Row over R1 mln bill

2019-01-30 16:35
Gavel and scales

Gavel and scales

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Msunduzi Municipality has been ordered by a judge to “debate” the R1 million account it has given the property owners of Crossways in Hilton.

And while this is being done, it has been stopped from disconnecting the electricity supply to the property.

The order was obtained on Tuesday in the Pietermaritzburg high court by Sunset Point Properties, which owns the premises at the corner of Dennis Shepstone Drive and Old Howick Road.

Lloyd Rowlands said in court papers on behalf of the company that it had signed a five-year lease with Crossways Hilton, which runs a successful pub and restaurant. The agreement started in September 2017.

He said that any disconnection in electricity supply would cause the establishment to suffer damages.

The disputed bill dates back to 2012.

Rowlands said the property was purchased in 2006 by Sunset and used to conduct a business known as “Crossways Restaurant”.

Due to many reasons, including an armed robbery, the restaurant business was abandoned and the property was leased to a tenant in 2008. The electricity bill was transferred to this tenant’s name.

The tenant did not comply with the lease agreement and vacated the premises. It was in arrears with its rental, electricity account and rates. About R65 000 was owed to the municipality. However, said Rowlands, Sunset settled the arrears in full.

“The electricity usage at the property during the period prior to May 2015 was always in the region of R4 000 to R5 000,” he said.

In May 2015, Sunset received an account of R551 454 from the municipality. When this was queried, it was discovered that during an upgrade of the meter, it was noted that one of the digits of the six-digit meter had not been read since May 2012.

It turned out that a “dial-size” error was the cause of the large bill. However, the municipality has not been able to produce the meter with the reading which it relies on, he said.

Rowlands added that in July 2015, Sunset instructed its attorneys to dispute the correctness of the account.

The municipality’s acting chief accountant, M. Pillay, said the municipality had been undercharging Sunset because the digits read were wrong.

Pillay said the owners of the business should have established that they were being undercharged and should have made further inquiries.

Rowlands said the municipality then undertook, in writing, not to disconnect the electricity supply to the property until the dispute was sorted out. However, the company still had to pay current accounts.

The disputed account remains unresolved.

In October 2016, the municipality cut off the electricity supply at Crossways.

Rowlands said that at the time his tenant operated a brewery and restaurant/pub. Due to the electricity being cut-off, the beer that was being brewed was spoiled.

Since then, the municipality has on various occasions cut or attempted to cut the electricity supply, despite the undertaking.

Read more on:    pietermaritzburg  |  msunduzi municipality
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