Bankenveld Homeowners Association v Elmir Property Projects (Pty) Ltd t/a Elmir Projects and Others (1523/2020) [2022] ZAMPMHC 23 (14 November 2022)

SAFLII Note: Certain personal/private details of parties or witnesses have been redacted from this document in compliance with the law and SAFLII Policy

IN THE HIGH COURT OF SOUTH AFRICA

MPUMALANGA DIVISION (MIDDELBURG LOCAL SEAT)

1523/2020

REPORTABLE: NO

OF INTEREST TO OTHER JUDGES: NO

REVISED

14 NOVEMBER 2022

In the matter between:

BANKENVELD HOMEOWNERS ASSOCIATION APPLICANT

(REG NO.2001/012106/08)

And

ELMIR PROPERTY PROJECTS (PTY) LTD T/A FIRST

RESPONDENT

ELMIR PROJECTS

(REG NO: 2005/021691/070

EMALAHLENI LOCAL MUNICIPAL COUNCIL SECOND

RESPONDENT

THE MINISTER OF WATER AND SANITATION THIRD

RESPONDENT

DEPARTMENT OF WATER AND SANITATION: FOURTH

RESPONDENT

COMPLIANCE DIVISION MPUMALANGA

MEC: MPUMALANGA PROVINCIAL DEPARTMENT FIFTH RESPONDENT

OF ECONOMIC DEVELOPMENT, ENVIRONMENT

AND TOURISM

THE GOLF CLUB BANKENVELD (PPTY) LTD SIXTH

RESPONDENT

(REG NO: 2007/006936/07)

THE REGISTRAR OF DEEDS, NELSPRUIT SEVENTH

RESPONDENT

BANKENVELD GOLF ESTATE PROPERTY

EIGHTH RESPONDENT

OWNERS’ ASSOCIATION (PTY) LTD

JUDGMENT

LANGA J

Introduction

[1] This application concerns the provisioning of proper sewage services to the Bankenveld residential estates in the eMalahleni Local Municipality. In addition to other relief, the Applicant, (“Bankenveld Homeowners Association NPC or Bankenveld HOA”) seeks an order to compel the First Respondent, Elmir Property Projects (Pty) Ltd, (“Elmir”),

a developer of the two private residential estates and/or the Second Respondent, the eMalahleni Local Municipal Council (“the

Municipality”), to properly maintain the two wastewater treatment plants, (“the plants”), erected by Elmir and

which serve the Applicant and the Eighth Respondent (“the Bankenveld Golf Estate Property Owners’ Association) also referred to as the Bankenveld Golf Estate HOA. In this matter “Estates” will be used with reference to the two Estates. As will be evident from the relief sought as tabulated below, the Applicant in the main seeks to compel Elmir and/or the Municipality, to properly maintain the two reclamation

plants in the estates.

The Parties

[2] The parties in this matters are the following:

2.1 The Applicant is Bankenveld HOA which controls the Bankenveld Estate.

2.2 The First Respondent is Elmir, a developer of two the two private residential estates involved in this matter;

2.3 The Second Respondent, the Municipality, is a local Municipal Council as contemplated in the Local Government: Municipal Structures Act 117 of 1998;

2.4 The Third Respondent is the Minister of Water and Sanitation;

2.5 The Fourth Respondent is the Department of Water and Sanitation: Compliance Division, Mpumalanga;

2.6 The Fifth Respondent is the MEC: Mpumalanga Provincial Department of Economic Development, Environment and Tourism; and

2.7 The Sixth Respondent is the Golf Club Bankenveld (Pty) Ltd;

2.8 The Seventh Respondent is the Registrar of Deeds, Nelspruit.

2.9 The Eighth Respondent is the Bankenveld Golf Estate Property Owner’s Association (Pty) Ltd.

[3] Elmir and the Municipality are the only respondents opposing the application. Elmir in turn also launched a counter-application against the Municipality. The Applicant was represented by Advocate FJ Erasmus SC whereas Advocate L Putter SC represented Elmir. The Municipality was represented by Advocate O Ben Zeev.

Relief sought in the Notice of Motion

[4] For completeness of the record, the relief sought in the notice of motion by the applicant is as follows:

1. That the First Respondent be interdicted and restrained from developing, alternatively selling and further alternatively subdividing any of properties in the Township known as Bankenveld Extensions 12 to 33, Witbank, (“hereinafter the Townships”), listed in Annexure “A” attached hereto, until it has: -

1.1 complied with all conditions of establishment of the Township;

1.2 obtained Water Use Licences as prescribed in terms of the National Water Act of 1998;

1.3 Complied with the conditions, if any, of any Directives issues in terms of the National Water Act 36 of 1998 and the National Environmental Management Act 107 of 1998;

1.4 obtained environmental authorizations for the existing and future sewer plants located on the Township; and

1.5 obtained consent from the Second Respondents in terms of the Spatial Planning and Land Use Management Act 16 of 2013.

2. That the First, alternatively the Second Respondent and further alternatively the First and Second Respondents, jointly and severally, be directed to provide sanitation services, namely sewer services which are compliant to all legislation - including but not limited to the Water Services Act 108 of 1997 and the National Water Act 36 of 1998 - to the Township including but not limited to: -

2.1 Budgeting, implementation, monitoring, upgrading and maintenance of such sewer services;

2.2 The payment of all or any operational costs on a daily basis and the capital payment of structural or any other maintenance for the first and second sewer reclaiming plants.

3. That the First, alternatively the Second Respondent and further alternatively the First and Second Respondents, jointly and severally, be directed to remediate and rehabilitate the environmental damage caused by the ongoing sewer spillage at the Township;

4. That the First, alternatively the Second Respondent and further alternatively the First and Second Respondents, jointly and severally, be directed to mitigate and prevent future environmental damage caused by the ongoing sewer spillage at the Township;

5. That the First and Second Respondents be directed to provide comprehensive written feedback to the Applicant every 2 (two) months on the implementation of prayers 1 (1.1 to 1.5) for both reclaiming sewer plants constructed in the Township;

6. That the First Respondent be directed to make application for the necessary environmental authorizations as prescribed by the National Water Act 36 of 1998 and the National Environmental Act 107 of 1998, including but not limited to a Water Use License, within 4 (four) months from the date of the order;

7. That the Sixth Respondent be prohibited to extract water in any format from the existing reclamation plants for irrigation purposes of the Bankenveld Golf Course pending compliance with prayers 1 and 2 hereof by First and Second Respondents;

8. That the Seventh Respondent be instructed to register a Caveat on the properties listed in Annexure A attached hereto, with the wording:

“The First Respondent is interdicted and restrained from developing alternatively selling and subdividing any of the following properties

in the Township known as Bankenveld Extensions 12 to 33, Witbank (the Township), listed in annexure “A’ attached hereto until it has: -

8.1 complied with all conditions of establishment of Township;

8.2 Obtained Water Use Licences in terms of the National Water Act 36 of 1988;

8.3 complied with the conditions, if any, of any Directive issued in terms of the National Water Act 107 of 1998;

8.4 obtained environmental authorizations for the existing and future private sewer plants located on the Township;

8.5 obtained consent from the First (sic) Respondent in terms of the Spatial Planning and Land Use Management Act 16 of 2013.

9. Costs against the First, Second and Sixth Respondents on attorney and own client scale, jointly and severally;

10. Costs against the remaining Respondents on attorney and own client scale only in the event of opposition.

The Factual matrix

[5] Although only Elmir and the Municipality opposed this application, the Eighth

Respondent (Golf Club Bankenveld), which is represented by the Bankenveld Golf Estate HOA, supports the relief sought by the Applicant. When the initial application was launched during June 2020, Elmir and the Municipality both filed answering affidavits followed by the replying affidavits by the Applicant. However, subsequent thereto, the Municipality launched an urgent application and obtained an order in this court on 06 November 2020 compelling Elmir, pending the finalization of the main application, and to the satisfaction of the Municipality, to operate and maintain the wastewater treatment plants and to rehabilitate the environmental damage caused by raw sewage discharged from the plants.

