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[2015] ZAFSHC 129
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Matjhabeng Local Municipality v Eskom Holdings Soc Ltd and Others (924/2013) [2015] ZAFSHC 129 (26 June 2015)
IN
THE HIGH COURT OF SOUTH AFRICA
FREE
STATE DIVISION, BLOEMFONTEIN
Case
No : 924/2013
In
the matter between:-
MATJHABENG
LOCAL
MUNICIPALITY
Applicant
and
ESKOM
HOLDINGS SOC
LTD
1
st
Respondent
MEMBER
OF THE EXECUTIVE COUNCIL,
LOCAL
GOVERNMENT, FREE STATE
PROVINCIAL
GOVERNMENT
2
nd
Respondent
NATIONAL
ENERGY REGULATOR OF SA
3
rd
Respondent
NATIONAL
MINISTER OF MINERALS &
ENERGY
4
th
Respondent
THE
MINISTER OF PROVINCIAL & LOCAL
GOVERNMENT,
RSA
5
th
Respondent
JUDGMENT
BY:
DAFFUE,
J
DELIVERED
ON:
26
JUNE 2015
[1]
This is an application by Matjhabeng Local Municipality, the
applicant, for leave to appeal my judgment of 19 February 2015.
Although several respondents have been cited in the main application,
second to fifth respondents gave notice to abide the judgment
of the
court. Eskom Holdings Soc Ltd, cited as first respondent, was
the only respondent who filed papers in the main application.
It opposes the application for leave to appeal. I shall refer
to Eskom later herein as respondent only.
[2]
The application is based on substantive and procedural grounds of
appeal and it is also alleged by applicant that procedural
irregularities have taken place. I shall deal with the grounds
and submissions in more detail later.
[3]
In accordance with rule of practice 16(5) of this division the
parties agreed that the application for leave to appeal could
be
adjudicated in chambers on receipt of their heads of argument.
The heads of argument have been filed and considered.
[4]
A distinguishing feature of this application is the filing of an
affidavit by the applicant’s municipal manager, Mr Mothusi
Frank Lepheana (“Lepheana”) which is referred to as an
explanatory affidavit and which is appended to the application
for
leave to appeal. Annexed to this affidavit is a draft affidavit
which was allegedly prepared by senior counsel in Johannesburg.
It was intended that the draft affidavit would be deposed to by
Lepheana to serve as applicant’s reasons in response to Kruger
J’s directions in the court order of 18 September 2014.
[5]
Messrs Moroka Attorneys, the attorneys who appeared for applicant at
all relevant times in the main application proceedings,
are not the
applicant’s attorneys of record any more. Their mandate
has been terminated following my order of 19 February
2015.
[6]
Mr Malgas, (“Malgas”) the attorney at Moroka Attorneys
directly involved in the litigation, deemed it fit to file
an
explanatory affidavit in response to the explanatory affidavit of
Lepheana referred to above. In this affidavit Malgas
disputes
several material allegations contained in Lepheana’s
affidavit. I am requested by applicant
“…
to
accept that the draft affidavit prepared by senior counsel attached
hereto marked “B”, be accepted for purposes of
the
adjudication of the appeal, or that upon the consideration of the
appeal, if the matter is remitted back to the Court a quo,
that the
Court a quo should give direction for the filing of proper
affidavits.”
[7]
I do not deem it necessary to refer in any detail to the draft
affidavit, but merely wish to state that even in this document
Lepheana failed to report why applicant had not provided all the
information required in paragraph 2 of the order of 31 July 2014
and
why he had not reported to the court the reasons for failure to pay
the current account for August 2014 in full. More
importantly,
he failed to disclose the details required in paragraph 7 of the
order of 31 July 2014 which reads as follows:
“
The
applicant to disclose to the first respondent and the above
Honourable Court the status of money collected from end users, in
lieu of electricity usage, from June 2013 to present, and what it has
been utilised for before on 6 August 2014.”
It
is clear from a reading of paragraph 4 of the court order of 18
September 2014 that Lepheana (as the acting municipal manager
at the
time) was called upon to give reasons why there was non-compliance
with the court order of 31 July 2014 and special reference
was made
to the directions contained in paragraphs 4(a) – (d).
