IN THE HIGH COURT OF SOUTH AFRICA
KWAZULU-NATAL LOCAL DIVISION, DURBAN
CASE NO: D3020/2025
In the matter between:
ETHEKWINI MUNICIPALITY APPLICANT
and
JODACHE OWEN PERUMAL FIRST RESPONDENT
FIRSTRAND BANK LTD SECOND RESPONDENT
GLOVER KANNIEAPPAN INC THIRD RESPONDENT
THE SHERIFF, INANDA 1 FOURTH RESPONDENT
SHASHIE KUNTHIKUMAR FIFTH RESPONDENT
REGISTRAR OF DEEDS, PIETERMARITZBURG SIXTH RESPONDENT
ORDER
In the result, I make the following order:
1. The rule nisi dated 18 March 2025 is confirmed.
2. Upon payment of the historical debt, the applicant is directed to
advise the sixth respondent in writing that the historical debt has
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been paid, whereafter, the sixth respondent is directed to remove the
interdict from the property records.
3. The second respondent is directed to pay the costs of this application
at scale A of the high court tariff.
JUDGMENT
Nicholson AJ
[1] The genesis of this matter rests in a series of email communications
exchanged between the applicant , and the third and fourth respondents , on
12 and 13 March 2025. In these exchanges, the applicant sought to address
and resolve the issue of an outstanding historical debt , owed by the first
respondent to the applicant, to avoid litigation to perfect a statutory hypothec,
as contemplated in s 118(3) of the Local Government: Municipal Systems Act
32 of 2000 (“the Act”).
[2] The relevant provisions of s 118 of the Act provides:
'Restraint on transfer of property
(1) A registrar of deeds may not register the transfer of property except on
production to that registrar of deeds of a prescribed certificate-
(a) issued by the municipality or municipalities in which that property is
situated; and
(b) which certifies that all amounts that became due in connection with
that property for municipal service fees, surcharges on fees, property
rates and other municipal taxes, levies and duties during the two
years preceding the date of application for the certificate have been
fully paid.
(2)…
(3) An amount due for municipal service fees, surcharges on fees, property
rates and other municipal taxes, levies and duties is a charge upon the property in
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connection with which the amount is owing and enjoys preference over any
mortgage bond registered against the property.
(4)…’
[3] It is apparent that ss 118(1) and 118(3) of the Act establish key
mechanisms that empower municipalities to recover outstanding debts
related to municipal charges on properties. These debts typically include
service fees, surcharges, and property rates, all of which are tied directly to
the property within the municipality's jurisdiction. Section 118(1) comes into
effect when a property is sold. It stipulates that the registrar of deeds cannot
register the transfer of property to a new owner unless the municipality issues
a prescribed certificate. This cert ificate serves as confirmation from the
municipality that all municipal charges incurred in connection with the
property during the two years preceding the application for the certificate
have been fully paid. The result is that the municipality is able to secure
payment of recent municipal debts before any transfer of ownership takes
place. Section 118(3) provides municipalities with a preferential right
regarding debts older than two years, commonly referred to as ‘historical
debt’. Specifically, it gives the municipality preference over any mortgage
bond registered against the property for these older debts.
[4] The email exchange disclosed a dispute regarding the interpretation
of s 118(3) of the Act. The applicant asserted that s 118(3) establishes a
statutory hypothec over the property, thereby permitting the municipality to
secure outstanding debts against the property itself. Conversely, the
respondents argued that any historic debt associated with the property is
recoverable exclusively from the first respondent and does not give rise to a
statutory hypothec. However, they concede that it does grant the municipality
preferential status as a creditor under Uniform r ules 46(14)(b)(i) and (ii) .
Additionally, they contend that the first respondent is responsible for the
Additionally, they contend that the first respondent is responsible for the
historical debt.