[6] Pursuant to the urgent court order referred to above, the Municipality unsuccessfully launched a contempt application against Elmir and its two directors which application was struck off due to lack of urgency. However, Elmir in response thereafter launched a counter-application relating to the main application, the urgent application and the contempt application. In the counter-application Elmir sought to assign the obligation to operate the reclamation plants to the Municipality. The thrust of its argument in the counter-application is that the Township Establishment Conditions imposed on it (Elmir) fell away as the proclamation of the Bankenveld Extension 11, including the said conditions, were not published in a Provincial Gazette in accordance with Section 103 of the Town-Planning and Townships Ordinance 15 of 1986 “the Ordinance”.

[7] It is common cause that from about around 2001 Elmir developed the “Bankenveld Extension 1-10”, also known as “Bankenveld Estate”, which is controlled by the Applicant. This was Phase I of the development which was later followed from 2006 by Phase II, also known as Extension 11. Extension 11 was later subdivided into Extension 12 to 33. The second estate, the Golf Estate, is situated on Extension 12 to 14.

[8] It is further common cause that prior to the erection of the reclamation plants at the centre of this litigation, the Bankenveld Estate had up to 2010 been serviced by the Sewage Works belonging to the Municipality. However, when Phase II development came about, the reclamation plants were constructed by Elmir as authorized by the Municipality and they were to serve the two Estates. The first plant is situated on property belonging to the Applicant and serves about 387 stands, while the second one is located adjacent to the Golf Estate on the property belonging to Elmir and serves about 55 households. After the construction thereof, the two plants were handed over to Elmir by its engineers on 29 October 2009 and 15 April 2010 respectively according to the Completion certificates by the engineers Strydom & Malan Consulting Engineers.

[9] It further common cause that on 25 September 2007 the Land Use Committee of the Municipality considered Elmir’s application for the establishment of township Bankenveld Extension 11 in terms of section 96 of the Ordinance. The committee supported the application which was also recommended by the Municipal Manager for approval by the Municipal Council subject to a number of conditions. The conditions included inter alia a condition that the provision of all municipal services will be for the account of the applicant Elmir.

[10] It was further indicated in the said consent letter, which is quoted in full in paragraph 11 below, “that it be noted that the treatment and handling capacities of the sanitation system is operating at full design capacity, therefore the proposed option of the developer establishing a water reclamation project be required. The water purification works which supplies potable water to the area is operating above design capacity. See TEC2.7 below.

A further and important condition central to this application 7is found in TEC2.8 and provides that “the activated sludge water reclamation plant be installed and operated by the developer at his cost to the satisfaction of the Council.” These conditions were captured in an approval/consent letter dated 1 October 2007 by the Municipality addressed to Elmir which reads as follows: (My emphasis)

[11] “It gives me pleasure to inform you that the Municipal Council resolved at a meeting held on 01 October 2007 (sic) under item E.124/07 as follows:

1. That in terms of the provisions of Section 96 (3), read in conjunction with Section 69 (10) of the Town Planning and Townships Ordinance, 1986, the comments received with respect to the proposed township Bankenveld Extension 11, be noted;

2. That the application received from ELMIR Projects, the authorized agent of Doornview South Properties (Pty) Ltd for the establishment of township Bankenveld Extension 11 on a portion of Portion 13 of the farm Doornpoort 312 J.S, be approved in accordance with the

provisions of section 98 of the Town Planning and Townships Ordinance, 1986 subject to the following:

2.1. that the conditions of establishment of the township be submitted for approval;

2.2. that the contributions for the remaining services that is payable in terms of the provisions of Section 17 of the Town Planning and Townships Ordinance 1986, be classified by means of an agreement and included in the Services Agreement;

2.3. that the applicant adheres to the conditions laid down by the Department of Public Works, Roads and Transport, the Department of Minerals and Energy, the Department of Agriculture, Conservation and Environment, the Nkangala District Council; Eskom; and the Council for Geoscience;

2.4. that the provisions of all municipal services will be for the account of the applicant and be addressed in a Services Agreement;

2.5. that the engineering plans for all municipal services have to be submitted by a professional engineer for the approval by the Director:

Infrastructure and Basic Services, prior to the commencement of any construction work;

2.6. that any repositioning or re-routing of existing services will be for the account of the applicant;

2.7. that it be noted that the treatment and handling capacities of the sanitation system is operating at full design capacity, therefore the proposed option of the developer establishing a water reclamation project be required. The water purification works which supplies potable water to the area is operating above design capacity;

2.8. that the activated sludge water reclamation plant be installed and operated by the developer at his cost to the satisfaction of the council;

2.9. that at least 500 kl/l day of the reclaimed water be added to the dam inflow

after irrigation;

2.10. that it be noted that no electrical services exist. The installation of services indicated by the Council will be supplied and installed at the costs of the applicant. The bulk supply and ring feed system shall be installed by the developer at his cost;

2.11. that it be noted that the upgrading of bulk infrastructure as mentioned in 2.7 -2.8 above must be budgeted for in future budgets and will be subject to the approval of the budget by the Council;

2.12. that it be noted that if there are no funds approved in the capital budget for the upgrading of water, sanitation and electrical bulk services, Council will not be held liable for the fact that the development of the township, Bankenveld Extension 11 (to be subdivided into Bankenveld Extensions 12-33) cannot continue and is recommended that the developer provide the necessary funds to the Council for the upgrading as required;

2.13. that the Traffic Impact Study Assessment must be conducted by the developer at his own cost for approval of the Directorate Infrastructure and Basic Services and implementation by the developer at his own costs and that a copy be forwarded to TRAC and the South African National Roads Agency;

2.14. that a new access road to the north of Benfleur Extensions 1and 3 which will end in a circle in Paul Sauer Avenue be constructed at the cost of the developer;

2.15. that the individuals to whom the properties will be transferred to must be registered in the Council’s valuation roll to ensure payment of services rendered to these properties;

2.16. that the development of the sites be done in accordance with the eMalahleni Town Planning Scheme, 1991;

2.17. that the amendment of the layout plan as submitted with the application in terms of the provisions of Section 96 (4) of the Town Planning and Townships Ordinance, 1986, be approved;

2.18. that the normal “Residential” parameters will apply to the residential zoning;

2.19. that the contours, floodline and geological zones shall be certified by a qualified professional prior to the endorsement of any Layout Plans;

2.20. that the geotechnical zones be indicated in the Layout Plan;

2.21. that it be a condition of the township establishment that an endowment be paid into a trust account to the value of 3% of the land value of the selling price of each erf on date of registration to compensate for the upgrading of, all construction of the new bulk infrastructure;

3. that, after the approval of the General Plan by the Surveyor General has been obtained and a copy thereof is made available to the Council, the applicant is to pay such fees, submit such documents and furnish such information as prescribed to amend the Town Planning Scheme in accordance with Section 125 of the Town Planning and Townships Ordinance, 1986;

4. that the restrictive title deed conditions, contained in the title deed of the property on which the township is to be established, be removed in terms with the relevant legislation before the opening of the township register, of which all costs will be for the account of the applicant;

5. that the division of the township into 22 different townships, to be known as Bankenveld Extensions 12 – 33, in terms with Section 99 of the Town Planning and Townships Ordinance, 1986, be approved; and

6. that consent to enter into contracts prior to the proclamation be granted to the township owner, in terms with the provisions of Section 97 of the Town Planning and Townships Ordinance, 1986.”

You are kindly requested to provide the draft conditions of the establishment for Bankenveld extension 12 – 33 to the Council

for finalization and approval. Please also send an electronic copy of same to [....]. (My emphasis).,

[12] It is also not in dispute that in 2008 Elmir, in its letter dated 5 February 2008, unsuccessfully attempted have TEC2.8 amended. The request to amend was turned down by the Municipality on 8 December 2011. It is further common cause that during the period 2011 to 2020 the reclamation plants did not function properly and this was confirmed by various experts appointed by Elmir inter alia Enviro Lab, BTW & Associates and M2Enco, confirmed who were all ad idem that the plants were dysfunctional and were polluting the Witbank Dam. It is also common cause that Elmir also appointed Enviro Lab during 2019 for the purpose of regulating the plants and managing the operations.

[13] It is on record that because of the crisis, at some point the two estates joined hands with Elmir and contributed about R30 000 per month towards the rectification of the problems at the reclamation plants. The Estates however later pulled out allegedly because Elmir was no longer prepared to bear the costs which it had under taken to carry. The evidence shows that despite these serious sewage problems, Elmir continued with the development and further subdivision of Extension 11.

