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[2015] ZAFSHC 64
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Ya Rona Investments (Pty) Ltd v Mangaung Metropolitan Municipality and Another (5303/2010) [2015] ZAFSHC 64 (19 March 2015)
IN THE HIGH COURT OF
SOUTH AFRICA
FREE STATE DIVISION:
BLOEMFONTEIN
Case Number: 5303/2010
DATE: 19 MARCH 2015
In the matter between:
YA RONA INVESTMENTS (PTY)
LTD
................................................................................
Applicant
And
MANGAUNG METROPOLITAN
MUNICIPALITY
...............................................
First
Respondent
THE SPEAKER OF THE
MANGAUNG
...............................................................
Second
Respondent
METROPOLITAN MANUCIPALITY
CORAM: LEKALE, J et MOENG, AJ
JUDGMENT: MOENG, AJ
HEARD ON: 27 & 28 JANUARY 2015
DELIVERED ON: 19 MARCH 2015
[1] The applicant seeks an order
reviewing and setting aside the decision of the first respondent’s
council taken on 3 July
2013 in terms of which council determined the
selling price of a piece of land at R 54 million. This decision was
prompted by the
following court order dated 13 June 2013 and obtained
by agreement between the parties:
1. “This matter is referred back
to the respondent’s council to pass a resolution to alienate
the property described
as Erf 321 of Sub-Division 238 of the farm
Bloemfontein, no 654 ( the “property”) to the applicant
in accordance with
the council resolution of 25 February 1999 and on
the court order under case number 5074/2006 of 29 March 2007;
2. The respondent’s council
determine the selling price for the property;
3. The respondent’s council
produce a contract to give effect to orders in 1 and 2 above;
4. The orders in 1, 2 and 3 above are
given effect to by the respondent within 30 days of this order.”
[2] Applicant seeks an order remitting
the matter back to council for proper reconsideration in terms of the
information on which
the property was valued by the first
respondent’s council in 1999 at R 7 000, 00 per hectare plus
VAT, and that the selling
price of the property be made on that
basis. Applicant’s main contention is that the council
resolution is a reviewable administrative
action that is unlawful,
unreasonable and irrational, and which, as such, was taken
arbitrarily without any relevant information
having been disclosed to
council members who were required to vote on the resolution.
[3] A short outline of the facts is
essential to comprehend the issue at hand. The background to the
dispute in casu dates back
to 1998, when the applicant made an
application to acquire the property in question which is 90 1547
hectares in extent, from the
Bloemfontein Transitional Local Council
(“the TLC”), the predecessor in title to the first
respondent. At a council
meeting held on 25 February 1999, the TLC
resolved to alienate the property to the applicant to be developed as
a light industrial
area as well as a housing component. The selling
price, which was below market value, was fixed at R 7 000, 00 per
hectare plus
VAT, therefore roughly R 631 082.90 before VAT. The
below market price was determined on the basis that the applicant was
an emerging
developer, that the land concerned was prairie land with
no infrastructure and that the soil condition in the area was poor.
The
sale was, however, made subject to the condition that the selling
price would be revised if the land was not taken up within 12
months
of its allocation.
[4] Applicant failed to take up the
land within the stipulated 12 month period and nothing was also done
by the TLC to cancel the
allocation. It was only on 14 November 2006,
7 and a half years later, that applicant approached the first
respondent to provide
it with the revised price in accordance with
the resolution. The first respondent was at this stage in the process
of alienating
the property to a third party. The applicant sought
confirmation from the respondent that the intended sale to the third
party
would not proceed and, when such undertaking was not
forthcoming, it successfully interdicted the impending sale.
