eThekwini Municipality and Another v Independent Schools Association of Southern Africa and Others (960/2019) [2021] ZASCA 155; [2022] 1 All SA 17 (SCA) (3 November 2021)

eThekwini Municipality and Another v Independent Schools Association of Southern Africa and Others (960/2019) [2021] ZASCA 155; [2022] 1 All SA 17 (SCA) (3 November 2021)

The Supreme Court of Appeal held that section 19 of the Municipal Property Rates Act, read with the 2010 amended regulations, imposes a binding cap on the rates that municipalities may levy on public benefit organisation property. Municipalities cannot evade this limitation by declining to recognise such property in their rates policies. The constitutional challenge to section 19(1)(b) fails because the Constitution expressly permits national legislation to regulate municipal taxing powers. The validity challenge based on alleged lack of consultation also fails, as the Minister for Cooperative Governance and Traditional Affairs consulted organised local government and published draft...

Citation
[2021] ZASCA 155
Parties
Appellant: eThekwini Municipality; Appellant: Stellenbosch Municipality; Respondent: Independent Schools Association of Southern Africa; Respondent: National Minister for Cooperative Governance and Traditional Affairs; Respondent: National Minister of Finance
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
3 November 2021
Case Number
960/2019
Procedural Posture
Civil Appeal / Appeal From Kwa Zulu Natal Division of the High Court, Durban
Outcome
Appeal dismissed. Cross appeal dismissed with no order as to costs.
Judges
Mbha, Dlodlo, Mbatha, Ledwaba, Unterhalter
Legal Topics
Municipal Property Rates Act, Ministerial Regulation, Local Government Autonomy, Consultation Requirements, Public Benefit Organisation Property, Constitutional Limitation of Municipal Powers
Administrative Law Land and Property Constitutional Law Municipal Property Rates Act Ministerial Regulation Local Government Autonomy Consultation Requirements Public Benefit Organisation Property +1 more

Case Brief

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Parties

eThekwini Municipality

Appellant

Stellenbosch Municipality

Appellant

Independent Schools Association of Southern Africa

Respondent

National Minister for Cooperative Governance and Traditional Affairs

Respondent

National Minister of Finance

Respondent

Procedural Posture

Civil Appeal / Appeal From Kwa Zulu Natal Division of the High Court, Durban

Legal Issues

  1. 1 Whether the 2010 amended regulations capping municipal rates on public benefit organisation property apply to eThekwini Municipality.
  2. 2 Whether the 2010 regulations and section 19(1)(b) of the Municipal Property Rates Act are valid and constitutional.
  3. 3 Whether there was adequate consultation in terms of section 84 of the Municipal Property Rates Act before promulgation of the regulations.

Ratio Decidendi

The Supreme Court of Appeal held that section 19 of the Municipal Property Rates Act, read with the 2010 amended regulations, imposes a binding cap on the rates that municipalities may levy on public benefit organisation property. Municipalities cannot evade this limitation by declining to recognise such property in their rates policies. The constitutional challenge to section 19(1)(b) fails because the Constitution expressly permits national legislation to regulate municipal taxing powers. The validity challenge based on alleged lack of consultation also fails, as the Minister for Cooperative Governance and Traditional Affairs consulted organised local government and published draft...

Court Disposition

Appeal dismissed. Cross appeal dismissed with no order as to costs.

Orders

  • The appeal is dismissed.
  • The appellants are liable jointly and severally, the one paying the other to be absolved, for the costs of the first, second and third respondents, including the costs of two counsel.