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[5] In order to avoid the need to invoke and perfect its statutory hypothec
against the property prior to the transfer of ownership, the applicant
requested that the second respondent settle the outstanding municipal debt
using the funds currently held by the fifth respondent. Additionally, should the
second respondent fail to agree to pay the historical debt from these funds,
the applicant indicated its intention to initiate urgent legal proceedings,
exercise its statutory hypothec to secure the outstanding amount, and pursue
recovery of associated legal costs from the respondents.
Factual background
[6] On 26 January 2023, a money judgment was granted in favour of the
second respondent against the first respondent, accompanied by an order
declaring the latter’s immovable property specially executable.
[7] On 8 March 2024, the Sheriff (the fourth respondent herein)
conducted a public auction and sold the immovable property to the fifth
respondent for R222 500. In accordance with s 118(1) of the Act, the third
respondent applied to the eThekwini Municipality ( ‘the applicant ’ or ‘the
municipality’) seeking a rates clearance certificate.
[8] Upon notification of an outstanding amount of R63 318,1 the third
respondent effected payment on 20 February 2025. Subsequently, on 11
March 2025, the applicant issued the rates clearance certificate for the
property, thereby enabling the third respondent to proceed with transferring
the property into the name of the fifth respondent.
History of application
[9] On 17 March 2025, the applicant brought an urgent application,
giving less than one day's notice to the parties concerned. The main relief
sought in this application was an interdict aimed at preventing and restraining
1 Founding affidavit, page 15, p ara 26.4 ; the applicant’s attorney’s report at page 62. A t
paragraph 27 of the founding affidavit, the applicant appears to confuse the historical debt of
R83 618.57, which is due in terms of s 118(3) with the clearance debt in terms of s 118(1).
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the transfer of the immovable property to the fifth respondent. The applicant
requested that this interdict remain operative until such time as the
outstanding historical debt, owed by the first respondent and quantified at
R83 618.57, was settled.
[10] In the alternative, the applicant sought an order interdicting and
restraining the release of the proceeds from the sale of the property to the
second and/or third respondent. This alternative relief was likewise sought to
remain in force pending the final determination of proceedings to be instituted
by the applicant for the recovery of the historical debt from the first
respondent.
[11] On 18 March 2025, the Honourable Justice Chithi considered the
matter and, following submissions from the parties, issued an interim order
that included the following terms:
‘1.1. That the fourth respondent is authorised to release the proceeds of the sale
in execution of the immovable property which is fully described at paragraph 2.1 at
the notice of motion in the application under Case No. D3020/2025, save for the
sum of R83 618.57, which amount shall be retained by the fourth respondent
pending the determination of an action to be instituted by the applicant for the
recovery of the historical debt which the applicant allege is owing to it.
1.2. The Applicant is directed to institute an action for the recovery of the
historical debt within 15 days of the granting of this order.
1.3. In the event of the Applicant failing to comply with paragraph 1.2 of this
order, this order shall lapse and be of no force and effect.’
[12] The order further reserved the determination of costs, instructed the
parties to submit heads of argument by 1 April 2025, and authorised the
parties to seek a preferential allocation on the opposed roll from the Senior
Civil Judge following the delivery of their respective heads of argument.
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[13] Both the interim order and the final order is opposed by the second
and third respondents only. In the circumstances, for convenience, I refer to
them as ‘the respondents’ herein.
[14] When this matter served before me, it appeared common cause that,
pursuant to paragraph 1.2 of the Chiti J order, the municipality initiated legal
proceedings against the first respondent for the recovery of the historical
debt.
Issues for determination
[15] During the hearing, Mr Rodel, who appeared for the respondents,
agreed that the rule ought to be confirmed and identified costs as the main
outstanding issue. Mr Broster, counsel for the applicant, argued that all cost -
related concerns were moot following the granting of the order , and further
submitted that if the case had not been urgent, it would have been struck
from the roll. Given that an order had already been granted and the case had
moved to the opposed roll, he asserts that the normal rule relating to costs
should appl y; which is, the unsucces sful party pay the successful party’s
costs.
[16] Mr Broster also correctly asserted that the costs order should follow
scale A of the high court tariff . However, Mr Rodel continues to advocate for
costs on scale C but has also suggested that either no costs should be
awarded or that each party should bear their own costs.
