Case Law[2025] ZAWCHC 435South Africa
Coetzee NO and Another v Mosselbay Municipality (16552/2024) [2025] ZAWCHC 435 (15 September 2025)
Headnotes
Summary: Administrative law – Review - Administrative action - Validity of Municipal Council decision- Refusal of application for alienation of municipal low value property for benefit of public - Refusal to allow representations on public participation process objections - Infringement of the right to procedural fairness section 3(2)(b)(ii) of the Promotion of Administrative Justice Act 3 of 2000. Decision of Municipality reviewed and set aside.
Judgment
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# South Africa: Western Cape High Court, Cape Town
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## Coetzee NO and Another v Mosselbay Municipality (16552/2024) [2025] ZAWCHC 435 (15 September 2025)
Coetzee NO and Another v Mosselbay Municipality (16552/2024) [2025] ZAWCHC 435 (15 September 2025)
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sino date 15 September 2025
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IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
Not Reportable
Case No: 16552/2024
In the matter between:
GERRIT
LODEWICKUS COETZEE N.O
First Applicant
ANDREA
COETZEE N.O
Second Applicant
(in
their capacities as trustees of the time being of
THE
SOUTH AFRICAN GLOBAL
CONQUEROR
TRUST, I[...])
and
MOSSELBAY
MUNICIPALITY
Respondent
Coram:
RALARALA, J
Heard
on
:
18
February 2025
Delivered
on:
15
September 2025
Summary:
Administrative law – Review -
Administrative action - Validity of Municipal Council decision-
Refusal of application for alienation
of municipal low value property
for benefit of public - Refusal to allow representations on public
participation process objections
- Infringement of the right to
procedural fairness
section 3(2)(b)(ii)
of the
Promotion of
Administrative Justice Act 3 of 2000
. Decision of Municipality
reviewed and set aside.
ORDER
1.
The decision of the Municipality of 29 February 2024 not to grant the
Trust approval
is reviewed and set aside.
2.
The matter is remitted to the Municipality for reconsideration.
3.
The Municipality is to provide the Trust with the relevant objections
by no later
than 30 October 2025 and allow the Trust reasonable time
for submission of the comments to the objections.
4.
The Municipality is to consider the Trust’s application with
all the comments
within 90 days of this order.
5.
The Municipality is directed to pay the Trust’s party and party
costs,
such costs to include the costs of Counsel on Scale C.
JUDGMENT
RALARALA,
J
[1]
This is an application to review and set aside the decisions of the
Respondent
(“the Municipality”)
to
deny the acquisition by the Applicants
(“the
Trust”)
of an immovable property owned
by the Municipality situated at Erf 6[...], Mossel Bay
(“the
property”).
[2]
The Trust’s application to purchase the property for the
benefit of the public,
to provide access to the beach through the
property was unsuccessful. The Trust asserts that the Municipality’s
decision
constitutes an administrative action in terms of the common
law and the Promotion of Administrative Justice Act 3 of 2000 (as
amended)
(“PAJA”)
.
Initially, three grounds underpinned the Trust’s review
application, and at the hearing two of the grounds for review were
abandoned by the Trust
.
The application is opposed by the Municipality contending
that PAJA is not applicable.
FACTUAL
BACKGROUND
[3]
The First Applicant submitted an application to buy the property from
the Municipality. In light of the First Applicant's decision
to
abandon this application, the Trust submitted a new application,
which is the subject matter of these proceedings. The purpose
of
acquiring this property was to provide public beachgoers with access
to the beach and to construct public amenities and changing
rooms.
The property is situated on the south coast of the garden route and
borders an exclusive residential estate, the Moquini
Estate, Dana
Bay, Mossel Bay. The property is said to be facing the Southern
Ocean, which is adjacent to the beach of the south
border. The
property covers approximately 4800 square meters.
[4]
On 30 November 2023, the Municipal Council considered the Trust's
application and granted the Trust an 'in-principle’
approval.
This approval was to be followed by a public participation process
(“the PPP”)
on the proposed alienation of the
property to the Trust. On 15 December 2023 the Municipality published
the proposed alienation
of the property for public comment and
pursuant thereto, on 31 January 2024 the Trust caused correspondence
to be sent to the Municipality
stating that it was alerted that
objections had been lodged against the Trust’s application and
enquired whether it would
be entitled to reply to the objections and
what steps the Trust should take. Pursuant to consideration of the
objections emanating
from the PPP, on 6 March 2024 the Municipality
informed the Trust of its decision not to alienate the property and
the basis thereof
notwithstanding the ‘in principle’
approval. The Trust was dissatisfied with the decision of the
Municipality in this
regard. The Trust seeks to impugn that decision
in this application.
