Brief Summary

Interdict — Final interdict — Application for interdict to compel registration of Kleinfontein as a legal township — Applicants, shareholders and residents of Kleinfontein, allege unlawful operation of the township and non-compliance with statutory requirements — First respondent disputes locus standi of applicants and claims compliance with necessary steps for township establishment — Court finds that applicants have established locus standi and a prima facie case for both final and interim interdicts, leading to the granting of the final interdict to compel compliance with statutory requirements for township registration.

Comprehensive Summary

Summary of Judgment

1. Introduction

This matter was brought in the Gauteng Division of the High Court, Pretoria, as a motion application in which multiple applicants sought final mandatory interdicts (and, in addition, relief framed as an interim interdict) directed primarily at compelling steps towards the formal township establishment (dorpstigting) and broader statutory compliance in respect of the settlement known as Kleinfontein.

The applicants were members and shareholders of the first respondent, Kleinfontein Boerebelange Koöperatief Bpk, a cooperative that owned the land on which the Kleinfontein settlement had developed. The respondents included the cooperative itself (as the first respondent), the Registrar of Cooperatives, various national and provincial executive authorities, and other entities connected with land, development, and transactions affecting Kleinfontein, including a contractor and an estate agent cited in relation to building and marketing activity.

The application was issued on 20 May 2010. The first respondent delivered an answering affidavit on 4 August 2011. The applicants filed a supplementary founding affidavit on 23 May 2013, and the first respondent responded with a further answering affidavit on 1 October 2013. Case management followed (including the admission of an affidavit by an attorney specialising in township development matters), and the applicants ultimately delivered an amended notice of motion on 29 June 2015 setting out the relief pursued at the hearing. The papers were voluminous (approximately 1 400 pages).

The dispute concerned the legal status and regulatory compliance of Kleinfontein, which had developed de facto residential features and infrastructure but had not been formally proclaimed or registered as a township. The applicants sought to compel formalisation and compliance, and to restrain further development and marketing pending such compliance.

2. Material Facts

It was common cause that the applicants were members and shareholders of the first respondent cooperative. With the exception of the first applicant, the applicants were also residents of Kleinfontein. By acquiring shares in the cooperative (directly or through trusts), members acquired rights to the use and enjoyment of defined portions of the cooperative’s land, and a number of members had erected dwellings on those portions at their own expense.

It was also common cause that Kleinfontein had developed the characteristics of a settlement with significant infrastructure and amenities, including roads, water and electricity supply, a school, an elderly care centre, a community hall, sports facilities, and a shopping centre. At the same time, it was not disputed that Kleinfontein had not been formally established and registered as a township in terms of the applicable legislative framework.

The applicants’ case, as relied upon by the court for purposes of identifying the dispute, was that the first respondent was effectively operating an “unlawful town” by failing to complete township establishment and by allegedly failing to comply with a range of statutory requirements associated with development, construction, services, and environmental regulation. The applicants asserted that this unlawful status caused property insecurity and prejudice given the money spent on housing and improvements.

The first respondent did not deny the absence of formal township proclamation. However, on the facts relied upon by the court, it asserted that substantial steps had already been taken to secure formalisation. Those steps included a resolution taken at a general meeting on 26 March 2011 to appoint experts to handle formalisation and township establishment under the leadership of Mr Adriaan Venter; the payment during April and May 2011 of budgeted funds of just over R1.6 million into Mr Venter’s trust account to drive the process; the appointment of Planpraktyk as project manager on 6 July 2011 (with documents provided on 7 July 2011); and the submission of an application on 19 March 2012 under the Development Facilitation Act 67 of 1995 to the relevant development tribunal, followed by notice and advertising on 9 May 2012.

A further material fact accepted by the court was that the formalisation process under the Development Facilitation Act became complicated by the Constitutional Court’s decision confirming the invalidity of certain chapters of that statute, with a 24-month suspension of invalidity. The suspension period expired on 18 June 2012, and the tribunal process in Kleinfontein’s case was, on the papers, indefinitely postponed pending further direction in light of the legislative position.