[17] While the parties agree that the rule nisi issued by Chiti J should be
confirmed, the respondent s assert that, although the sole matter currently
before the court is the issue of costs, a determination on costs requires the
merits of the application to be addressed. Since I neither have a recission
application before me, nor am I sitting as an appellate court, t he merits for
the granting of the interim order, which is essentially an anti-dissipation order,
are not relevant to my current considerations.
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[18] The difference between an interim and a final interdict lies in the
evidentiary standard required to establish rights. In the case of an interim
interdict, the applicant must demonstrate a prima facie right, even if subject
to some doubt. Conversely, a final interdict requires the applicant to prove a
clear right. Furthermore, when seeking an interim interdict, it is necessary to
show that the balance of convenience supports its issuance; this is not a
consideration for a final interdict. In both instances, however, the absence of
any adequate alternative remedy must be established.2
[19] In the circumstances, the crisp issues before me are, first, whether
the applicant possesses a clear right, and second, whether there is an
absence of any alternative remedy.
Clear right
[20] The applicant asserts a statutory hypothec granted in terms of s 118
of the Act .3 The applicant’s position regarding the interdict is that the
historical debt is owed to the municipality and is secured pursuant to s 118(3)
of the Act, which creates a ‘statutory hypothec’.
[21] To substantiate the historical debt , the applicant puts up as
annexures to the founding affidavit:
(a) a detailed reconciliation of the monthly account for the property in the
name of the first respondent together with a confirmatory affidavit; and
(b) metro bills dated 18 December 2024 and 18 January 2025 to the
affidavit, reflecting arrears of R135 412.39 and R136 337.38, respectively.
[22] I pause to mention that the first respondent, despite being served
with the papers, has not disputed the debt.
2 Setlogelo v Setlogelo , 1914 AD 221 ; Safcor Forwarding (Johannesburg) (Pty) Ltd v
National Transport Commission 1982 (3) SA 654 (A) at 674H-675A.
3 Founding affidavit, page 14, para 18.
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[23] The wording of s 118(3) of the Act is unambiguous; it provides
preference to the municipality for historical debt and it establishes a statutory
hypothec over the property. This interpretation is supported by the decision in
City of Tshwane Metropolitan Municipality v Mathabathe and Another,4 where
the Supreme Court of Appeal (“SCA”) further clarified the distinction between
the various subsections of s 118. The SCA confirmed that, unlike subsec (1),
which serves as an embargo provision, subsec (3) functions as a security
provision.
[24] In City of Tshwane ,5 the SCA further held that municipalities are
required to collect payments due for property rates, taxes, and municipal
services. They have two main forms of support for this responsibility: firstly, a
security interest is placed on the relevant property to guarantee repayment of
debts (s 118(3)); secondly, municipalities have the authority to prevent
transfer of property ownership until certain debts are paid (s 118(1)). Section
118 therefore features both an embargo provision with a time limit (s 118(1))
and a security provision without a time limit; thereby offering municipalities
two distinct remedies. While both aim to secure payment for qualifying
municipal claims, they do so through different approaches.
[25] In Jordaan, the Constitutional Court confirmed that municipalities
have several mechanisms to recover debts for services and rates, including s
118(3), which establishes a statutory hypothec on the property associated
with the incurred debt. This hypothec takes preference over mortgage bonds
but seizes upon transfer. Municipalities can enforce this hypothec against
current owners, with their claims taking precedence over mortgage holders,
until the property is transferred. If debts remain unpaid, a municipality can
obtain a court order to stop the property's transfer until payment is received.
4 City of Tshwane Metropolitan Municipality v Mathabathe and Another [2017] ZACC 31;
4 City of Tshwane Metropolitan Municipality v Mathabathe and Another [2017] ZACC 31;
2017 (6) SA 287 (CC) (Jordaan) para 55.
