CONSTITUTIONAL COURT OF SOUTH AFRICA
Case CCT 228/22
In the matter between:
CITY OF EKURHULENI METROPOLITAN
MUNICIPALITY Applicant
In re:
UNLAWFUL OCCUPIERS: 1 ARGYL STREET First Applicants
UNLAWFUL OCCUPIERS: 193 PRESIDENT STREET Second Applicants
UNLAWFUL OCCUPIERS: 214 MEYER DRIVE Third Applicants
UNLAWFUL OCCUPIERS: 146 MEYER DRIVE Fourth Applicants
UNLAWFUL OCCUPIERS: 117 JOUBERT STREET Fifth Applicants
UNLAWFUL OCCUPIERS: 180 MEYER STREET Sixth Applicants
UNLAWFUL OCCUPIERS: 12 KNOX STREET Seventh Applicants
UNLAWFUL OCCUPIERS: 70 PRESIDENT STREET Eighth Applicants
UNLAWFUL OCCUPIERS: 103 KNOX STREET Ninth Applicants
UNLAWFUL OCCUPIERS: 1 GRAVETT STREET Tenth Applicants
UNLAWFUL OCCUPIERS: 43 SPILBURY STREET Eleventh Applicants
UNLAWFUL OCCUPIERS: 53 END STREET Twelfth Applicants
UNLAWFUL OCCUPIERS: STIRLING COURT Thirteenth Applicant
2
UNLAWFUL OCCUPIERS: 27 POWER STREET Fourteenth Applicants
UNLAWFUL OCCUPIERS: UNITED BUILDING Fifteenth Applicants
UNLAWFUL OCCUPIERS: FRIMIDA COURT Sixteenth Applicants
and
ROHLANDT HOLDINGS CC First Respondent
42 POWER STREET PROPERTIES CC Second Respondent
LANRON PROPERTIES Third Respondent
RICHMOND INVESTMENTS CC Fourth Respondent
GERMISTON CENTRAL REAL ESTATE CC Fifth Respondent
LIMA JOSE MANUEL MONTEIRO Sixth Respondent
EKURHULENI METROPOLITAN MUNICIPALITY Seventh Respondent
MEMBER OF THE EXECUTIVE COUNCIL FOR
DEPARTMENT OF HUMAN SETTLEMENTS,
GAUTENG PROVINCE Eighth Respondent
SHERIFF OF THE HIGH COURT:
GERMISTON SOUTH Ninth Respondent
WAVERLEY COURT CC Tenth Respondent
Neutral citation: City of Ekurhuleni Metropolitan Municipality In re: Unlawful
Occupiers 1 Argyl Street and Others v Rohlandt Holdings CC and
Others [2024] ZACC 10
Coram: Zondo CJ, Chaskalson AJ, Dodson AJ, Kollapen J, Mathopo J,
Rogers J, Schippers AJ and Tshiqi J
Judgments: Dodson AJ (unanimous)
Heard on: 23 November 2023
Decided on: 31 May 2024
3
Summary: Condonation — late filing of application for leave to appeal, record
and written submissions — lengthy delay in filing of record
criticised — importance of issues raised and public interest
justifying airing of dispute and granting of condonation
Consent order — order recording settlement reached between
parties — requirements for grant of such order — order related to
lis between parties — consistent with Constitution, law and public
policy – holding some practical or legitimate advantage for parties
Consent order — non-compliance with requirements for grant of
such order — consent order unrelated to lis, inconsistent with
Constitution, Local Government: Municipal Structures Act 117 of
1998 and Local Government Ordinance 17 of 1939 and holding no
practical or legitimate advantage — attorney lacking authority to
consent to order
Rescission of consent order — delay in seeking — requirements
for grant of rescission at common law — residual discretion to
refuse
Costs — unsatisfactorily explained delays — costs not following
suit
ORDER
On appeal from the High Court of South Africa, Gauteng Division, Johannesburg
(Van Der Merwe AJ):
1. Condonation is granted for the late filing of the application for leave to
appeal, the record and the applicant’s written submissions.
2. The application for leave to appeal is granted.
3. The appeal is upheld.
4. The order of the High Court of South Africa , Gauteng Division,
Johannesburg dated 19 August 2021 is set aside and substituted with the
following order:
4
“(a) The application for rescission of the order of Lamont J dated
12 February 2020 is granted.
(b) Each party must bear its own costs.”
5. The matter is remitted to the High Court of South Africa , Gauteng
Division, Johannesburg for the further conduct of the proceedings under
case numbers 40089/2017, 43010/2017 and 7583/2019.
6. Each party must bear its own costs in this Court and in the Supreme Court
of Appeal.
JUDGMENT
DODSON AJ (Zondo CJ, Chaskalson AJ, Kollapen J, Mathopo J, Rogers J, Schippers
AJ and Tshiqi J concurring):
Introduction
[1] This is an application for leave to appeal against a decision of the High Court of
South Africa, Gauteng Division, Johannesburg (High Court), refusing the rescission of
an order granted by consent on 12 February 2020 (consent order). The effect of the
consent order was, amongst other things, to compel the applicant ,
the City of Ekurhuleni Metropolitan Municipality (City), to purchase a number of
properties on which ther e are residential buildings that are occupied unlawfully (the
properties). The City contends that rescission of the consent order ought to have been
granted because, amongst other things, its attorney lacked the authority to consent to
the order and the r equirements laid down by this Court in Eke1 for a court to make a
settlement agreement an order of court were not fulfilled. The owners of the properties
oppose the application and seek to defend the High Court judgment refusing rescission.
1 Eke v Parsons [2015] ZACC 30; 2015 (11) BCLR 1319 (CC); 2016 (3) SA 37 (CC) (Eke).
DODSON AJ
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[2] The participating parties in the present application are the City, as applicant, and
the owners of the properties, as the first to sixth and tenth respondents (owners). The
persons unlawfully occupying the residential buildings ( occupiers) were the first to
sixteenth applicants in the application to stay two eviction orders, which are discussed
more fully below. The occupiers did not participate in the application before this Court.
Nor did the eighth and ninth respondents, the Member of the Executive Council for
Human Settlements, Gauteng Province (MEC) and the Sheriff for Germiston South.
Background
[3] During October and November 2017, 16 buildings privately owned by the
owners were unlawfully occupied. The circumstances under which this took place are
unclear, but it does not seem disputed that occupation was taken with physical violence
against person and property. The current situation in the properties is similarly unclear.
A letter from the occupiers’ attorney to the MEC on 7 February 2019 refers to there
being more than a thousand families in occupation.
[4] The properties are within the City’s area of jurisdiction. In two separate
applications, the owners applied to the H igh Court for the urgent eviction of the
occupiers in terms of section 5 of the Prevention of Illegal Eviction from and Unlawful
Occupation of Land Act 2 (PIE). Rules nisi3 were issued in each of the applications
directing the occupiers to show cause why final eviction orders should not be granted.
The applications were consolidated.
[5] The rules nisi were extended while, in terms of further orders by the High Court,
the MEC and the executive mayor were joined, certain officials were required to appear
before the Court, a report was provided on the availability of alternative accommodation
and, in terms of an order made on 10 July 2018, the parties were directed to “engage
2 19 of 1998.
3 A rule nisi is an order that calls on a party subject to it to come to court and explain why a particular order should
not be made against them. See also National Director of Public Prosecutions v Mohamed N.O. [2003] ZACC 4;
2003 (4) SA 1 (CC); 2003 (5) BCLR 476 (CC) at paras 28-9.
DODSON AJ
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meaningfully . . . in regard to the purchase of the properties and or [alternative]
housing” (engagement order). The precise circumstances in which the engagement
order was made are not explained. But the presiding Judge must have envisaged the
possibility that the buildings might be purchased by the City to fulfil its duty to provide
the occupiers with emergency accommodation. This would have averted the need to
evict them, while at the same time compensating the owners for the loss of occupation
of their properties.
[6] On 20 July 2018, the owners’ counsel called the City’s attorney, Mr Maluleke,
to complain about the City’s failure to comply with the court orders, particularly, the
engagement order. On 24 July 2018, Mr Maluleke addressed a letter to the own ers’
attorneys saying that he had met with his client the previous day and his client’s
instructions were that any purchase of the properties by the City would require a report
to, and resolution of, the council, along with permission from the “Provincial office”,4
“in line with the relevant legislation”. According to the owners, the “stumbling block”
in negotiations over the acquisition of the properties at that time was the price.
[7] On 2 October 2018, after these developments had been brought to the atten tion
of the Judge presiding in the matters, Victor J, she granted eviction orders against the
occupiers in both matters. The orders required vacation of the properties on
22 February 2019. The orders did not require the City or the MEC to provide alternative
accommodation.
