ConCourt questions withholding of rates

2013-02-05 14:35
(Picture: Sapa)

(Picture: Sapa)

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Johannesburg - The Constitutional Court on Tuesday questioned how municipalities were supposed to provide services if residents withheld payment whenever they had a gripe.

"How could we pick and choose and municipalities still remain viable?" asked Deputy Chief Justice Dikgang Moseneke.

Fed up with the Moqjaka Municipality in the Free State's services, Kroonstad resident Olga Rademan stopped paying the rates portion of her bill, but kept up payment on the electricity, sewerage, and water portion.

Cut off

The municipality cut off her electricity even though she was fully paid up for this aspect of her bill.

Rademan argued that the municipality had no right to do this.

In terms of the Electricity Regulation Act, municipalities were not allowed to cut the electricity supply unless a client had not paid.

"If you paid your electricity, you must receive electricity," her lawyer Dennie Du Preez argued on her behalf at the Constitutional Court.

For residents concerned about municipal financial mismanagement, there was no other course of action.

There was no law that allowed for withholding money from municipalities, but it was also wrong to cut her power off when she was paid up.

The only other option, if residents were disgruntled, was the ballot box, which was "not such a strong weapon", or intervention by national government.

In 2011, Treasury intervened in Limpopo to help rectify the province's finances.

Du Preez said if the municipality wanted its money for rates, it should sue under the common law, but it could not cut off her electricity if it was paid up.

The municipality cited the Municipal Services Act (MSA) to justify its actions.

It contended it could consolidate all amounts a resident or property owner owed into one bill, and if any aspect was outstanding, it could cut the power - regardless of what was paid up and what not.

The bylaws that the municipality used were promulgated in terms of the MSA, the court heard.

Contractual obligation

Jimmy Claasen, SC, for the municipality, said the bylaws gave the municipality the right to cut power if any aspect of the bill was unpaid.

This was part of the agreement the resident entered into with the municipality to receive services.

Disgruntled residents could get a declaration from a court, exercise their options at the ballot box, or protest.

"But they can't withhold money," he said.

Moseneke asked how a municipality's customer could be held so strictly in terms of a contract to pay for, for example, water, if they had not received it for six months.

What happened to a municipality that was in breach of its own contractual obligation to actually provide the water, he asked.

Claasen said ratepayers should make an application to the courts against the municipality, and not withhold their money.

Chief Justice Mogoeng Mogoeng commented that the court's decision would have a profound effect on the approach to service provision in the country, the failure to pay for services, and protests related to service delivery.

The matter continues.

Read more on:    bloemfontein  |  service delivery  |  local government

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