The court further relied on the fact that the Spatial Planning and Land Use Management Act 16 of 2013 (SPLUMA) came into operation on 1 July 2015, and that its transitional provisions (including the continuation of pending tribunal matters) were invoked by the first respondent in support of the proposition that the previously lodged application remained capable of being continued and finalised under the new regime.

In addition, the court accepted that environmental compliance processes had been initiated. The first respondent relied on the existence of a parallel environmental authorisation process under the National Environmental Management Act 107 of 1998, including an inspection in November 2010, further requirements communicated in July 2014, and an undertaking that no further listed activities would be undertaken without written approval. The first respondent also asserted that it had decided not to permit further building work until the environmental process was concluded or written approval was obtained, and that members had been informed accordingly.

3. Legal Issues

The central legal questions before the court were whether the applicants had satisfied the requirements for the relief sought in the form of final mandatory interdicts compelling the cooperative to (i) take all steps necessary to register Kleinfontein as a lawful township, and (ii) take all steps necessary to comply with all statutory provisions and requirements applicable to development and infrastructure; and whether they had satisfied the requirements for an interim interdict restraining further development and the marketing or sale of rights pending compliance.

The dispute primarily concerned the application of established interdict principles to the facts placed before the court. While questions of legality and statutory compliance provided the substantive context, the court framed the decisive enquiry in interdict terms, focusing on whether a clear right (for final relief) and a prima facie right (for interim relief) had been shown on the papers, given the respondent’s evidence of ongoing processes and undertakings.

Although locus standi was raised as a major defence, the court approached the matter on the basis that it would assume (without deciding) that the applicants had locus standi and had made out at least a prima facie case on other interdict requirements, so that the key determination became whether the relevant right for interdict purposes had been established.

4. Court’s Reasoning

The court identified the nature of an interdict as a court order compelling or restraining conduct. It then distinguished between the requirements for final interdictory relief and those for interim interdictory relief.

In relation to the final interdicts (prayers 1 and 2), the court applied the settled principle that an applicant must establish, on a balance of probabilities, a clear right that is legally protectable and capable of being finally vindicated by a final order. The court emphasised that a clear right is not assessed in isolation; the applicant must prove facts showing that objective law confers a right that can be enforced or protected by the particular order sought, and that the order would constitute a final determination of the parties’ rights.

Against that framework, the court accepted that Kleinfontein had not yet been proclaimed as a township, but treated as material the first respondent’s evidence that formalisation steps had already been initiated, including professional appointments, substantial expenditure, and the submission of a development application under the Development Facilitation Act. The court also accepted that progress thereafter was significantly affected by the legislative uncertainty created after the Constitutional Court’s confirmation of invalidity (and the expiry of the suspension period without legislative correction), which the court described as a form of statutory inadequacy resulting in a gap that hampered further movement under the initial statutory route.

The applicants’ final interdict, as framed, sought to compel the first respondent to register Kleinfontein within two years (or a period determined by the court) in terms of the Town Planning and Townships Ordinance 15 of 1986 or other legislation. The court reasoned that granting such an order would, in substance, require the first respondent to abandon the pending application route already pursued and restart the process afresh under a different legislative mechanism. The court attached weight to the respondent’s contention that this would entail unnecessary duplication and additional expense, particularly given the approximately R1.6 million already spent.

The court further considered the respondent’s evidence that, in parallel to land-use formalisation, an environmental approval process had been launched and was ongoing under the National Environmental Management Act. On the facts as accepted, this meant that the respondent was not inactive; rather, it was engaged in processes aimed at addressing the relevant regulatory requirements. In the court’s view, this undermined the applicants’ attempt to frame the dispute as one where a court order was needed to compel steps that were not being taken at all.

On this factual footing, the court concluded that there was serious doubt that the applicants had established a clear right to the specific mandatory interdicts sought. The decisive reasoning was that the orders would effectively compel the first respondent to do again what had already been set in motion, at potentially unnecessary cost, and without sufficient basis to show that the applicants had a clear enforceable right to compel the particular course demanded by the notice of motion.