[8] On 21 February 2019, the attorney for the occupiers addressed a letter to the
other parties indicating that his letter to the MEC regarding alternative housing had met
with no response. The letter pointed out that execution of the evi ction orders would
render “thousands of occupiers homeless and destitute”. The letter conveyed their
instructions urgently to seek a stay of the execution of the eviction orders.
4 What this referred to is discussed in [69] below.
DODSON AJ
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[9] On 28 February 2019, the occupiers launched an urgent application for a stay of
the eviction orders pending the provision of alternative accommodation by the City and
the MEC. The launch of the stay application appears to have stalled the execution of
the eviction orders. On 23 May 2019, the owners “counter -applied” for relief against
the City and the MEC, conditional upon the stay order being granted. The relief
included constitutional damages and a declarator that the City and the MEC’s failure to
provide alternative accommodation resulted in breach es of the owners’ rights un der
sections 7(2), 9(1) and (2) and 25(1) of the Constitution.
[10] The subsequent delay from 23 May 2019 is not explained by either side. It
appears that the stay application was then set down for hearing on 12 February 2020.
At court on that day, the parties negotiated with each other. Mr Maluleke purported to
represent the City. He was, say the respondents, accompanied by a female official of
the City from whom he took instructions. The parties were able to settle the matter on
the basis of an agreement “encapsulated into an appropriate draft order”. The draft
order was not signed by any of the parties. On the same day, Lamont J made the draft
an order of court. The consent order provides—
(a) that the City “is ordered to purchase” the properties;
(b) for the determination of the value of the properties in terms of
section 12(1) of the Expropriation Act 5 by agreement or, failing that, by
the Court;
(c) for the write off of arrear rates and service charges in respect of the
properties with effect from October 2017, when the buildings were first
unlawfully occupied;
(d) for the disputed rates and service charges from before October 2017 to be
determined either by agreement or “by court”, and then to be “taken into
account in the determination of the purchase price”;
(e) that the owners’ claims for loss of income will be determined by
agreement or, failing that, by the court;
5 63 of 1975.
DODSON AJ
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(f) that the MEC is required to make the funds available to the City for the
purchase of the properties within three months, failing which the owners
may issue a warrant against the MEC for the amounts determined;
(g) that the Sheriff is authorised to sign the documentation required to effect
transfer in the event of the City failing to do so; and
(h) directing the City to bear the costs of the transfer of the properties.
[11] The City avers that it was not “fully aware” of this order at the time that it was
granted. Soon after, it says, the Covid -19 lockdown came into force. This precluded
consultation with the City’s attorney. It was only in August 2020, after it had consulted
with Mr Maluleke, and requested and received a memorandum from him on
18 August 2020, that it became fully aware of the consent order. Mr Maluleke was
instructed to obtain an opinion from counsel regarding the implications of the consent
order, the manner in which it had been obtained and whether it was competent for the
Court to have granted it. The opinion was received in the second week of
September 2020. Based on the opinion, the City now fully understood the implications
of the order. The City insisted that Mr Maluleke had no mandate to consent to the order
on the terms that he did. It therefore terminated Mr Maluleke’s mandate at the end of
September 2020 and appointed new attorneys in the first week of October 2020.
[12] The City launched i ts rescission application on 2 November 2020. In the
founding affidavit, the City averred that Mr Maluleke had no authority to bind the City
to the consent order; that the order purported to dispose of disputes about rates and
service charges in respect of the properties when those disputes were not before the
Court; that it introduced the Expropriation Act when it was not relevant ; and that it
failed to settle the dispute that was before the Court, namely the stay application. The
consent order therefore stood to be rescinded in terms of the common law.6
6 The City pleaded in its founding affidavit that rescission should be granted “on the common law principle in that
the parties . . . were in a common justus error and . . . there are sufficient grounds for the Court Order to be
rescinded under the justa causa [justifiable mistake].”
DODSON AJ
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Litigation history
[13] The application for rescission failed before the High Court. On the question of
the attorney’s alleged lack of a mandate, the High Court applied Kruizenga.7 There, the
Supreme Court of Appeal said, with reference to an attorney’s actual authority, that—
“Attorneys generally do not have implied authority to settle or compromise a claim
without the consent of the client. However, the instruction to an attor ney to sue or
defend a claim may include the implied authority to do so provided the attorney acts in
good faith”.
[14] On this basis, the High Court considered that Mr Maluleke had the requisite
authority to settle the matter and had acted in good faith and i n the best interests of the
City. The Court held further that the City was estopped from denying Mr Maluleke’s
authority.
[15] As to the competency of the consent order, the High Court went on to consider
whether the three requirements in Eke were satisfied. It held that they were. The
consent order related directly and indirectly to the underlying dispute. As to consistency
with the Constitution, the law and public policy, there was no objection to an order
compelling the purchase of property because the S upreme Court of Appeal had
endorsed such an order in Coppermoon.8 Furthermore, the consent order held some
practical and legitimate advantage as there was no need for the execution of the eviction
orders, the City was absolved from having to secure alternative accommodation for the
occupiers, and it brought the litigation between the parties to an end.
7 MEC for Economic Affairs, Environment and Tourism v Kruizenga [2010] ZASCA 58; 2010 (4) SA 122 (SCA)
at para 11.
8 Coppermoon Trading 203 (Pty) Ltd v The persons whose identities are to the Applicant unknown and who
unlawfully occupy remainder Erf 149, Phillippi, Cape Town 2020 JDR 0553 (SCA) (Coppermoon).
DODSON AJ
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[16] The High Court and the Supreme Court of Appeal refused leave to appeal. The
President of the Supreme Court of Appeal also refused a request for reconsider ation in
terms of section 17(2)(f) of the Superior Courts Act.9
In this Court
Jurisdiction
[17] The matter raises at least the following constitutional issues:
(a) A consent order embodying a settlement agreement brings the legal
dispute between the parties to a close. None of the parties may further
litigate an issue resolved by the consent order. The result is that no party
may exercise any further their right under section 34 of the Constitution
to have such issues adjudicated in a fair public hearing before a court.
Where a party complains that the consent order was wrongly granted, it
asserts in effect that it has wrongly been deprived of the right to pursue
the litigation further in terms of section 34.10
(b) The City alleges that the obligation imposed on it by the consent order to
purchase the owners’ properties bypasses—
(i) the requirements for fair, equitable, transparent, competitive and
cost-effective procurement in section 217 of the Constitution; and
(ii) the requirement of a prior resolution by a municipal council before
the acquisition of immovable property that is compliant with
section 160(3)(a) and (c) of the Constitution.
(c) The City raises the issue of whether or not the consent order is compliant
with the legislation regulating the City’s acquisition of immovable
property, which raises questions pertaining to the rule of law, a founding
value in terms of section 1(c) of the Constitution.
(d) The matter also raises the question of the remedies available to the
owners, in circumstances where they were allegedly deprived of their
9 10 of 2013.
10 Eke above n 1 at paras 43-8.
DODSON AJ
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property rights under section 25(1) of the Constitution as a result of the
City’s failure to fulfil the housing rights of the occupiers in terms of
section 26 of the Constitution.
[18] This Court accordingly has jurisdiction in terms of sect ion 167(3)(b)(i) of the
Constitution. It is unnecessary to consider whether it also has jurisdiction under section
167(3)(b)(ii) of the Constitution.
Condonation
[19] The City filed every document required to be filed in its application for leave to
appeal late.
[20] The City was required to file its application for leave to appeal in this Court on
or before 5 August 2022. The application was filed on 11 August 2022. Having regard
to the intervening weekend and public holiday, the application was filed t hree court
days late. An explanation is provided by the City. The lateness arose primarily out of
the security staff at the offices of the MEC having been unwilling to accept service on
the basis that there was no one present with the authority to accept service. The attempt
at serving on the MEC was made within the required period for filing. An attempt to
serve on the MEC by email before the expiry of this period also failed, in the sense that
a delivery confirmation was generated, but a read receipt was not received from the
offices of the MEC . All other parties were timeously served with the application.
Condonation of the late launch of the application is not opposed.
[21] In terms of directions of this Court, the record was to be filed by 16 June 2023 ,
and t he City’s written submissions by 23 June 2023. A reasonable explanation is
provided for the delay in the preparation of the record, which was ultimately finalised
on 17 July 2023. However, the record could not be filed without an accompanying
condonation application for its late filing. The record along with the required
condonation application was ultimately only filed on or about 6 October 2023 and the
written submissions on 16 October 2023. The only explanation given for the delay after
DODSON AJ
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17 July 2023 is that there were “issues between the applicant’s representatives and the
applicant, which issues were only settled in the first week of October 2023.” No
explanation is provided in the relevant condonation application as to what the issues
were.
