MUNICIPAL DEBT: GREAT BLOW AGAINST THE MUNICIPALITY 2015 04 27

MUNICIPAL DEBT:
GREAT BLOW AGAINST THE MUNICIPALITY

27 APRIL 2015

Stand 278 Strydom Park (Pty) Ltd vs Ekurhuleni Metropolitan Municipality Case No: 23503/2014

Certain Municipalities from the end of 2013 have taken the law into their own hands. We launched a number of Court Applications against various Municipalities, forcing them to comply with their obligations and attempt to convert the Municipality from “PUBLIC ENEMY” back into “PUBLIC SERVANTS”. In this recent week, on one of our matters where the owners of the property instructed us to perform an audit, reduce and settle the Municipalities debts; Ekurhuleni Metropolitan Municipality has again suffered another major blow with their persistent“god-like attitude” that they can simply:

  1. Transfer old owners/tenants debts to current owners;
  2. Prevent the new owners from opening a consumer’s agreement until previous debts are paid;
  3. Unilaterally disconnecting innocent rate payer’s services (water and electricity) for previous unpaid debts.

In this matter, the previous owners sold the commercial property and due to a number of reasons the property accumulated an amount of approximately R6 million over a number of years. The transferring attorneys applied for Clearance Figures and the owners mandated our firm to challenge the Municipality’s claims. Due to our expertise, our firm found a number of errors with the Municipality’s accounts and reduced the Municipality’s claim substantially to approximately R1 million. A number of errors were found, however the majority of the debt for water and electricity had prescribed.

The Municipality should have written off the balance. Ekurhuleni Germiston, felt that now armed with the INFAMOUS “City of Tshwane vs. Mathabatha Judgment”, believed that they could go back into the history of properties and collect debts they previously failed to collect from the previous owners, from the new owners, notwithstanding the fact that the amount claimed was incorrect and overstated.

The municipality attempted to bully the new owners by disconnecting the electricity. The new owners begged and pleaded and attempted to reason with the Municipality that their actions were illegal and unlawful, but to no avail.

The new owners launched an Interim Urgent Interdict against Ekurhuleni for the immediate restoration of electricity. The learned Judge naturally gave the necessary relief.

The matter was then set down to be heard and this past week Judge Strydom granted a Cost order against Ekurhuleni and declared that the new owner is not liable for arrears or charges on accounts held by previous owners.

Ironically, at the doors of court, the Municipality conceded that they were not allowed to hold the new owner liable and/or switch off the electricity.

The Judge declared that the Municipality is not entitled to terminate the supply of services to the new owner on the ground that previous owners of the property are indebted to it. The Municipality attempted a counter application and was also dismissed with costs.

It is sad that a Local Government body is wasting public funds and by abusing and using bullying tactics, notwithstanding the fact that they have to respect innocent people’s constitutional rights. If the Municipality was not a Government institution, no doubt they would be sued for Millions in damages every time.

There is no doubt that innocent parties that have paid these extorted amounts, will have every right to claim the said amounts back from the Municipality. We will assist.

The Municipality is getting Judgment after Judgment against them and cannot believe that despite the courts lambasting them time after time, they continue with these extortion-like tactics as they know that each rate payer’s only relief will be the court’s rescue. Few people have the resources to take the Municipality on each and every time.

Our firm is committed to all Transferring Attorneys, Banks, Estate Agents, Buyers and Sellers in the property industry to ensure the correctness of the Municipalities’ accounts and charges. With the same breath, we are also committed to the Municipalities in assisting them with correcting their accounts.

Our firm always ensures that the correct debts that are due and owing to a Municipality are paid.

To download a copy of this Judgment from our website, between:

Stand 278 Strydom Park (Pty) Ltd and Ekurhuleni Metropolitan Municipality

Case No: 23503/2014

2015-04-27-judgment-case-no-23503-2014-stand-278-strydom-park-pty-ltd-vs-ekurhuleni-metropolitan-municipality

Another pertinent Judgment that we would like to bring to your attention is in the case between:

Motsoatsoa and City of Tshwane Metropolitian Municipality.

Case No: 39315/13

And in particular Paragraph 19 on Page 12.

2014-05-04-judgment-case-no-39315-13-motsoatsoa-vs-city-of-tshwane

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