Municipal Manager - The City of Johannesburg Metropolitan Municipality and others v San Ridge Heights Rental Property (Pty) Ltd

• Jurisdiction: http://justis.com/jurisdiction/166,South Africa
• Judge: Nicholls J, Carelse J, Mabindla-Boqwana J, Weiner J and Molefe JA
• Judgment Date: 11 July 2023
• Citation: 2023 JDR 2525 (SCA)
• Hearing Date: 11 May 2023
• Docket Number: 517/2022
• Court: Supreme Court of Appeal

Carelse JA (Nicholls, Mabindla-Boqwana, Weiner and Molefe JJA concurring):

[1]

This appeal is against the judgment and order of the Gauteng Division of the High Court, Johannesburg, per Strydom J (the high court), in terms of which the high court granted an order in the following terms:

2023 JDR 2525 p4

‘1.

The decision of the second and/or third respondent to classify Erf 827 Erard (sic) Gardens, Ext 36 Township, held by Certificate of Consolidated Title T1100883/2016, (“the property”) as a “multiple dwelling”, taken in terms of the second respondent’s tariff policy under section 74(1) of Act 32 of 2000 (“the Act”) and/or the second respondent’s tariff resolution under section 75(a)(ii) of the Act is reviewed, declared invalid and set aside.

2.

The decision in paragraph 1 is substituted with a decision that the property is classified as “blocks of flats” in terms of the second respondent’s tariff policy and/or tariff resolution referred to above.

3.

The respondents are ordered to pay the applicant’s costs, including the costs of two counsel where so employed.’

[2]

The Municipal Manager of the City of Johannesburg Metropolitan Municipality is the first appellant (the municipal manager). The City of Johannesburg Metropolitan Municipality is the second appellant (the City). Johannesburg Water (SOC) Limited (Johannesburg Water), the third appellant, is the agency responsible for providing water and sanitation services to the residents of Johannesburg and collecting charges on behalf of the City). The respondent, San Ridge Heights Rental Property (Pty) Ltd (San Ridge) is the owner of immovable property described as Erf 827, Erand Gardens in Gauteng measuring 5,2929 hectares, known as San Ridge Heights. The property was purchased from Zotec Developments (Pty) Ltd (Zotec), a property development company.

[3]

The facts are largely common cause. San Ridge Heights consists of 42 buildings on a single erf (erf 827). Each of the 42 buildings is a multi-storey building with eight separate flats. In total, there are 470 flats on the erf. Each block has its own communal entrance, except the ground floor units which have direct access to the ground level.

2023 JDR 2525 p5

[4]

The City and/or Johannesburg Water provide both sewerage and sanitation services to San Ridge Heights. The City and/or Johannesburg Water charge San Ridge for sewerage and sanitation services in terms of its tariff policy, which is adjusted annually. The tariff policy sets out the charges payable by property owners for sewerage and sanitation services for different categories of property. The tariff policy distinguishes between different categories/classification of property, namely, a dwelling unit, [1] a multi dwelling, [2] and a flat. [3] The charges a property owner pays for sewerage and sanitation services is based on the category/classification that the property is assigned.

[5]

The City and/or Johannesburg Water classified San Ridge Heights under the category ‘multi dwelling’, which attracts a tariff of R416.47 per month, per unit effective 1 July 2019. Zotec, the previous owner of San Ridge Heights, lodged an internal appeal, in terms of s 62 of the Local Government: Municipal Systems Act 32 of 2000 [4] (Municipal Systems Act) against the City and/or Johannesburg Water’s

2023 JDR 2525 p6

decision to classify San Ridge Heights as a ‘multi dwelling’. The notice of appeal and a subsequent follow-up letter to the City and/or Johannesburg Water was simply ignored. Dissatisfied with this classification, San Ridge contends that its property should fall under the category/classification of ‘blocks of flats’ and the tariff should be R250.00 per month, per unit. [5]

[6]

In a letter dated 17 October 2019, Zotec informed the City and/or Johannesburg Water that if it did not receive a response to its notice of appeal it ‘will be forced to assume that [its] appeal has been unsuccessful’. As a result of the incorrect tariff, it has suffered a loss of R950 876.64 per year and its ability to provide low cost rental-housing has been adversely affected. To date, San Ridge has not received a response from the City and/or Johannesburg Water.

[7]

On 18 May 2020, San Ridge instituted review proceedings in terms of the Promotion of Administrative Justice Act 3 of 2000 (PAJA), alternatively on the grounds of legality. It submitted that the City and/or Johannesburg Water did not comply with s 5 of PAJA to the extent that it did not provide reasons for its decision to classify San Ridge Heights as a ‘multi dwelling’. San Ridge relied on the following grounds of review: ss 6(2)(c), 6(2)(e)(iii), 6(2)(e)(vi) and 6(2)(i) of PAJA. [6]

2023 JDR 2525 p7

[8]

On 22 June 2020, the Municipal Manager, the City and Johannesburg Water filed their notice of intention to oppose. They only filed the rule 53 record on 26 August 2020. On 18 May 2022, the high court found in favour of San Ridge in terms of the order mentioned above. Leave to appeal to this Court was granted by the high court.

[9]

The record consisted of documents of the mayoral committee dated 6 March 2019, the planning scheme, the Land Use Scheme, the property rates policy for the period 2018/2019, 2019/2020, the Local Government: Municipal Systems Act 32 of 2000 and Local Government: Municipal Property Rates Act 6 of 2004. The City and/or Johannesburg Water do not deny that the record filed does not relate to the decision and/or reasons to classify San Ridge Heights as a ‘multi dwelling’.

[10]

It is common cause that the decision by the City and/or Johannesburg Water amounts to administrative action and is subject to review under PAJA. The City and/or Johannesburg Water concede that San Ridge’s case is not an attack on the validity of the tariff policy, but on its decision to classify the property as a ‘multi dwelling’. In sum, San Ridge’s review challenge is premised on the implementation of the City’s tariff policy and not the tariff policy itself. [7]

[11]

Section 7 of PAJA provides:

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‘(1)

Any proceedings for judicial review in terms of section 6(1) must be instituted without unreasonable delay and not later than 180 days after the date-

(a)

subject to subsection (2)(c), on which any proceedings instituted in terms of internal remedies as contemplated in subsection (2)(a) have been concluded; or

(b)

where no such remedies exist, on which the person concerned was informed of the administrative action, became aware of the action and the reasons for it or might reasonably have been expected to have become aware of the action and the reasons.

(2) (a)

Subject to paragraph (c), no court or tribunal shall review an administrative action in terms of this Act unless any internal remedy provided for in any other law has first been exhausted.

(b)

Subject to paragraph (c), a court or...