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[2008] ZASCA 130
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Municipality of the City of Cape Town v Reader and Others (719/07) [2008] ZASCA 130; 2009 (1) SA 555 (SCA) (14 November 2008)
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THE
SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH
AFRICA
JUDGMENT
Case number: 719/07
In
the matter between:
THE
MUNICIPALITY OF THE
CITY
OF CAPE TOWN
APPELLANT
v
MARINA
GUILIETTA READER FIRST RESPONDENT
IAN
DONALD PEPLOE SECOND RESPONDENT
JULIA
PATRICIA IKIN THIRD RESPONDENT
ETHEKWINI
MUNICIPALITY AMICUS CURIAE
Neutral
citation:
City
of Cape Town v Reader
(719/2007)
[2008]
ZASCA 130
(14 November 2008)
Coram: Cameron
JA, Lewis JA, Jafta JA, Mlambo JA
et
Combrinck JA
Heard: 21
August 2008
Delivered: 14
November 2008
Summary: Interpretation
of
s 62
of the
Local Government: Municipal Systems Act 32 of 2000
–
the provision does not afford an appeal to objectors to grant of
planning permission.
ORDER
On
appeal from:
Cape
High
Court, (Davis J, NC Erasmus J and H Erasmus J sitting as the
Full Court on appeal from a single judge).
(1) The
appeal is dismissed with costs, including costs occasioned by the
employment of two counsel.
JUDGMENT
JAFTA
JA (MLAMBO JA concurring
)
[1] The
issue in this appeal is whether s 7(2)
1
of the Promotion of Administrative Justice Act 3 of 2000 (PAJA)
precluded the first and second respondents (the applicants) from
seeking an order reviewing and setting aside a decision of the
appellant (the municipality) until they had exhausted internal
remedies. The applicants instituted review proceedings in the Cape
High Court for an order setting aside the municipality’s
approval of the third respondent’s building plans. The
challenged approval was granted in terms of s 7 of the National
Building
Regulations and Building Standards Act 103 of 1977.
[2]
The municipality and the third respondent opposed the application.
Relying on s 7(2) of PAJA, the municipality argued
in
limine
that the application ought to be dismissed on the basis that the
applicants had failed to invoke the municipality’s internal
appeal procedure in terms of s 62 of the Local Government: Municipal
Systems Act 32 of 2000 (the Systems Act). Veldhuizen J upheld
this
argument and dismissed the application without considering the
merits.
[3] On
appeal to the Full Court the order issued by Veldhuizen J was
reversed. The Full Court held that the provisions of s 7(2)
of PAJA
do not apply to the present case because the internal appeal in
question did not constitute a ‘viable internal remedy’
for the applicants. The judgment of the Full Court is reported sub
nom
Reader
& another v Ikin & another
2008 (2) SA 582
(C). The present appeal is with special leave of this
court.
[4] In
this court Ethekwini Municipality was admitted as an
amicus
curiae
.
Counsel addressed useful argument to the court on the proper
interpretation of s 62 of the Systems Act. The court appreciates
the
assistance derived from all submissions presented in the case.
[5] The
facts are common cause. The applicants and the third respondent are
owners of adjoining immovable properties in Sea Point,
Cape Town. The
third respondent’s property lies to the north of the first
applicant’s property and the second applicant’s
property
is located on the eastern side. These properties are located in an
area zoned for single dwelling units. There is one
house built on
each property.
[6] In
terms of the municipality’s zoning scheme regulations, it is
permissible to build a three-storey house in the area.
Before the
approval of the third respondent’s building plans, her house
was a single storey building. Having decided to extend
it in 2003 and
convert it into a double storey house, she submitted plans to the
municipality for approval. On 20 February
2003 the municipality
approved her plans and construction commenced on her property.
[7] The
construction on the third respondent’s property attracted the
attention of the applicants and led to an enquiry at
the
municipality. They were informed that the construction was lawful and
that the building plans relating thereto had been approved.