[14] As a result of the deterioration of the plants, in a letter dated 5 February 2020, the Applicant’s attorneys demanded various undertakings from the Municipality in respect of its oversight role in the operation of the plants and further that land development be ceased until the sewage problems were resolved. When the Municipality failed to respond, the Applicant launched this application seeking an order compelling Elmir and the Municipality to properly maintain the two sewage plants.

[15] At the centre of this dispute is the question whose responsibility it is to maintain the two reclamation plants. While the Applicant contended that Elmir and the Municipality had the responsibility to take care of the plants, Elmir, on the other, contended that the plants are the responsibility of the Municipality as it is constitutionally responsible institution for the provision of sewage services amongst others services. Elmir also contended that after the completion of the construction of the plants they were handed over to the Municipality and that from 2010 to 2020 they were basically managed and maintained by the Eighth Respondent.

The Applicant’s contentions

[16] The Applicant contended that the failure by Elmir and the Municipality to properly operate the reclamation plants was placing the Witbank Dam, which is an important fresh water resource within the Olifants River water basin, at risk. It is not disputed that the Municipality did not have capacity to deal with the additional sewage that would be generated when phase II commenced. The Applicant’s case is that Elmir is responsible for the plants because when it commenced with this development, and it became apparent that the Municipality did not have sufficient capacity to provide sewage services, Elmir proposed to step in and provide its own solution in the form of two reclamation plants without which Phase II development would not have been approved.

[17] The Applicant further contended that while the Bankenveld Estate had up to 2010 been serviced by the Municipal Sewage Works belonging to the Municipality, which is also common cause, Elmir disconnected Bankenveld Estate from the Municipal sewage system around 2010 and connected it, together with the Golf Estate, to the first reclaiming plant due to insufficient capacity and maintenance on the part of the Municipality. Elmir denied the alleged termination of the external municipal sanitation services and contended that it is the Municipality which decommissioned its pump station after the proclamation of Extensions 12-14 Bankenveld. It contended further that as a result of the decommissioning of the pump, all the residents were served by the wastewater treatment works provided by Elmir. As stated above Elmir’s case is that these plants were handed over to the Municipality. This contention is denied by the Municipality.

[18] The Applicant in the main also relied on the Municipality’s letter of consent referred to in paragraph 11 above in respect of the impugned approval of Extension 11, Township Establishment Conditions of Extension 11 in particular TEC2.8, which contains a condition that the water reclamation plant shall be installed and operated by the developer at his costs to the satisfaction of the Council.

[19] The Applicant also points out that Elmir, despite filing a comprehensive and lengthy answering affidavit, did not raise the defence that Extension 11 was never proclaimed and that this defence was only raised for the first time in Elmir’s counter-claim. The Applicant further contended that there are factors supporting the contention that the TEC 2.8 was a sine qua non for the development of Phase II which Elmir did not dispute until 09 October 2020. It refers for instance to the following:

[19.1] In paragraph 88 of the answering affidavit Elmir states inter alia that “…prior to 2008 all sanitation services for the Bankenveld development were rendered by the Municipality. After 2008, the developer developed a further 274 erven as part of the Bankenveld Golf Estate which included Extension 12 to 14. The application for the establishment of these townships was brought about under Bankenveld Extension 11, which was later phased in as Extensions 12, 13 and 14.”

19.2 Furthermore, although Elmir attempted to amend TEC2.8, however, in its letter dated 5 February 2008 it states the following in respect of TEC 2.8:

“This condition is acceptable to Elmir Projects as a developer. The implication of this condition is that Elmir will be responsible for the “bulk” sanitation infrastructure, while the local municipality will be responsible for the “internal” sewer network.” (my emphasis).

19.3 In addition, in its answer to paragraph 55 of the Founding Affidavit in the main application, which makes reference to the above mentioned letter dated 5 February 2008, Elmir does not state that TEC2.8 has no relevance to Extension 12 but instead states the following:

“A correct approach was followed to enable amendment of the initial conditions under which extension 12 was established.”

[20] The applicant points out further that in 2008, after the approval of Phase II in 2007, Elmir made a request to amend this condition, which application was declined by the Municipality in 2011. The applicant relies in this regard on the extracts from the minutes of the council meetings held on 08 December 2011 showing that the amendment was tabled before council on 23 November 2011 and rejected on 08 December 2011.

[21] The applicant’s contention is that when this attempted amendment was sought byElmir, the two reclamation plants had already been handed over to Elmir by the engineers as indicated in the Certificate of Completion by Strydom & Malan Engineers as stated above. The applicant further argued that the plants had by then already started experiencing problems and that over the next 9 years, from 2011 until around 2020, Elmir consulted various engineers regarding these plants and all reported that the plants were not functioning properly and that they were causing the contamination of the Witbank dam. In this regard the Applicant referred inter alia to Elmir Projects Process Audit Report dated 29 June 2017 and the reports by BTW & Associates and M2Enco.

[22] The applicant further contended that it is as a result of the dysfunctionality of the plants, in 2019 Elmir engaged an environmental company, EnviroLab to regulate the plants by replacing key components and managing its operations. The Applicant alleged further it is at that time that the two Estates joined forces with Elmir to solve the problem and contributed R30 000.00 per month, to buy chemicals etc. The Applicant alleged further that the Estates eventually pulled out of the project because Elmir did not, amongst other undertakings, replace the pumps.

[23] The applicant contended that despite the serious problems experienced by the waste water plants, Elmir never ceased the further development and subdivision of Extension 11 until in 2020 when the applicant wrote a letter of demand. As already stated the letter of demand was followed by this application to compel Elmir to properly maintain the sewage plants serving the two estates. The Applicant contends that it is a fact that the plants are dysfunctional and further that Elmir has no water use licences. The applicant argued therefore that there is no factual dispute which cannot be resolved on paper as contended

by Elmir.

The contentions by Elmir

[24] In opposing the application Elmir renounced any responsibility for the plants and stated amongst other things that the after it constructed and installed the wastewater treatment plants based on written agreements with the Municipality, the plants were handed over to the Municipality in 2011 and were managed and maintained by the Eighth Respondent from 2010 to 2020. As already alluded to above, Elmir further denied that it terminated the external sanitation services which were provided by the Municipality and contended that it is the Municipality which decommissioned its pump station after the proclamation of Extensions 12-14 Bankenveld. Elmir argued that it was as a result of the decommissioning of the pump station that all the residents were served by the wastewater treatment works provided by Elmir. However, these contentions by Elmir were denied by the Municipality. This therefore also constitutes an issue for determination as the Municipality denies the alleged hand over of the plants to it and contended that the plants were always controlled and managed by Elmir.

[25] Elmir further challenges the conditions in respect of the approval of Extension 11 and in particular the TEC2.8 contained in the Township Establishment Conditions of Extension 11 which the Applicant relies on. Elmir’s contention in this regard is that the TEC2.8 is not binding on it as it was made in relation to Extension 11 which was never proclaimed as an approved township. The further argument in this regard is that Elmir and the Municipality entered into service level agreements in respect of Extensions 12 -14 and that these agreements exclude any other agreement and constitute the final document governing the relationship between the parties. It contended therefore that the TEC2 .8 was not valid and binding on it.

[26] In his submissions Elmir’s counsel dealt at length with the procedures laid down in the Ordinance and argued that the TEC2.8 condition was made with reference to Extension 11 and not Extensions 12–14 and that therefore, reliance on a condition relating to Extension 11 under a decision taken in terms of section 98 of the Ordinance has no legal basis. The Municipality, the argument continues, entered into services agreements and also issued the notices on which the Proclamation followed without the TEC2.8 forming part thereof.

[27] Elmir contended therefore that it followed the correct procedures in terms of the Ordinance to proclaim the townships and provide them with sanitation. Elmir argued further that the wastewater treatment plants were operational for a substantial period of time and were successfully managed by the Eighth Respondent until the Estates collectively decided to terminate their agreement with Enviro Lab due to financial reasons as well as the Municipality’s failure to maintain them while it earned a monthly income.

[28] Elmir further relies on a letter dated 19 November 2019 by the Municipal manager of the Second Respondent, one Mr Mayisela, acting on behalf of the Municipality, in which he acknowledged the Municipality’s statutory duties to render external engineering services, including sewerage, and further undertook to take the necessary steps to comply with its supply chain management principles. Elmir states that as a follow up on 20 January 2020 it requested the Municipality to expedite and clarify who would operate, maintain and manage the sewerage system to avoid the double-charging of municipal services and Homeowner’s levies.