APPLICANT’S
CASE
[5]
The Trust avers in its founding affidavit
that the aforementioned administrative actions are unlawful and fall
to be reviewed and
set aside on the basis that they materially and
adversely affect the Trust’s rights and the rights of the
general public,
which in turn affects the legitimate expectations of
the collective. The Trust further avers that the decision to revoke
the initial
‘in principle approval’ to alienate the
immovable property to the Trust was taken with wilful disregard of
the collective
interest and without complying with procedural
fairness requirements stipulated in section 33 (1) of the
Constitution and section
3 of PAJA. The decisions were taken by
Municipality for all the reasons set out in section 6(2)(c), (e) and
(f)(ii) of PAJA that
justify judicial review.
[6]
The Trust contends that the First Applicant visited the Garden Route
area during March
2023 with the intent to acquire immovable
property/ies for the Trust. The property, an exclusive residential
estate, Moquini Estate,
consisting of luxury private residential
accommodation was spotted by First Applicant. Ownership of Moquini
Estate vests in the
Municipality. It is contended that the First
Applicant approached the Municipality to ascertain the possibility of
acquiring the
property in order to provide public amenities to the
general public at the beach and to facilitate easy access to the
beach via
the property.
[7]
On 6 March 2023, the Municipality advised the First Applicant to make
an application
to the Municipality for the alienation of the
property. The Municipality responded to the email correspondence
setting out the
process that must be followed in order to submit the
appropriate or necessary application.
[8]
In July 2023, the First Applicant enquired about the progress of the
application and
was advised that the application had been
preliminarily approved by the Municipality’s Mayoral Committee.
The application
would be included in the Council's agenda for
approval at a meeting scheduled for 27 November 2023.
[9]
The First Applicant received an email from Douw Steyn
(“Steyn”),
the Municipality's Legal Advisor, on 24 July 2023.
The
Municipality required information from the Trust regarding the
purpose of the Trust together with the letters of Trusteeship
and the
Trust’s resolution, in order to inform the public. Further, the
Municipality advised the Trust that a Public Participation
Process
would be necessary.
[10]
On 24 July 2023, the First Applicant addressed an email
correspondence responding to Steyn proposing
that the Municipality
approve the alienation of the property to the Trust. Certain
undertakings were made by the Trust including
not to alter or in any
way disturb any services.
[11]
Further correspondence was exchanged between the First Applicant and
Steyn which led to the virtual
meeting on 24 August 2023. At the
meeting, Steyn indicated that they were satisfied with the responses
from the Municipality and
that the application would be circulated to
other departments within the Municipality for approval and comment.
This was followed
by additional correspondence from the First
Applicant to Steyn, advising of a meeting with area consultants, “key
people”
in the Fisherman Village Moquini Estate etc. and
aspects that were discussed as well as recommendations.
[12]
The Municipality responded to the correspondence on 20 September
2023, advising that the aspects
raised in the Trust’s
correspondence of 28 July 2023 were with the Directorate of Urban
Planning for further comment, as
part of the application’s
evaluation process.
[13]
On 7 November 2023, the First Applicant was advised by the
Municipality that its Legal Department
was engaged in its final
stages of discussions to make a recommendation to the Council of the
Municipality. The Municipality enquired
about the progress of the
Department of Environmental Affairs.
[14]
The Municipality conveyed that the item to be raised at the Council
meeting was internal in nature
and will only be published on the
website once it had gone through the approval of all the relevant
Committees of the Municipality.
Further, it was conveyed to the First
Applicant that the Municipality first makes an “in-principle”
decision, which
will be communicated to the Trust. Alternatively,
that further input and/or objections may be encountered which might
require further
amendment from the Trust and also having regard to
the PPP which needs to be undertaken
.
[15]
Subsequently, further correspondence was exchanged between the
parties. On 24 November 2023,
the Municipality conveyed and
confirmed that the application would be tabled at the Council’s
meeting on 30 November 2023
following its approval by the Mayoral
Committee.
