the principle articulated in Lodhi 2 Properties Investments CC v Bondev Investments 2007 (6) SA 87 (SCA) that a default judgment is not “erroneously granted” merely because a defence is later disclosed; the existence or non-existence of a defence is irrelevant where the plaintiff was procedurally entitled to judgment. The court therefore concluded that Rule 42 did not avail the municipality. It further held that the municipality’s founding papers did not establish the requirements for rescission under the common law, including a reasonable explanation for default and a bona fide defence with prospects of success, and noted that the municipality’s case relied heavily on the municipal manager’s conclusions and hearsay rather than cogent evidence and record material.

On the self-review application, the court accepted that, because the municipality is an organ of state, it was not subject to the 180-day bar applicable to private litigants under section 7(1) of the statute referred to in argument. The court considered whether the seven-month delay in launching the self-review was unreasonable. It was not prepared to non-suit the municipality on delay alone in the context of a legality review, noting the court’s discretion to overlook delay in appropriate cases.

However, on the merits the court found the self-review evidentially and substantively deficient for reasons similar to those applicable to rescission. The municipality did not place before court admissible evidence from the responsible decision-makers, nor the relevant record establishing how and why the approval of 25 October 2018 was unlawful or a legally excusable “mistake”. The court also criticised the municipal manager’s approach of effectively declaring “unlawfulness” without furnishing the evidential foundation for that conclusion, and it regarded the municipality’s stance and conduct as reflecting serious shortcomings in accountability, transparency, and procedural fairness. The self-review was dismissed with costs, including the costs of two counsel.

On the urgent interim interdict application, the court reasoned that the interdict was sought pending the outcome of the rescission and self-review applications, and that the dismissal of both of those applications meant that the interim interdict could not stand. The court also considered the interdict requirements in light of the papers. It noted substantial non-disclosure and contradictions on the municipality’s side, including the failure to disclose that many units had already been completed and that occupation certificates had been issued for a number of units (and that a portion of the relief concerning occupation certificates had been abandoned). The court highlighted that the municipality’s own conduct was inconsistent with its stance that the development was unlawful, given its approvals and acceptance of large payments for upgraded electrical and water infrastructure and its issuance of rates clearance certificates.

Applying the Plascon-Evans approach for disputes of fact in motion proceedings and the requirements for an interlocutory interdict, the court concluded that the municipality had not established a basis for the relief. It held that the balance of convenience favoured Biermann, particularly where much-needed housing would be provided and the development was substantially complete. Although the court expressed some discomfort regarding an undertaking by Biermann’s attorney which was later not adhered to, it nonetheless dismissed the interim interdict and discharged the rule nisi, awarding costs (including costs of two counsel).

5. Outcome and Relief

The contempt application was withdrawn by Biermann after the municipality’s point in limine was upheld in principle, and Biermann tendered costs.

The municipality’s rescission application to set aside the Tokota J order of 8 January 2019 was dismissed. The municipality was ordered to pay Biermann’s costs, including costs consequent upon the employment of two counsel.

The municipality’s self-review (legality review) application to set aside the municipal approval decision of 25 October 2018 was dismissed. The municipality was ordered to pay Biermann’s costs, including the costs of two counsel.

The municipality’s urgent interim interdict application was dismissed, and the rule nisi issued on 5 November 2019 was discharged. The municipality was ordered to pay costs, including the costs of two counsel where so engaged. The court declined to award Biermann punitive costs on an attorney-and-client scale, primarily due to concerns about the reneged undertaking by Biermann’s attorney.

Cases Cited

Buffalo City Metropolitan Municipality v ASLA Construction (Pty) Ltd 2019 (4) SA 331 (CC); [2019] ZACC (as referenced in the judgment).

MANANA v KING SABATA DALINDYEBO MUNICIPALITY [2011] 3 All SA 140 (SCA).

Grace v McCulloch 1908 TH 165.

Firestone South Africa (Pty) Ltd v Genticuro AG 1977 (4) SA 298 (AD).

Finishing Touch 163 (Pty) Ltd v BHP Billiton Energy Coal South Africa Ltd and Others 2013 (2) SA 204 (SCA).

Eke v Parsons 2016 (3) SA 37 (CC).

Mathabeng Local Municipality v Eskom Holdings Ltd and Others 2018 (1) SA 1 (CC).

Mansell v Mansell 1953 (3) SA 716 (N).

De Witts Auto Body Repairs (Pty) Ltd v Fedgen Insurance Co Ltd 1979 (2) SA 298 (E).