[5] The parties thereafter reached a
settlement which was made an order of court on 29 March 2007. It was
agreed that the first
respondent would finalise the alienation of the
property in accordance with the 1999 resolution. First respondent
appointed valuators
to determine the market value of the property and
eventually revised the price to roughly R 43 million. The parties
entered into
a sale agreement on 8 February 2008 in terms of which
the property was sold to the applicant. The applicant provided the
respondent
with guarantees and paid an amount of R 286 403, 00 in
respect of the purchase price and transfer fees. Applicant however
contends
that it entered into this agreement due to the strict
condition that the 1999 resolution would be rescinded should it not
accept
the valuation within 14 days. The transaction could not be
registered due to applicant’s alleged failure to pay the full
purchase price and first respondent resultantly cancelled the sale
agreement. The collapse of the agreement, so applicant contends,
was
due to the fact that the valuation was fundamentally flawed and it is
challenging the cancellation of the contract in the action
pending
between the parties.
[6] Despite the purported cancellation
of the agreement, the parties reached yet another settlement that
culminated in the court
order dated13 June 2013. First respondent
resultantly obtained a valuation report which valued the property at
R 54 million. A
council meeting was convened on 3 July 2013 and the
council, by majority vote, approved the sale of the property for an
amount
of R 54 million.
[7] Applicant feels aggrieved by this
decision and submits that it has no independent knowledge of the
considerations that were
taken into account in arriving at the
amount. Save for the minutes of the council meeting dated 3 July
2013, applicant contends
that respondent failed to provide it with
any information about its adherence to the 1999 resolution in
formulating the revised
price. It further argues that insufficient
information was placed before the council members to perform their
duties properly as
the 1999 resolution, and the court order dated 29
March 2007, were not provided to them. Applicant further contends
that the instruction
given to the valuator to evaluate the property
at market value was contrary to the court order dated 13 June 2013.
The valuator,
so applicant argues, also made fundamental errors, in
that he wrongly concluded that the land is serviced, that feasibility
studies
as to road management and bulk services have been conducted,
that the soil conditions are stable and that the land has
improvements.
[8] Three points in limine were raised
by the respondents. They contend that the decision taken by the
respondent is not an administrative
action, that the same dispute is
pending in another action and that the application is out of time.
The third point was however
abandoned during the deliberations. The
applicant in turn argued at the commencement of the proceedings that
the opposing affidavit
is out of time and that the respondents failed
to apply for condonation.
[9] It appears from the court order
dated 30 October 2014 that the parties agreed that the respondent
would file its answering affidavit
by no later than 14 November 2014
whereas the applicant was to file its reply no later than 28 November
2014. The parties also
agreed that the instant application be
postponed to 27 and 28 January 2015. Mr Ncongwane, counsel for
respondents, argued that
the parties agreed that the matter would
proceed on the agreed dates of hearing and the late filing was
effectively condoned. A
literal reading of the court order does not
reflect that respondents had to apply for condonation. The order
stipulates a date
for the filing of the answering affidavit as a
matter of course and for the present application to proceed over two
days. It would
have been absurd for the parties to agree on specific
dates for the filing of the affidavits and a date of hearing if the
applicant
was of the view that condonation should first be sought. A
date for the filing of the replying affidavit in my view also
signified
applicant’s preparedness to reply to the allegations
contained in the answering affidavit despite the lateness thereof. We
are therefore of the view that the application should proceed and
applicant’s objection in this regard should be dismissed.
[10] Mr Ncongwane argued that the
respondents were directed by an order of court to pass a resolution
to alienate the property to
the applicant and to determine the
selling price, and in so doing, they were not performing an
administrative action that is susceptible
to review proceedings under
the Promotion of Administrative Justice Act 3 of 2000(PAJA). He
submitted that had the respondents
not complied with the court order,
they would have been in contempt of court. Respondents, so he argued,
complied with the order
hence the applicant did not initiate contempt
of court proceedings.
[11] Applicant reasoned in its heads of
argument that its application is not brought in terms of PAJA but
that the nature of the
decision taken and which is sought to be
reviewed is by definition an administrative action. It submits that
the principle of legality
accordingly finds application. Mr
Ngutshane, counsel for applicant submitted that to alienate immovable
property at a particular
value is a public power exercised in terms
of section 77 of the Free State Local Government Ordinance 8 of 1962
and as such, council
performed an administrative action. He contended
that the application falls within the ambit of PAJA and more
specifically the
definition of an administrative action as contained
in the Act.