[16]
The Council’s resolution stipulating, inter alia, that approval
was granted for the alienation
of 4800m
2
of immovable property to the Trust at a market related price of
R980 000 (V.A.T inclusive) and that it would be used for
conservation and coastal access point for the general public. The
Trust indicated that it accepts the resolution. Enquiries were
addressed to the Municipality regarding the PPP and on 31 January
2024, the Trust advised the Municipality that they were alerted
through the local Media regarding opposition to the proposal. The
First Applicant avers that they had studied the objections and
viewed
the individual objections as unwarranted and biased. The Trust
contends that it enquired from the Municipality as to whether
the
Trust would be afforded an opportunity to respond to the objections,
since they were not aware if there were other comments
and what the
full extent and content of the objections is. The Trust also sought
to determine how it could address any or all of
the objections.
[17]
The Municipality advised the Trust on 1 February 2024, that the Trust
has no opportunity to comment
on the objections. On 6 March 2024, the
Trust was informed that the alienation approval was revoked. On 28
March 2024 the Trust’s
legal representative addressed further
correspondence to the Municipality requesting reasons for its
decision and internal remedies
available to the Trust insofar as
review or appeal processes were concerned. To obtain the information
requested, the Trust was
directed to the provisions of the
Promotion
of Access to Information Act, 2 of 2000
[18]
Essentially, the Trust asserts that the Municipality did not afford
it a reasonable opportunity
to make representations before the
revocation of the ‘in principle’ approval. Furthermore,
the Trust contends that
the Municipality failed to provide it with
adequate notification regarding any rights of review or how the
applicant could exhaust
internal remedies as envisaged in
section 7
of PAJA.
RESPONDENT’S
CASE
[19]
The Municipality on the other hand, sets out in its answering papers
that none of the decisions
constitute administrative action as
envisaged in PAJA, as they have no adverse effect on the rights of
the Trust or the general
public.
[20]
Further than on a factual level, the Municipality never made a
decision to alienate the immovable
property or revoke such a
decision. The two decisions made by the Municipality’s Council:
First, on 30 November 2023, constitutes an
‘in-principle’ approval to alienate the immovable
property but subject to
a PPP, vested no rights and stipulated that
the item will be referred back to Council for further consideration.
[21]
The second decision was taken in February 2024 after the PPP which
entails the following:
“
the
comments and objections were substantive and significant in number
and approval for the alienation of the property was not granted
and
the property is to remain undeveloped in its natural state subsequent
to this decision Council is functus officio.”
[22]
The Municipality asserts that the Trust has failed to establish any
case in which it or the collective
had any legitimate expectation
that could or would be adversely affected by any decision taken by
the Municipality.
[23]
The Municipality persists persists that it adhered to the appropriate
procedure when managing
reactive disposals of this nature,
acknowledging that it is not legally obligated to alienate its
immovable property. The Municipality
further contends that no
decision was ever taken prior to the receipt of the Trust’s
offer to alienate the immovable property.
The alienation of public
property is a prerogative to be exercised only by the Municipality;
and courts cannot compel the Municipality
to exercise this
prerogative.
[24]
The Municipality avers that the decision was fair, and all parties
involved, including the public,
were afforded an opportunity to be
heard and advised of the process and accepted same. Members of the
public, who were interested
parties objected to the Trust’s
application and filed objections and comments.
[25]
The Municipality submits that in terms of its Asset Management
Policy, it may not dispose of
an immovable property unless its
council has held a public meeting and determined on reasonable
grounds that the property is not
required for service delivery and
has considered the fair market value.
[26]
The Municipality asserts that the procedure adopted is consistent
with the provisions of the
Municipal Finance Management Act 56 of
2003 (“MFMA”) and the Regulations. Consequently, it is a
fair process for both
the Trust and the public, constituting a fair
procedure as envisaged in section 3(2), alternatively section 3(4) of
PAJA.
[27]
In March 2023, a letter was addressed to the First Applicant, as the
Trust had not yet been registered.
The Municipality in the
aforementioned correspondence stated that the immovable property
cannot be alienated. The Trust may request
legal services to obtain a
formal Council Resolution, and the procedure to be followed was
encapsulated in this correspondence.
The Municipality asserts that
the Trust understood and accepted the process.
