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2024
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[2024] ZAECMKHC 137
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Municipal Workers Retirement Fund v Groot Kei Municipality and Others (2377/2022) [2024] ZAECMKHC 137; [2025] 1 All SA 258 (ECG) (22 August 2024)
IN
THE HIGH COURT OF SOUTH AFRICA
(EASTERN
CAPE DIVISION – MAKHANDA)
Reportable/
Not
Reportable
Case
no.: 2377/2022
Matter
heard on: 15 August 2024
Judgment
delivered on: 22 August 2024
In
the matter of:
THE
MUNICIPAL WORKERS RETIREMENT FUND
Applicant
and
GROOT
KEI MUNICIPALITY
First Respondent
LAWRENCE
MAMBILA
Second Respondent
NGENSISILE
TEKILE
Third Respondent
JUDGMENT
BRODY
AJ
1.
This matter has a long history dating back to 2007, some sixteen
years ago. The
applicant, the Municipal Workers Retirement Fund (“the
fund”), a pension fund organisation registered as such in terms
of section 4 of the Pension Funds Act, Act 24 of 1956 (“the
Act”) brought an application against the Groot Kei Municipality
(“the municipality”) which has its principal office at 17
Main Road, Komga, for an order compelling the municipality
to furnish
information from January 2007 within ten days of the order. The order
to compel was handed down on the 5
th
of February 2019 by
Mbabane AJ and this was essentially an order compelling the
municipality to furnish information in terms of
Regulation 33 of the
Pension Funds Regulations (published under GNR98 in GG 162 of 26
January 1962, as amended) as read with section
13A(2) of the Act.
2.
In that order the municipality was required to furnish the name and
identity
of the fund in respect of which pension fund contributions
were payable and the name and address of the employer, or pay-point
which made the deduction, together with the responsible person to
contact at the “employer”.
3.
Despite service of this order on the relevant officials of the
municipality,
nothing was done by the municipality and an application
for contempt was then brought on the 16
th
of April 2019
and an order made by Malusi J in which he found that the municipality
and the municipal manager were in contempt
of court of failing to
comply with the earlier order, and that the municipal manager was
committed to imprisonment for a period
of thirty days, suspended for
a period of twenty court days on condition that the order was
complied with. The usual order by the
sheriff to take the necessary
steps in the event of a failure to comply was also granted. Costs
were also granted on the scale
as between attorney and client.
4.
That order too was served on the respondents in the contempt
application.
5.
This order too was ignored by the municipality and the municipal
manager, and
a writ for imprisonment of Mr Olwethu Kwababaana was
issued. It transpired that Mr Kwababaana had in fact resigned and
could not
be located.
6.
After extensive correspondence between the fund and the municipality
during the
period August 2019 to February 2022, the municipality
refused to furnish the necessary minimum information as required by
the statute.
7.
On the 13
th
of September 2022 Rugunanan J handed down a
personal liability order in which the municipality and its officials
were required
to furnish the information, as previously set out, and
costs were payable on an attorney and client basis.
8.
This order was not only served by the sheriff but also emailed to all
the relevant
officials of the municipality and there can be no doubt
that they were aware of the order.
9.
None of the information was furnished to the fund after which the
present application
was brought on the 7
th
of August 2023.
10.
In the municipality’s answering affidavit the general defence
was raised by the second
respondent that the municipality
“
endeavoured (through its legal representatives) in good
faith, to resolve the issue by tendering to settle the matter out of
court
subject to the applicant’s representatives availing
themselves for settlement negotiations.”
11.
A further explanation was that advocate Patel, who had been
instructed to deal with the
matter, had furnished the fund with
“
documentation
” and that “
it was
discovered that the documentation so required was destroyed in a fire
that burnt down the municipal building in which they
were kept,
during May 2018.”
12.
The fund challenged the veracity of these defences and, in
particular, indicated that there
was no detail regarding the alleged
fire.
13.
This led to an application for the admission of the filing of a
further affidavit by the
second respondent, and after hearing
argument, I ordered that the supplementary affidavit be accepted,
after which the matter was
argued. This supplementary affidavit gave
more detail about the alleged fire and indicated again that the
municipality was unable
to comply with the court orders as it did not
have the necessary documentation, or information.