[22] In a subsequent condonation application pertaining to the City’s supplementary
written submissions, reading between the lines, there is a partial explanation for the
“issues” between the applicant and its attorneys. The head of the department
responsible for decision-making on the City’s litigation took a decision to appoint new
attorneys, presumably because of dissatisfaction with the sequence of decisions that
went against the City in the High Court and the Supreme Court of Appeal. However,
before this decision could be implemented the head of department’s contract expired.
After that , the decision to appoint new attorneys was withdrawn and the existing
attorneys were instructed to resume their mandate.
[23] The owners oppose the City’s applications to condone the late filing of the record
and the written submissions. However, they only signalled their opposition in their
written submissions. The owners did nothing about formally opposing the application.
Their excuse for not doing so is that the notice o f motion in the City’s condonation
application did not provide for the filing of an answering affidavit. This is no excuse.
It is trite that a party is entitled to file an answering affidavit in an interlocutory
application within a reasonable time, rega rdless of what the notice of motion might or
might not say. Having elected not to oppose properly, the owners’ opportunity to
articulate any prejudice they might suffer if condonation is granted, is forfeited.
[24] The City’s third condonation application rel ates to its late filing of
supplementary written submissions. Senior counsel declined the City’s brief for the
initial filing of written submissions. Subsequent to the filing of the record and written
submissions, and when the “issues” between the City a nd its attorneys had been
resolved, it seems that he was persuaded to accept the brief. Senior counsel was not
satisfied that the written submissions filed fully addressed the issues. Hence , the
DODSON AJ
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supplementary written submissions and the application to co ndone their filing. This
application is not opposed, although the owners objected to the slew of new legal points
raised. This is dealt with later in the judgment. The owners filed supplementary
submissions in response.
[25] The factors that a court will co nsider in deciding whether the grant of
condonation is in the interests of justice include—
“the nature of the relief sought; the extent and cause of the delay; the effect of the delay
on the administration of justice and other litigants; the reasonablene ss of
the explanation for the delay; the importance of the issue to be raised in the intended
appeal; and the prospects of success. It is crucial to reiterate that both Brummer11
and Van Wyk12 emphasise that the ultimate determination of what is in the interests of
justice must reflect due regard to all the relevant factors but it is not necessarily limited
to those mentioned above. The particular circumstances of each case will determine
which of these factors are relevant.”13
[26] A party seeking condonation must make out a proper case for the court’s
indulgence with reference to these criteria. The explanation for the delay must be full
and “reasonable enough to excuse the default”.14
[27] Applying these criteria, the late filing of the City’s application for leave to appeal
is explained satisfactorily. It was not due to neglect on the part of the City. The extent
of the delay was three court days, which is a short period. It is rightly not opposed and
should be condoned.
11 Brummer v Gorfil Brothers Investments (Pty) Ltd [2000] ZACC 3; 2000 (2) SA 837 (CC); 2000 (5) BCLR 465
(CC) at para 3.
12 Van Wyk v Unitas Hospital (Open Democratic Advice Centre as Am icus Curiae) [2007] ZACC 24 ; 2008 (2)
SA 472 (CC) ;2008 (4) BCLR 442 (CC) at para 20.
13 Grootboom v National Prosecuting Authority [2013] ZACC 37; 2014 (2) SA 68 (CC); 2014 (1) BCLR 65 (CC)
at para 22.
14 Id at para 23.
DODSON AJ
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[28] The filing of the supplementary written submissions was something that should
not have happened if the City was managing its litigation properly, something it bears
an enhanced duty to ensure as an organ of state. 15 This Court will not lightly entertain
such conduct, particularly from an organ of state. This Court bears a massive caseload.
Taking two attempts at written submissions to get it right adds to the Court’s burden.
Ultimately however, in this matter the Court is better off with the supplementary written
submissions given the clarity they provided. Subject to what is said below about new
legal points on appeal, any prejudice was addressed by the owners’ filing of
supplementary written submissions in reply. Condonation is therefore appropriate in
this respect.
[29] The remaining aspect is the City’s late filing of the record and the written
submissions. This is satisfactorily explained until 17 July 2023, which is a month after
the due date for the record and approximately three weeks after the written submissions
were due. Then follows a three-month delay during which all that needed to be done to
enable the filing of the record was for a condonation application to be prepared. The
explanation for this delay is wholly inadequate and opaque. The late filing of the City’s
initial written submissions was seemingly a casualty of the late filing of the record,
because the former could not precede the latter. They were filed shortly after the record.
[30] Considering the condonation criteria of the extent and cause of the de lay, the
effect of the delay on the administration of justice and other litigants , and the
reasonableness of the explanation for the delay , the City fares poorly. The delay in
filing the record was long, some four months in all. The cause is not properly explained,
but it appears to have been official dithering over replacing the City’s attorneys,
presumably for poor performance. The impact on the administration of justice caused
by such a delay is invariably negative. Justice delayed is justice denied.
15 Id at para 30. See also MEC for Health, Eastern Cape and Another v Kirland Investments (Pty) Ltd t/a Eye &
Lazer Institute [2014] ZACC 6; 2014 (3) SA 481 (CC); 2014 (5) BCLR 547 (CC) at para 82.
DODSON AJ
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[31] On the other hand, as regards the nature of the relief sought, the importance of
the issues raised and the public interest, there is much to be said for the airing of the
dispute in this Court. The remedy fashioned in the consent order was novel. It wi ll
provide helpful guidance to the courts more broadly if this Court goes some way
towards deciding whether the parties and the High Court went about it in the right way.
The situation in the owners’ residential buildings remains unresolved. There is a n eed
for certainty about the positions of the occupiers of the se buildings. They should not
be prevented from attaining greater certainty by the City’s delays in prosecuting the
application before this Court. Similarly, the interests of ratepayers are affected. It is
their rates that will ultimately pay for the substantial amount of immovable property
that the City must acquire in terms of the consent order. If the purchase required by the
consent order is unlawful, this Court should be slow to turn a blind eye to it on the basis
that the record was filed late. For reasons that will become apparent, the City’s
prospects of success are strong.
[32] For these reasons and weighing the competing considerations , the late filing of
the record and the City’s initial written submissions should also be condoned.
Nevertheless, it bears emphasis that the repeated failures to comply with the time limits
laid down in the Rules of this Court and in the directions issued by the Chief Justice
manifest disrespect towards this Court, its processes and the Chief Justice. The City
has apologised for this. Whether its apology is sincere is open to question. Sincerity
will be demonstrated by future strict compliance. The City’s conduct is also relevant to
the issue of costs, which is dealt with at the end of the judgment.
Leave to appeal
[33] As pointed out by Zondo J (as he then was) in Dengetenge16—
16 Dengetenge Holdings (Pty) Ltd v Southern Sphere Mining & Development Co Ltd [2013] ZACC 48; 2014 (5)
SA 138 (CC); 2014 (3) BCLR 265 (CC).
DODSON AJ
16
“[t]his court grants leave to appeal if it is in the interests of justice to do so. The factors
that it normally takes into account include the importance of the issues raised by the
matter, the prospects of success and the public interest.”17
[34] The matter undoubtedly raises important issues. Similar questions to those
raised in this case have arisen in earlier cases in the High Court and the
Supreme Court of Appeal.18 On a daily basis, the various divisions of the High Court
are confronted with cases raising difficult issues pertaining to the fates of both unlawful
occupiers faced with eviction and owners prevented by such occupation from exercising
their ownership rights. These are the consequences of the acute housing crisis faced in
South Africa. Any guidance that can be derived from the adjudication of this case will
be of assistance to them.
[35] The City has reasonable prospects of success. 19 As pointed out earlier, the
consent order was novel. It is in the public interest that it be decided whether the
solution it attempted was compliant with the Constitution and the law.
[36] In the c ircumstances, it is in the interests of justice that leave to appeal be
granted.
Submissions in this Court
The applicant
[37] The City submitted initial and supplementary written submissions. In its initial
submissions, the City contends that the High Court erred in refusing rescission of the
consent order. In doing so, the City focuses on the alleged absence of authority on the
17 Id at para 52.
18 See Coppermoon above n 8; Ekurhuleni Metropolitan Municipality v Dada NO [2009] ZASCA 21; 2009 (4)
SA 463 (SCA); Dada NNO v Unlawful Occupiers of Portion 41 of the Farm Rooikop 2009 (2) SA 492 (W); and
Fischer v Unlawful Occupiers 2018 (2) SA 228 (WCC) (Fischer).
19 Paulsen v Slip Knot Investments 777 (Pty) Ltd [2015] ZACC 5; 2015 (3) SA 479 (CC); 2015 (5) BCLR 509
(CC) (Paulsen) at para 29, quoting S v Boesak [2000] ZACC 25; 2001 (1) SA 912 (CC); 2001 (1) SACR 1; 2001
(1) BCLR 36 (CC) at paras 11-12.