The
municipality’s building control officer – Mr Neil Moir –
informed the first applicant that the third respondent
would be
adding a ‘second storey’ to her house. The first
applicant was unhappy as she held the view that the proposed
building
would ‘obliterate [her] view of the sea’; compromise the
privacy of her home; and reduce the value of her
property by the
amount of R350 000.
[8] The
applicants, as already mentioned, instituted review proceedings
challenging the validity of the approval mainly on the ground
that
jurisdictional facts necessary for the exercise of the power to
approve building plans did not exist at the time of the approval.
They contended that the decision–maker ought to have considered
a recommendation to grant approval by the building control
officer
and that he must have been satisfied that the erection of the
building in question would not probably or in fact disfigure
the
area; be unsightly or objectionable; and would not derogate from the
value of neighbouring properties.
[9] The
building was completed while the application was pending in the court
of first instance. The applicants asked, in addition
to the order
setting aside the approval, that the third respondent be directed to
demolish the building in question. As stated
earlier, the court of
first instance dismissed the application on the basis that the
applicants had, in contravention of s 7(2)
of PAJA, prematurely
approached it before exhausting internal remedies.
[10] In
this court counsel for the municipality attacked the Full Court’s
interpretation to the effect that s 62 of the Systems
Act did not
provide a ‘viable internal remedy’ for the applicants and
that as a result s 7(2) of PAJA did not apply
to their case. The Full
Court’s conclusion was based on the effect s 62(3) has on the
scope of an appeal under the section.
The Full Court held that in
terms of s 62(3) once a right had accrued as a result of the impugned
decision, that ‘decision
cannot be reversed on an appeal if the
reversal takes away the right initially granted’.
2
[11] Having
observed that an unlawful administrative action may, in appropriate
cases, give rise to a legal consequence, the Full
Court said:
‘
For
these reasons, s 62(1) read with s 62(3) of the Systems Act does not
appear to provide any viable internal remedy to an aggrieved
party
such as appellant in the present dispute. The mechanism created by ss
62(1) and 62(3) of the Systems Act provides an appeal
for a party
aggrieved by the initial decision but does not extend to third
parties who contend that their rights or legitimate
expectations have
been adversely affected by the decision. The latter group, however,
has a right of access to a court to set aside
such a decision. In my
view Veldhuizen J erred in holding that appellants were required to
exhaust an internal remedy in terms
of s 62 before approaching a
court, as the section did not provide appellants an internal remedy,
as envisaged in terms of s 7(2)
of PAJA.’
3
[12] Generally
speaking s 7(2) excludes, albeit temporarily, the court’s
jurisdiction on review proceedings where there is
provision for an
internal remedy. In those circumstances the aggrieved person’s
right of access to courts or other independent
and impartial
tribunals is denied until he or she has exhausted the internal
remedy. The subsection is couched in peremptory terms
which oblige
every reviewing court to decline to hear a review application brought
under PAJA until the aggrieved party has exhausted
internal
remedies.
4
Recently
in
Nichol
this
court said:
‘
Under
the common law, the mere existence of an internal remedy was not, by
itself, sufficient to defer access to judicial review
until the
remedy had been exhausted. Judicial review would in general only be
deferred where the relevant statutory or contractual
provision,
properly construed, required that the internal remedies first be
exhausted. However, as is pointed out by Iain Currie
and Jonathan
Klaaren, “by imposing a strict duty to exhaust domestic
remedies, [PAJA] has considerably reformed the common
law”. It
is now compulsory for the aggrieved party in all cases to exhaust the
relevant internal remedies unless exempted
from doing so by way of a
successful application under s 7 (2) (c). Moreover, the person
seeking exemption must satisfy the court
of two matters: first, that
there are exceptional circumstances, and second, that it is in the
interest of justice that the exemption
be given.’
5
[13] The
issue of exemption from exhausting an internal remedy does not arise
in the present case simply because no application
therefor was made
to the reviewing court. As a result it is not necessary to consider
whether the requirements for an exemption
have been met. The validity
of s 7(2) was not challenged in these proceedings and therefore I
proceed on the assumption that it
is consistent with the
Constitution. The question for consideration is whether s 62 of the
Systems Act affords the applicants an
internal remedy contemplated in
s 7(2) of PAJA. The answer to this question lies in the
interpretation of s 62.
