Ratepayers associations across South-Africa, the Soutpansberg Ratepayers Association (SRPA) in Louis Trichardt included, were dealt a severe blow last week with the Supreme Court of Appeal’s judgment in favour of local government.

In the case of Rademan v Maqhaka Municipality and others, the Supreme Court basically ruled that a municipality has the right to cut off a resident’s services if any amount on his or her municipal account is outstanding. This is bad news for ratepayer’s associations who are currently embroiled in disputes with their municipalities regarding poor service delivery and withholding taxes by paying residents' contribution into trust accounts. In the SRPA’s case, members' property tax and basic services component of their monthly municipal account is paid into a trust account, while only the amount for water and electricity consumption is paid over to the municipality.

The case was heard on 16 November by Supreme Court judges Lewis, Bosielo and Petse and judgement given on 1 December. The case follows after the appellant, Ms Olga Rademan of Kroonstad and a member of the Moqhaka Ratepayer and Residents Association’s electricity supply was disconnected because of her failure to pay. This was done without a court order. Rademan then successfully launched an urgent application for her electricity supply to be restored and an order to this effect was granted by the Kroonstad Magistrate’s Court. The Moqhaka Municipality then successfully appealed against this order through the Free State High Court. Rademan then took the case to the Supreme Court of Appeal, with the leave of the High Court.

In its answering affidavit, the Moqhaka Municipality admitted to having disconnected the supply of electricity, but denied that such action was unlawful. Rademan’s counsel, on the other hand, contended that it was unlawful for a municipality to disconnect the supply of electricity without a court order.

In his judgement, judge Boshielo quoted several sections of the Local Government: Municipal Systems Act 32 of 2000 (Systems Act) wherein a municipality has the legal right to demand payment from residents in their area of jurisdiction to render services effectively.

“For a proper understanding of the legal issues facing us in this appeal, one should ask: what is a municipality expected to do when faced with a number of its residents who steadfastly refuse to pay their taxes and levies? Is a municipality expected to approach the court each time a ratepayer defaults to seek a court order authorising discontinuation of services?” judge Boshielo asked, adding that such a proposition is both unrealistic and untenable.

Boshielo quoted section 102 of the Systems Act and said this made it clear that in pursuit of its obligation to charge and receive payments for municipal services, a municipality had the option to consolidate accounts for the various services it provided.

“This is intended to circumvent the very problem confronting us in this appeal, that is, allowing residents to choose which account they wish to pay and which they will not pay. Such tactics should not be allowed as they have the potential to frustrate a municipality in governing its area and, importantly, meeting it constitutional obligations,” Boshielo said. He said it should be borne in mind that water and electricity were not the only services rendered by a municipality.

Boshielo did, however, make reference to the state of municipal service delivery in the country in his judgement.

“Sadly, in the past few years, public demonstrations and protest by communities complaining of failure by municipalities to provide municipal services or the provision of poor municipal services have become a common feature in our print and electronic media. In many instances, these public demonstrations and protests arise because the residents fail to appreciate that, for a municipality to supply such municipal services, they must pay their levies, taxes and duties as responsible residents,” he said.

Rademan’s appeal was dismissed with costs.

In reaction to the judgement, the chairperson of the SRPA Ms Inga Gilfillan referred the Zoutpansberger to Mr Jaap Kelder, chairman of the National Ratepayer’s Union. Kelder described the judgement as very “simplistic” and indicated that the Ratepayer’s Union will definitely take the matter further.

“Our legal team is studying the judgement and we are definitely considering taking the matter to the Constitutional Court,” Kelder said. He argued that the court gave no consideration to the issue of the dispute against the municipality and relied on, among others, by-laws to justify the Moqhaka Municipality’s actions. For instance, Kelder said, the National Electricity Act clearly states the conditions under which a person’s electricity supply can be disconnected. In this regard, he said, a by-law cannot outweigh the conditions of a national Act.