DODSON AJ
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part of Mr Maluleke to settle the matter, particularly the absence of compliance by the
City with the statutory requirements imposed on it by section 79(24) of the (Transvaal)
Local Government Ordinance 20 (LGO) for the acquisition by a municipality of
immovable property. The City also point s out that there was no compliance with the
requirements of section 217 of the Constitution for fair, equitable, transparent,
competitive and cost-effective procurement of goods, in this case, the properties.
[38] The City asserts that the consent order failed to bring finality to the main dispute
between the occupiers and the owners over the eviction orders and the undecided
application to stay them. It would, in fact, lead to further protracted litigation. It was
also void for vagueness.
[39] These were matters that the Judge granting the consent order ought to have
considered, but failed to. In these initial submissions, the City seeks the overturning of
the High Court’s order refusing rescission, its replacement with an order granting
rescission and remittal of the stay application to the High Court for adjudication. Apart
from the setting aside of the High Court’s costs orders against it, no award of costs is
sought.
[40] In the City’s supplementary written submission s it elaborates upon the grounds
in the initial submissions and raises, in addition, the supposed invalidity of the consent
order under the Alienation of Land Act ,21 the Local Government: Municipal Property
Rates Act22 (Rates Act) and the State Liability Act. 23 As regards relief, there is a new
tack. A declaration of constitutional invalidity of the consent order is sought. This is
despite the fact that no such relief was sought in the original notice of motion or in the
notice of application to this Court fo r leave to appeal. This declaration is now put
forward as the basis for rescission. Remittal is no longer sought. However, having no
20 17 of 1939.
21 68 of 1981.
22 6 of 2004.
23 20 of 1957.
DODSON AJ
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foundation in the pleadings, the new tack cannot receive any further consideration. 24
Costs are now sought by the City against “the respondents” in all of the litigation.
The respondents
[41] The owners raise preliminary points. They contend that the application before
this Court is stillborn because the City ha s not separately appealed, or sought leave to
appeal, the refusals by the High Court and the Supreme Court of Appeal to grant leave
to appeal. There is no such requirement, so this ground needs no further attention.
[42] The owners sa y that the High Court’s refusal of condonation of the late
application for rescission lay u nchallenged – that too precludes the application to this
Court for leave. But the application in this Court seeks leave to appeal against the whole
of the judgment and order of the High Court, so there is no merit in that submission.
[43] On the merits, the owners assert that the reasoning and findings of the High Court
in refusing rescission are unassailable. The question of Mr Maluleke’s authority is a
factual, not a legal one, and the City had not adduced the facts to show any constraint
on his authority. As regards non -compliance with the statutory requirements for the
purchase of immovable property, the mechanisms in the consent order ensure that fair
value is paid. This caters for the concerns pertaining to section 217 and the LGO.
[44] The owners submit that the requirements for rescission were not established and
the Court granting the consent order was functus officio (meaning it had finally and
irreversibly adjudicated the matter). The rescission application was an impermissible ,
disguised appeal against the consent order.
24 Having regard to the authorities referred to in n 25 below, it is open to question whether a direct constitutional
challenge to a court order of this nature is permissible at all.
DODSON AJ
19
[45] This Court’s judgment in Modderklip25 was cited as authority for the grant of the
consent order. As to the lack of alignment between the consent order and the underlying
litigation, Eke recognises that issues that are not strictly at issue in the litigation may be
included in a settlement agreement that is made an order of court. The consent order
was not vague.
[46] In their supplementary written submissions, the owners complain that a new case
is now advanced impermissibly by the City. The City does so, according to the owners,
on new facts that were not pleaded in the original rescission application. This
notwithstanding, the owners deal with the merits of the new points raised, none of which
they consider sustainable. They persist in asking that the application for leave to appeal
be dismissed with costs.
Legal framework
[47] The City in its notice of motion in the High Court sought the rescission of the
consent order. It pleaded its case in the founding affidavit on the basis of the c ommon
law grounds for rescission. The High Court in its judgment dealt with the application
accordingly. In considering whether or not the consent order had correctly been granted
by Lamont J, the High Court applied this Court’s judgment in Eke. It also evaluated
whether the common law grounds for rescission had been established. 26 Its approach
was true to the case pleaded. In my view, it is within that framework that the
High Court’s judgment must be assessed on appeal. I will consider first whether t he
High Court was correct in holding that the consent order complied with Eke, including
the question whether Mr Maluleke had the requisite authority, and then whether a case
was made out for rescission.
25 President of the Republic of South Africa v Modderklip Boerdery (Pty) Ltd [2005] ZACC 5; 2005 (5) SA 3
(CC); 2005 (8) BCLR 786 (CC) (Modderklip).
26 It also applied rule 42 of the Uniform Rules of Court, although the case pleaded in the founding affidavit is
based solely on the common law.
DODSON AJ
20
[48] As appears from the summary of the High Court’s jud gment, Eke requires that,
before a court makes a settlement reached between the parties an order of court, it must
be “competent and proper”. This requires that—
(a) the consent order must relate directly or indirectly to a lis (lawsuit) or
issue between the parties;
(b) the terms of the consent order must be consistent with the Constitution,
law and public policy; and
(c) the consent order must hold some practical or legitimate advantage.27
[49] Were these requirements satisfied?
Compliance with Eke
Related to the lis between the parties
[50] Eke encourages a generous approach to this requirement, so as not to burden
parties unduly, or deter them from settling their litigation. 28 Thus ancillary or related
matters, not strictly central to the litigation, might form part of an approved settlement.
Absent such an approach, two settlement agreements might be required to cover those
issues relevant to a dispute and those not, or a settlement might fail because clauses
important to one or both of the parties could not receive the be nefit of the court’s
sanction. On the other hand, a legal agreement reached entirely outside the context of
litigation cannot be made an order of court.29
[51] In relation to this requirement, the City complains that the consent order was
made in the context o f proceedings where the occupiers sought relief, namely the stay
application, against the owners. The lis was between them. The City was only cited as
an interested party. There was no lis between the City and the owners justifying a
counter-application by the owners against it. This, says the City, is impermissible in
27 Eke above n 1 at paras 25-6.
28 Id at paras 19-20.
29 Id at para 25.
DODSON AJ
21
terms of rule 24 read with rule 6(7)(a) of the Uniform Rules of Court without the leave
of the court granted under rule 24(2).30
[52] Rule 24 deals with claims in reconvention. Rule 6(7)(a) p laces a respondent
bringing a counter-application in the same position as a defendant bringing a claim in
reconvention. Rule 24(2) requires the leave of the court before a defendant may bring
a claim in reconvention against both the plaintiff and “any other person”. This is not
what the owners’ counter-application sought to achieve. Their counter-application was
not directed against the occupiers, who were the applicants in the main case, but against
the City and the MEC, who were co-respondents with the owners in the main application
brought by the occupiers.
[53] What was in fact required was the issuing of a third party notice by the owners
against the City and the MEC under rule 13(8),31 which applies to applications in terms
30 Rule 24(2) reads as follows:
“(2) If the defendant is entitled to take action against any other person and the plaintiff,
whether jointly, jointly and severally, separately or in the alternative, he may with the
leave of the court proceed in such action by way of a claim in reconvention against the
plaintiff and such other persons, in such manner and on such terms as the court may
direct.”
31 Rule 13 reads, in relevant part, as follows:
“(1) Where a party in any action claims—
(a) as against any other perso n not a party to the action (in this rule called a
‘third party’) that such party is entitled, in respect of any relief claimed
against him, to a contribution or indemnification from such third party, or
(b) any question or issue in the action is substanti ally the same as a question or
issue which has arisen or will arise between such party and the third party,
and should properly be determined not only as between any parties to the
action but also as between such parties and the third party or between any of
them,
such party may issue a notice, hereinafter referred to as a third party notice, as near as may be
in accordance with Form 7 of the First Schedule, which notice shall be served by the sheriff.
. . .
(8) Where a party to an action has against any ot her party (whether either such party
became a party by virtue of any counter -claim by any person or by virtue of a third
party notice or by any other means) a claim referred to in subrule (1), he may issue and
serve on such other party a third party notice in accordance with the provisions of this
rule. Save that no further notice of intention to defend shall be necessary, the same
procedure shall apply as between the parties to such notice and they shall be subject to
the same rights and duties as if such other party had been served with a third party
notice in terms of subrule (1).”
DODSON AJ
22
of rule 6(14). No such th ird party notice was issued, so the counter -application by the
owners was not compliant with the Uniform Rules of Court. A settlement between the
owners, the City and the MEC against the backdrop of such a rule 13 notice would
clearly have been one relate d to an issue or issues in dispute. But technical
non-compliance of this nature is not a sufficient basis to fall foul of the first Eke
requirement. There is still an indirect relationship with the issues in dispute.