[28]
The Municipality further asserts that the Applicant accepted the
terms of the ‘in principle’
decision from the Council
without making any further comments or raising objections. In
addition, in terms of the process there
is no provision for an
applicant to be provided with the comments and objections received
from the public. This was confirmed by
legal services to the Trust on
1 February 2024, when advising that the final decision of Council
will be communicated to him after
all objections and commentary had
been taken into account.
[29]
The Municipality's Council is required to determine whether to sell
the property based on the
item prepared by legal services, the
remarks from the internal departments, and the results of the PPP.
There is no legal or constitutional
obligation to alienate its
immovable property.
[30]
The Municipality denies that an expectation was created that the
different departments would
approve the application. The Trust was
informed of the Council meeting and the date but chose not to attend.
When the Trust was
informed that the Council would take a final
decision and on what basis, it did not make any request to the
Municipality to make
further submissions.
ISSUES
FOR DETERMINATION
[31
]
The Trust's documents initially outlined three primary reasons for
review. Firstly, that the revocation
of the ‘in principle
approval’ is unlawful; secondly, that the Municipality should
have provided the Trust with an
opportunity to comment on the
objections received in the PPP; thirdly, that the decision to refuse
the application is not rationally
related to the information before
the decision -maker, as objections have no merit
.
At the hearing,
the Trust abandoned the first and the third grounds and proceeded on
the basis of the second ground
of
procedural fairness under PAJA. Thus, this court is enjoined to
determine the following, firstly, whether the Municipality’s
omission to permit the Trust to submit to its Council representations
after the objections were lodged by the public is an administrative
action, simply put, whether PAJA applies. Secondly, whether the
Municipality infringed the applicant’s right to procedural
fairness as contemplated in section 3(2)(b)(ii) thereof. I turn to
consider these disputed issues ad seriatim.
[32]
To effectively address this question, I consider it important to
provide a detailed overview
of the legal principles that underpin
administrative actions. In my view, these principles form the basis
of how organs of state,
the Municipality in this case, should
exercise its public power when making decisions that affect
individuals and organisations.
An examination of the relevant
statutes, and relevant case law, will enable this court to unravel
the responsibilities of the Municipality,
an organ of state towards
members of the public like the applicant to ensure fairness and
accountability.
LEGAL
PRINCIPLES
[33]
The Promotion of Administrative Justice Act 3 of 2000 (PAJA) section
1 defines a decision as
follows:
“‘
decision’
means any decision of an administrative nature made, proposed to be
made, or required to be made, as the case may
be, under the
empowering provision, including a decision relating to-
(a)
making, suspending, revoking or refusing
to make an order, award or determination;
(b)
giving, suspending, revoking or refusing
to give a certificate, direction, approval, consent or permission;
(c)
issuing, suspending, revoking or refusing
to issue a licence, authority or other instrument;
(d)
imposing a condition or restriction;
(e)
making a declaration, demand or
requirement;
(f)
retaining, or refusing to deliver up, an
article; or
(g)
doing or refusing to do any other act or
thing in administrative nature, and a reference to a failure to take
a decision must be
construed accordingly;”
Section
1 defines ’administrative action’ as meaning any decision
taken, or any failure to take a decision, by-
(a)
an organ of
state, when-
(i)
exercising a power in terms of the Constitution or a provincial
constitution; or
(ii)
exercising a public power or performing a public function in terms of
any legislation; or. . .”
[34]
Section 3 of PAJA reads:
”
Procedurally
fair administrative action affecting any person
(1)
Administrative action which materially and
adversely affects the rights or legitimate expectations of any person
must be procedurally
fair
(2)
(a) A fair administrative procedure
depends on the circumstances of each case.
(b)
In order to give effect to the right to
procedurally fair administrative action, an administrator, subject
to subsection (4)
must give a person referred to in subsection (1)-
(i)
Adequate notice to the nature and purpose
of the proposed administrative action;
(ii)
A reasonable opportunity to make
representations;
(iii)
A clear statement of the administrative
action;
(iv)
Adequate notice of any right of review or
internal appeal where applicable; and
(v)
adequate notice of the right to request
reasons in terms of section 5”
DISCUSSION
Is
the decision of the Municipality to revoke the ‘in-principle’
approval an administrative action?