[14] Section
62 of the Systems Act provides:
‘
(1) A
person whose rights are affected by a decision taken by a political
structure, political office bearer, councillor or staff
member of a
municipality in terms of a power or duty delegated or sub-delegated
by a delegating authority to the political structure,
political
office bearer, councillor or staff member, may appeal against that
decision by giving written notice of the appeal and
reasons to the
municipal manager within 21 days of the date of the notification of
the decision.
(2) The
municipal manager must promptly submit the appeal to the appropriate
appeal authority mentioned in subsection (4).
(3) The
appeal authority must consider the appeal, and confirm, vary or
revoke the decision, but no such variation or revocation
of a
decision may detract from any rights that may have accrued as a
result of the decision.
(4) When
the appeal is against a decision taken by –
(a) a
staff member other than the municipal manager, the municipal manager
is the appeal authority;
(b) the
municipal manager, the executive committee or executive mayor is the
appeal authority, or, if the municipality does not
have an executive
committee or executive mayor, the council of the municipality is the
appeal authority; or
(c) a
political structure or political office bearer, or a councillor –
(i) the
municipal council is the appeal authority where the council comprises
less than 15 councillors; or
(ii) a
committee of councillors who were not involved in the decision and
appointed by the municipal council for this purpose
is the appeal
authority where the council comprises more than 14 councillors.
(5) An
appeal authority must commence with an appeal within six weeks and
decide the appeal within a reasonable period.
(6) The
provisions of this section do not detract from any appropriate appeal
procedure provided for in any other applicable law.’
[15] Section
62(1) lays down two threshold requirements. The first is that the
decision appealed against must have affected the
rights of the
appellant. The second is that such decision ought to have been
reached in the exercise of a delegated power. In this
matter it is
common cause that the building plans concerned were approved in terms
of a delegated power. What needs to be considered
is whether the
present applicants satisfied the first requirement. If not, it cannot
be held that there was an internal remedy
which they ought to have
exhausted before approaching the high court.
[16] On
the construction of s 62(1) it must be shown that the decision to
approve the plans itself affected the rights of the applicants.
Since
the issue in the present case was raised as a point
in
limine
,
I accept that a mere allegation of this fact will suffice. Absent
such allegation, however, the finding that the approval affected
the
rights of the applicants cannot be made.
[17] In
their papers the applicants have not alleged that the approval itself
affected their rights. All that they have alleged
in challenging the
approval is that its subsequent execution – the erection of the
building – affected their rights.
Hence the complaint that the
value of their properties was diminished by the building in question.
If the third respondent had
not erected it after obtaining approval,
the applicants’ sea view could not have been obliterated and
there could not have
been a derogation from the value of their
properties. This must be borne in mind in determining whether it has
been shown that
the approval had affected the applicants’
rights.
[18]
As it was the municipality which raised the issue that the
applicants were obliged to invoke the remedy in s 62 before
approaching the court, it is necessary to look for the essential
allegation in its answering affidavit. It does not make the
allegation
that the decision affected the applicants’ rights.
On the contrary, Mr Craig Thomas Rolfe – the
municipality’s
Principal Plans Examiner – states:
‘
41. As
stated before, as [the municipality’s] decision to approve
[third respondent’s] application did not materially
and
adversely affect the Applicants’ rights, they had no right to
be heard either in terms of the Act, or the Constitution,
before the
building plans were approved.’
And
later he repeats the same allegation:
45.2 Applicants
were not given notice as [the municipality] was satisfied that its
decision to approve [third respondent’s]
application would not
materially and adversely affect any of the Applicants’ rights.’
[19] The
above allegation by the municipality is correct in the light of the
finding made in
Walele
v The City of Cape Town & others.
6
In that case the Constitutional Court considered whether objectors
such as the present applicants were entitled to a pre-approval
hearing, in the context of s 3 of PAJA.