[29] In addition, Elmir contended that after the undertakings by Mayisela, the Municipality advertised tenders to provide for the provisioning of potable water and wastewater treatment through modular plants for a period of 36 months and that in this tender the Municipality refers to the wastewater treatment constructed in the Township as an interim solution. Elmir further points out that in the tender, the Municipality further undertakes to assume its responsibility as a water service authority in order to mitigate the existing challenges. Elmir contended therefore that the Municipality’s defences in this application are not in accord with these undertakings as well as its constitutional obligations.

[30] Elmir averred that the Applicant and the Eighth Respondent were responsible for the termination of the 10-year-old operation and maintenance of the wastewater treatment plants. It alleges that this termination was done in a calculated and insincere fashion apparently in order to create an environment of emergency to serve its purpose. Elmir contended that that the real reason for this was the failure by the Municipality to upgrade and repair its wastewater treatment infrastructure which had been installed by Elmir ten years before. Elmir contended therefore that it responded to this emergency by appointing an environmental consultant to institute the emergency procedure in terms of the National Water Act, 35 of 1998 in order to regulate what it refers to as the unlawful conduct by the Applicant.

Elmir’s Counter application

[31] The defences raised by Elmir above are illuminated in its counter-application in which it seeks declarators in the following terms:

31.1 that Bankenveld Extension 11 is not a proclaimed township and that no Condition of Establishment or Condition of Approval has been proclaimed which imposes an obligation on Elmir;

31.2 that Elmir is not obliged to operate and maintain the plants as a result of the establishment of any township and that the Municipality is obliged to operate and maintain the plants.

31.2 that the Municipality is obliged to operate and maintain the plants.

[32] Elmir contended that the Township Establishment Conditions imposed by the Municipality fell away because Bankenveld Extension 11 was never proclaimed and further because these conditions were not published in the Provincial Gazette in accordance with section 103 of the Ordinance.

[33] In addition to the counter claim, Elmir contended that there is a dispute of fact in this matter which cannot finalized on paper. The Applicant, however, points out that this defence cannot assist Elmir as the purported dispute was never raised in the answering affidavit by Elmir in the main application.

[34] In a nutshell Elmir’s defences are that the TEC2.8 was never proclaimed and is therefore not binding on it; the Municipality is responsible for the plants as it took over the operation and maintenance of the plants in 2010; the plants were managed and maintained the Eighth Respondent since 2010.

The contentions by the Municipality

[35] The Municipality, on the other hand, unsurprisingly relies on the TEC2.8 and further denies that it took over the plants as alleged by Elmir. The Municipality places the responsibility for the proper maintenance of the plants on the two Estates and Elmir. It contended that Elmir failed to comply with its obligations and responsibility to operate and maintain the sewage reclamation plants on the Estates, which are its own developments, in line with the condition TEC2.8.

[36] The Municipality further argued that when it approved Bankenveld Extension 11 in 2007, Extension 11 was simultaneously formally subdivided into Bankenveld Extensions 12, 13 and 14 in terms of the Ordinance. The Municipality’s contention is that as part of this approval, the TEC2.8 was imposed on Elmir as it was common cause that the municipal infrastructure was at full capacity and would not be able to accommodate water and sanitation services for the new development, including the golf course, which would require a huge amount of water for irrigation purposes.

[37] While it recognizes that as an organ of state and the relevant local government entity it is obliged to provide the Applicant with water and sanitation services, the Municipality nevertheless contends that Elmir, as the developer, carried the primary responsibility to provide these services based on TEC2.8, which it contends, formed part of the conditions of the approval of the Bankenveld Extension. The Municipality contended therefore that this condition expressly provides that Elmir would install and operate the sewage plants serving Bankenveld Estates at its own cost.

[38] The Municipality argued further that when motivating for the approval of the establishment of Bankenveld Extension, Elmir proposed and undertook to provide its own sanitation services by installing the reclamation plants and to treat and use the water therefrom for the irrigation of the golf course. The Municipality contended further that it is Elmir which drafted the conditions and also submitted an expert report supporting the proposal.

[39] The Municipality maintained therefore that had Elmir not made these undertakings, it would not have approved the establishment of the township as that would have resulted in a service demand beyond its capacity, technology and resources. It therefore argued that it was always Elmir’s responsibility to ensure the satisfactory construction and operation of the plants in terms of the conditions imposed in relation thereto.

[40] The Municipality further stressed that it was as a result of the failure by Elmir to ensure the proper functioning of the reclamations plants that it has now initiated a tender for the upgrade of the Bankenveld and other sewerage services. The Municipality rejects the contention in the counter-application by Elmir claiming that as Bankenveld Extension 11 was never proclaimed, the TEC2.8 fell away and is therefore not binding on it.

[41] The Municipality further contended that upon a proper interpretation of the Ordinance, the counter-claim cannot succeed. It relied on the provisions of section 98 (2) of the Ordinance which authorizes a local authority to impose any condition it may deem fit when it approves an application in terms of section 98 (1). It therefore argued that Elmir’s assertion that the condition does not apply is not correct as the conditions which may be imposed under section 98 attach to an approval under section 96 and not any other step in the process of the establishment of a township.

[42] The Municipality therefore argued that Bankenveld Extension 11 was correctly established under section 98 and simultaneously subdivided into Extensions 12-13 in terms of section 99 of the Ordinance. It stressed that the approval, together with the TEC’s, were communicated to Emir on 1 October 2007. The Municipality argued that the approval of a township in terms of section 98 and the declaration of a township in terms of section 103 are two distinct steps in the establishment of a township. While the latter requires publication in a Provincial Gazette the former does not. Furthermore, section 103, the argument proceeds, constitutes a mere procedural formality while the administrative decision is made under section 98. The Municipality therefore argued that although Bankenveld Extension 11 was not published in a Provincial Gazette, that does not mean that it was never formally established.

[43] The Municipality’s reasoning is that if Elmir’s contention was correct, Extensions 12-13 could not have been established as there would be nothing for the Council to subdivide in that case. It therefore argued that the imposition of the TEC’s attached to the establishment of Bankenveld Extension 11 remain valid and the fact that the TEC conditions are not repeated in the section 103 notice does not render them invalid. The Municipality contended therefore that the TEC’s imposed on Elmir, and in particular TEC2.8, remain binding on Elmir. The Municipality argued therefore that Elmir’s suggestion that the TEC’s did not constitute a final administrative decision because they were not published

should be rejected.

[44] Regarding Elmir’s suggestion that the Ordinance does not empower the Municipality to outsource the installation and operation of external municipal services, the Municipality relied on section 118 (2) of the Ordinance which provides that an “applicant shall at his expense, install and provide any external engineering service of which the local authority concerned is not the supplier or cause such service to be installed or so provided.” The Municipality further relied on the wording of the TEC’s which it contended makes it clear that they were meant to apply beyond the proclamation of the township.

[45] In addition the Municipality further contended that Elmir and all the stakeholders involved conducted themselves in a manner suggesting that they accepted and perceived the TEC’s to be binding. It refers to inter alia Elmir’s correspondence dated 5 February 2008 expressly informing the Municipality that TEC2.8 is acceptable to Emir as a

developer. The Municipality also points out that although Elmir attempted, in the same correspondence, to amend the same TEC’s

in order to make the Eighth Respondent responsible for the operation and maintenance of the sanitation system, Elmir however, did not seek to delete TEC2.8. It stressed that Elmir stated in its Environmental Management Plan that the development would devolve to the property owners’ associations or another association and did not suggest at all that it would fall directly under the Municipality. In addition, the Municipality pointed out that Elmir also confirmed in its email dated 03 December 2014 that it was responsible for the operation of the Plants in accordance with the TEC.2.8. (my emphasis)

[46] The Municipality referred to the Supreme Court of Appeal decision in the Municipality of Stellenbosch v Shelf-Line 104 2012 (1) SA 599 (SCA) in which the court stated the following in dealing with the relationship between the developer and the local authority:

“That township development is an economic speculation that holds serious implications for both the developer and the public authority. The developer, for example, must balance the costs… the best interest of the local authority lies in the success of the

development. It too has infrastructural costs recoverable in the medium to long term. …In these circumstances prudence requires

that both parties exclude by their consensus as much uncertainty as they can at the outset. The development process is, of course, also designed to protect the persons who will be acquiring property in the development and will become its residents and users of its amenities.”