[12] This necessitates a determination
of whether the provisions of PAJA are applicable, and more
importantly whether respondents’
conduct falls within the ambit
of the definition of an administrative action. The relevant
provisions of section 1 of PAJA, defines
“administrative
action” as: ‘any decision taken, or any failure to take a
decision, by-
(a) an organ of state, when-
(i) exercising a power in terms of the
Constitution or a provincial constitution; or
(ii) exercising a public power or
performing a public function in terms of any legislation; or
(b) a natural or juristic person, other
than an organ of state, when exercising a public power or performing
a public function in
terms of an empowering provision, which
adversely affects the rights of any person and which has a direct,
external legal effect,
but does not include-
(aa) …
(bb) …
(cc) the executive powers or
functions of a municipal council;
(dd) the legislative functions of
Parliament, a provincial legislature or a municipal council;
(ee) …’
[13] For the conduct of the Council to
be subject to review in terms of PAJA, it has to comprise all the
elements listed under section
1, failing which the conduct complained
of cannot be subject to review in terms of PAJA. Section 1(cc) and
(dd) excludes from the
definition of administrative action decisions
or failure to take decisions by municipal councils in the performance
or exercise
of their executive and legislative powers or functions.
These exclusions are a codification of the Constitutional Court’s
jurisprudence before the advent of PAJA on what amounts to
administrative action. (See Fedsure Life Assurance Ltd and Others v
Greater Johannesburg Transitional Metropolitan Council and Others
[1998] ZACC 17
;
1999 (1) SA 374
(CC) and President of the Republic of South Africa
and Others v South African Rugby Football Union and Others
2000 (1)
SA 1
(CC). From the above definition in terms of PAJA, administrative
action in the context of municipal councils is therefore a decision
or failure to take a decision by a municipality, as an organ of
state, when exercising public powers or performing public functions
in terms of the Constitution and legislation, excluding executive or
legislative functions, which adversely affects the rights
of others
and has external legal effect.
[14] The question is therefore whether
the council’s determination of a selling price is a decision of
an administrative nature
as envisaged by PAJA. Should this question
be answered in the negative, case law has demonstrated that the
principle of legality
will then act as a safety net to give the Court
some degree of control over the respondents’ conduct, although
not administrative
in nature. This is so since no exercise of public
power is beyond the sphere of the principle of legality and the rule
of law.
(See Minister of Health and Another NO v New Clicks South
Africa (Pty) Ltd and Others (Treatment Action Campaign and Another as
Amici Curiae)
2006 (2) SA 311
(CC) at para 97)
[15] As correctly submitted by counsel
for applicant, what matters is not so much the functionary as the
function. The question
is whether the task itself is administrative
in nature or not. It may well be that some acts of a legislature or
the executive
may constitute 'administrative action' within the
contemplation of PAJA. The focus of the enquiry as to whether conduct
is 'administrative
action' is not on the arm of government to which
the relevant actor belongs, but on the nature of the power that is
exercised.
See President of the Republic of South Africa and Others v
SARFU and Others supra.
[16] The legislative and executive
authority of a municipality is, in terms of section 151(2) of the
Constitution, vested in its
Municipal Council. Legislative powers are
concerned with the making of or the power to make laws which is the
prerogative of elected,
deliberative bodies such as parliament and
municipal councils. I am satisfied that by its nature, council’s
decision to determine
the price of the property is not action taken
to make legislation and it can therefore not qualify under the
exclusionary provisions
of section 1 (dd) of PAJA.
[17] In addition to section 151(2) of
the Constitution, section 11(3) of the Municipal Systems Act 32 of
2000, for our current purposes,
provides that a municipality
exercises its legislative or executive authority by promoting and
undertaking development; implementing
applicable national and
provincial legislation and its by-laws; and doing anything else
within its legislative and executive competence.