Harris v ABSA Bank Ltd t/a Volkskas 2006 (4) SA 527 (TPD).

Nyingwa v Moolman NO 1993 (2) SA 508 (Tk).

Topol and Others v LS Group Management Services (Pty) Ltd 1988 (1) SA 639 (W).

Lodhi 2 Properties Investments CC v Bondev Investments 2007 (6) SA 87 (SCA).

Freedom Stationery (Pty) Ltd and Others v Hassam and Others 2019 (4) SA 459 (SCA).

State Information Technology Agency SOC Limited v Gijima Holdings (Pty) Ltd 2018 (3) SA 23 (CC).

Notyawa v Makana Municipality and Others [2019] ZACC 43.

Biowatch Trust v Registrar, Genetic Resources 2009 (6) SA 232 (CC).

Harrielall v University of Kwa-Zulu Natal 2018 (1) BCLR 12 (CC).

Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd 1984 (3) SA 623 (A).

Setlogelo v Setlogelo 1914 AD 221.

Legislation Cited

Constitution of the Republic of South Africa, 1996.

National Building Regulations and Building Standards Act 103 of 1977.

Occupational Health and Safety Act 85 of 1993.

Promotion of Access to Justice Act 3 of 2000 (as referenced in the judgment in connection with section 7(1) and PAJA-related argument).

Rules of Court Cited

Uniform Rule of Court 31(2)(b).

Uniform Rule of Court 42(1)(a).

Held

The court held that contempt proceedings seeking personal sanction against a public official require that the official be joined in their personal capacity, and that citation in a merely representative capacity is insufficient for contempt relief of that nature. On that basis, the contempt application did not proceed and was withdrawn with a tender of costs.

The court held that the Tokota J order of 8 January 2019 was clear and enforceable when read as a whole, notwithstanding an incorrect reference to a month in one paragraph. It held that rescission was not competent under Rule 42(1)(a) because the order was not “erroneously granted” where the applicant in those proceedings was procedurally entitled to judgment after proper service, and the later disclosure of a defence could not convert it into an erroneous order. It further held that the municipality failed to establish good cause for rescission under Rule 31(2)(b) and failed to meet the common-law requirements, given the inadequate explanation for default and the absence of a bona fide defence supported by admissible evidence.

The court held that the municipality’s self-review application failed on the merits because it did not candidly and properly explain the alleged mistake or unlawfulness of the 25 October 2018 approval by way of the relevant record and first-hand admissible evidence from responsible officials. Although the court was not prepared to dismiss the self-review on delay alone, the evidential and substantive deficiencies were decisive.

The court held that the interim interdict application necessarily failed once the rescission and self-review applications were dismissed, and that on the papers the municipality did not satisfy the interdict requirements in any event, particularly given non-disclosures, factual disputes governed by motion-proceeding principles, and the balance of convenience favouring Biermann.

LEGAL PRINCIPLES

A court order must be interpreted as a whole to determine its meaning and purpose. An isolated error in part of an order does not necessarily render it ambiguous or unenforceable if the operative and directory parts are clear when read in context.

Rescission under Uniform Rule 42(1)(a) is confined to circumstances where an order was erroneously sought or erroneously granted in the absence of an affected party. Where a party was procedurally entitled to default judgment due to proper service and the other party’s failure to oppose, the later disclosure of a defence does not render the judgment “erroneously granted”.

Rescission under Uniform Rule 31(2)(b) requires an application within the stipulated period after knowledge of the judgment and requires good cause, including an adequate explanation for default and a bona fide defence with prospects. A materially late rescission application coupled with a poor explanation for default and evidentially inadequate founding material will not satisfy the standard.

In a legality review brought by an organ of state, delay is assessed under the legality framework and the court retains a discretion whether to overlook delay, but the applicant remains obliged to place before court a proper evidential foundation, including the decision-making record and admissible evidence explaining the alleged unlawfulness.

Contempt proceedings that may result in personal sanction against public officials require proper joinder of the official in their personal capacity, consistent with Constitutional Court authority governing procedural fairness and the gravity of contempt consequences.

An applicant for an interlocutory interdict must satisfy the requirements for such relief, and in motion proceedings factual disputes are approached in accordance with the Plascon-Evans principle. Where the interdict is sought pending proceedings that fail, and where the balance of convenience and evidential material do not support relief, the interdict should be refused and any rule nisi discharged.

Biermann v Buffalo City Metropolitan Municipality (EL179/2019) [2019] ZAECELLC 33; [2020] 1 All SA 688 (ECL) (5 December 2019)