7
The Constitutional Court interpreted s 3 and said:
‘
On
a proper construction of section 3, the applicant’s claim to a
hearing can only succeed if he establishes that the decision
to
approve the building plans materially and adversely affected his
rights or legitimate expectations. The parties involved in
the
application for the approval were the respondents and the City. The
applicant was not a party to that process nor was he entitled
to be
involved. The building plans concerned were drawn at the instance of
the respondents who wanted to erect the four-storey
block of flats on
their own property. The granting of the approval could not, by
itself, affect the applicant’s rights.’
[20] Before
us, counsel for the municipality argued that the finding in
Walele
turned closely on the interpretation of PAJA. That finding, said
counsel, does not mean that the unlawful approval of building
plans
did not give a neighbour affected thereby a right of appeal in terms
of s 62 of the Systems Act.
[21] Although
the finding in
Walele
was based on the interpretation of s 3 of PAJA, there are
similarities between that section and s 62(1) in so far as the
requirements for invoking each section are concerned. The language
used in these sections is similar and the requirement common
to both
sections is that the challenged decision must affect the rights of
the aggrieved party. Since in this case the impugned
decision is the
approval of the third respondent’s building plans, it must be
shown in the manner mentioned above that this
decision has affected
the applicants’ rights.
[22] There
can be no doubt that on the authority in
Walele
,
it cannot be said that the impugned approval affected the applicants’
rights for purposes of founding a claim for a pre-decision
hearing.
The question that arises, therefore, is whether it can be said that
the same decision affects their rights for purposes
of an appeal in
terms of s 62(1). To hold that it does will introduce an
illogicality. In my view, if the decision concerned does
not affect
the applicants’ rights for purposes of a hearing, it must
equally not affect their rights for purposes of an appeal.
It is
difficult – if not impossible – to imagine a situation
where an approval of building plans does not affect the
objectors’
rights for purposes of a pre-decision hearing while at the same time
it affects their rights for purposes of an
appeal.
[23] Moreover,
s 62(1) requires that the person whose rights are affected by the
decision be notified of it so that he or she can
note an appeal
within 21 days from the date of notification. Notification must
follow a decision which affects the aggrieved party’s
rights.
In this matter notification was not given presumably because the
municipality held the view that the approval did not affect
the
applicants’ rights. This view is inconsistent with the
requirement of s 62(1). This is a further indication that s 62
was
not designed to apply to cases of objectors to the approval of
building plans, whose objection is ordinarily raised against
the
execution of the plans and not the approval itself. Therefore, I
conclude that s 62 does not apply to cases such as the present.
[24] But
even if the section applied to such cases, the present application
ought not to have been dismissed because one of the
threshold
requirements was not met. As mentioned earlier, it was not alleged
that the decision which is challenged by the applicants
affected
their rights. This makes it unnecessary to interpret the other parts
of s 62 and as a result I decline the invitation
by the parties that
we should construe the whole section. It is also not necessary to
consider whether the reasons given by the
Full Court for its decision
are correct or not. Suffice it to say it reached the correct
decision. It follows that the appeal must
fail.
[25] Lewis
JA rejects the construction of s 62(1) which ascribes to it the
meaning that before a party can invoke the section, it
must be shown
that the decision appealed against has affected the rights of the
appellant (para 33) and concludes that a successful
appeal under s
62(1) ‘would necessarily entail the outcome that the decision
would be revoked or varied – contrary
to s 62(3)’ (para
34). I disagree. Section 62(3) does not insulate the decision forming
the subject matter of the appeal,
itself, from variation or even
revocation. What is protected by the subsection is the rights which
have accrued as a result of
such decision. The subsection stipulates
that no variation or revocation of the decision may detract from
accrued rights. In other
words, once the appeal authority
contemplates revoking or varying the decision appealed against, s
62(3) comes in to play and such
revocation or variation ought not to
affect the rights which accrued as a result of the impugned decision.
For example, in this
case the revocation or variation of the approval
granted would not affect the third respondent’s right to build.
Whether
this could constitute appropriate relief for the applicants
is a different matter, and the answer thereto lies in what is meant
by an internal remedy contemplated in s 7(2) of PAJA.
[26] In
the result the appeal is dismissed with costs, including costs
occasioned by the employment of two counsel.
