Port Edward Town Board v Kay

• Jurisdiction: South Africa
• Judge: Van Heerden JA, Vivier JA, Nienaber JA, Marais JA and Plewman AJA
• Judgment Date: 27 March 1996
• Citation: 1996 (3) SA 664 (A)
• Docket Number: 366/94
• Hearing Date: 16 February 1996
• Counsel: M D Southwood SC for the appellant. C G Marnewick SC for the respondent.
• Court: Appellate Division

A Nienaber JA et Plewman AJA:

Introduction

The appellant (the defendant in the Court below) is the Town Board of the township of Port Edward, Natal. The B respondent (the plaintiff in the Court below) was the owner of a property described as 'remainder of lot 1015', some 105 hectares in extent, situated within the township of Port Edward. For the sake of convenience we refer to the subject property as 'the property' and to the parties as in the Court below. Prior to 6 March 1984 C the property, then still part of lot 1015, had been zoned 'undetermined' in terms of the defendant's town planning scheme. Together with an adjoining lot, lot 1016, lot 1015 was the last extensive coastal holding in the area upon which development had not yet taken place. On 6 March 1984 the defendant resolved as an 'interim measure' to amend the zoning of lots 1015 and 1016 to 'conservation reserve'. It was this change in zoning D which, in the result, led to the defendant becoming obliged in terms of s 67 sept of the Local Authorities Ordinance 25 of 1974 (N) ('the ordinance') to acquire the property because the parties had not been able within five years to agree on a value as they were required by the ordinance to attempt to do. The defendant was reluctant to carry out its obligations in this regard and the plaintiff accordingly applied to the Durban and Coast E Local Division for relief directing it to do so. On 12 November 1991 Van der Reyden J granted an order which compelled the defendant to expropriate the property. On 10 February 1992 a notice of expropriation was thereupon served on the plaintiff. This expropriation culminated in the present litigation, which is an action for an order determining the value of the property in terms of s 12 of the Expropriation Act 63 of 1975 F ('the Act'). Thirion J, sitting in the Durban and Coast Local Division, fixed the value at R3 640 000 and granted judgment in favour of the plaintiff in that amount, together with a solatium of R10 000 (in terms of s 12(2)(a) of the Act), interest and costs. The amount of the award satisfied neither party. Both sought and received leave from the Court a quo G to appeal to this Court. Hence the appeal and the cross-appeal.

The property

The property initially designated as lot 1015, was subdivided in 1989 into sub 1 (6,18 hectare in extent), sub 2 (22,7 H hectare in extent) and the remaining extent of lot 1015, which is the subject property (105,8 hectare in extent). Sub 1 was retained by the original owners of lot 1015 and sub 2 and the subject property were transferred to the plaintiff. To the north of these properties lies lot 1016 - a triangular piece of land. All these I properties are part of the town of Port Edward. The property is separated from portions 1 and 2 by the main South Coast road (the R61) and lies on the inland side of this road. Portions 1 and 2 are to the seaward side of the road and therefore are beachfront properties.

The town of Port Edward has been built up as far as the northern boundary of the adjoining lot 1016. Lot 1016 is only J partly developed. The property itself is vacant land.

Nienaber JA et Plewman AJA

A There has been some development on portions 1 and 2 and on ground lying further inland on the western boundary of the property. It must be noted further that the southern boundary of the property and of portion 2 is the Umtamvuna River which is the boundary between Natal and the Transkei. The river in that part which borders the property runs in B a cliff-lined gorge.

To the west (that is the inland side of the property) is found what is called the Old Pont area - so named because prior to the construction of a bridge this is where the road to the Transkei crossed the river. Upstream from the Old Pont area lies the Umtamvuna Nature Reserve.

Certain developments had at the expropriation date taken place on sub 2, in the Old Pont C road area and across the river in the Transkei. On sub 2 which had been sold off by the plaintiff to a developer, a cluster home development known as Caribbean Estates had been erected. In the Old Pont road area there is a mixed area of industrial land and small holdings where two residential developments known as Eden Wild and Eden Crest have D been built. And on the Transkeian bank there is, on the sea front, the Wild Coast Sun - a hotel and casino complex which includes various recreational facilities and a golf course said to have been built to international standards. Further inland there is, on the Trans-keian side, an area of informal structures sometimes referred to as a squatter E settlement.