Paragraph 4(d) called upon the municipal manager (Lepheana)
to
advance reasons why he should not be held in contempt of court for
non-compliance with the order of 31 July 2014. The
issue was
set out in more detail in paragraph 5 in that the municipal manager
was called upon to give his reasons in the form of
an affidavit
before a certain date and to be present in person at court on 6
November 2014.
[8]
In the light of the contradictory versions of Lepheane and Malgas,
and in view of the fact that adv Louw, who was applicant’s
counsel throughout the main proceedings and the person who drafted
Lepheane’s “reasons” placed before court,
appeared
for applicant on 6 November 2014 in accordance with the order of 18
September 2014 and Lepheana’s own appearance
that day, I am not
prepared to accede to applicant’s request that the draft
affidavit be accepted for purposes of adjudication
of the application
for leave to appeal. It must also be noted that unlike
Lepheana’s version now placed before me,
he had ample time to
peruse and consider the affidavit sent to him by e-mail and even made
corrections thereto before he deposed
to it and dispatched same to
the attorneys. This is apparent from the founding affidavit in
support of an application for
condonation which he deposed to two
days later, i.e. on 17 October 2014.
[9]
In several of the grounds of appeal and as argued by applicant’s
counsel reliance is placed on the fact that I misdirected
myself in
so far as Lepheane was not cited as a party to the proceedings, the
application papers were not served on him personally
and that he was
also not served with a court order. Mr Louw conceded that the
first two requisites to prove contempt of court
have been met, i.e.
the granting of the orders of 31 July 2014 and 18 September 2014 and
secondly that Lepheane was fully aware
of both orders which were
granted by agreement between the parties. The fact that service
of the orders was not effected
on Lepheane as municipal manager, is
really immaterial in the circumstances. The orders were granted
by agreement.
[10]
Although Leheana relied on vague and general averments, there is also
no doubt that there was a failure to give reasons for
the
non-compliance with paragraphs 2, 4 and 7 of the order of 31 July
2014. The third requirement for contempt has been met.
The only issue is whether Lepheana has satisfied the evidential
burden in relation to wilfulness and
mala
fides
,
to which I shall return.
[11]
It is also alleged that I misdirected myself and that Lepheane’s
right to a fair trial has been violated. In particular,
it is
alleged that he was ambushed in so far as he was subjected without
warning to examination and even cross-examination.
It should be
record that Kruger J made an order that the municipal manager had to
attend the court proceedings on 6 November 2014
personally.
Having perused the affidavits of both parties prior to the hearing of
the application, it struck me that Lepheana
did not respond fully and
the purpose of calling him to the witness box for examination was in
an effort to obtain more detail.
The finding of
mala
fides
and wilfulness was in fact made based on his explanatory affidavit
and his failure to state categorically why he did not comply
with the
aforesaid two orders. His oral evidence did not take the matter
any further.
[12]
I am criticised for convicting Lepheana for contempt of court in the
absence of a substantive application by respondent.
There was
no objection to the approach adopted and no word of objection was
raised even in the draft affidavit prepared by senior
counsel.
The order of 18 September 2014 has never been set aside and no appeal
in respect of that order is pending.
In fact, that order was by
agreement.
[13]
Organs of State act through public servants and
in casu
the
municipal manager is the accounting officer of the applicant.
Organs of State and public officials, like all citizens,
must abide
by court orders. I have referred to several authorities in my
judgment. See also
Pheko and Others v Ekurhuleni
Metropolitan Municipality (no 2)
[2015] ZACC 10
at para
[25]
and further. The full bench of the Gauteng North High Court
expressed itself as follows in para [37.2] of the fresh out of
the
oven judgment of
The Southern Africa Litigation Centre v The
Minister of Justice and Constitutional Development
, case no
27740/2015 delivered on 24 June 2015:
“
A democratic
State based on the rule of law cannot exist or function, if the
government ignores its constitutional obligations and
fails to abide
by Court orders. A Court is the guardian of justice, the corner-stone
of a democratic system based on the rule of
law. If the State, an
organ of State or State official does not abide by Court orders, the
democratic edifice will crumble stone-by-stone
until it collapses and
chaos ensues.”
