eThekwini loses in Concourt

2013-03-29 00:00

A CONSTITUTIONAL Court ruling yesterday dashed eThekwini Municipality’s hopes of claiming millions of rands from the Ingonyama Trust for rates payments that are in arrears on almost three million hectares of trust land.

eThekwini had believed it was in a position to claim rates arrears on land administered and owned by the Ingonyama Trust from 1998 until 2005.

During that period the Local Authorities Ordinance conferred the authority to levy rates on municipalities in KwaZulu-Natal. This changed on July 2, 2005, when the Local Government: Municipal Property Rates Act came into force, creating a new rates system.

Dismissing eThekwini’s application for leave to appeal against the decision of the Supreme Court of Appeal (SCA) in favour of Ingonyama Trust, the Concourt said the municipality had not satisfactorily explained why it had lodged its application two months late.

The Concourt said there was no prospect that an appeal could succeed because it found that the land was state property, which was exempt from rates in terms of the Rating of State Property Act.

The decision has implications for all local authorities and ratepayers in the province as the Ingonyama Trust Board is said to own an estimated 2,7 million hectares of land in KZN.

In a unanimous judgment the Concourt said that because eThekwini had lodged the application more than two months after the deadline, it not only had to show that the case involved a constitutional issue, but also that the interests of justice warranted the granting of leave to appeal. The Concourt said it was disturbed by the number of litigants not complying with the rules of court, and that this unacceptable behaviour should be halted.

“In this term alone, in eight of the 13 matters set down for hearing, litigants failed to comply with the time limits,” the court said.

eThekwini had stated that its municipal manager had thought it desirable that council approval be obtained before the appeal was lodged, but because the council was in recess this could not be done. In his affidavit, however, he said approval had to be sought from the executive committee. The Concourt said it was not told why the municipal manager had not asked the mayor to convene a meeting of Exco.

The municipality’s lawyers had meanwhile been instructed to prepare the application, which was ready two days before the deadline expired.

The Concourt said the municipality had failed to establish that its non-compliance could be excused.

It ruled that the SCA was correct in its finding that the Trust’s land was state land and could not be declared rateable in terms of the Rating Act.

The Concourt said it would not ordinarily be in the interests of justice to allow a municipality to levy rates on immovable property dating back eight to 17 years without any explanation of why it had failed to do so in the relevant financial years.

“An underlying principle regarding the levying of rates is that they must be levied within the financial year in respect of which the rates are charged.”

The Concourt said rates were based on property valuations that must be on a valuation roll and property owners had the right to dispute the value placed on their properties.

This right could be undermined if municipalities were allowed to assess rates years after the relevant period.


SIDEBAR: “We accept the ruling of the Constitutional Court even though we have not yet had an opportunity to look at and consider the judgment,” eThekwini municipal spokesman, Thabo Mofokeng said last night. He said he could not comment about the substance of the judgment including criticisms levelled by the Concourt about the late filing of the application until the municipality had a chance to study the judgment.

Ingonyama Trust Board chairman, Judge Jerome Ngwenya, said the Board welcomed the judgment, but felt it was unfortunate that they had to “go so far” to resolve the matter. “We hope the parties will be able to plot a way forward after studying the judgment,” he said.

The chairman of the Ingonyama Trust Board, Judge Jerome Ngwenya said Board welcomes the judgment but felt it was unfortunate that they had to “go so far” to resolve the matter. “We hope the parties will be able to plot a way forward after studying the judgment,” he said.

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