5 City of Tshwane para 9.
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[26] In the circumstances, it is evident that the applicant possesses a
statutory hypothec in respect of the historical debt attached to the property,
which will lapse upon transfer of the property. Therefore, the applicant has a
clear right.
Apprehension of harm
[27] It is evident that the respondents’ interpretation of s 118 of the Act is
incorrect. The text of s 118 and authorities cited demonstrate that s 118(3)
establishes a statutory hypothec in favour of the municipality for historical
municipal debts attached to the property.
[28] This hypothec grants the municipality preferential status over bond
holders and persists until the transfer of the property, at which point it lapses.
Accordingly, it is evident that without approaching the court, the municipality
would suffer harm.
Alternate satisfactory remedy
[29] The alternate remedy must be either satisfactory or suitable to the
circumstances. In Drilltec (Proprietary) Limited v E and M Tshwragano Joint
Venture (Proprietary) Limited and Another 6 the court phrased this
requirement as the applicant ‘must prove the absence of similar protection by
any other remedy ordinarily obtainable’.
[30] In opposition to the application, the first respondent takes three
points in limine as follows:
(a) urgency is self-created;
(b) an alternative remedy to the interdict is available pursuant to rule
46(14)(b);
6 Drilltec (Proprietary) Limited v E and M Tshwragano Joint Venture (Proprietary) Limited and
Another [2023] ZANWHC 220 para 23.
10
(c) several alternative remedies would have been available to the
applicant had it complied with s 96 of the Act, which mandates that
municipalities adopt, maintain, and implement a credit control and debt policy
aligned with their rates and tariff policies and in accordance with the
provisions of the Act. In this context, the respondents identify seven options
available to the applicant as follows:7
‘17.1. to terminate or restrict the provision of the municipal service in terms of By -
Law 19;
17.2. to allocate the whole or a portion of any payment of an account, or the whole
or a portion of a plea – payments for future accounts as payment for arrear
municipal service fees or rates;
17.3. to withhold the issuing of rates or revenue clearance certificate until all
amounts due in connection with the property concerned for municipal service
fees, surcharges on fees, rates and other municipal taxes, levies and duties
for the period contemplated in paragraph 118(1)(b) of the Systems Act
having been fully paid;
17.4. to unilaterally disconnect the supply of electricity supplied by way of an
electricity dispenser to any premises, or refuse to supply any person with any
card or token for the operation of an electricity dispenser;
17.5. refuse to register new customers for services in the premises until the
previous debt is paid;
17.6. to list the defaulting person with the credit bureau; and/or
17.7. to hand the defaulting person over to a debt collector or an attorney for
collection.’
[31] The applicant asserts that it complied with its debt collection policy by
implementing measures such as disconnecting electricity, restricting the
property's water supply, and issuing monthly utility bills to the first
respondent.
[32] The debt collection measures identified by the respondents under s
96 of the Act refer to actions previously available to the applicant. At this
point, however, these measures do not offer the municipality any viable
point, however, these measures do not offer the municipality any viable
7 Answering affidavit, page 87. Also see the respondents’ heads of argument, para 10.
11
means to recover the first respondent’s outstanding historical debt. Given the
current circumstances, these remedies are neither suitable nor sufficient,
particularly as the applicant holds a statutory hypothec and there are funds
presently held by the fourth respondent that are available to satisfy this
hypothec.
[33] As such, it cannot be said that these alternative measures constitute
an adequate remedy for the purposes of an interdict. This is especially so
considering that the statutory hypothec will lapse upon the transfer of the
property,8 rendering these remedies ineffective for the recovery of the
historical debt.
[34] The respondents contend that the Municipality could have deferred
the initiation of these proceedings and instead relied on the process outlined
in rule 46(14) (b), because the statutory preference would take precedence
over that of the bondholder .9 However, this argument is untenable. Once the
rule 46(14)(b) process is set in motion, the property will have already been
transferred to the new owner. As a direct consequence of this transfer, the
applicant’s statutory hypothec will be extinguished, thereby eliminating the
legal basis for the applicant’s preferential claim. Accordingly, the applicant
cannot rely on post -transfer remedies to recover its debt, and any delay in
initiating proceedings risks the loss of its security over the property.