The property is described in the judgment of the Court a quo in the following terms:

'The subject property is about 3,5 km from the central business area of Port Edward. It is on the southern boundary of Port Edward and at the southernmost end of the Natal Lower South Coast. Its southern boundary is the Umtamvuna F river which in that area also forms the boundary between Natal and Transkei.

Alongside the subject property the Umtamvuna river runs approximately south east but for the sake of easy reference I shall take it as running due east and I shall fix all other directions accordingly.

The subject property is bounded on its eastern side by the main south coast road G (national road) which is carried over the Umtamvuna by a bridge at the south-eastern corner of the property. Across the national road from the subject property and between the national road and the sea lie sub 1 and sub 2 of lot 1015. On sub 2 has been established Caribbean Estates, a chalet development, a photograph of which forms part of exh MM.

The subject property's frontage onto the Umtamvuna river is just short of a kilometre in length. Cliffs covered with riverine forest rise steeply from the river H bank (as can be observed on a photograph, part of exh MM) to a height of about 75 feet. From above the cliffs the terrain rises gently in the direction of the apex in the north western corner of the property. The greater part of the property is gently undulating.

The western part of the subject property is at an elevated level and the land slopes gradually from there in the direction of the national road and also
I southwards towards the river and northwards towards lot 1016, so that there is a ridge down about the central part of the property. Most parts of the property enjoy good sea views even though some are distant views. The portion next to the national road does not have a sea view. The more southerly portions have views over the Transkei across the Umtamvuna.

Access to the Umtamvuna lagoon down the cliffs can be had at one point only - just west of the bridge - down a steep path. J

Nienaber JA et Plewman AJA

A The subject property is undeveloped land and appears never to have been farmed - except that it might have been used for grazing. The vegetation on the property is of a rich and diverse nature. The central high-lying area is covered with watsonia/protea/grassland which appears to be in its pristine state. This area has a high conservation value - so has the riverine forest along the cliffs above the B Umtamvuna river. Immediately to the west of the national road is an area of disturbed red desert which is infested with casuarina trees. This area which covers roughly one-fifth of the property appears white on the aerial photograph in exh Q. The area has no conservation value. It was referred to in the evidence as the southern red desert.

Near the western boundary of the subject property is an oval shaped disturbed area as can be observed on C the aerial photograph, part of exh Q. This area has been referred to in the evidence as the western (sometimes northern) red desert. It appears to have been used as a borrowpit and is largely denuded of vegetation. It has no conservation value. Two wetlands have been identified on the property. One is north of the western red desert. It drains into a tributary of the Zolwani D river which runs across lot 1016 and into the Zolwani lagoon at the northern boundary of sub 1 of lot 1015. Conservationists regard it as important to the successful management of the lagoon that the catchment area of the Zolwani - and thus also the wetland - should not be disturbed. Any development of the subject property would have to take account of the need to preserve and properly manage the wetland.

The other wetland is on the subject property's boundary with lot 1016 and is next E to the eastern (or southern) red desert. This wetland is an eroded area which is in need of rehabilitation.

Adjoining the subject property on its western side and close to the river is a cluster housing development, Eden Crest. This development is on the edge of the escarpment overlooking the Pont area. Beyond the Pont area to the west, the F Umtamvuna State Forest commences. Further north of Eden Crest and on the western boundary of the subject property are a number of smallholdings. On its northern boundary the subject property adjoins rem of lot 1016 which is unimproved land with some old banana fields in evidence. Like the subject property, rem of lot 1016 is reserved for conservation.'

G Port Edward itself is what is described as a resort industry service-orientated town. What this seems to mean, is that it is a small seaside town with no significant industrial or business centre beyond that which is required to service the various seaside resorts in the area. It has a distinct retirement component. There were growing pressures to allow further resort and residential development although there were still many undeveloped H stands in the town. The demand for expansion created its own pressures. So, for instance, the defendant was at the relevant time involved in litigation relating to the need for a refuse site. There was also a demand that the...