14.
There can be no doubt that the liability of the municipality and the
present officials has
already been determined in the previous court
order and the liability of the municipality is based on the
provisions of section
13A(2) of the Act.
15.
There can also be no doubt that this court granted an order against
the second and third
respondents in the personal liability order in
terms of the provisions of section 13A(8)(c) as read with section
13A(9)(b) of the
Act.
16.
The second respondent, as the municipal manager, is also the
responsible person tasked with
overseeing the implementation of court
orders against a municipality
[1]
18.
In Fakie N.O. vs CCII Systems (Pty) Ltd 2006(4) SA 326(SCA) it was
held that a litigant
who has obtained a court order requiring an
opponent to do, or not to do something, is permitted to approach the
court again in
the event of non-compliance with a further order
declaring the non-compliant party in contempt of court and imposing a
sanction.
19.
The essence of a contempt offence lies in violating the dignity, the
repute or authority
of the court. The rule of law requires that the
dignity and authority of the courts, as well as their capacity to
carry their functions
should also bemaintained.
20.
An applicant must prove the requisites of contempt, being the order,
service of the order,
knowledge of the order, and non-compliance with
the order and wilfulness and
mala
fides
.
[2]
21.
Cameron JA stated the following:
“
But, once the
applicant has proved the order, service or notice, and
non-compliance, the respondent bears an evidential burden in
relation
to wilfulness and mala fides: Should the respondent fail to advance
evidence that establish a reasonable doubt as to whether
non-compliance was wilful and mala fide, contempt will have been
established beyond any reasonable doubt.”
22.
In argument, it was clear that the order, and the terms thereof, were
known to the respondents
and there was no doubt that they had
received the personal liability order.
23.
At paragraph 7.4 of the fund’s replying affidavit, the
following was stated:
“
7.4
The prescribed information which the municipality is required by
statute to furnish is not extensive
or difficult to obtain. I refer
to the personal liability order (annexure “MWRF3”, to the
founding affidavit, page
30)
.
I point out that much of the
information required is common cause, ie the name of the Fund (the
applicant), the name and address
of the employer (being the
municipality) and the percentage or amounts of contributions split
between member and employer (it follows
from the rules of the Fund),
and is known to the Fund and the municipality.”
24.
I was advised in argument by Mr van der Berg SC that the municipality
did in fact comply
with that information.
25.
7.6 of the reply, however, states the following:
“
Accordingly,
what is essentially required is the particulars of each employee who
is a member of the Fund, and his pensionable emoluments
for the
relevant period. This is information that can be reconstructed or
should be electronically available, but the Municipality
has made no
effort to furnish the prescribed information. The Municipality has
literally had years to do so but elected to do nothing.”
26.
I was advised by Mr van der Berg SC that this information has still
not been furnished by
the municipality, and in particular, the second
respondent, in violation of the personal liability order.
27.
The difficulty with the “
fire
” defence is that
this was raised for the first time in this application and was not
raised at all before this application,
and before the previous orders
were obtained. The fire allegedly took place on the 2
nd
of
May 2018 and all the orders granted by this court, postdate that
event. The municipality, including the present municipal manager,
did
not raise the fire defence prior to the granting of the order by
Rugunanan J on the 13
th
of September 2022.
28.
A further difficulty that I have with the “fire” defence
is that we live in
a world where records are usually kept
electronically and digitally. I agree with Mr van der Berg SC that no
explanation is given
why certain of this information could not have
been obtained, or reconstructed, from electronic data.
29.
It is clear from the papers, and the various orders, that the
prescribed information required
is not extensive, or difficult to
obtain. The name of the fund, the name and address of the employer,
and the percentage of amounts
of contributions split between member
and employer is not an onerous task.
30.
The municipality must be in possession of a list of employees with
their starting dates,
and their salary scales. What is required is
that the particulars of each employee, who is, or was, a member of
the fund, and his
or her pensionable emoluments for the relevant
period of their employment.
31.
In addition to the above, the respondents did not oppose the personal
liability application
and which, in itself, raises the question
whether they had any defence at all.
32.
It must be emphasised that the information now sought from the fund
was information that
should have been given on a monthly basis to the
fund in terms of the Act as far back as 2007.