[18] Section 77 of the Free State Local
Government Ordinance 8 of 1962 provides that a council may sell, let
or in any other manner
alienate immovable property vested in it or
rights in respect of such property. Section 11(3) of the Municipal
Systems Act, in
turn defines the implementation of applicable
provincial legislation, as an executive exercise of the authority of
a municipality.
The sale or alienation of immovable property can
therefore be classified under a municipality’s executive
exercise of authority
insofar as in doing so it acts in terms of
section 77 of the Free State Local Government Ordinance 8 of 1962.
[19] In Diggers Development (Pty) Ltd v
City of Matlosana 2010 JDR 0214 (GNP) Murphy J held at para 39 that:
‘When a council passes a
resolution, by a majority of the members present, adopting or
ratifying conduct of the municipal
manager, it does not act
legislatively. The action is akin to a board of directors ratifying
the actions of its CEO. In such circumstances
the council acts
executively. In this case the municipal manager was authorised by
means of a standing resolution to execute any
sale which the Council
was legally authorised to conclude. His role was to act in concert
with the Council acting executively.
In the result, the sale of land
between the second and first respondents would seem to be either an
exercise of the executive powers
or the performance of an executive
function of the Council and hence would be excluded from review under
PAJA’. (My emphasis)
[20] In Steele v South Peninsula
Municipal Council
2001 (3) SA 640
(C) the court did not consider the
resolution of the council to remove speed bumps to be categorised as
administrative action as
council passed a resolution pursuant to its
statutory obligation to see to traffic control and road safety within
its area of jurisdiction.
The court stated at 644 C – E that
the council resolution was carried by a majority and it was not a
decision taken by a
functionary who could be expected to furnish
reasons. It was a decision taken by a politically elected
deliberative assembly whose
individual members could not be asked to
give reasons for the manner in which they had voted.
[21] In Mazibuko and Others v City of
Johannesburg and Others
2010 (4) SA 1
(CC), O’ Regan J held
that the decision in issue was authorised by a resolution of the City
Council after receiving full
proposals. A municipal council is a
deliberative body which exercises both legislative and executive
functions. Where a decision
is taken by a municipal council in
pursuance of its legislative and executive functions, that decision
will not ordinarily be administrative
in character. This principle,
she concluded, is recognised in paras (cc) and (dd) of the definition
of 'administrative action'
contained in section 1 of PAJA, which
expressly excludes the executive or legislative powers or functions
of a municipal council.
[22] Reverting to the issue at hand, it
is common cause between the parties that prior to council’s
determination of the selling
price of the land, its Head of Corporate
Services, WH Boshoff, sought a valuation of the property. Upon
receipt of the valuation
report, a recommendation, by the executive
head of the respondent, the City Manager Ms S Mazibuko, to accept the
valuation was
placed before council together with a report compiled
by Mr Boshoff. The record reflects that the council deliberated on
the report
with some members of the opposition party having made
objections to the lack of certain information which was not placed
before
council. A resolution was however taken to sell the land to
the applicant at R 54 million with a majority vote.
[23] The deliberations in casu took
place in the assembly and in public where the members articulated
their own views on the subject
of the proposed resolution. Each
member was entitled to his or her own reasons for having voted for or
against the resolution and
was entitled to do so. It was for the
members, and not the Court, to decide what was relevant in the
circumstances depending on
the interpretation they accorded to the
court order in question. It is of importance to note that members of
the opposition party
raised their objections with regard to the
issues at hand, these were deliberated upon and the matter was put to
a vote. This decision
was taken by council in pursuance of its
executive functions and can thus not be classified as administrative.
[24] The respondent, in spite of being
a public body having derived its powers to alienate the property from
statute, to the contrary,
derived its power to revise or determine
the price after expiry of the 12 month period, from the 1999
resolution. The decision
taken by first respondent, although that of
a public body, was taken in a private law sphere wherein the seller
made the merx available
to the purchaser in return for the payment of
a specified price.