[47] The Municipality argued that contrary to this decision, Elmir adopted a position that runs contrary to the consensus reached with it by the Municipality in respect of the Bankenveld development as well as the delicate balance of resources involved in this development. It argued that the TEC2.8, for instance, was imposed at the instance of Elmir as the Municipality did not have sufficient capacity in terms of infrastructure and other resources to approve and sustain the new development proposed by Elmir.

[48] As stated in the preceding paragraphs, concerning the averment that the plants were handed over to the Municipality in 2010, the Municipality denied this claim and pointed out that despite making this allegation, Elmir has not produced any document to prove the claim.

[49] Based on the above, the Municipality opposed only prayers 2, 3, 4, 5 and 9 which are sought against it. It, however, did not oppose prayers 1, 6, 7, and 8 sought against Elmir. The Municipality therefore prayed for the dismissal of the interdict sought by the Applicant so far as it concerns it. The Municipality further argued that the court must consider the principle of separation of powers and the Municipality’s ability to govern own affairs. The Municipality referred in this regard to Molteno Brothers and Others v South African Railways and Others 1936 AD 321 where it was held that a court may not order a mandamus against a state organ in the absence of mala fides on the part of the organ of state. The Municipality further referred to National Treasury v Opposition to Urban Tolling Alliance 2012 (6) SA 223 (CC) where the Constitutional Court stated the following at paragraph 44:

“Beyond the common law, separation of powers is an even more vital tenet of our constitutional democracy. This means that the Constitution

requires courts to ensure that all branches of Government act within the law. However, courts in turn must refrain from entering the exclusive terrain of the Executive and the Legislative branches of Government unless the intrusion is mandated by the Constitution

itself.”

[50] The Municipality also sought reliance on the decision of the Supreme Court of Appeal in Capricon District Municipality v SANCO 2014 (4) SA 335 (SCA) where the court a quo had granted a mandamus directing the two appellants (municipalities) to replace or repair all leaking water pipes and defective water meters. In upholding the appeal against the mandamus the SCA held as follows in respect of the separation of powers.

“One is dealing here with a sphere of authority which fall within the executive and legislative authority of the municipality as the third level of government. In our constitutional order, local government is recognised as the third sphere of government and that in that capacity it exercises both legislative and executive powers. When a decision is taken by a municipality through its council, it will not ordinarily be administrative in character. In these circumstances the executive and legislative powers of a municipality are excluded from judicial scrutiny.”

[51] The Municipality argued further that the although it has the duty to provide water and sanitation, it is however not obliged in the circumstances, to take over the operation and maintenance of the reclamation plants. It contended therefore that the Applicant has failed to establish that it has a clear right against it. It further argued that since it has now, in line with its constitutional responsibility, taken the steps to issue a tender to ensure that proper sanitation is provided to all communities including Bankenveld, there is no longer any basis for the granting of an interdict against it.

[52] The Municipality submitted therefore that the Applicant is in the circumstances only entitled to enforce an interdict against Elmir in respect of the maintenance of the reclamation plants based on the TEC’s. Regarding the relief sought in respect of the environmental damage the Municipality argued that this too should only be enforceable against only Elmir, particularly when the provisions of section 19 (1) and 20 of the National Water Act 36 of 1988 and section 28 of the National Environmental Management Act 107 of 1998 are taken into account. These provisions are discussed in the ensuing paragraphs.

[53] Concerning the counter-application the Municipality prayed that it be dismissed and that Elmir be held responsible for the operation of the reclamation plants in line with its express

undertaking to do so under TEC2.8.

Issues for determination

[54] Based on the above, the central issue for determination in both the main and counter application is about the responsibility for the proper operation of the reclamation plants. The question is whether it is Elmir and/or the Municipality which is responsible and obliged to operate and maintain the two Bankenveld Estate waste-water treatment/sewage plants. Expanded, the issues involve the inquiry whether the TEC’s, in particular TEC2. 8, are valid and binding on Elmir and whether the management and operation of the plants was taken over by the Municipality or to put it differently, whether the plants were handed over to the Municipality as alleged by Elmir.

Evaluation and Legal principles

[55] In view of the identified issues in dispute, I intend dealing with the defences raised by Elmir and the Municipality as well as the and the counter application by Elmir. The defences raised by Elmir are succinctly dealt with in the paragraphs above. The first is that that since Bankenveld Extension 11 was not proclaimed a township, the TEC’s have therefore fallen away and are not binding on Elmir. Secondly, that it is not obliged to operate and maintain the plants as a result of the establishment of any township and that the Municipality is obliged to operate and maintain the plants. Thirdly that the reclamation plants were taken over by the Municipality as early as 2010 and that they were managed by the Golf Estate since then. Fourthly that there is a dispute of fact which cannot finalized on paper. I now will deal with these defences and will deal with the contention that there is a dispute of fact.

Whether there is a genuine dispute of fact

[56] In addition to the counter claim, Elmir contended in the answering affidavit that the matter cannot be resolved on paper as there is a dispute of fact. It is however common cause that Elmir launched a counter application and by so doing concedes that the Applicant correctly approached court by application procedure. Some of the issues involved are not disputed. It is common cause that the plants were constructed and installed by Elmir, it is further common cause that at some point these plants became dysfunctional. Given the defences relied on by Elmir there appears to be no genuine dispute of fact incapable of resolution on paper. The defence that the TEC2.8 was never proclaimed and therefore not binding does not constitute a dispute of fact which cannot be determined on paper. In any event the purported dispute relied upon by Elmir was never raised in the answering affidavit in the main application. This contention that there is a dispute of fact stands to be dismissed.

Extension 11 not proclaimed and the Township Establishment Conditions not binding

[57] Firstly, it has to be pointed out that the defence that Extension 11 was never proclaimed was not raised by Elmir in the main application until the counter claim was launched in October 2020 pursuant to the contempt application. While in its answering affidavit Elmir states that it does not have any issue with the township conditions of approval dated 1 October 2007 as referred to in the Applicant’s founding affidavit, it however, also argued that the Proclamation does not relate to Bankenveld Extension 11, which was phased in by Extensions 12, 13 and 14.

[58] It is, however, clear from inter alia its answering affidavit that Elmir accepted and confirmed that the application for these townships (Bankenveld Extensions 12 – 14) was brought under the auspices of the Bankenveld Extension 11. Elmir clearly envisaged the approval of subdivision of Extension 11 into further extensions as is evident from the correspondence and affidavit. For instance, it stated the following in paragraph 118 of the answering affidavit:

“Application for the establishment of Bankenveld Extension 11, which became Extensions 12–14, was lodged in March 2007 in terms of the Ordinance…Proclamation of these townships were done in phases.”

This position further finds confirmation in a letter dated 11 March 2020 by Elmir to the Department of Water and Sanitation in which the following is stated.

“Application for the establishment of Bankenveld Extensions 11 (which became Extensions 12 to 14) was lodged in March 2007… Proclamation was done in phases, each with a new extension number, e.g. Extensions 12, 13 and 14. A copy of the township application was circulated to the Department of Water Affairs and Forestry in May 2007.”

[59] Apart from the fact that Elmir applied for the approval division of the township, it is common practice for the approval of a large township and the subsequent subdivision thereof in the establishment of townships. This practice also appears to be in accord with Section 99 (1) of the Ordinance dealing with the division of townships. The section provides that an applicant who has been notified in terms of section 98 (4) that his application has been

approved, may within a prescribed period or such period as the authorised local authority within whose area of jurisdiction the township is situated may allow, apply to the local authority in the prescribed manner for the division of the township into two or more separate townships. Subsection (2) authorizes the local authority to consent to the division of the township subject to any condition such local authority may deem expedient. The granting of consent in terms of subsection (2) and the notice contemplated in subsection (3) shall, in respect of each separate township, be deemed to be the approval of an application in terms of section 98 (1) and a notice contemplated in section 98 (4) respectively.

[60] While the approval of the application for a new township is dealt with in terms of Section 96 read with Section 98, the Proclamation of a township is dealt with in terms of Section 103. The proclamation and approval of a township are clearly two distinct processes and the conditions of approval of a township are not necessarily the same as those for the proclamation.