________________
C
N JAFTA
JUDGE
OF APPEAL
LEWIS
JA (CAMERON JA and COMBRINCK JA CONCURRING)
[27] I
have had the benefit of reading the judgment of my colleague Jafta
and agree with him that the appeal should be dismissed.
However, I
write separately because I consider that there is a narrower and more
direct path to that outcome, based on a construction
of what seems to
me to be the clear meaning of s 62 of the Systems Act. In my view,
that provision cannot be invoked at all by
neighbours, such as the
applicants in this case, who have not been party to a municipal
planning permission application.
[28] The
essential dispute between the parties is whether s 62 of the Systems
Act confers on the applicants a viable right of appeal.
I shall refer
to the parties and the legislation in the same way as Jafta JA has
done. The applicants argue that, once the municipality
approved the
neighbour’s plans to which they object, their only right of
appeal lay to a review board constituted under s
9 of the National
Building Regulations and Building Standards Act 103 of 1977 (the NRB
Act). Section 9(1) of that Act provides
that a person who feels
aggrieved by the refusal of a local authority to grant approval in
respect of the erection of a building
may appeal to a review board.
The section is plainly inapposite to this case. The municipality
contends instead that s 62 of the
Systems Act afforded the applicants
a right of appeal, and that, having failed to exercise it (for it is
common cause that they
did not), s 7(2) of PAJA blocks their right to
challenge the approval in a court of law.
[29] The
resolution of this question will, as the amicus ably demonstrated,
and the parties agreed, have immense practical implications
for local
governance in this country; for, if s 62 affords a right of appeal –
any right of appeal – to those aggrieved
by municipal planning
decisions, their exercise of those rights must be accommodated before
the decision can be implemented.
[30] But
s 62 clearly gives no general right of appeal to those who object to
municipal planning permissions and decisions. As
I see it, s 62 (1)
gives only one whose rights are directly affected by a decision,
taken by a person delegated to make such decision,
a right to appeal
against that decision within the strictures of s 62. That raises the
question as to who has a right directly
affected by the decision.
Although on an initial reading it might appear that anyone who is in
some way affected by a decision
to grant permission to build (a
neighbour, say, who believes that his or her property rights are in
some way diminished) may appeal,
that cannot be. How can a person not
party to the application procedure itself appeal against the decision
that results? And the
Constitutional Court held in
Walele
,
to which Jafta JA refers (para 19 of his judgment), that neighbours
in the position of the applicants (although they may later
challenge
the lawfulness and regularity of the permission accorded) have no
entitlement to be party to the approval process itself.
[31] This
interpretation, that objecting neighbours and others have no right of
appeal at all under s 62, is borne out by s 62(3):
‘
The
appeal authority must consider the appeal, and confirm, vary or
revoke the decision,
but
no such variation or revocation of a decision may detract from any
rights that may have accrued as a result of the decision
’
(my emphasis).
It
seems plain that the purpose of s 62 as a whole is to give to the
dissatisfied applicant for permission – and to no one
else –
an opportunity for the matter to be reheard by a higher authority
within the municipality. It is only the aggrieved
applicant, who has
failed to secure the permission sought in his or her application, who
is afforded a right of appeal under s
62. For if it were otherwise
any appeal would be pointless: only those affected by the grant of
permission, or a decision favourable
to an applicant, would wish to
apply and they could not succeed if the appeal resulted in a
revocation or variation of a right
that has accrued to the applicant.
[32] Section
62 thus grants no viable appeal at all to a person not party to the
planning permission application (or, for that matter,
by any other
section in the Systems Act). It makes no difference, in my view,
whether the objection is to the decision itself,
or to the
implementation of the decision – for instance by starting
building works – or to the completion of that process.
It is
the decision made by the municipality or its delegee in the case of
the application itself that may be appealed against –
but only
if the outcome of the appeal does not detract from the rights of the
successful applicant.
[33] For
this reason, I find myself regretfully unable to accept the
construction of the section suggested by Jafta JA (paras 17
and 23).