[25] Counsel for respondents argued, in
my view persuasively so, that if one considers that the
implementation of a law by a functionary
is one of the
characteristics of an administrative action, the respondents in casu
were directed by an order of court to pass a
resolution to alienate
the property to the applicant and to determine the selling price, and
in so doing, they were not performing
an administrative action that
is susceptible to review under PAJA. If applicant was of the view
that the respondent failed to adhere
to the court order, contempt of
court and not review proceedings would have been proper.
[26] After having considered the
factors above, we conclude that the determination or revision of the
selling price of the piece
of land in question was not an
administrative action.
[27] For the reasons that will appear
hereunder, I do not deem it necessary to deal with the issue of lis
alibi pendens that was
raised by the respondents.
[28] Respondents’ decision is
however not exempt from judicial review in spite of it not being
classified as administrative
action. The fundamental principle,
ordinarily referred to as the principle of legality, is that the
exercise of all public power
is only legitimate when lawful (see
Fedsure Life Assurance Ltd supra at para 56). The principle of
legality not only requires that
the decision must satisfy all legal
requirements but it also means that the decision should not be
arbitrary. Such a decision should
be rationally related to the
purpose for which the power was given. The question whether a
decision is rationally related to the
purpose for which the power was
given, calls for an objective enquiry. See Pharmaceutical
Manufacturers of South Africa: In re
ex parte President of the RSA
[2000] ZACC 1
;
2000 (2) SA 674
(CC) at para 85 and 86.
[29] Applicant contends in the main
that insufficient information was placed before the council members
to perform their duties
properly as the 1999 resolution, and the
court order dated 29 March 2007, were not provided to councillors
before they could vote.
The significance of the 1999 resolution to
applicant can be gleaned from the first and second prayers of its
notice of motion wherein
it seeks an order compelling respondents to
reconsider the selling price of the land on the basis of the same
information on which
the property was valued at R 7000 per hectare
and therefore below market value.
[30] The relevant part of the 1999
resolution provided as follows:
‘(a) that subdivision 321 of 238
of the farm Bloemfontein 654, 90,1547 ha in extent be alienated to
Messrs Ya Rona Development
to be developed as proposed;
(g) that the selling price of the land
be determined at R7 000, 00 per hectare plus VAT and that if the land
is not taken up within
twelve months from the date of allocation, the
selling price be revised’
[31] The court order dated13 June 2013
directed council to pass a resolution to alienate the property to the
applicant in accordance
with this resolution and in accordance with
the court order under case number 5074/2006 of 29 March 2007. The
latter order was
in essence a duplication of the 1999 resolution.
[32] Applicant argues that the
valuation of the property in terms of the current market value is in
conflict with the 1999 resolution
as well as the latest court order.
It further contends that the court order directed the first
respondent to alienate the property
and determine the selling price
on the basis of the same information as in 1999. Respondents
conversely correctly argue that the
1999 resolution conferred upon
the first respondent the right to revise the price should the land
not be taken up within 12 months
of its allocation. In determining
such revised price, it was incumbent to offer the land to applicant
at market value as prescribed
by the provisions of section 14 of the
Municipal Finance Management Act 56 of 2003 (“MFMA”).
This legislation came
into operation on 1 July 2004 and provides as
follows:
‘14. Disposal of capital
assets.—(1) A municipality may not transfer ownership as a
result of a sale or other transaction
or otherwise permanently
dispose of a capital asset needed to provide the minimum level of
basic municipal services.
(2) A municipality may transfer
ownership or otherwise dispose of a capital asset other than one
contemplated in subsection (1),
but only after the municipal council,
in a meeting open to the public—
(a) has decided on reasonable grounds
that the asset is not needed to provide the minimum level of basic
municipal services; and
(b) has considered the fair market
value of the asset and the economic and community value to be
received in exchange for the asset.
(3) A decision by a municipal council
that a specific capital asset is not needed to provide the minimum
level of basic municipal
services, may not be reversed by the
municipality after that asset has been sold, transferred or otherwise
disposed of.
