No ruling in fight over Joburg rates

2011-02-22 20:24

Johannesburg - Judgment was reserved by the High Court in Johannesburg on Tuesday, in an application brought against the City of Johannesburg for part of its 2009 budget to be reviewed or set aside.

The application was brought by the SA Property Owners Association (Sapoa) which is challenging an additional 18% rates and taxes increase imposed on commercial property owners in May 2009.

The 18% was imposed over and above the 10% increase imposed earlier the same year.

The City of Johannesburg's advocate Fanie du Plessis said the additional increase was imposed because of a reduction in property value which affected the rates and taxes.

"The large value reduction on properties influenced the increase on rates. When the budget was tabled in March we had no idea how that reduction on property value would influence the rates," he argued responding to Sapoa which accused the council of being negligent in its handling of the matter.

Sapoa's advocate Robert Stockwell said the council had known about the reduction in property value as early as March when they tabled their 2009/10 budget for public comment, but had said nothing about the 18 percent hike they later imposed in May.

Du Plessis said there was nothing unlawful about the setting of the rates and proper procedure had been followed.

Stockwell argued that the council had failed in its duties because they should have known as far back as January about the reduction in property values.

"When the budget was tabled in March, they kept quiet, nobody said they might be a difficulty later on."

However, Du Plessis said the council had not failed because the budget was only "tabled, not adopted" in March.

Judge Stanley Moshidi reserved judgment on the matter but requested both parties to file supplementary heads of arguments on a sub-section on the Rates Act to enable him to grant a judgment later.

On Monday, Du Plessis submitted that some paragraphs of the application were "defamatory, senseless and irrelevant to the merits of the case".

"The allegation that the council mismanaged its financial affairs is very general and totally irrelevant to the merits of the case," he said.

"There are no facts or evidence to support this."

Du Plessis described as "verbal abuse and irrelevant" a section that said the council was irresponsible in the manner in which it attended to its affairs.

He also questioned a claim that the city was unable to attend to its functions.

"These are slogans used in public demonstrations, my lord. This is a court of law. Evidence must be provided.

"This is not a forum for political slogans and vague accusations."

He said Sapoa had no basis for attacking "municipal values" in the application.

Sapoa argued that the increase was imposed without complying with procedures prescribed in the applicable legislation.

Stockwell said the municipality was required by the constitution to handle its public affairs in an "effective and transparent manner".

He said the community had the right to be informed of the municipality's decision and its state of financial affairs.

Stockwell also argued that in the Rates Act communities were supposed to participate where an increase was to be imposed.

"The municipality has a duty not only to inform the community of how its going to spend its budget but to also inform them of where it's coming from," he said.

He said when these increases were imposed in May 2009 they could not even be found on the municipality's website.

Stockwell said the owners were given only a ten day notice before the increases were imposed.

The municipality's policy said 30 days notice should be given to allow public comment on the budget.