[54] The City also complains that the con sent order incorporates the settlement of
disputed outstanding municipal rates and service charges as between the owners and the
City. This does not seem to me to be decisive on the first Eke requirement. If the
purchase by the City of the properties is a permissible basis for settling the owners’
counter-application, it would be an understandable consequence that extant disputes
over rates and service charges pertaining specifically to those properties be settled. It
would however, be necessary that the settlement of rates and service charges was
permissible under all relevant legislation and was properly effected in each of the courts
in which the disputes were pending. This is not the case here. This difficulty is
discussed in relation to the third Eke requirement below.
[55] What is more problematic in this context is that the consent order does not
address the unenforced eviction orders or the application to stay them. These were the
main issues before the High Court. Instead, the effect of the consent order is that the
City is simply replaced as the party entitled to enforce, and responsible for enforcing,
the eviction orders, which remain extant. The consent order d oes not require the City
to allow the occupiers to continue in occupation of the properties. The stay application
also remains pending, now against the City as the new owner of the properties.
[56] Viewed holistically, the settlement does not relate to the primary lis between the
parties. Notwithstanding a generous approa ch to the ancillary and related issues, they
cannot form the main substance of the consent order. That is what happened here. The
first Eke requirement is therefore not satisfied. The High Court erred in finding that it
was.
DODSON AJ
23
Constitutional, statutory and public policy compliance
[57] Is the consent order consistent with the Constitution, the relevant legislation and
public policy?
[58] The City complains that the consent order is in conflict with section 217 of the
Constitution and related statutes insofar as n o competitive public procurement process
was followed in the acquisition of the properties. It also asserts that the consent order
was in conflict with section 2 of the Alienation of Land Act – it was not “a deed of
alienation signed by the parties theret o or by their agents acting on their written
authority”. Insofar as the consent order provided for the write-off of arrear rates, it was
said by the City to offend section 15(2) of the Rates Act, which regulates rebates of,
and exemptions from, rates.
[59] The order’s provisions for execution against the MEC were argued to be in
conflict with section 3(1) of the State Liability Act, insofar as it provides for execution
by the owners against the MEC in circumstances where they are not the judgment
creditors of the MEC. The City contends further that its purchase of immovable
property is regulated by section 79(24) of the LGO, which requires a prior resolution
by the council, informed by an independent valuation in respect of the property,
prepared by a qualified valuer or associated valuer.32
[60] The difficulty is that, save for the last point pertaining to the LGO, these points
of law were not raised in either the City’s founding or replying affidavits in the
rescission application. They do not seem to have been a rgued before the High Court.
Unless they were canvassed in the unsuccessful application to the
Supreme Court of Appeal for leave to appeal and the request for reconsideration,33 they
32 Section 19(1)(a) and (b) of the Property Valuers Profession Act 47 of 2000 provides for these property valuation
professionals.
33 The papers from this application and the request for reconsideration are not available to this Court.
DODSON AJ
24
are being raised for the first time in the application for leave to appea l to this Court.
Should we have any regard to them?
[61] The question of when this Court will allow a point of law to be raised for the first
time on appeal was considered recently in Fujitsu.34 The general approach may be
summarised as follows:
(a) The mere fact that a point of law is raised for the first time on appeal is
not sufficient reason to refuse to consider it.35
(b) This Court must have jurisdiction to consider the point. If the point does
not raise a constitutional issue, it must comply with section 167(3)(b)(ii)
of the Constitution . That, in turn, necessitates that the point of law is
(i) arguable; (ii) of general public importance and transcends the interests
of the immediate parties to the dispute;36 and (iii) ought to be considered,
in the sense that th e interests of justice require that leave to appeal be
granted in order to do so.37
(c) The fact-base for adjudication of the new point must be sufficiently set
out in the pleadings and evidence in the record of the first instance
court38 – the point must not raise any new facts.
(d) Consideration of the point must not give rise to any unfairness to a party.
(e) The disadvantage of the absence of decisions on the point from the
High Court and the Supreme Court of Appeal must be considered.
34 Fujitsu Services Core (Pty) Ltd v Schenker South Africa (Pty) Ltd [2023] ZACC 20; 2023 (6) SA 327 (CC);
2023 (9) BCLR 1054 (CC). Both the majority and minority judgments discussed the approach to new points of
law on appeal at paras 34 -41 and 91 -5. The judgments align in this regard. The following judgments were
considered in the majority and minority judgments: Barkhuizen v Napier [2007] ZACC 5; 2007 (5) SA 323 (CC);
2007 (7) BCLR 691 (CC) (Barkhuizen) at paras 37-43; Tiekiedraai Eiendomme (Pty) Limited v Shell South Africa
Marketing (Pty) Limited [2019] ZACC 14; 2019 (7) BCLR 850 (CC) (Tiekiedraai); Alexkor Ltd v Richtersveld
Community [2003] ZACC 18; 2003 (12) BCLR 1301 (CC) ; 2004 (5) SA 460 (CC) at paras 44-6 and Tuta v The
State [2022] ZACC 19; 2023 (2) BCLR 179 (CC); 2024 (1) SACR 242 (CC) at paras 52-3.
35 Barkhuizen id at para 39.
36 Tiekiedraai above n 34 at para 14.
37 Id at paras 17-8.
38 The court from which the appeal emanates.
DODSON AJ
25
(f) That counsel did not think of the point earlier is not on its own a good
enough reason to entertain it, particularly if there have been full and fair
opportunities to argue the case in the High Court and
the Supreme Court of Appeal.39
(g) Even if there is compliance with the foregoing, this Court has an ultimate
discretion to decide whether or not to entertain the point.
[62] Turning to the new points here, save for the point relating to the
State Liability Act, they satisfy the jurisdictional requirements. It is open to question,
though, whether the City’s founding and replying affidavits in the High Court plead an
adequate factual or legal basis for their adjudication. The question of compliance with
section 217 of the Constitution raises difficult issues pertaining to whether the process
is governed, and the public interest protected, by the regulatory framework for
procurement, or the regulatory framework for the acquisition of immovable property ,
or both . This raises legal and p olicy considerations, in respect of which this Court
would have benefitted from a fuller pleading.
[63] Similarly, in relation to the Alienation of Land Act, the City’s practice may be
that the preparation and signature of a written agreement of sale is a formality that
follows automatically upon a compliant decision -making process under the LGO. If
that is so, the non -compliance of the consent order with the Alienation of Land Act
might not vitiate the consent order, if the LGO was complied with. However, the facts
regarding the City’s practice in this regard would need to be pleaded for the Court to
make this assessment.
[64] Insofar as the Rates Act is concerned, section 15(2) is not the only relevant
provision. The starting point is section 15(1) . It provides that a municipality may “in
terms of the criteria set out in its rates policy ” exempt from rates , or grant rebates or
reductions in rates to, categories of owners or to the owners of categories of properties.
39 Tiekiedraai above n 34 at paras 21-3.
DODSON AJ
26
A rates policy must in terms of section 3 of the Rates Act be adopted by every
municipality. Having the City’s rates policy before us seems to be indispensable for an
adjudication of this point. The policy is not before us.
[65] There may be an adequate factual basis for deciding the point based on the State
Liability Act, but its prospects of success are questionable and it would therefore not be
in the interests of justice to consider it.40
[66] Another obstacle to the consideration of the City’s new points is the absence of
decisions on them from either the High Court or the Supreme Court of Appeal. These
would have been helpful. Further, whilst not serving as a bar to their consideration, this
also appears to be a case where the City’s lawyers failed to think of the points earlier.
On a conspectus, a fair exercise of the discretion enjoyed by this Court must go against
considering these new points on appeal.
[67] The LGO point is on a different footing. It was the owners who in their
answering affidavit drew attention to its factual basis. They quoted directly from, and
attached, the letter from Mr Maluleke dated 24 July 2018 pointing out that “in order to
purchase any immovable properties unlawful[ly] occupied, a report will have to be
prepared and submitted to the Council for a resolution; furthermore, the Provincial
office must also provide permission in line with the relevant legislation”. Although not
directly referred to in the founding affidavit, this is plainly a reference to section 79(24)
of the LGO which reads in relevant part as follows:
“79. General powers
The council may do all or any of the following things, namely—
. . .
(24)
(a) Subject to the succeeding paragraphs—
40 Paulsen above n 19 at paras 29-30.
DODSON AJ
27
(i) hire, purchase, expropriate or in any other manner acquire any
movable or immovable property, including a servitude on or a
right in immovable property, for the performance or discharge
of any function or duty which the council is in terms of any
law authorised or required to perform or discharge;
. . .
(b) A council wishing to exercise any of the powers conferred by
paragraph ( a)(i) . . . shall cause a valuer or an associated valuer
registered in terms of the provisions of the Valuers’ Act, 1962, to—
. . .
(ii) evaluate the immovable property it wishes to purchase, to
expropriate or to acquire in any other manner . . .
. . .