[35] Furthermore, it is a well-established principle that a party is entitled to
select the form of relief it seeks and should not have a particular remedy
imposed upon it by its opponent.10 In this matter, the applicant has elected to
assert its rights under the statutory hypothec, and this decision ought to be
respected.
No urgency, alternatively urgency is self-created
8 Jordaan paras 64-68.
9 Answering affidavit, pages 84-86, paras 4-13.
10 Baloyi v Public Protector and Others 2022(3) SA 321(CC) at paras 40 and 42
12
[36] In support of urgency, the applicant asserts that a rates clearance
certificate was issued to the third respondent on 11 March 2025 11 which
would allow the transfer of the property into the name of the fifth respondent.
The statutory hypothec which is in terms of s 118(3) of the Act would cease
after transfer and the applicant does not have any realistic hope of the
recovery of the debt should that happen.
[37] The respondents’ heads of argument further dispute the existence of
any genuine urgency in the present application, arguing that any alleged
urgency is self-created for the following reasons:
(a) The urgent court did not grant the main relief sought in the notice of
motion.
(b) The outstanding debt has been in existence for more than two years,
yet the applicant approaches the court on an urgent basis without offering
any explanation for the delay in doing so.
(c) The applicant has failed to comply with its own debt collection policy
prior to launching these proceedings.
(d) The applicant has not asserted that the first respondent lacks
sufficient moveable or immovable assets to satisfy the debt in question.
(e) The applicant has not addressed possible defences that may be
available to the first respondent, such as prescription.
(f) Despite having been notified some time ago about the action being
taken by the second respondent to have the property declared specially
executable, the applicant has delayed and now brings the application at the
last possible moment.
[38] For the reasons detailed below, none of these reasons impede
urgency. Nonetheless, for the sake of thoroughness, it is necessary to
address the respondents' assertion regarding the order issued by the urgent
court. Their claim that the order granted by Chithi J differed from relief sought
by the applicant is unfounded. A careful review of the notice of motion
11 It must be borne in mind that the application was filed on 1 April 2025.
13
confirms that the rule nisi granted precisely aligns with the alternative relief
requested therein .12 I am not aware of any statute or legal precedent
indicating that the granting of an alternative order as requested constitutes a
bar to costs. In relation to the merits of urgency, the respondents, in their
heads of argument, raise several contentions disputing the applicant’s
justification for bringing the matter on an urgent basis:
(a) The respondents argue that the application itself was unnecessary.
They contend that, as a preferential creditor in terms of rule 46(14)(b), the
applicant already enjoys a statutory preference. Accordingly, the respondents
submit that there was no need for the applicant to approach the court for
relief, as its rights could have been protected under the established rules
governing preferential creditors.
(b) The respondents further assert that the applicant had not taken any
steps to perfect the hypothec upon which it now relies, until the institution of
the present application. This omission, they argue, undermines the assertion
of urgency, as the applicant did not act to secure its alleged preference at an
earlier stage.
(c) The respondents maintain that the applicant has not adequately
established a case in respect of the historical debt. As a result, they argue,
the applicant does not possess a clear right to the relief now sought. The
respondents point out that the applicant could instead have lodged a claim
with the fourth respondent for payment of its debt, which would have
constituted a more appropriate course of action under the circumstances.
[39] Upon careful evaluation of the arguments advanced by the
respondents regarding the applicability of rule 46, it has already been
determined that their submissions lack merit , when considering the
respondents’ interpretation of s 118(3) was found to be incorrect. Given this
finding, it is unnecessary to engage in further deliberation on this issue. The
finding, it is unnecessary to engage in further deliberation on this issue. The
question of whether rule 46 provides an alternative remedy, or whether it
affects the applicant’s entitlement to relief, has been resolved by a proper
12 Prayers 2.2 and 2.3 of the notice of motion, at page 5 of the indexed papers.
14
interpretation of rule 118(3). Accordingly, the respondents’ point in this regard
requires no additional consideration.