[14]
I am satisfied that there is no reasonable possibility that another
court may find that either a substantive contempt of court
application should have been brought
in
casu
,
incurring further costs and more so, that the municipal manager had
to be cited as respondent in such application, given the fact
that he
was directed by an order of court to provide reasons under oath.
The authorities are clear and that is that in the
event of complaints
of contempt of court, proceedings may be proceeded with against the
functionary or functionaries responsible
for ensuring compliance with
the court order. When such functionary or functionaries are
specifically identified and directed
in an order of court to do
something or to refrain from acting in a specific manner, there is no
reason to insist on a separate
and new application for institution of
contempt proceedings, or to join the recalcitrant functionary in the
pending application.
In
Pheko and Others
loc
cit
the applicants intended to join the municipal manager and executive
mayor of the municipality in a matter where the municipality
was
ordered to comply with court orders, but refrained to do so. No
functionary was cited at all. It was not necessary
to consider
the joinder application as the Court found that the municipality was
not in contempt of court.
[15]
Many references in the application for leave to appeal as well as in
applicant’s heads of argument are found to the effect
that I
misdirected myself in convicting Lepheane of contempt of court in
respect of the monetary debts of applicant. I have
made it
clear that the conviction of contempt of court had nothing to do with
the fact that applicant as judgment debtor did not
or could not pay
the judgment debt. I refer
inter
alia
to
paragraphs 40, 41, 43, 45 and 46 of my judgment.
[16]
The application for leave to appeal is also directed at the setting
of a time table for applicant to pay its outstanding debt
to Eskom in
monthly instalments, the last payment to be made at the end of
September 2015. The order of Kruger J dated 18
September 2014
is in essence a structural interdict and although judgment was
granted by agreement against applicant for payment
of the sum of
R371 908,24 to Eskom, the court directed applicant as
represented by the municipal manager in paragraph 4(c)
to provide
reasons why the judgment debt should not be payable on or before 31
March 2015. Bearing in mind the payment plan
adopted by
applicant’s council and the representations by Adv. Louw on
behalf of applicant as well as the facts set out in
the explaining
affidavit of Lepheana concerning serious financial constraints, I was
prepared to allow applicant to pay the outstanding
debt in respect of
arrears in eight instalments from February 2015 to September 2015.
This is in essence what applicant sought:
an opportunity to pay the
debt in instalments with a final payment on 30 September 2015.
In my view there is no reasonable
possibility that another court may
find that I misdirected myself in this regard, but even if that might
be case, no appeal in
this regard will have any practical effect in
that the judgment granted by Kruger J would still stand.
[17]
It is furthermore alleged that a misdirection has been committed in
so far as the applicant was directed to pay the future
monthly
accounts for electricity supply by Eskom in full on due date.
This order is in line with paragraph 4 of the order
of 31 July 2014
agreed to by the parties read with paragraph 4(a) of the order of 18
September 2014. Even if my order could
be set aside on appeal,
it would be of no practical value as the order of 31 July 2014 will
still stand and has to be obeyed.
However and as mentioned, my
order is merely a confirmation of an agreement entered into between
the parties and which was made
an order of court earlier.
[18]
I am also satisfied that the costs order was fully justified and that
there is no reasonable possibility that another court
may interfere
with that order if the history between the parties and applicant’s
failures are considered.
[19]
In so far as my orders granted on 19 February 2015 are modifications
of the structural interdict issued by Kruger J, and bearing
in mind
applicant’s continued responsibility to comply with such
interdict, it was considered fair to include paragraph 6
in the order
to allow anyone of the parties the right to enrol the application
with 14 days written notification to the other party
and if this is
not done, for the application to be postponed to 8 October 2015, a
date after the final payment is supposed to be
made. In view of
the purpose of structural interdicts, I am of the view that there is
no reasonable possibility that another
count may intervene with such
order
[20]
Consequently the application for leave to appeal is dismissed with
costs, such costs to include the costs of two counsel.
______________
J.
P. DAFFUE, J
On
behalf of applicant: Adv. W. R. Mokhari SC
with
A. E. Ayayee
Instructed
by:
Rampai
Attorneys
BLOEMFONTEIN
On
behalf of respondent: Adv. M. G. Khoza SC
with
N. Moloto
Instructed
by:
Phatsoane
Henney Inc.
BLOEMFONTEIN
/eb