(c) A council, . . . shall not acquire—
(i) any immovable property . . . by purchasing, expropriating or
acquiring it in any other manner, excluding by hiring it, for an
amount exceeding the amount for which it was evaluated in
terms of paragraph (b)(ii), by more than five per cent;
. . .
unless the Administrator has, subject to such terms and conditions as
he may determine, granted his approval thereto beforehand.”
[68] The introductory paragraph of section 79 of the LGO provides for conferral of
the various powers listed in its subsections on “the council”. It contemplates that, for
the power in subsection (24) to purchase immovable property to be engaged, there must
be in place a valid decision of the municipal council. This requires, under
section 160(3)(a) of the Constitution, a majority of the members of the council to be
present at a meeting and, under section 160(3)(c), a majority of the votes at that meeting
being cast in favour of the decision. These constitutional requirements are echoed in
subsections 30(1) and (3) of the Local Government: Municipal Structures Act 41
(Structures Act).
41 117 of 1998.
DODSON AJ
28
[69] Section 79(24)( b) requires that a council “wishing to exercise” its power to
purchase property under section 79(24)(a)(i) must obtain a valuation by an appropriately
qualified valuer. A property valuation is typically provided in the form of a valuation
report. This is no doubt the report referred to in Mr Maluleke’s letter. The words
“wishing to exercise” convey that the valuation report is something that must be in place
before the council takes its decision to purchase. If the contemplated purchase price
exceeds th e valuation in the valuer’s report by more than 5%, permission of the
“Administrator” is required. This is in all likelihood the requirement alluded to in
Mr Maluleke’s letter as the permission of the “Provincial office”.42
[70] Yet neither the owners nor the City put up any evidence whatsoever to suggest
that these constitutional and statutory requirements were complied with before the
settlement recorded in the consent order was concluded. Indeed, it was common cause
in the hearing before this Court that the y had not. Absent compliance with these
requirements of the LGO, the Constitution and the Structures Act, the City failed to
comply with the constitutional and statutory preconditions for the exercise of its power
to “purchase . . . or in any other manner acquire ” immovable property, as the consent
order required it to do.
42 In this regard, Item 3(2)(b) of Schedule 6 to the Constitution , which forms part of an item dealing with the
interpretation of legislation existing when the Constitution took effect, provides as follows:
“(2) Unless inconsistent with the context or clearly inappropriate, a reference in any
remaining old order legislation—
. . .
(b) to a State President, Chief Minister, Administrator or other chief executive,
Cabinet, Ministers ’ Council or executive council of the Republic or of a
homeland, must be construed as a reference to—
(i) the President under the new Constitution, if the administration of that
legislation has been allocated or assigned in terms of the previous
Constitution or this Schedule to the national executive; or
(ii) the Premier of a province under the new Constitution , if the
administration of that legislation has been allocated or assigned in
terms of the previous Constitution or this Schedule to a provincial
executive.” (Emphasis added.)
In terms of Proclamation R114 GG 15813 of 17 June 1994, the administration of the Local Government
Ordinance 17 of 1939 was assigned to what is now the Gauteng Provincial Government.
DODSON AJ
29
[71] The owners argue that section 79(24) of the LGO was substantially complied
with. This was because the purpose behind the section, namely that the City receives
fair value for money, was supposedly accomplished by the terms of the consent order.
This is a reference to the mechanism in the consent order for determining the purchase
price of the properties. This was to be done with reference to section 12(1) of the
Expropriation Act. In the event that agreement could not be reached on the purchase
price, it was to be determined by the High Court.
[72] This argument does not withstand scrutiny. A statute is not complied with
through compliance with a different statute that seeks to achieve similar ends. In any
event, the non-compliance with section 79(24) of the LGO is not confined to the absence
of a valuation report. There is no council resolution in place . For the reasons given in
paragraph [68] above, such a resolution is required by section 79(24)(a)(i) of the LGO,
read with the Constitution and the Structures Act.
[73] The owners argue, further, on the authority of Gijima43 and Buffalo City,44 that
the City ought to have “instituted review proceedings to attack their agent’s authority
to act as such”. There is no merit in this argument. If the City has a valid basis in law
to seek rescission, it is entitled to do so. This mu ch is confirmed by the
Supreme Court of Appeal judgments discussed later.45
[74] The owners’ reliance on Modderklip46 is also misplaced. In that case, the Court
was concerned with a situation where thousands of persons had unlawfully occupied a
farm, and the St ate authorities responsible for ensuring the enforcement of eviction
orders had failed in their constitutional duties to do so. This was a breach of
43 State Information Technology Agency SOC Limited v Gijima Holdings (Pty) Limited [2017] ZACC 40; 2018
(2) SA 23 (CC); 2018 (2) BCLR 240 (CC).
44 Buffalo City Metropolitan Municipality v Asla Construction (Pty) Limited [2019] ZACC 15; 2019 (4) SA 331
(CC); 2016 (6) BCLR 661 (CC).
45 Valor IT v Premier, North West Province [2020] ZASCA 62; 2021 (1) SA 42 (SCA) ( Valor IT); Oppressed
ACSA Minority 1 (Pty) Ltd v Government of the Republic of South Africa [2022] ZASCA 50; 2022 JDR 0767
(SCA) (Oppressed ACSA Minority).
46 Modderklip above n 25.
DODSON AJ
30
Modderklip’s rights in terms of section 34 of the Constitution, for which it was entitled
to constitutional damages. Those are not the facts here. Nor does the consent order
provide for such a remedy.
[75] The High Court placed reliance on the order of the Supreme Court of Appeal in
Coppermoon.47 The order in that case was made in an appeal against a decision of the
Western Cape Division of the High Court where the City of Cape Town had been
ordered to enter into good faith negotiations for the purchase of unlawfully occupied
properties.48 The order of the Supreme Court of Appeal was granted by consent and
without reasons. Significantly, it set aside all the provisions of the High Court’s order
for the acquisition of the properties. It did however provide afresh for the acquisition
of the properties at a price to be determined by way of arbitration, referenced to
section 12 of the Expropriation Act and section 25(3) of the Constitution.
[76] There are important differences between th e consent order in Coppermoon and
the present one. In Coppermoon the dismissal of the eviction applicat ions by the
High Court was left in place. There is nothing to suggest that the attorneys for the
municipality in that case were unauthorised or that any prior legislative requirements
had not been satisfied. There is no indication that any components of the High Court
litigation were left unresolved. In the absence of reasons from the
Supreme Court of Appeal, the order does not establish any helpful precedent.
[77] Accordingly, none of the authorities relied on by the owners provide a basis for
finding that the consent order was constitutionally and statutorily compliant.
[78] Eke also requires an assessment of the consent order from the perspective of
public policy. Had the consent order been concluded on the basis of full prior
compliance with the Constitution and the relevant statutes, the conferral of a lawful
47 Coppermoon above n 8.
48 Fischer above n 18.
DODSON AJ
31
mandate on Mr Maluleke, and compliance with the three Eke requirements in all other
respects, it does not seem that there could have been any public policy objection to it.49
[79] It is appropriate at this point to consider the question of Mr Maluleke’s authority.
As the City’s attorney, he could only agree to the consent order if he enjoyed authority
to bind the City to it. An agent may not bind a municipality as principal to an act that
requires, but lacks, prior compliance by the municipality with a statute. 50 Put
differently, if a municipality may not perform a particular act without first complying
with a statute, still less may it mandate an agent to perform that act on its behalf. The
agent’s conduct in these circumstances is invalid, notwithstanding that the municipality
may have purported to confer authority on the agent expressly or tacitly, or is said to
have done so ostensibly. Similarly, a principal may not be estopped from denying an
agent’s purported authority where to do so would give rise to an illegality.51
[80] The City’s failure to comply with section 79(24) of the LGO meant that neither
it, nor any agent purportedly mandated by it, could purchase immovable property. In
consenting to an order committing the City to the purchase of immovable property in
these circumstances, Mr Maluleke acted without authority. To hold the City estopped
from denying its agent’s authority, as the High Court did, would give rise to an
illegality. Estoppel cannot therefore apply here.
49 Although this Court in Modderklip (above n 25) left open the question whether it could order the State to
expropriate unlawfully occupied property (at paras 62 -5), it recognised purchase of the properties as a potential
solution, saying “[n]o reasons have been given why Modderklip’s offer for the State to purchase a portion of
Modderklip’s farm was not taken up” (at para 50). This Court also pointed out that the State could have considered
expropriation (at para 51).
50 Insofar as the position in English law is concerned, Woolf et al De Smith’s Judicial Review 8 ed (Sweet and
Maxwell 2018) say at 703: “In the law of agency, an agent . . . cannot bind his principal to do what is ultra vires”,
referencing Ganz “Estoppel and Res Judicata in Administrative Law ” (1965) 1 PL 321; Craig “Representations
by Public Bodies” (1977) 73 LQR 398.