[40] The statutory hypothec in question serves merely as security for a
potential claim, with its full effect and enforceability only realised upon the
granting of a court order. In these proceedings, the respondents , who were
not aware of the underlying debt , have opposed both the perfection of the
hypothec and the granting of the main relief sought by the applicant. This
opposition has effectively compelled the applicant to approach the court
solely for an order perfecting the hypothec, rather than for the pri ncipal relief
initially contemplated.
[41] Despite their opposition to the payment of the historical debt on the
ground that it was not proved, the respondents, without raising any objection,
accepted the figures presented in the rates assessment report for the
purposes of complying with s 118(1) of the Act. Notably, these figures were
confirmed in the founding affidavit by the same individual who also confirmed
the existence and amount of the historical debt.
[42] The respondents did not challenge these figures, presumably
because accepting them served their interests within the current
proceedings. The lack of dispute regarding the rates assessment, especially
when the confirmation affidavit and the first respondent’s municipal bill were
provided by the applicant, undermines the respondents’ contention that the
historical debt was not properly established.
[43] In the circumstances, there is no merit to the respondents’ argument
that the historical debt was unproven. The applicant has furnished sufficient
evidence by submitting the first respondent’s municipal bill alongside a
supporting affidavit confirming the relevant figures. In the absence of any
challenge by the first respondent to these documents, it is reasonable to
conclude that the historical debt is adequately proven. Accordingly, ha d I
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been called to do so, I would have granted the money judgment against the
first respondent.
[44] It is important to note that none of the issues mentioned above, such
as the delay in bringing the application, the applicant’s failure to comply with
its own debt collection policy, the absence of evidence regarding the
respondent’s assets, or the potential defences available to the first
respondent, were raised in the email exchange that prec eded this urgent
application. For the sake of context and to ensure a clear understanding of
the sequence of events that led to the initiation of these proceedings, i t is
necessary to provide the complete content of the email exchange.
[45] On 12 March 2025, at 10 .34 am, Mr Siyabulela Mfingwana (“Mr
Mfingwana”), the Deputy Head: Litigation for eThekwini Municipality,
addressed an email to the third respondents as follows:
‘Dear Ms Maturi Naidoo
The above matter refers.
We confirm to date a telecon between the writer and yourself wherein the writer
advised as follows, that:
1. The rates clearance certificate has now been issued as demanded.
2. The municipality has given yourselves as well as the purchaser an
opportunity to settle the Section 118(3) debt, but such efforts have been
unsuccessful.
3. The only available option for the municipality would be to interdict the
transfer and seek costs from yourselves as the transferring attorneys who
are or should be able to advise the purchaser of the ramifications. The
municipality has tried its best endeavours to avoid instituting a High Court
application by adequately advising you of its remedies derived from the
constitutional case of Chantelle Jordaan vs City of Tshwane and has
successfully referred you to paragraphs 54 to 56.
4. Such Court application would reluctantly be instituted since the disputed
Section 18(3) monies are minimum and with the municipality open to a
discussion seeing that this is a sale in execution. However, all these
endeavours were rejected.
16
We confirm the lengthy discussion the writer had with yourself wherein the writer
advised that the municipality would seek costs from yourselves and the purchaser
as you have now demanded to be issued with the clearance certificate, due to the
risk of losing the security the municipality over the property. We confirm advising this
type of application will not be the first of its kind.
We also confirm your advice that you had not lodged at the deeds office yet,
however, it is common cause you can lodge any time and get the property
transferred. Unless we hear from you by no later than the end of business on
Thursday, 13 March 2025, we have no option but to instruct our attorneys to launch
an urgent application to protect the municipality’s rights.’
[46] On the same date at 3.33 pm, Ms Maturi Naidoo, representing the
third respondent, responded to Mr Mfingwana as follows:
‘Dear Siyabulela,
Your email below refers.