33.
No document, or schedule, was put up by the respondents in this
application to even suggested
that the municipality, and the
remaining respondents, had attempted to comply with the court order,
and to furnish the fund with
the required information.
34.
Ms Sidlai, on behalf of the municipality, argued that the third
respondent, namely the executive
mayor, could not be held liable for
contempt as this was not his function in the municipality.
35.
Unfortunately for the third respondent, that horse bolted when the
order was granted by
my brother, Rugunanan J on the 13
th
of September 2022. The third respondent was the third respondent in
that order and he was required to place evidence before this
court as
to how he in fact attempted to comply with the court order, (and
could not do so, if that was his defence).
36.
There were repeated references in the answering affidavit and the
replying affidavit, and
also in argument, that the municipality and
the other respondents sought to meet with the fund to try and resolve
issues. I do
not understand this defence as the order of Rugunanan J
is clear and concise. All that is required is the information sought
by
the fund and in terms of the Act which should be available to the
municipality, and not the fund. I agree with Mr van der Berg SC
that
it is not up to the fund to provide the information, however, it is
the municipality.
37.
As indicated above, no evidence was placed before this court that any
attempt had been made
to finalise a schedule, or even part of a
schedule. Had it been done, this would undoubtedly have been attached
to the opposing
affidavits, or the replying affidavit.
38.
South Africa is a constitutional democracy where the rule of law is
paramount. Compliance
with court orders ensures that municipalities
act within the bounds of the law and respect the legal system.
39.
The Constitution mandates that all Organs of State, including
municipalities, must adhere
to judicial rulings and that
non-compliance could result in a violation of the Constitution, which
is the supreme law.
40.
Municipalities, and in particular municipal managers, are responsible
for providing an essential
service to the public. Adhering to court
orders is part of good governance and accountability.
41.
The failure to comply can lead to mismanagement, inefficiency, and a
loss of public trust.
42.
Non-compliance with a high court order must result in a finding of
contempt of court, and
especially in circumstances where there are
mala fides,
which I find there is in the present application.
43.
There is no doubt that once the lists are received by the fund,
substantial sums will be
due by the municipality to the fund for
non-compliance in terms of the Act.
44.
The municipality, by ignoring the previous court orders, has led to a
conflict between itself
and the fund which will have consequences for
all members of the fund throughout South Africa. Compliance with a
high court order
is essential for obtaining the rule of law, ensuring
good governance, and upholding the Constitution.
45.
In the result the following order is granted:
45.1 it
is declared that the first respondent, the second respondent and the
third respondents are in contempt
of court by failing to comply with
the court order granted under case number 2377/2022 on 13 September
2022;
45.2
The second respondent and the third respondent are committed to
imprisonment for a period of 30 days, suspended
for a period of 30
court days on condition that the first respondent or second
respondent or third respondent within 30 court days
of the granting
of this order, comply with the court order granted under case number
2377/2022 on 13 September 2022;
45.3
The Sheriff and the South African Police Services are authorised and
ordered to take all necessary steps
to commit the second and third
respondents to imprisonment in the event of the condition of
suspension referred to in paragraph
45.2 is not fulfilled within the
period stipulated herein;
45.4
The first, second and third respondents are ordered, jointly and
severally, to pay the costs of this application
on a scale as between
attorney and client, including costs associated with travelling for
applicant’s counsel and the attorney
of record.
B B BRODY
ACTING JUDGE OF THE
HIGH COURT
APPEARANCES:
Counsel
for the Applicant
:
Adv.
Van Der Berg SC
Instructed
by
:
Shepstone & Wylie Attorneys
c/o
Jager & Lordan
2
Allen Road
MAKHANDA
(REF.:
ST/cb/M555)
Counsel
for Respondent
:
Adv.
Sidlai
Instructed
by
:
Sonamzi
Attorneys Inc.
c/o Yokwana Attorneys
10
New Street
MAKHANDA
(REF.:
G. 197/DT/FN)
[1]
Meadow Glen Home Owners Association and Others vs Tshwane City
Metropolitan Municipality and Another 2015(2) SA 413(SCA), paragraph
[24], page 424E - H
[2]
Fakie, paragraph (42) (c), page 344H - J