51 Hoexter, Penfold Administrative Law in South Africa 3 ed (Juta & Co Ltd, Cape Town 2021) at pages 50-5 and
the authorities discussed there. See also the judgment of Corbett AJ in a Full Court judgment in Hauptfleisch v
Caledon Divisional Council 1963 (4) SA 53 (C) where he said the following at 57E-F:
“[I]t is also a good affirmative answer to a case of estoppel by representation that the allowance
of the estoppel must result in illegality and thus a statutory body cannot be estopped from
denying an act which is ultra vires. (Spencer Bower, p. 182; Halsbury, p. 226; F Donges and
van Winsen, Municipal Law, 2nd ed. pp. 38-40).”
DODSON AJ
32
[81] In the circumstances, the second Eke requirement was not complied with on
account of the City’s failure to comply with the Constitution, the LGO and the
Structures Act. Its attorney also lacked authority to consent to the order. The
High Court accordingly erred in finding that this requirement was satisfied.
Practical or legitimate advantage
[82] Does the consent order “hold some practical and legitimate advantage”? The
consent order does not resolve the position of the occupiers. They remain subject to the
eviction orders. Their stay application remains undecided. Their housing rights under
section 26 of the Constitution have therefore not been addressed. Their eviction orders
stand unenforced. So the breach of the rule of law continues.
[83] The consent order does not resolve the “counterclaim” of the owners. They have
expressly preserved the right in the consent order to pursue an as-yet unquantified claim
for loss of income.
[84] Paragraph 3.1 of the consent order requires that the disputed quantum of arrear
rates and service charges in respect of the period pre-dating the unlawful occupation of
the properties “must be determined either by agreement or by court”. Read with
paragraph 5 of the consent order, it is clear that the court referred to here is the
High Court. However, disputes in relation to those arrears are already pending in the
Germiston Regional and Magistrates’ courts. The upshot is that disputes regarding the
arrear rates and service charges remain pending in three different courts. No practical
or legitimate advantage can be gained by that.
[85] Generally speaking, the courts favour a settlement.52 One of the primary reasons
that they do so is that it reduces demands on the courts and allows them to reallocate
52 Gollach & Gomperts (1967) (Pty) Ltd v Universal Mills & Produce Co (Pty) Ltd 1978 (1) SA 914 (A) at
923C-D.
DODSON AJ
33
their limited resources to other cases. 53 Unfortunately, the consent order i n question
does not achieve this. If anything, it has birthed more litigation than it purported to
settle. Accordingly, the High Court erred in finding that the third Eke requirement was
satisfied.
Rescission
Introductory
[86] Absent compliance with the thre e Eke requirements, the consent order ought
never to have been granted. That is not, however, the end of the enquiry. If the
High Court had come to the correct conclusion on the Eke requirements, it would still
have had to consider whether a case was mad e out for rescission of the consent order.
Apart from the formal requirements for rescission, this includes the questions :
(a) whether the rescission application was brought timeously; and (b) whether the court
should exercise the ultimate discretion it e njoys to refuse rescission, even where the
formal requirements are established.
[87] In assessing whether a case has been made out for rescission, it is important to
bear in mind that a consent order “brings finality to the lis between the parties; the lis
becomes res judicata (literally, a ‘matter judged’)”. 54 The fact that an order may be
incorrect or in conflict with the Constitution is not, on its own, a reason for its
rescission.55 Indeed, this Court has made it clear that it will not, in a constitutional
dispensation where court orders are sacrosanct, readily allow a widening of the grounds
for rescission.56 The City must be able to demonstrate a sound and recognised legal
basis for rescission. It is that question to which I now turn.
53 Ex Parte Le Grange and Another In re: Le Grange v Le Grange [2013] ECGHC 75 (Le Grange) at para 22. In
the South African Law Reports, this is reported as PL v YL 2013 (6) SA 28 (ECG) at paras 36-8.
54 Eke above n 1 at para 31.
55 Zuma v Secretary of the Judicial Commission of Inquiry into Allegations of State Captu re, Corruption and
Fraud in the Public Sector Including Organs of State [2021] ZACC 28; 2021 (11) BCLR 1263 (CC) ( Zuma) at
paras 71-85; Department of Transport v Tasima (Pty) Ltd [2016] ZACC 39; 2017 (2) SA 622 (CC) ; 2017 (1)
BCLR 1 (CC) at paras 177-183.
56 Id.
DODSON AJ
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Delay
[88] An application for rescission under the common law must be brought within a
reasonable time. What is reasonable will depend on the circumstances of the particular
case. A starting point in determining what is reasonable is the 20 -day time period
referred to in rule 31(2)(b) of the Uniform Rules of Court. Where there has been delay,
the applicant must show that there is a reasonable explanation for the delay.57
[89] The City acknowledges that it delayed in bringing the rescission application. It
contends that it has a reasonable explanation. The consent order was granted on
12 February 2020. As explained earlier, the City asserts that it was “not fully aware,
nor did it appreciate or [understand] the terms of the Court Order” at the time. It only
came to appre ciate the content and implications of the consent order once it had
consulted with Mr Maluleke, received a memorandum from him and obtained an
opinion from counsel. The delay in consulting with Mr Maluleke was brought about
primarily by the Covid-19 lockdown.
[90] In their answering affidavit, the owners contest the City’s version of events.
They point out that the owners’ attorneys sent an email to Mr Maluleke on
12 March 2020 attaching a draft deed of sale and requesting a meeting with Mr Frank,
the deponen t to the City’s founding affidavit. Mr Maluleke responded on
17 March 2020 confirming that a meeting had been arranged for 20 March 2020.
However, on 19 March 2020, Mr Maluleke emailed cancelling the meeting on account
of Mr Frank’s having fallen ill.
[91] On the basis of this correspondence the owners contended that the City was
aware of the consent order much earlier than it claimed. However, the owners conceded
in their answering affidavit that the Covid -19 lockdown, which commenced on
57 Roopnarain v Kamalapathy 1971 (3) SA 387 (D) at 390F-391D; Nkata v Firstrand Bank Ltd 2014 (2) SA 412
(WCC) at paras 26-9 and NW Civil Contractors CC v Anton Romaano Inc [2019] ZASCA 143; 2020 (3) SA 241
(SCA) at para 21.
DODSON AJ
35
26 March 2020,58 affected the parties’ ability to implement the order. This is borne out
by the fact that their attorneys’ next letter attempting to convene the envisaged meeting
was only sent on 5 August 2020. If the months from April to July 2020 are left out of
account, the City’s delay beyond the 20 -court day period envisaged in rule 31(2)(b) is
of the order of three-and-a-half months.
[92] In Valor IT59 a settlement agreement that gave effect to a breach of section 217
of the Constitution had been made an order of court. The Supreme Court of Appeal was
willing to uphold the rescission of the order on the basis of the unlawfulness of the
underlying settlement agreement, despite the Premier having delayed for some
20 months in applying for rescission and having failed to provi de a satisfactory
explanation for the delay. 60 Regard was had to the strong prospects of success on the
merits of the rescission and the judicial review of the settlement agreement.
[93] In Oppressed ACSA Minority ,61 the rescission application was launched a ye ar
after the granting of the consent order at a point when substantial steps had already been
undertaken in its implementation. The Supreme Court of Appeal nevertheless upheld
the rescission of the consent order granted by the High Court.
[94] In this case it is so that the City’s explanation of the delay is at the weak end of
the spectrum. It is lacking in detail and couched in what appears to be deliberately
vague language. However, the disruptive effect of the Covid -19 lockdown on both
public and private institutions, even after 1 June 2020 when employees were allowed to
58 On 23 March 2020, President Cyril Ramaphosa announced that South Africa w ould enter a nationwide
lockdown with effect from midnight on 26 March 2020. The initial regulations giving effect to the lockdown
were promulgated in terms of section 27(2) of the Disaster Management Act 57 of 2002 in GN R318 GG 43107,
18 March 2020, as amended by GN R398 GG 43148, 25 March 2020 and by GN R419 GG 43168, 26 March 2020
and by GN 608, GG 43364, 28 May 2020.
59 Valor IT above n 45.
60 Id at paras 31-9.
61 Oppressed ACSA Minority above n 45 at para 9.
DODSON AJ
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return to work wearing masks, 62 cannot be denied. Given that a serious breach of the
rule of law forms the basis of the rescission application, and that the degree of
non-compliance of the consent order with the Eke requirements is substantial , I am
disinclined to refuse rescission on account of delay. This should not, however, be taken
as a departure from this Court’s stance that it will only consider the grant of rescission
in exceptional circumsta nces. The likelihood of an exception being made will be in
inverse proportion to the passage of time since the order was made and the laxity of the
explanation for the delay.