[61] The argument by Elmir that the proclamation does not relate to Bankenveld Extension 11, which was phased in by Extensions 12, 13 and 14 does not make sense given that Extensions 12 to 14 were dependent on the approval of Extension 11. Furthermore, the evidence clearly shows that from its conduct and assertions, Elmir in fact accepted the TEC’s and in particular TEC2.8. As stated in the preceding paragraphs, instead of challenging the TEC2.8 as it now does, Elmir attempted to amend it in its letter to the Municipality dated 5 February 2008 in which it strangely also expressly stated that the condition is acceptable to Elmir as a developer. It stated further that its understanding is that it will be responsible for the “bulk” sanitation infrastructure while the Municipality will be responsible for the “internal” sewer network. Furthermore, in its answering affidavit Elmir confirms that a correct procedure was followed to amend the

condition. This notwithstanding, there is no explanation by Elmir for not having challenged the TEC2.8 then as not binding on it. (my emphasis).

[62] However, despite having stated that that Elmir will be responsible for the “bulk” sanitation infrastructure while the Municipality will be responsible for the “internal” sewer network, Elmir now also avers that the Municipality is responsible for the external services and relies in this regard on the service agreements. This argument cannot take off and stands to be dismissed.

[63] There is in my view overwhelming evidence to illustrate that Elmir never had issues with the Township Establishment Conditions including the impugned TEC2.8. Elmir’s conduct justifies a conclusion that it regarded the conditions as applicable to Extension 11, as well as Extensions 12 to 14. For instance, although Elmir’s version is that the construction and operation of the plants is not part of the conditions of Extensions 12 to 14 Elmir, however, still constructed, installed and operated the plants at its own cost where in its view there was no obligation on it to do so. In addition to this Elmir even appointed experts inter alia EnviroLab and committed to the desludging of the plants and the replacement of pumps amongst other things. It is further clear from the email dated 03 December 2014 by Eben van Wyk of Elmir that he also regarded the TEC2.8 as valid and binding. In this email he states “Die Munispaliteit het die werke oorgeneem, maar ons moet dit instand hou in terme van die goedkeuring van die dorpstigting (par 2.8).” This email was written almost 6 years after the TEC’s were put in place. It is clear therefore that Elmir’s conduct is inconsistent with the case that it now raises in the counter application.

[64] Elmir’s further argument that the conduct of the parties before the imposition of the conditions are of limited assistance in determining the intention of the Municipality and that its conduct after the imposition of the conditions is irrelevant needs comment. The interpretational arguments raised by Elmir are not supportable. It is trite that evidence of previous conversations and negotiations between the parties as well as evidence of the manner in which the parties carried out the contract are important in determining the intention of the parties. The following statement made in Rane Investments Trust v Commission SA Revenue Service 2003 (6) SA 332 (SCA) is of relevance here.

“There is ample authority for the proposition that in seeking to establish the parties’ intentions, when a third person is questioning the meaning of a contract, regard must be had to the parties’ conduct in executing their obligations.”

[65] In the light of the above I find that Elmir’s defence and contention that the TEC’s are invalid and not binding on it is without merit and should be rejected. It is not supported by evidence and the facts. It is in fact contradicted by Elmir’s own conduct. This defence therefore stands to be rejected.

Was there a handover of the reclamation plants from Elmir to the Municipality?

[66] I now turn to deal with the question whether Elmir handed over the plants to the Municipality as averred. However, before dealing with this question, it is necessary to consider the contention by Elmir that the plants became dysfunctional because of the lack of maintenance on the part of the Eighth Respondent (Golf Estate) or both the Golf Estate and the Applicant. Elmir averred in the answering affidavit that the Eighth Respondent managed the reclamation plants from 2010 and that the Eighth Respondents and the Applicant were the cause of the dysfunctionality of the plants because of their inadequate maintenance thereof. Elmir’s own correspondence however, does not support this averment. The evidence shows that it is Elmir which had the responsibility to maintain the plants and this is evident from Elmir’s own correspondence amongst other things.

[67] For instance, on 12 June 2019 the Department of Water Affairs issued a directive to Elmir in terms of sections 19 (3) and 53 (1) of the National Water Act 36 of 1998 raising the issue of water pollution and the failure to take reasonable steps to prevent such pollution and for engaging in water use activities without the necessary authorization. In response to this directive Elmir in its letter dated 23 September 2019 explained the problems. Although in its answering affidavit Elmir stated that the design was not rejected or criticised, it is however, evident from its own letters that this was incorrect. Evidence demonstrates that Elmir was acutely aware of the design problems as well.

[68] Elmir stated further in the same letter that the cause of the problems is that the effluent is not achieving the special limits applicable to the catchment area due to process design by the responsible consulting engineers who Elmir states it intends holding responsible. Elmir further requested a time extension to appeal the directive and to also provide proof of the institution of a claim against the said engineers. Furthermore, it is evident that prior to the letter dated 23 September 2019, Marius van Wyk of Elmir also confirmed in his letter dated 21 August 2019 to the two Estates that Elmir agreed that the plant is not functioning at an acceptable level and explained the problems to be one of design and development, operational and maintenance issues as well as regulatory

challenges.

[69] In addition, Elmir stated in the papers that according to engineers (BTW Engineers), the plants were ineffective in aeriation, disinfection and recirculation of pumps and there was no flow measurement within the plants. It is further evident from the report dated 5 August 2019 by EnviroLab that there were far more serious problems attendant to the plants. For instance, it reported that the plants had no incoming effluent flow meter, the aeration systems were inadequate and there were problems with the pumps which called for the replacement. The averment by Elmir therefore that the Eighth Respondent was responsible for the management and maintenance of the plants is not supported by the evidence and facts.

[70] I now turn to the issue of the alleged handing over of the plants to the Municipality in 2010 as alleged by Elmir. It must be pointed out that although Elmir makes this contention, no evidence or proof of the handover was advanced. Elmir however confirms in its answering affidavit that it unsuccessfully attempted to finalise the management and the levying of the charges with the Municipality.

[71] In addition, Elmir seems to be relying on the Certificates of Completion issued by its engineers. These certificates however, only state that the contract for the construction of the plants was handed over to Elmir and do not confirm that the sewer plants were handed over to the Municipality. The certificates do not in any manner support Elmir’s case that the plants were handed over to the Municipality. In addition, Elmir also refers in this regard to the service agreements which it concluded with the Municipality in respect of Extension 12 to14 for engineering services and averred that the responsibility for the operation of the plants was not incorporated in the Service Agreements. Elmir seems to place reliance on clause 4 of the agreements which provides as follows:

“After the installation of all the essential internal services and the construction of all roads, streets and storm water drainage systems have been completed to the satisfaction of the COUNCIL, the above mentioned services, as well as the maintenance thereof, will be taken over by the COUNCIL after the proclamation of the township and the DEVELOPER will fir this purpose transfer at his own cost all the streets, parks and public open spaces as required to the COUNCIL. All the above-mentioned services (sic) is subject to a 12 (twelve) month retention period, after the township has been proclaimed, or after it was taken over by the COUNCIL, whichever date is the latest.”

[72] The problem for Elmir here is that the service agreement used is a generic one or template. For instance, under Clause 1 the service agreement deals with the normal situation where the Municipality is responsible for the supply of external services or sewage system. It is however, common cause that this Clause is not applicable in this matter as it is not a normal set up as the Municipality in this case did not have enough resources to dispose of the sewage and was not responsible for sewage. This is the reason Elmir constructed the sewage plants at its own costs. Furthermore, Clause 4 referred to above does not assist Elmir as it refers to internal services. This clause however, further states that the retention period ceases after the proclamation of the township or after the takeover by council whichever date is the latest. The Service Agreements argument clearly does not assist Elmir.

[73] Elmir also appears to be reliant on the letter from the Municipality dated 18 November 2019 stating that the Municipality should have taken over the responsibility for the maintenance and upgrade of the sewage plants. The context of this letter and the setting under which it was penned are important. The letter was written in order to do damage control after the crisis. Elmir has failed to prove the allegation that the Municipality took over the control of the plants from Elmir. This brings me to Elmir’s argument that the Eighth Respondent took over the maintenance of the plants.