We note of paragraph 54 to 56 in the matter of Chantelle Jordaan and Others vs
City of Tshwane Metropolitan Municipality and Others, Case No: CCT383/16 and
respectfully advise that the municipality’s interpretation is misplaced. You will note,
with specific reference to paragraph 54 of the above judgment that Section 118(3) of
the Local Government: Municipal Systems Act 32 of 2000 (“MSA”) are charges on
the property which are levied against the existing owner.
As discussed telephonically , due to the nature of the transfer being a sale in
execution, the execution creditor nor the purchaser are the owners of the property
and as such, are not liable for settlement of the Section 118(3) figures as requested.
As a law firm, we have done our due diligence by informing the municipality of the
pending transfer and thus have complied with the judgment.
We will nonetheless inform the purchaser of the below correspondence and proceed
with the transfer unless instructed otherwise.
Trusting you find the above in order.
Kind regards,
Glover Kannieappan Inc.’
Trusting you find the above in order.
Kind regards,
Glover Kannieappan Inc.’
[47] On 13 March 2025, at 8 .42 am, Mr Mfingwana replied to Ms Naidoo
with the following response:
17
‘Thank you for your response. It seems you are employing a literal interpretation
which of course leads to absurdity in the current situation. Nevertheless, we are left
with no option but to go ahead with an urgent application to protect the municipality’s
interests by interdicting the transfer and seeking costs as we have done all that we
could to avert this step.
Regards
Siyabulela Mfingwana’.
[48] On the same day at 9.25 am, Lue Kannieappan, on behalf of the third
respondent, replied to Mr Mfingwana as follows:
‘WITH PREJUDICE
Dear Sir
Thank you for your email below.
The email is transmitted with prejudice and will be used to fend off any
misconceived attempt to threaten our firm with a cost order. We have no attempt to
debate the law or to litigate by correspondence. However, it will be useful to set out
that a literal interpretation is the first rule to be adopted in interpretation. The rule
states that clauses should be interpreted in their original meanings without any
substitutions or addition of words during the interpretation process. Having said that
an owner, t hrough a literal or purpose approach is still an owner. This is the
important point of departure.
Be that as it may, it is regrettable that the municipality has taken this point without
having itself tried to litigate against the owner to recover its debt and has the
appetite now to proceed with litigation. It is curious that the municipality decides to
interdict the transfer having received the only payment.
We look forward to receiving this application in due course.
Kind regards.
Lue Kannieappan.’
[49] For purposes of comparison, I refer to the specific language used in
paragraphs 54 and 55 of Jordaan, as well as the text of s 118(3), both of
which are cited within the referenced email exchange.
[50] Section 118(3) of the Act reads:
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‘An amount due for municipal service fees, surcharges on fees, property rates and
other municipal taxes, levies and duties is a charge upon the property in connection
with which the amount is owing and enjoys preference over any mortgage bond
registered against the property.’ (My emphasis.)
[51] Jordaan reads:
‘[54] And the statute does indeed provide a full -plated panoply of mechanisms
enabling efficient debt recovery in the cause of collecting publicly vital revenue. Here
the parts of s 118(3) that are uncontested are integral. These are the charge on the
property against the existing owner, and the municipality's preference over
registered mortgagees. During argument the municipalities conceded, correctly, that
the provision enables them to enforce the charge against the existing owner up to
the moment of transfer - and to do so above and before any registered mortgagees.
And they were constrained to concede, also correctly, where there are unpaid
municipal debts, that the charge enables them to slam the legal brake on any
impending transfer by obtaining an interdict against transfer.
[55] Add this: s 118(1) places municipalities on notice that a transfer within their
jurisdiction is pending. Because the provision embargoes each and every transfer
until the municipality issues a clearance certificate for the last two years ’ debt,
prospective transferors and their attorneys are obliged to notify municipalities of
every impending transfer. Doing so is indeed indispensable and invariable. This
gives the municipality full power, and full opportunity, to enforce the charge against
the existin g owner for all recoverable debt, even beyond the last two years .’
