In a ground-breaking judgment the Supreme Court of Appeal (SCA) has held in the matter of Govan Mbeki Local Municipality and another v Glencore Operations, South Africa (Pty) Ltd and others that the by-laws enforced in terms of the SPLUMA Act, are invalid. These by-laws contain the provisions that authorise local authorities to issue certificates of compliance with spacial planning regulations and require attorneys to obtain certificates of compliance prior to registrations of transfer of properties. The issuing of these certificates have to date been a major stumbling block in the property market resulting in the delay in transfers.
In its decision the SCA held that: “the restriction on transfer of land is not a necessary power incidental to land use management, as enforcement mechanisms of its land-use are already provided for Chapter 9 of the by-laws. The registration of transfer of property is expressly regulated by the Deeds Registries Act and S 118 of the Systems Act. There is thus no room for an implied municipal power to regulate the registrar’s statutory power to register the transfer of properties. The embargo therefore cannot be incidental to the effective enforcement of land-use schemes and the impugned by-laws are invalid insofar at they impose a mechanism which impermissibly regulates transfer of property. They exceed the legislative competence of the respective municiplaities, and thus offend the principle of legality.” (my emphasis)
The Appeal of the Govan Mbeki Loal Municipality and Emahlahleni Local Municipality was accordingly dismissed with costs. Whilst the judgment only relates to the said two municipalities, the wording of the by-laws of other jurisdictions are very similar and the same principle is involved. Unless all municipalities follow suit and adhere to the judgment, similar applications will follow to force them to do so.
The Steve Tshwete Local Municipality was the First Respondent when the High Court of South Africa Mpumalanga Division, Middelburg (Local Seat) ordered that: “Section 82 of the Steve Tshewete Local Municipality Spatial Planning and Land Use Management by-laws, 2016 is declared to be:
- Inconsistent with Section 25 and Section 156 read with Part B of Schedule 4 of the Constitution of the Republic of South Africa, 1996 (the “Constitution”) and invalid; and
- Invalid in terms of Section 156(3) of the Constitution because it conflicts with Section 118 of the Local Government: Municipal Systems Act, 32 of 2000;
in so far as it requires the Applicants to provide occupancy certificates, approved building plans, zoning certificates and a certificate that “funds” have been paid, for purposes of registration of transfer of the Applicants’ properties set out in Annexure FA2(1) of the founding affidavit”.
Although the decision of the High Court of South Africa, Mpumalanga Division, Middelburg (Local Seat) was suspended for a period of 6 (six) months, the SCA further held:
“I can see no reason to keep the invalid by-laws in operation, especially because of the usurpation by the two municipalities of legislative functions of other spheres of government. It follows that the suspension of the declaration of invalidity of the by-laws must be set aside”.
The SCA then ordered that the suspension of the declaration is set aside. This has the effect that the order of the High Court of South Africa, Mpumalanga Division, Middelburg, Local Seat, is effective from 17 June 2022.
It must be noted that the attorneys for the Respondents have indicated that they hold instructions to take the judgment on appeal to the Constitutional Court. Once an application for leave to appeal is filed, the SCA judgment will be suspended.