Merits of the rescission
[95] As a s tarting point on the merits, it is well to remind ourselves of what was
pointed out by Khampepe J in Zuma:
“There is a reason that rule 42, in consolidating what the common law has long
permitted, operates only in specific and limited circumstances. Lest chaos be invited
into the process of administering justice, the interests of justice require the grounds
available for rescission to remain carefully defined. In Colyn, the Supreme Court of
Appeal emphasised that ‘the guiding principle of the common law is certainty of
judgments’. Indeed, a court must be guided by prudence when exercising its
discretionary powers in terms of the law of rescission, which discretion, . . . should be
exercised only in exceptional cases, having ‘regar d to the principle that it is desirable
for there to be finality in judgments.’”63
[96] This Court in Berea64 overturned the High Court’s refusal to rescind an eviction
order granted by consent on the basis of the common law ground of justus error. The
occupiers appeared in the court of first instance unrepresented, planning to seek a
postponement to secure legal representation. However, they were persuaded at court to
62 Determination of Alert Levels and Hotspots R608, GG 43364, 28 May 2020. The determination was made in
terms of regulation 3(2) of the regulations issued under section 27(2) of the Disaster Management Act 57 of 2002
in GN R480, GG 43258, 29 April 2020, as amended.
63 Zuma above n 55 at para 98.
64 Occupiers of Erven 87 and 88 Berea v De Wet N.O. [2017] ZACC 18; 2017 (5) SA 346 (CC); 2017 (8) BCLR
1015 (CC) (Berea).
DODSON AJ
37
consent to an eviction order. They gave their consent without knowledge of their rights
under PIE or their right s to temporary alternative accommodation. The court of first
instance granted the order under the erroneous belief that the applicants consented to it.
In truth the consent was invalid because it was not informed consent. This Court held
that an error is “justus” where there is “good and sufficient cause”, which, in turn,
requires: (a) a reasonable explanation of the circumstances in which the consent order
was granted; (b) that the application must be made bona fide (in good faith); and (c) that
the applicant must have a bona fide defence on the merits which carries prospects of
success.65
[97] The facts and issues in this matter and the terms of the consent order do not lend
themselves comfortably to analysis with reference to the three Berea requirements for
rescission. In Moraitis,66 the Supreme Court of Appeal held that rescission may be
granted in circumstances where a legal representative consented to an order without the
authority to do so.67 The effect of this would be that the court granting the consent order
had been misled into thinking that the parties bound by the order had agreed to it, when
in fact they had not. 68 In Moraitis, had it been proven, the absence of authority alone
might have been sufficient to grant rescission, although the court acknowledged that—
“A gloss has subsequently been placed upon this proposition that, while lack of
authority is the preponderant factor, on its own it may not suffice unless there is a
reasonable explanation for the circumstances in which the consent judgment came to
be entered.”69
65 Id at paras 68-78.
66 Moraitis Investments (Pty) Ltd v Montic Dairy (Pty) Ltd [2017] ZASCA 54; 2017 (5) SA 508 (SCA) (Moraitis).
67 Id at paras 17-9.
68 Id at para 17.
69 Id at para 20, referring to Georgias v Standard Chartered Finance Zimbabwe Ltd 2000 (1) SA 126 (ZS) at
132B-D and Ntlabezo v MEC for Education, Culture and Sport, Eastern Cape 2001 (2) SA 1073 (TkH) at
1081B-E. See also Valor IT above n 45, where a settlement agreement that was in breach of section 217 of the
Constitution and other procurement-related “prescripts” was rescinded on the basis of the breach alone.
DODSON AJ
38
[98] In Oppressed ACSA Minority,70 the Supreme Court of Appeal was faced with an
appeal concerning the rescission of a consent order because ACSA’s legal
representatives and executives agreed to it without the authority to do so. There the
Supreme Court of Appeal applied the three require ments referred to in Berea, but
treated the third requirement as “a bona fide defence justifying rescission of the
judgment”,71 (in the sense of there being good reason to conclude that the agreement
underlying the consent order was invalid) rather than a bona fide defence in the legal
proceedings that would revive on rescission of the consent order. Whilst this
articulation of the third requirement may not be consistent with the authorities on
rescission of a consent order at common law, it represents a sensible application of them
in this context.
[99] It is not necessary here to resolve which approach is correct. Whether one
applies the approach in Moraitis or that in Oppressed ACSA Minority, the City in this
matter has demonstrated that—
(a) there is a reasonable explanation of the circumstances in which the
consent order came to be granted, including the High Court’s failure
correctly to apply the Eke requirements and the attorney’s lack of
authority;
(b) the application is made in good faith; and
(c) there is a bona fide and sound legal basis, both for the rescission and for
the City to defend the “counter -application” that it will face in the stay
proceedings.
Residual discretion
[100] The City has made out a case for compliance with the formal r equirements for
rescission. A court considering an application for rescission under the common law
70 Oppressed ACSA Minority above n 45 at paras 27 and 33.
71 Id at para 27.
DODSON AJ
39
nevertheless enjoys a wide discretion. 72 It may refuse rescission if justice and equity
demand it, notwithstanding that an applicant had shown formal compli ance with the
requirements for granting rescission.
[101] The owners, in effect, ask that this discretion be exercised in their favour. They
contend, on the basis of Steenkamp73 and All Pay ,74 that this Court could grant
declaratory relief in respect of the non -compliance with the Constitution and the
relevant statutes under section 172(1)(a) of the Constitution, but leave the consent order
intact in the exercise of its discretion under section 172(1)(b) of the Constitution. In the
present context, the argument must be considered with reference to the Court’s residual
discretion.
[102] In my view this is not an occasion for the exercise of the Court’s residual
discretion in favour of the owners by refusing rescission. The constitutional and
statutory non -compliance t hat gave rise both to non -compliance with Eke and the
attorney’s lack of authority is fundamental. The fact that the eviction orders stand
unenforced and the stay application remains pending and unresolved is a significant
problem. It is so that the owners are prejudiced by the rescission of the consent order,
in that the uncertainty of their position is revived. But withholding rescission prejudices
the unlawful occupiers , whose situation was left unresolved by the consent order . It
also prejudices the ratepayers, who must bear any consequences of non-compliance
with the statute regulating the acquisition of immovable property and the introduction
by the consent order of an open-ended loss of income claim against the City.
72 Colyn v Tiger Food Industries Ltd t/a Meadow Feed Mills (Cape) [2003] ZASCA 36; 2003 (6) SA 1 (SCA) at
para 11; De Wet v Western Bank Ltd 1979 (2) SA 1031 (A) at 1039H-1043A (the focus is on rescission at common
law of a judgment granted by default, but the discussion of the relevant Roman -Dutch law and other authorities
goes wider than this).
73 Steenkamp N.O. v Provincial Tender Board, Eastern Cape [2006] ZACC 16; 2007 (3) SA 121 (CC); 2007 (3)
BCLR 300 (CC) at para 29.
74 AllPay Consolidated Investment Holdings (Pty) Ltd v Chief Executive Officer of the South African Social
Security Agency [2013] ZACC 42; 2014 (1) SA 604 (CC); 2014 (1) BCLR 1 (CC) at para 56.
DODSON AJ
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Conclusion
[103] Having regard to a ll the circumstances, the High Court erred in not granting
rescission. The appeal should accordingly be upheld, the High Court’s order set aside
and replaced with one granting rescission, and the matter remitted to the High Court for
adjudication of the stay application.
[104] On costs, the City has not conducted the litigation in the manner expected of an
organ of State. I refer in this regard to what is said above in relation to condonation and
the City’s lateness in filing every document that it was required to file in this Court. In
the circumstances giving rise to the grant of the consent order, all the parties took their
eyes off the ball on compliance with Eke and the LGO. In those circumstances, although
the City has been successful, no award of costs should be made in its favour. Each party
should bear its own costs.
Order
[105] The following order is accordingly made:
1. Condonation is granted for the late filing of the application for leave to
appeal, the record and the applicant’s written submissions.
2. The application for leave to appeal is granted.
3. The appeal is upheld.
4. The order of the High Court of South Africa , Gauteng Division,
Johannesburg dated 19 August 2021 is set aside and substituted with the
following order:
“(a) The application for rescission o f the order of Lamont J da ted
12 February 2020 is granted.
(b) Each party must bear its own costs.”
5. The matter is remitted to the High Court of South Africa , Gauteng
Division, Johannesburg for the further conduct of the proceedings under
case numbers 40089/2017, 43010/2017 and 7583/2019.
DODSON AJ
41
6. Each party must bear its own costs in this Court and in the Supreme Court
of Appeal.
For the Applicant: J P eter SC and E Sithole instructed by
Ncube Incorporated Attorneys and
Ezenwa Attorneys
For the First to Sixth and Tenth
Respondents:
K Prehmid, K Kabinde and P Vabaza
instructed by JHS Attorneys