[35]
Adv. De Waal SC, counsel for the Municipality argued that a decision
to sell a low value capital
asset reactively does not qualify as an
administrative action under PAJA. The reasons for this submission are
based on the fact
that the decision is not administrative in nature,
as the Council is not typically an administrative decision-making
body. Further
that there is nothing bureaucratic about the decision,
nor does it involve ’application of policy’ instead, the
decision
seems more commercial or managerial in nature, rather than
administrative. Reliance was placed on
Grey’s Marine Hout
Bay (Pty) Ltd v Minister of Public Works
[2005] ZASCA 43
;
2005 (6) SA 313
(SCA)
where the court found that the decision to let state land was an
administrative action but stated that:
“
[29]
But section 3(1) of PAJA confers a right to procedural fairness only
in respect of administrative action
that materially and adversely
affects the rights or legitimate expectation of any person.
[30]
While ‘rights’ may have a wider connotation in this
context, and may include prospective
rights that have yet to accrue,
it is difficult to see how the term could encompass interests that
fall short of that. It has not
been shown that any rights -or even
prospective rights -of any of the appellants (or of any other person)
have been adversely affected
by the Minister’s decision. None
of the appellants has any right to use the property that has been
let, or to restrict its
use by others, nor has any case been made out
that rights of occupation of their own premises have been unlawfully
compromised.
As pointed out in Kyalami Ridge at para [95]
‘
The general
rule is that the reasonable use of property by an owner is not
subject to restrictions, even if such user causes prejudice
to
others.’
[32]
Nor has it been shown that any of the appellants (or any other
person) has a legitimate expectation
that the property would be left
vacant, or even that they would be consulted, or their comments
invited, before it was let.”
[36]
Section 160 of the Constitution stipulates that ‘
A municipal
Council makes decisions concerning the exercise of all powers and the
performance of all functions of the Municipality’
. In the
present matter the decision was made by the Municipal Council
exercising a public power or performing a public function.
Moreover,
the decision involves the implementation of a legislation, thus the
exercise of the power is administrative in nature.
Public power
carries with it a duty to act in the best interest of the public. See
Law Society of South Africa v President of the Republic of South
Africa
2019 (3) SA 30
(CC) para 3. Moreover Section 239 of the
Constitution defines an organ of state as to include ‘
any
functionary or institution exercising a public power or performing a
public function in terms of any legislation’
. Thus, I
venture to say that Counsel’s argument in this regard cannot be
sustained.
[37]
In
Grey’s Marine supra (page 323 paragraph D to F)
the
court held as follows
:
“
The PAJA
definition of administrative action restricts administrative action
to decisions that adversely affect rights of any person
that literal
meaning could not have been intended. For administrative action to be
characterised by its effect in particular cases
(either beneficial or
adverse) seems to me to be paradoxical and also finds no support from
the construction that has until now
been placed on section 33 of the
Constitution. Moreover, that literal construction would be
inconsonant with section 3(1), which
envisages that administrative
action might or might not affect rights adversely. The qualification,
particularly when seen in conjunction
with the requirement that it
must have a ‘direct and external legal effect’, was
probably intended rather to convey
that administrative action is
action that has the capacity to affect legal rights, the two
qualifications in tandem serving to
emphasise that administrative
action impacted directly and immediately on individuals. “
[38]
The Trust contends that in terms of
section 40
(2) (b) (i) of the
Municipal Supply Chain Management Regulations immovable
property may
be sold only at market related prices except when the public interest
or the plight of the impoverished demands otherwise.
The
Municipality, in this manner when exercising its power may dispose of
its rights in the property and such disposal constitutes
administrative action.
Bullock NO and Others v Provincial
Government, North West Province and Another
2004(5) SA 262 (SCA).
Significantly,
section 3(1)
of PAJA confers the right to procedural
fairness only in respect of administrative action that materially and
adversely affects
the rights or legitimate expectations of any
person.
Grey’s Marine Hout Bay (Pty) Ltd v Minister of
Public Works
2005(6) SA 313 at 325 para 29. The decision was made
in the exercise of the public power and impacted the public. This
decision
is an administrative action because it involved the
application of Municipal Council’s policy, the highest
decision-making
authority of the Municipality which had direct and
immediate consequences to the members of the public who are meant to
benefit
from the provision of access to a natural resource through
the property and public amenities.
Grey’s Marine supra para
24.