Whether the Eighth respondent took over the maintenance of the plants

[74] In support of the allegation that the Eighth Respondent took over the maintenance of the plants relies on the fact that the Eighth Respondent took monthly contributions of about R30 000–R40 000 from the members. Elmir however could not dispute that the contributions were meant for the operational costs on Enviro-Lab which had been engaged to deal with the rectification of the problems at the plants. It is clear from the email letters between Marius Van Wyk and Lourens Nienaber of Enviro-Lab in May and June 2020 that Elmir gave Enviro-Lab instructions to regulate the plants and undertook to pay for the services. It is evident from the papers that the two estates became involved in the running of the plants when there were operational problems in 2019 and they contributed to the costs of Enviro-Lab which had been engaged by Elmir in 2019 to procure equipment for both plants.

[75] Although it contends that it was not obliged to do so, Elmir, however, admitted that it was involved in the rectification of the problems at the two reclamation plants. Elmir stated categorically that it spent money in its efforts to resolve the the problems surrounding the reclamation plants. Elmir’s conduct in its dealings directly with the Municipality is not consistent with its contention that the Estates were responsible for the maintenance of the plants.

[76] For the Eighth Respondent to have assumed the responsibility for the plants required a resolution by the special general meeting. There is no evidence of such resolution. However, it must be noed that despite the allegation that the Eighth Respondent was responsible for the maintenance of the plants, Elmir still appointed experts such as M2Enco, its own environmantal consultants in 2020, who provided Elmir with the Emergency Procedure Report dated October 2020. As stated in the preceding paragraphs, Elmir also conceded that it instructed EnviroLab in November 2019 to procure equipment for both plants and

spent a substantial amount on experts to resolve the mismanagement and maintenance issues at the palnts even though it was not its responsibility. It is not clear why Elmir would have engaged EnviroLab and also approached the Municipality in November 2019 if the Eighth Respondent was in control of and maintaining the plants.

[77] Another hurdle for Elmir in this regard is that the environmental authorization granted to it on 19 September 2007 has never been transferred to the Eighth Respondent or any entity for that matter. The environmental authorization placed a responsibility squarely on Elmir and no responsibilty under the EMP devolved on the Eighth Respondent as alleged by Elmir. There is nevertheless no evidential proof that the Eighth Respondent assumed permanent responsibility of the maintainance of the plants and this defence by Elmir therefore also stands to be rejected.

Water Use Licence (WUL)

[78] I now trurn to the issue of the Water Use Licence (WUL) which is important in this matter as the operation of the plants and the concomittant irrigation of the golf course with the water from the sewage plants could not be arried out without the necessary WUL issued by the Department of Water Affairs. In terms of Scetion 151 of the National Water Act 36 of 1998 it is an offence to use water use water otherwise than as permitted under the Act. In terms of Section 21 (e) read with 37 (1) Elmir was obliged to obtain a water use licence for the irrigation purposes and in terms of section 21 (f) for the discharge of water containing waste into a water resource through a pipe, canal, sewer or other conduit. Elmir does not its obligation to obtain the WUL and that it failed to do so.

[79] As already stated in the preceding paragraphs, in order to obtain the approval of the township, Elmir proposed the reclamation plants as the best solution to the sewage conondrum. This proposal also involved the purification of water from the system and its subsequent use for the purposes of the irrigation of the golf course. The irrigation and operation of the plant required the water use licence. Clause 1.16 of the Environmental Authorization referred to above prescribed how sewage had to be treated. It was therefore necessary for Elmir to obtain the necessary Environmental Authorization from the Directorate of Environmental Impact Management, Mpumalanga. The was indeed granted to Elmir in terms of the NEMA in respect of the sewage plant and stipulated inter alia that the sewage had to be treated.

[80] Section 21 (e) of the National Water Act deals with irrigation while Section 21 (f) deals with the discharge of water containing waste into a water resource through a pipe, canal, sewer, or other conduit. In terms of section 151 of the National Water Act it is an offence to operate such plants without a Water Use Licence. Elmir did not dispute its obligation to obtain the Water Use Licences and it is common cause that it did not obtain the same for the installation and operation of the plants.

[81] Given that the environmental authorization was issued specifically to it, Elmir cannot contend that it attempted to obtain the Water Use Licence in order to fulfil the functions of the Municipality which was responsible for the water and sanitation services. Likewise, the suggestion by Elmir that the licences would have been transferred to Municipality after the completion of the plants is unsustainable as the transfer would not have been possible since the EA was issued specifically to Elmir and is not transferrable to a third party. In the answering affidavit Elmir further attempted to blame its failure to procure the Water Use Licence on the Department of Water Affairs and alleged that the application had been pending for 13 years. It is however, not clearl what steps were taken by Elmir in this regard. It is nonetheless, common cause that on 29 June 2017 Elmir withdrew the application for Water Use Licence and it would appear that the reason therefore was to expedite the process by the

launching of a fresh application which would have been quicker as apparently advised by DWAF officials. This is evident from Elmir’s

letter dated 11 March 2020 to the Department of Water and Sanitation.

[82] Furthermore, Elmir cannot explain why it pursued the application for Water Use Licence in 2020 if it is correct that it had already handed the plants over to the Municipality in 2010 as it alleged in the papers. If this averment is correct, then Elmir would not have been under any obligation to obtain the Water Use Licence which would have been the responsibility of the Municipality. Likewise, it also makes no sense that Elmir would have assisted the Municipality in 2019 to obtain the Water Use Licence if it had indeed handed over the plants to the Municipality in 2010. On the basis of the above the defences raised by Elmir should be dismissed with costs.

The responsibilities of the Municipality

[83] I now trun to the allegations and relief sought against the Municipality. It is common cause that the Municipality carries certain constitutional and statutory obligations as part of the government at local level. For instance, Section 152 (1) (b) to (d) of the Constitution clearly provides that local governments are responsible for the provisioning of inter alia services to communities in a sustainable manner and to promote a safe and healthy environment. In terms of Section 24 of the Bill of Rights everyone has the right of access to sufficient water while section 27 makes provision for an environment that is not harmful to health and well-being as well as the protection of the environment from degradation. The Water Services Act on the other hand also places the responsibility to provide access to water supply and sanitation on the Municipalities.

[84] In the light of these provisions the Municipality in this case is the primamry institution responsible for the provisioning of water and sanitation. Over and above the legislative responsibilities, the Municipality collects revenue for these services. Although the Municipality in this case assigned the responsibility to provide services to Elmir, the Municipality cannot, absolve itself from the overall responsibility concerning these services. The Municipality still has the overall supervisory responsibility to ensure that the plants are properly run. In its letter dated 18 November 2019 the Municipality correctly acknowledged that the provision of basic services is its mandatory responsibility and that it was exploring options to now render these services.

[86] The fact that when the crisis emerged, the Municipality launched litigation against Elmir by bringing an urgent application is confirmation of its responsibility in the whole saga. The Municipality’s supervisory role is also evident from the TEC2.8 which provides that the water reclamation plant shall be installed and operated by the developer at his cost “to the satisfaction of the council.” The clause obliges Elmir to operate the plants to the satisfation of the Municipal Council the Municipality correctly relies on this condition to force Elmir to take responsibility for the plants as it should have. The Municipality cannot therefore escape responsibility by blaming Elmir or the Eighth Respondent. (my emphasis).

[87] Despite the responsibility flowing from the TEC2.8, th5e Municipal Council failed to provide any undertaking to provide the Estates with monitoring reports in respect of the reclamation plants from 1 October 2007. In response the Municipality

suggested that it was not aware of Elmir’s failure to ensure that the plants are properly operated and only came to know thereof when it received the letter. The Municipality does not explain why it only took steps in September 2020 despite the fact that it was informed in February 2020 that Elmir and the Applicant had allegedly abondoned the maintenance of the plants. The Municipality’s

excuse that it had directed Elmir to submit monthly reports is not enough as it could not show that reports had been submitted. It is evident that the Municipality did not paly its oversight role responsibly, if at all. It cannot, therefore, be absolved from

responsibility.

[88] In addition, despite the Applicant’s attorneys having demanded in the same letter that the Municipality must refrain from approving further subdivisions of Extension 11 until such time that the problems of the plants are resolved, the Municipality nevertheless proceeded and approved the school, restaurant and subdivision of Erf 1055. The Municipality appears to have also ignored even the directives by DWA. Despite acknowledging in 2019 that it was responsible for the provision of basic services as stated above, and should have taken over the plants in 2011, the Municipality cannot explain why it did not take over until there was a crisis.