(Footnote omitted.) (My emphasis.)
[52] An analysis of s118(3) and paragraphs 54 and 55 of Jordaan
indicates that while the property owner remains liable for debts for municipal
services associated with the property , a transfer of the property cannot
services associated with the property , a transfer of the property cannot
proceed until any arrears from the previous two years are settled because
the prescribed certificate required for transfer will not be issue d. Debts older
than two years (referred to as historical debt) do not prevent a transfer unless
the municipality enforces its statutory hypothec over the propert y and
withholds transfer until these outstanding amounts are paid.
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[53] Despite the applicant having directed the respondents to the
pertinent paragraphs of Jordaan, the respondents maintained its position that
the first respondent remains liable for the historical debt ; and therefore,
should be the subject of the demand. This stance was adopted without due
consideration of the fact that, pursuant to s 118(3) of the Act , the applicant
holds a statutory hypothec over the property. Once this hypothec is
perfected, it will prevent the transfer of the property to the fifth respondent.
[54] It is apparent that this matter was brought before the court due to the
respondents' misinterpretation of s 118 and the Jordaan decision, as
evidenced by the email exchange. Prior to initiating legal proceedings, the
municipality endeavoured to resolve the matter amicably; accordingly, the
application was filed after the respondents declined to settle the outstanding
debt or provide an undertaking that the property would not be transferred. In
the circumstances, there is no basis to criticize the municipality for bringing
this application on an urgent basis.
[55] Mr Rodel, both in his appearance before me and in his heads of
argument, asserts that if a cost s order had not been sought against them,
they would not have opposed this application. Mr Broster rightly highlights
that the answering affidavit does not merely contest the cost s order; rather, it
challenges several allegations contained within the founding affidavit as well
as the interpretation of s 118 of the Act. Furthermore, the answering affidavit
raises additional disputes beyond those expressed in the exchange o f
emails. Mr Rodel’s position also overlooks the fact that the applicant initiated
these proceedings due to the respondents' failure to provide an undertaking
to proceed with the property transfer.
[56] Although the third respondent was cited in these proceedings, their
inclusion was not warranted. Despite their interpretation being incorrect, they
inclusion was not warranted. Despite their interpretation being incorrect, they
remain ‘creatures of instruction’, without a personal interest in the matter.
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[57] It is , however, unfortunate that this issue required the court's
attention on an already overburdened court roll, particularly as both an urgent
and preferent opposed; thereby taking precedence over other matters with
greater merit, especially when the issues are straightforward and have
previously been addressed by the Constitutional Court.
[58] I get the impression due to the language used, in both the answering
affidavit and the email exchanges, that the third respondent may have
approached the situation with considerable emotion, which led to the
incorrect interpretation regarding the relevant paragraphs of Jordaan and the
content of s 118 of the Act. Nevertheless, the third respondent does not have
a direct interest in this matter. Accordingly, it would be inappropriate to award
costs against them, as such an order would constitute a de bonis p ropriis
order, without sufficient grounds for doing so.
Order
[59] In the result, I make the following order:
1. The rule nisi dated 18 March 2025 is confirmed.
2. Upon payment of the historical debt, the applicant is directed to
advise the sixth respondent in writing that the historical debt has
been paid, whereafter, the sixth respondent is directed to remove the
interdict from the property records.
3. The second respondent is directed to pay the costs of this application
at scale A of the high court tariff.
______________
NICHOLSON AJ
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Case information
Date of hearing: 21 October 2025
Handed down: 27 November 2025
Counsel for the applicant: Advocate Broster / Advocate Menzi Mtshali
Instructed by: Mkhize Miya Inc
Suite 2, Moor House
137 Jan Hofmeyr Road
Westville
KwaZulu-Natal
Counsel for the second Advocate CLL Rodel
and third respondents:
Instructed by: Glover Kannieappan Incorporated
Office 1 A, Stadium Building
Lion Match Office Park
892 Umgeni Road
Durban