[39]
It is of the utmost importance that the Trust's application is
altruistic in nature, as it is
intended to serve the public interest
by facilitating public access to and enjoyment of the beach areas and
nature. The Trust intended
that the property be utilised by beach
goers especially the poor of the community who cannot afford such
amenities close by and
would otherwise be precluded from visiting and
enjoying a public beach. The Trust in its founding affidavit
references the Municipality
Council Resolution of 30 November 2023
which remains uncontroverted and states at paragraph 43.2:
‘
the immovable
property would be utilised for conservation and costal access point
for the general public.’
At
paragraph 43.6 it continues to state
:
‘
the public will
have free access to and over the immovable property at all times.’
At
paragraph 43.7 it is stated:
‘
the respondent
is satisfied that the disposal would be for the benefit of the
community.”
[40]
The Trust in dispelling the Municipality’s contention that its
decision had no effect on
rights of the Trust or the public, asserts
that the Municipality admitted that it could not afford to render the
required services
and failed to deliver the required public services
which the Trust offered to deliver on behalf of the Municipality.
These services
were neglected, refused, or failed to be provided for
more than 30 years. It cannot be successfully argued that the
decision to
let state land in Grey’s Marine supra is akin to
the present decision on the sale of municipal land. In that case
,
the Minister of Public Works concluded a lease agreement with
Bluefin, a company established by a group of women with deep roots
from Hout Bay where the leased property was located. These women
wished to venture into the fishing industry and were historically
excluded. The leased property was intended for constructing and
operating a fish processing facility and restaurant on the quayside
at Hout Bay. The Appellants were neighbouring businesses on the
quayside and were concerned that the development would result in
traffic congestion on the quayside, deprive tenants and visitors of
the necessary parking and manoeuvring space, and impede access
to
their premises and to the waterside. They sought to review and set
aside the Minister’s decision. The appellants were
not parties
to the lease agreement between the Minister and Bluefin.
[41]
The second appellant was previously the tenant of the property that
was leased, and the provisions
of the lease required the second
appellant to construct a clubhouse on the property within 12 months
of the lease's commencement.
The second appellant failed to act in
this regard even after obtaining an extension. The second appellant
proposed to terminate
its lease agreement for the property; however,
they requested an assurance that the property and the adjacent water
area would
remain vacant, and that they would not be rented to any
other individual or used for the construction of any substantial
structure.
This proposition was declined by the state, and no such
undertaking was given.
[42]
This matter is distinguishable from the present matter in that the
Trust is party to the alienation
process as it initiated the
alienation application and is directly affected by the decision of
the Municipality. Further in
Grey’s Marine
the
appellants had not established any rights or prospective rights which
had been adversely affected by the Minister’s decision.
In the
current matter the application by the Trust explicitly stipulates
that the procurement of the property is for the benefit
of the
public. Crucially, section 24 of the Constitution is of paramount
importance, as it guarantees everyone a right to the protection
of
the environment for the benefit of the public through reasonable
legislation and other measures that secure use of natural resources
while promoting justifiable economic and social development. The
beach is a natural resource, and as such the public is entitled
to
the access that the Trust seeks to provide. The Trust has indeed
demonstrated that the rights of the public are at stake in
this
matter.
[43]
The Municipality while appreciative of that right acted contrary to
the provisions of section
24 of the Constitution and the
Municipality’s decision materially and adversely affects this
right.
There can be no doubt that the
non-delivery of these services has an adverse effect on the public.
Thus, the proposition by Mr DeWaal that there
is a grave doubt regarding whether the Trust was genuinely acting in
the public interest
fundamentally misses the point and cannot be
sustained.
[44]
Furthermore, the appellants in
Grey's Marine
did not establish
a legitimate expectation, as no undertaking was made by the state
that the property would be left vacant after
the second appellant
relinquished its rights thereto
.
The Trust asserts that the
‘in-principle’ approval created a legitimate expectation.
In my view, it is clear that the
decision of the Municipality falls
within the purview of PAJA. For reasons set out above I take the view
that PAJA is applicable
in this matter and section 3 (2) (a)(ii)
thereof was contravened by the Municipality.
Did
the Municipality deny the Trust the right to procedural fairness?
[45]
Regarding the issue of rebuttal of the objections from the PPP, the
Trust argued that, in paragraph
20.1 of the founding affidavit, the
Municipality contends that no steps were taken by the Trust when
advised to furnish the Municipality
by way of PPP or otherwise with
any rebuttal or comment on the objections. This is while no
invitation was extended to the Trust
for comments notwithstanding the
Municipality’s stance that the Trust had no right to comment on
the objections. This assertion
by the Municipality is not
sustainable.