(4) A municipal council may delegate
to the accounting officer of the municipality its power to make the
determinations referred
to in subsection (2) (a) and (b) in respect
of movable capital assets below a value determined by the council.
(5) Any transfer of ownership of a
capital asset in terms of subsection (2) or (4) must be fair,
equitable, transparent, competitive
and consistent with the supply
chain management policy which the municipality must have and maintain
in terms of section 111.
(6) This section does not apply to the
transfer of a capital asset to another municipality or to a municipal
entity or to a national
or provincial organ of state in circumstances
and in respect of categories of assets approved by the National
Treasury, provided
that such transfers are in accordance with a
prescribed framework
[33] The MFMA admittedly came into
operation after the 1999 resolution. It is however of importance to
note that the land was not
taken up within 12 months of its
allocation to the applicant and the revised price was only requested
after the coming into operation
of the MFMA. The transaction in
question was therefore not completed prior to the coming into
operation of the Act. The presumption
against the retrospective
application of statutes is trite and statutes should be considered as
affecting future matters only.
Vested rights as at the time the
statute came into operation can therefore not be taken away. A valid
agreement of sale is only
concluded when an agreement has been
reached on the merx and the price. This was not the case in casu as
the price of the land
still had to be determined. Inasmuch as the
property was allocated to the applicant prior to the coming into
operation of the Act,
the price had not yet been considered. A
distinction, as reflected in the court order, was therefore made
between the allocation
of the land and the determination of its
price. I will deal with this aspect further later herein.
[34] Returning to applicant’s
main contention, the question whether it was incumbent upon the
respondents to make the 1999
resolution available to the councilors
will largely depend on the interpretation that one will accord to the
court order dated
13 June 2013. The order is twofold. It first
compels the respondent to pass a resolution to alienate the property
in terms of the
1999 resolution to the applicant and it secondly
requires of the respondent to determine the selling price of the
land. The first
leg of the order is clearly peremptory and did not
give the respondent the option of applying the provisions of section
14(2) (a)
of the MFMA, in determining whether the asset is not needed
to provide the minimum level of basic municipal services.
[35] It appears from the record of the
council meeting held on 3 July 2013 that the issue relating to the
alienation of the land
was a non-issue and that the only aspect that
council was to consider related to the selling price of the land.
This is confirmed
by the comments of Councillor MD Sekakanyo where he
commented as follows: ‘when you look at the Court Order, the
Council
must determine the price of the property. He comments later
as follows: ‘…as we implement the court order, we are
actually not opening the process of starting afresh…’
Councillor W Horn also commented that ‘… these two
previous court orders give us the guidelines as to what can be done
in determining the purchase price. (My underlining)
[36] Applicant also placed great
reliance on the response in terms of Rule 53 by the City Manager to
questions which were raised
during the deliberations relating to the
lack of information on the 1999 resolution. Members of the opposition
were therefore evidently
of the view that the history of the matter
and more importantly the 1999 resolution, had to be considered in
determining the selling
price. The majority party was of the contrary
view that the market value of the property had to be the decisive
factor.
[37] It remains to be determined
whether the 1999 resolution was a relevant consideration in
determining the selling price of the
land and whether the respondent
‘applied its mind to the matter’ by having ignored same.
In applying its mind to the
matter, the council was essentially
expected to consider all ‘relevant information’ in
determining the selling price
as ordered.
[38] The court order should be properly
understood as referring to the 1999 resolution in its entirety
inclusive of the proviso
that the applicant had 12 months to take up
the land and in case such allocation was not taken up, the respondent
had the right
to revise the price. This order, contrary to the
contention by applicant, makes no mention of the ‘determination
of the price
in accordance with the 1999 resolution’. All that
the order provides for is the allocation of the land in accordance
with
the 1999 resolution and the determination of the price. The fact
that the land was to be allocated to the applicant therefore ensured
that the applicant, and no one else, was to be given the first option
to purchase. First respondent has in fact, since 2007, always
been
prepared to offer or allocate the land, contrary to the MFMA, to the
applicant. This allocation was according to the respondents
subject
to a market related price. Logic dictates that in case the price was
not suitable to the applicant, there would resultantly
be no
enforceable agreement between the parties.