He states that the applicants had not objected to the decision itself
but to the execution of the building works pursuant
to it. The fact
that the third respondent had actually not only started, but also
completed, the building work for which permission
was granted is not,
in my respectful view, relevant. The third respondent acquired a
right from the municipality and it is of no
consequence to the
question whether objecting neighbours and others had a right of
appeal under s 62 that she acted on it.
[34] A
successful appeal against the grant of planning permission by the
municipality under s 62(1) would necessarily entail the
outcome that
the decision would be revoked or varied – contrary to s 62(3).
The fact that the beneficiary of the decision
acted on the decision
by building, and the extent of the building, thus cannot be relevant
in determining whether the Systems Act
affords the applicants any
right to appeal. It therefore does not matter whether in claiming
relief the applicants stated their
complaint to be the building
works, pursuant to permission, or the permission itself.
[35] Thus
in my view, the applicants – and neighbours in their position
who are not party to an application or an objection
to the grant of
permission to act by a municipality – are not afforded an
appeal under s 62. The very wording of the section
precludes it. If
they are entitled to relief of any kind outside the NBR Act or the
Systems Act, it can only be a review under
PAJA. And since s 62 does
not afford them a viable appeal there is no internal remedy that can
first be exhausted before applying
for a review of the decision.
[36] This
approach differs from that in the judgment of Jafta JA in that it
essentially accords with the approach of the full court
which Jafta
JA finds unnecessary to consider. In my view, the entire reasoning
and approach of the full court should be affirmed.
8
[37] For
these reasons I agree with Jafta JA that the appeal should be
dismissed with costs including those consequent on the employment
of
two counsel.
________________
C
H LEWIS
JUDGE
OF APPEAL
APPEARANCES:
FOR
APPELLANT: A G Binns-Ward SC
ATTORNEYS: Cliffe
Dekker Inc
CAPE
TOWN
Claude
Reid Attorneys
BLOEMFONTEIN
FOR
RESPONDENT: S P Rosenberg SC
ATTORNEYS: Dykman
Attorneys (1
st
and 2
nd
Resp)
CAPE
TOWN
Bisset
Boehmke McBlain (3
rd
Resp)
CAPE
TOWN
Webbers
BLOEMFONTEIN
FOR
AMICUS CURIAE: P J Olsen SC
A
A Gabriel
Linda
Mazibuko & Associates
DURBAN
Matsepes
Inc
BLOEMFONTEIN
1
Section 7(2) provides: ‘(2) (a) Subject to paragraph (c), no
court or tribunal shall review an administrative action in
terms of
this Act unless any internal remedy provided for in any other law
has first been exhausted. (b) Subject to paragraph
(c), a court or
tribunal must, if it is not satisfied that any internal remedy
referred to in paragraph (a) has been exhausted,
direct that the
person concerned must first exhaust such remedy before instituting
proceedings in a court or tribunal for judicial
review in terms of
this Act. (c) A court or tribunal may, in exceptional circumstances
and on application by the person concerned,
exempt such person from
the obligation to exhaust any internal remedy if the court or
tribunal deems it in the interests of justice.’
2
Reader v Ikin
2008 (2) SA 582
(C) (above) para 25.
3
Id para 32.
4
Nichol & another v Registrar of Pension
Funds & others
2008 (1) SA 383
(SCA).
5
Id para 15.
6
2008 (6) SA 129
(CC);
[2008] ZACC 11.
7
Section 3(1) of PAJA provides: ‘Administrative
action which materially and adversely affects the rights or
legitimate expectations
of any person must be procedurally fair.’
8
Counsel for the municipality referred this court
to a decision of Olivier AJ in the Cape High Court,
Syntell
(Pty) Ltd v The City of Cape Town & another
(unreported judgment, case 17780/2007, handed down on 13 March
2008), in which that court sought to distinguish the case before
it
from that now before us, having regard to the judgment of the full
court in this matter. The issue before that court was the
right of
an unsuccessful tenderer to appeal in terms of s 62 of the Systems
Act. Since no final tender had been awarded, the
court held that an
appeal under s 62 was not precluded by the decision of the full
court. The question of a tenderer’s
right to appeal as it
emerged in that case is not before us.