Turning to the interim interdict (prayer 3), the court applied the standard approach that an applicant must show, among other requirements, a prima facie right, even if open to some doubt. The court adopted the method of assessing the applicant’s allegations together with those respondent allegations that the applicant could not dispute, and then considering whether respondent contradictions created serious doubt.

The applicants alleged ongoing unlawful activity, including the continued provision of municipal-type services by the cooperative, continued marketing and sale of stands or rights, and non-compliance with building regulations linked to the cited contractor and estate agent. However, the court accepted the first respondent’s evidence that an environmental process was underway, that an undertaking had been given that no further listed activities would occur without written approval, and that the cooperative had decided not to permit further building until the regulatory processes were finalised or permission obtained, with members being informed accordingly. On this basis, the court reasoned that the interim relief sought had effectively been overtaken by the steps already taken by the first respondent, and that serious doubt existed as to whether the applicants had demonstrated the prima facie right needed for interim relief.

Although the contractor (17th respondent) and estate agent (18th respondent) had not opposed and the applicants sought default relief against them, the court proceeded on the applicants’ concession that if relief could not be sustained against the first respondent, it should likewise not succeed against those respondents. The failure to establish the necessary basis for interim relief against the first respondent therefore disposed of the interim interdict as a whole.

On costs, while both sides sought special cost orders, the court considered the prolonged history and the evident conflict between members and the cooperative. It accepted that there was some force in the submission that the litigation may have had a “salutary effect” by placing pressure on the first respondent to advance the relevant processes. Balancing these considerations, the court exercised its discretion to make no order as to costs.

5. Outcome and Relief

The application was dismissed in its entirety. The court refused the final mandatory interdicts compelling township registration and statutory compliance steps, and refused the interim interdict restraining further development and marketing/sale of rights pending compliance.

The court made no order as to costs.

Cases Cited

Johannesburg Municipality v Gauteng Development Tribunal 2010 (6) SA 182 (CC).

Legislation Cited

Co-operatives Act 91 of 1981.

Co-operatives Act 14 of 2005.

Development Facilitation Act 67 of 1995.

Spatial Planning and Land Use Management Act 16 of 2013.

Town Planning and Townships Ordinance 15 of 1986.

National Environmental Management Act 107 of 1998.

Rules of Court Cited

No rules of court were cited in the judgment.

Held

The court held that, even assuming in the applicants’ favour (without deciding) that they had locus standi and had otherwise approached the interdict requirements on a prima facie basis, they failed to establish the clear right required for the final mandatory interdicts because the first respondent had already initiated and was pursuing formalisation and environmental compliance processes, and the orders sought would effectively compel duplication of steps already undertaken.

The court further held that the applicants failed to establish the prima facie right required for the interim interdict because the first respondent’s evidence of ongoing environmental authorisation processes, undertakings to refrain from further unapproved activities, and internal steps to halt new building pending approvals created serious doubt as to the applicants’ entitlement to interim restraint, and because the requested interim relief had effectively been overtaken by those steps.

Finally, the court held that the appropriate costs order, in the circumstances of the parties’ relationship and the history of the dispute, was that each party should bear its own costs.

LEGAL PRINCIPLES

A final interdict, including a mandatory interdict compelling performance, requires proof on a balance of probabilities of a clear right that is legally protectable and sufficiently definite to warrant final determination through the interdict.

In determining whether a clear right has been established, the court assesses whether objective law confers a right that can be enforced through the specific relief sought, and whether the order would finally determine the parties’ rights. Relief that would effectively compel a respondent to repeat steps already undertaken, or to abandon and restart processes already initiated, may fail where the applicant cannot show a clear enforceable entitlement to that particular course.

An interim interdict requires, among other requirements, proof of a prima facie right, even if open to some doubt. The assessment involves considering the applicant’s facts together with respondent facts that cannot be disputed, and then evaluating whether respondent contradictions raise serious doubt about the applicant’s entitlement to final relief.

The court retains a discretion on costs, and may decline to award costs even to a successful party where the circumstances, including the nature of the dispute and the practical effects of the litigation, make a no-costs order appropriate.

Smith en Andere v Kleinfontein Boerebelange Kooperatief Bpk en Andere (28685/2010) [2016] ZAGPPHC 628 (22 April 2016)