[39] In disposing capital assets,
section 14(2) (b) of the MFMA enjoined the respondents to consider
the fair market value of the
asset. As indicated earlier in this
judgment, the contract of sale between the parties was dependent upon
the determination or
revision of the selling price. The only
obligation that the court order created was for the first respondent
to offer the property
to the applicant in terms of the 1999
resolution. This obligation could however not be extended so as to
oblige the first respondent
to determine the price on the same facts
that were at its disposal in 1999 or as turning the clock back to the
date when the property
was first allocated to the applicant in 1999.
The preceding is apparent ex facie the order that the first
respondent determine
the selling price. Council had a free hand in
determining the price because it was entitled to revise the same in
line with the
proviso to the offer made in 1999 and the relevant
court order does not prescribe how the price is to be determined. The
favourable
give away price and all the considerations that motivated
it went out of the window when the proviso kicked in leaving the
first
respondent to look to, inter alia, market forces for guidance.
[40] As pointed out above and contrary
to applicant’s interpretation, the court order did not specify
how the respondents
were to go about determining the price. The
councillors who objected to the determination of the price during the
council meeting
appear to have languished under the same misguided
interpretation of the court order. The determination of such a price
fell squarely
within the first respondent’s discretion. It was
therefore not incumbent on respondent to consider the same factors as
in
1999, because it had made the allocation subject to the condition
that the land be taken up within 12 months and if not, the price
could be revised. Section 14(2) (b) of the MFMA could therefore not
simply be ignored in revising or determining such a price.
The first
respondent, in my view, therefore acted within the ambit of the law
and it cannot be said that its conduct was arbitrary
or unreasonable
and therefore unlawful.
[41] I am under these circumstances
unpersuaded that the absence of the 1999 resolution and the court
order dated 29 March 2007,
at the relevant council sitting, rendered
the first respondent’s decision unlawful and ,therefore,
reviewable. First respondent
was obligated by the MFMA to sell the
land at a fair market value and for this purpose, it deemed it
adequate to obtain a valuation
report. Applicant’s contention
that the instruction given to the valuator to appraise the property
at market value, contrary
to the court order dated 13 June 2013 can,
on the same reasons as advanced above, also not be sustained.
[42] The attack on the alleged flaws in
the valuation report is in my view misplaced. Applicant sought a
review, according to its
notice of motion, for reconsideration of the
selling price in terms of the factors that were at first respondent’s
disposal
in 1999. In valuing the land, the Valuator took a variety of
current factors into account. These were amongst others that the land
was vacant with no services, the potential thereof and comparable
sales in the vicinity. All relevant information, the lapse of
time
and locality of sales were duly considered. The report further
concluded that agents and other valuers were of the opinion
that the
current unit price of such property ranges between R50 to R200 per
square meter in the open market. The property was valued
at the lower
end of the square meter pricing at R60 per square meter thus at R54
million.
[43] Applicant further felt aggrieved
by first respondent’s initial failure to provide it with the
record of the council meeting
and also had misgivings about the
record that was ultimately provided. The record that was provided to
applicant allegedly ran
into hundreds of pages and no trace of the
impugned resolution could be found. This conduct by respondents
should be frowned upon.
It is however not in dispute that applicant
managed to retrieve the relevant minutes of the council meeting
wherein the price
determination was made. This complaint therefore
becomes stale and need not be dealt with any further.
[44] I will therefore propose that the
following order be made:
1. The application is dismissed with
costs.
L.B.J. MOENG, AJ
I concur, and it is so ordered.
L.J LEKALE, J
On behalf of the applicant: Adv. VP
NGUTSHANE
Instructed by: SR MABUZA Inc.
MIDRAND
On behalf of the respondents: Adv.
AT NCONGWANE SC
Instructed by: MOROKA ATTORNEYS
BLOEMFONTEIN