[46]
The Municipality’s stand point is that the PPP was not
applicable as the property was a
low value asset but based on the
MFMA, they had to comply with the requirement that a transfer of
ownership of immovable asset
must be fair, equitable, transparent and
competitive, while Counsel for the Municipality in his written
submissions states that
because the property is a low value property
no PPP was required in terms of the Asset Transfer Regulations
therefore a decision
on low value asset does not trigger PAJA’s
obligations to consult. Notwithstanding, the Municipality claims that
the
procedure followed was fair to both the Trust and the public. It
is important to point out that the Municipality asserts that
resolution
E37-02/2024 in fact extended an invitation to the Trust
not only to attend the PPP but also to lodge representations.
[47]
Pragmatically, in such a case, the Trust’s representations
would not be based on the Trust’s
own application, but rather
on the comments and objections received from the public. This
denoting that the comments and objections
would have to be provided
to the Trust by the Municipality and allow reasonable time for
comment by the Trust. The Municipality
in this manner opened the door
for the consideration of objections, comments, and representations,
by extending the invitation.
However, notwithstanding such invitation
the Municipality only considered the objections and comments lodged
by the public, without
affording the Trust an equal opportunity to
make representation to advocate for the section of the public it
serves, even when
this was clearly requested by the Trust.
[48]
The Municipality’s contention in its answering affidavit that
‘
the Trust took no steps when so advised to furnish the
Municipality by way of the PPP or
otherwise with any
rebuttal or comment on the objections
‘
[para
20.1 of the answering affidavit] in the context of the preceding
paragraph is telling. Furthermore, it is incongruous to the
response
proffered by the Municipality to the Trust’s email
correspondence of 31 January 2024 regarding the PPP objections.
In addition, the Municipality in this paragraph propounds that the
Trust was not precluded from providing comments or rebuttal
to the
objections. This renders the argument tendered by Mr De Waal, which
posits that the administrator exercised his discretion
not to allow
the Trust an opportunity to present comments and dispute the
objections, similarly meritless.
[49]
The First Applicant pertinently requested an opportunity to respond
to the objections in this
correspondence, indicating that the Trust
is not aware of the precise nature of the objections. In my view,
this indicates that
the Trust had a well-grounded, legitimate
expectation that it would be afforded an opportunity to comment on
the objections. The
response to that correspondence from Steyn
indicated that the Municipality was yet to consider the objections
and comments and
thus the opportunity could and should have been
granted to the Trust before a decision was taken by the Municipality.
It is concerning
that the Municipality felt justified in not allowing
the Trust an opportunity to make representations despite the Trust’s
expressed yearning to be heard. Significantly, from the above
contention as correctly pointed out by Adv Bence for the Trust, the
Municipality does not contend that the Trust was not entitled to
provide comments and or rebuttal to the objections during the
PPP.
Authority to make administrative decisions require that decision
makers do so in a manner that is harmonious with PAJA. See
Zondi v
MEC for Traditional and Local Government Affairs
2005(3) SA 589
(CC) para101.The procedure that the Municipality followed was flawed
and violated the Trust’s right to procedural
fairness as
envisaged in PAJA read with section 33 of the Constitution.
[50]
Besides, the argument proffered by the Municipality to the effect
that it would be ineffective
and cost-consuming to provide for a
process where the Trust and objectors are provided with further
opportunities would culminate
in a process akin to trial proceedings
in which the Council would be required to serve as an adjudicator, is
disputed by the Trust.
The Trust contends that the conduct of the
Municipality instead resulted in a very costly litigation, evading
responsibility necessitating
the court to adjudicate on a gratuitous
PPP. It is well to remind ourselves that no process of cross
examination is envisaged but
merely the submission of representations
by the Trust and consideration thereof by the Municipality.
[51]
In the Municipality’s quest to achieve a fair, equitable,
transparent and competitive process
in the transfer of a low value
asset, complete compliance with the MFMA the Municipality had
anticipated that representations from
the Trust in response to the
public comments would be forthcoming. In its correspondence dated 08
July 2023 addressed to the Municipality
the Trust intimated the same
sentiments that ‘
it anticipated objections would come from
the affluent residents, however, cognisance should be taken of the
broader interests of
the whole community’
. In light of the
aforestasted, the PPP should have involved the Trust being granted an
opportunity to make representations as that
is what the application
of procedural fairness in the form of the
audi alteram partem
requires. In
Janse van Rensburg NO V Minister of Trade and
Industry NO
2001 (1) SA 29
(CC) para 24 Goldstone J
remarked as follows:
“
In the modern
States it has become more and more common to grant far reaching
powers to administrative functionaries. The safeguards
provided by
the rules of procedural fairness are thus all the more important . .