[89] It is patently clear that the Municipality has failed in its oversight role as the local municipality and also as obligated in terms of the TEC2.8 in which its supervisory role was expressly stated. The Municipality cannot complain about the lack of funding as the Land Use Committee in its report dated 25 September 2007 explicilty referred to Elmir’s proposal in line with TEC.2.21 that “that it be a condition of the township establishment that an endowment be paid into a trust account to the value of 3% of the land value of the selling price of each erf on date of registration to compensate for the upgrading of, all construction of the new bulk infrastructure.” The bulk infrastructure clearly included sewage as conceded by Elmir in it definition of bulk engineering services in its he counter-application. Despite the fact that this funding was meant for bulk infrastructure such as sewage, the Municipality failed to exact payment by Elmir. By failing to enforce compliance with this condition the Municipality lost millions which could have been used for the bulk infrastructure such as the upgrade of the sewage plants. In the light of the above it is clear that the Municipality was equally, if not more, responsible for ensuring that the reclamation plants were run properly.

Conclusion

[90] In the light of the issues dealt with and highlighted above, I am satisfied that the applicant has made out a case for the granting of an interdcit against Elmir. Elmir has clearly not only failed to comply with the TEC2.8, but it also failed to comply with the directives issued by the Department of Water Affairs. In addition, and most importantly, Elmir failed to obtain the Water Use Licence as well as the Environmental Authorization in respect of the second reclamation plant.

[91] I am satified that the Applicant is entitled to the relief sought in prayer 1 against Elmir interdicting the latter from developning and further subdividing any properties in Bankenveld Extensions 12 to 33 until such time the tender is finalized and Elmir has complied with the conditions of the Establishment of the Township. There are sufficient grounds to conclude that the connection of further properties to the plants will only exercebate the problem.

[92] While it is clear from the evidence that the Municipality is the constitutionally and statutorily obliged institution to provide basic services including water and sanitation, it is however, equally clear that Elmir made an undertaking to provide the sewage services as part of the approval of the township and the further development which Elmir was involved in. Elmir is therefore also responsible for the proper maintenance of the plants. The conditions relied on by the Applicant to exact performance by Elmir were proposed by Elmir itself. Elmir cannot therefore be heard to complain about these conditions. Elmir is therefore euqally responsible for the crisis and therefore an interdict should be granted against it and the Municipality as per prayers 2, 3 and 4. Both Elmir and the Municipality have an obligation to provide proper and compliant sewer services and to remediate and rehabilitate the environment damage caused by the sewer spillage.

[93] Likewise, I am satisfied that Elmir and the Municipality both have an obligation to prevent the sewer spillage in order to mitigate and prevent future environmental damage it causes. Furthermore, in the light of the disorderly manner in which the matter has developed in the past, an order directing Elmir and the Municipality to report to the Applicant on a bi-momhtly in respect of both plants regarding the implementation of the orders in prayer 1 is justified and it is the order I intend making.

[94] Concerning the Water Use Licences, it is clear that Elmir ought to have obtained the Water Use Licence in order to oprerate the plants. As matters stand Elmir is oprerating the plants unlawfully. In order to cure the illegality Elmir should be ordered to obtain the WUL within 4 months of the court order. Furthermore, a case has been made out for the Sixth Respondent to be prohibited from extracting water from the reclamation plants in question for the purposes of the irrigation of the Bankenveld Golf Course until prayers 1 and 2 have been complied with by Elmir and the Municipality.

[95] Lastly, the granting of an order against the Seventh Respondent in the terms of prayer 8 is also justified in order to ensure compliance with the orders against Elmir, in particular the orders in prayer 1.

[96] As stated in the preceding paragraphs, concerning the conterclaim by Elmir, I find that no case has been made for the granting of the counter-claim which ought to be dismissed with costs.

Costs

[97] Concerning costs the rule is that the costs follow the result. In the light of the above, the Applicant is therefore entitled to costs against Elmir and the Municipality who have both unsuccessfully opposed the application. The only question for determination is whether the Applicant is entitled to costs against Elmir and the Municipality on a punitive scale. The Applicant argued that costs should be awarded on attorney and client scale primarily as Elmir did not heed the pleas by the Applicant to resolve the problems and the Municipality also simply just kept quiet. The Applicant therefore submitted that costs should be awarded jointly and severally against Elmir and the Minucipality, the one paying the other to be absolved.

[98] I am satisfied that the Municipality did not act in a manner that was expected in the circumstances.

This litigation could have been evaded had the Municipality and Elmir recognized their responsibilities. It is evident that the Applicant approached court after attempting to have the matter resolved amicably. The Applicant and the citizens of the Estates should therefore not be left out of pocket for having approached court to force the Municipality and Elmir to comply. I am satisfied that a punitive costs order is justified against both Elmir and the Municipality, jointly and severally.

Order

[99] In the result I make the following order:

1. The First Respondent, Elmir, is hereby interdicted and restrained from developing alternatively, selling and further subdividing any of the properties in the Township known as Bankenveld Extension 12 to 33, Witbank (“the Township”), listed in Annexure “A” attached to this order until it has:-

1.1 complied with all conditions of etablishment of the Township;

1.2 obtained Water Use Licence as prescribed in the National Water Act 36 of 1998;

1.3 complied with the conditions, if any, of any Directive issued in terms of the National Water Act 36 of 1998;

1.4 obtained Environmental Authorisation for the existing and future sewer plants located on the Township; and

1.5 obtained consent from the Second Respondent in terms of the Spatial Planning and Land Use Mnagagement Act 16 of 2013;

2. That the First alternatively the Second Respondent and further alternatively the First and Second Respondents are jointly and severally directed to provide sanitation services, namely sewer services which are compliant to all legislation - including but not limited to the Water Services Act 108 of 1997 and the National Water Act 36 of 1998 - to the Township including but not limited to:

2.1 Budgeting, implementation, monitoring, upgrading and maintenance of such sewer services;

2.2 The payment of all or any operational costs on a daily basis and the capital payment of structural or any other maintenance for the first and second sewer reclaiming palnts;

3. The First alternatively the Second Respondent and further alternatively the First and Second Respondents are jointly and severally directed to remediate and rehabilitate the environmental damage caused by the ongoing sewer spillage at the Township;

4. That the Firstalternatively the Second Respondents and further alternatively the First and Second Respondents are jointly and severally directed to mitigate and prevent future environmental damage caused by the ongoing sewer spillage at the Towship;

5. The First and Second Respondents are directed to provide comprehensive written feedback to the Applicant every 2 (two) months on the implementation of prayers 1 (1.1 to 1.5) in respect of both reclaiming plants constructed in the Township;

6. The First Respondent is directed to make application for the necessary Environmental Authorisations as prescribed by the National Water Act 36 of 1998 and the National Environmental Act 107 of 1998, including but not limited to a Water Use License, within 4 (four) months from the date of this order;

7. The Sixth Respondent is hereby prohibited from extracting water in any format from the existing reclamation plants for the purposes of the irrigation of the Bankenveld Golf Course pending compliance with prayers 1 and 2 of this order by the First and Second Respondents;

8. The Seventh Respondent is ordered to register a caveat on the properties listed in Annexure “A” attached to this order, with the following wording:

“The First Respondent is interdicted and restrained from developing and selling and subdividing any of the following properties in the Township known as Bankenveld Extensions 12 to 33, Witbank, (“the Township”), listed in Annexure “A” attached ti this order, until it has:

8.1

complied with all conditions of etablishment of the Township;

8.2 obtained Water Use Licence as prescribed in the National Water Act 36 of 1998;

8.3 complied with the conditions, if any, of any Directive issued in terms of the National Water Act 36 of 1998 and the National Environmental Management Act 107 of 1998;

8.4 obtained Environmental Authorisation for the existing and future sewer plants located on the Township; and

8.5 obtained consent from the Second Respondent in terms of the Spatial Planning and Land Use Mnagagement Act 16 of 2013;

9. The costs are awarded to the Applicant on attorney and client scale against the First, Second and Sixth Respondents, jointly and severally, the one paying the other to be absolved.

MBG LANGA

JUDGE OF THE HIGH COURT

Appearances:

For the Applicant;

Advocate FJ Erasmus SC

For the First Respondent: Advocate

L Putter SC,

with Advocate S Ogunronbi

For the Second Respondent:

Advocate O Ben Zeev

This judgment was handed down electronically by circulation to the parties’ representatives by email. The date for hand-down is deemed to be the 14 November 2022.