. Observance of the rules of procedural fairness
ensures that an
administrative functionary has an open mind and complete picture of
the facts and circumstances within which the
administrative action is
to be taken. In that way the functionary is more likely to apply his
or her mind to the matter in a fair
and regular manner.”
[52]
Essentially, the determination of fairness must be based on the
unique circumstances of each
case. Although it is acknowledged that
the process in the context of local government must not only lose the
attributes of fairness
but also those of transparency,
competitiveness, and cost-effectiveness, permitting the Trust to
submit representations clearly
would not result in the
over-judicialization of the administrative process. Regulation 7(i)
of the Municipal Asset Transfer Regulations:
Municipal Finance
Management Act, 56 of 2003 in relation to consideration of proposals
to transfer or dispose of non-exempted capital
assets makes it
peremptory that any comments or representations on the proposed
transfer or disposal received from the local community
and other
interested parties be considered.
[53]
Crucially, deeply embedded in the circumstances of the present matter
is the conspicuous common
feature that both the Municipality and the
Trust are acting in the
interest of the members
of the same community. Another distinguishing feature from
Grey’s
Marine
, where the appellants were
acting in their own interests while the Minister acted on behalf of
the state. The Trust’s benevolence
is intelligible, it aims to
provide public amenities to the general public and to facilitate easy
access to the beach, a natural
resource via the property and was
intent to preserve the property while the Municipality will be
gaining a financial advantage,
and that remains uncontroverted
.
It bears emphasis that the 33 objectors are a small proportion of the
140,000 residents of Mossel Bay who stand to benefit from
the
alienation of the property. In my view, the argument proffered by Mr
De Waal that there was no factual basis that the Trust
was promised
an opportunity to comment on the public’s comments cannot be
sustained.
[54]
As already alluded to in the preceding paragraphs of the judgment,
the Trust contended that the
‘
in principle’
approval
by the Municipality gave rise to a legitimate expectation on the part
of the Trust that the Municipality would alienate
the property. In my
view, the ‘
in principle’
approval, the service
delivery intentions as demonstrated by the Trust, and the involvement
of rights of Trust and those of the
public are even greater reason
for the Trust to be afforded an opportunity to submit
representations pursuant to the lodging
of the objections and
comments from the public in order to render the process fair,
equitable, transparent and competitive.
[55]
One final issue for consideration, the Municipality argues that the
objectors have to be joined
as they would have a direct and
substantial legal interest in the matter. The matter before this
court concerns the question whether
the decision taken by the
Municipality was through the correct decision-making process or not,
specifically the decision not to
grant the Trust the opportunity to
comment on the objections and not the correctness of the decision not
to alienate the property.
In my view, the objectors would not have a
substantial legal interest in those circumstances. Thus, the joinder
of the objectors
is not necessary for the purposes of these
proceedings. In conclusion pertaining to the decision of the
Municipality not to grant
the Trust the opportunity to respond to the
objections emanating from the PPP, the Trust established proper
grounds for impugning
the Municipality’s decision.
ORDER
[56]
In the result, the following order is granted:
[56.1] The decision
of the Municipality of 29 February 2024 not to grant the Trust
approval is reviewed and set aside.
[56.2] The decision
is remitted to the Municipality for reconsideration.
[56.3 The
Municipality is to provide the Trust with the relevant objections by
no later than 30 October 2025 and allow
the Trust reasonable time for
submission of the comments.
[56.4] The
Municipality is to reconsider the Trust’s application with the
comments within 90 days of this order.
[56.5] The
Municipality is directed to pay the applicant’s costs, on a
party and party scale such costs to include that
of counsel on Scale
C.
RALARALA
J
JUDGE
OF THE HIGH COURT
Appearances
For
Applicants: J
Bence
Instructed
by:
PPM Attorneys
For
Respondent: J De Waal SC
Instructed
by:
H Oosthuizen Attorneys
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