Jan Zeevaart v Kleinfontein Boerebelange Koop BPK (A373/13) [2013] ZAGPPHC 489 (3 December 2013)

IN THE NORTH GAUTENG HIGH COURT, PRE1

(REPUBLIC OF SOUTH AFRICA)

Case Number: A373/13

DATE: 03 DECEMBER 2013

in the matter between:

ANTON JAN ZEEVAART..........................................................................Appellant

And

KLEINFONTEIN BOEREBELANGE KOOP BPK..............................Respondent

JUDGMENT

KEIGHTLEY AJ:

Background

[1] In this matter the Appellant appeals against a Magistrate’s Court’s dismissal of the Appellant’s application for an order directing the Respondent to reconnect his

electricity supply to his home. The Appellant based his application on the mandament van spolie.

[2] The Respondent is a co-operative duly registered and incorporated in terms of the Co-Operatives Act 91 of 1981. It is common cause that the Respondent operates in terms of its own constitution, statute and rules.

[3] The Respondent is the registered owner of immovable property outside Pretoria. It operates a residential settlement, Kleinfontein, on this property. The Appellant’s history with the Respondent may be summarised as follows:

3.1 In 2003 and 2004 the Appellant bought two sets of share allocations in the Respondent. Consequently, two erven were allocated to the Appellant for his use. The Appellant constructed a house on one of the properties, and he resides there with his wife.

3.2 It is common cause that the Appellant was a member of the Respondent. As a member, he bound himself contractually to the Respondent’s constitution and rules.

3.3 It is further common cause that the Appellant's membership of the Respondent was terminated following a special meeting of members on 11 August 2007.

3.4 In November 2007 the Appellant instituted proceedings in the High Court in terms of which he sought to review the decision to terminate his membership.

The Respondent filed a counter-application seeking an order of eviction against the Appellant.

3.5 In the interim, the Appellant disputed that he was liable for the amounts invoiced to him on a monthly basis by the Respondent in terms of water, electricity, and other services, levies and charges. The Appellant took the view that in light of the termination of his membership of the Respondent, he was no longer bound to pay the amounts invoiced to him monthly. Instead, he elected to pay the Respondent a portion of each monthly invoice, indicating that this was for the amount of water, electricity and other services actually used by him.

3.6 Before the Appellant’s review application was heard, he instituted interim proceedings against the Respondent. This resulted in an interim order, granted by the Honourable Bertelsman J on 15 January 2008 (“the Bertelsman J Order”). This order was granted by consent between the parties. In terms of this order, the Respondent undertook, among other things, and without making any concessions on the merits, as follows:

“D/e eerste respondent onderneem om nie die applicant se dienste wa rgeiewer word deur die eerste respondent by Patryssingel 58, Kleingfontein, Gauteng te bee indig hangend die afhandeiing van die aksie onder saaknommer 51715/07 nie, met dien verstande dat die applicant stipteiik sy maandeiikse rekening vir die iewering van sodanige dienste betaal. In die gaval van wanbetaling deur die applicant van die rekenings ten aansien van die dienste, onderneem die eerste respondent om die dienste nie to beeindig nie, tensy skriftelike kennisgewinq van die applicant

se versuim en van die voorneme om die dienste te beeindg minstens tien dae voor sodaniqe beeindpinq aan die appliant gegee word by beide sy woonadres en die adres van sy prokureur van record en die applicant daarna steeds in versuim is om die verskuldigde bedrag to betaaf." (emphasis added)

3.7 The essence of this order by consent was to place the Respondent under a duty (pending the outcome of the Appellant’s review application) not to terminate the provision of services to the Appellant on condition that the Appellant continued to pay his monthly services accounts. In the event that the Appellant failed to pay these accounts, the Respondent would be entitled to terminate the services on written notice to the Appellant, at both the Appellant’s and his attorney’s address, at least 10 days in advance of such termination,

3.8 On 3 May 2011, the Honourable Louw J handed down judgment in the Appellant’s review application. He dismissed the application and granted the Respondent’s counter-application for eviction. The Appellant was ordered to vacate both erven associated with his original shareholding in the Respondent, with provision being made for him to recoup the value of improvements made by him on the properties.

3.9 The Appellant sought leave to appeal from the Supreme Court of Appeal against the Honourable Louw J’s judgment and order. The application for leave to appeal was dismissed.

3.10 It is common cause that the Appellant continues to reside on the Respondent’s property despite the eviction order, and that he continues to refuse to pay the amount invoiced to him every month by the Respondent, save for a portion of each invoice associated with the value of the services that the Appellant claims he actually uses.

[4] It was this state of affairs that led to the Appellant’s urgent application for the reconnection of his electricity supply. More particularly, on 3 July 2012, the Respondent delivered a notice to the appellant that it intended to disconnect his electricity supply in view of the fact that he was in arrears on his account in the amount of R32 184, 60. The notice advised the Appellant that unless he paid his outstanding arrears by 16 July 2012, the Respondent would disconnect his electricity on that date. It is common cause that the Respondent did not send a copy of this notice to the Appellant’s attorney as per the Bertelsman J order.

[5] The Appellant responded to this notice the following day by way of an email. The Appellant indicated in this letter that the notice was improperly motivated in light of the fact that he was no longer a member of the Respondent, and accordingly he was not liable for the various levies and charges included in the invoices sent to him by the Respondent. Further written communication between the parties followed, up to and including on the 18 July 2012, when the Respondent disconnected the Appellant’s electricity supply.

[6] Consequently, the Appellant launched urgent, ex parte proceedings in the Cullinan Magistrate’s Court on 20 August 2012 for an order directing the Respondent to restore the Appellant’s electricity supply. The order was granted

in the form of a rule nisi. On the return day, the learned Magistrate dismissed the application with costs on an attorney and client scale. The learned Magistrate found that the Appellant had not made full disclosure of all the relevant facts before the court. He further found that the Respondent had acted lawfully in disconnecting the Appellant’s electricity supply, and that the Appellant was not entitled to relief under the manadament van spolie.

[7] The Appellant appeals against the learned Magistrate’s order.

[8] The parties were ad idem that insofar as the requirements of the mandament van spolie are concerned, only the second requirement, viz. the question of whether the Appellant had established that he was unlawfully deprived of his supply of electricity, was in issue for purposes of the appeal.

[9] An unlawful dispossession means one without the possessor’s consent, and without due legal process, so that it can be said that the party responsible for the dispossession took the law into his or her own hands. See in this regard Sillo v Naude 1929 AD 21; Stocks Housing (Cape) (Pty) Ltd v Chief Executive Director. Department of Education and Culture Services 1996 (4) SA231 (C) at 240C-D.

[10] Initially there were essentially two issues in dispute between the parties in this regard:

10.1 In the first instance, the Appellant submitted that the Respondent could not rely on the terms of its statute and rules to justify the legality of the termination of the Appellant’s electricity supply because these rules are

not longer applicable to, and binding on the Appellant by virtue of the termination of his membership in 2007.

10.2 In the second instance, the Appellant submitted that the Respondent did not act in accordance with the Bertlesman J Order in that although it gave notice to the Appellant of the intention to disconnect his electricity supply, it did not give notice to his attorney. Accordingly, the Appellant submitted that the Respondent had acted unlawfully and had taken the law into its own hands in terminating the electricity supply without proper notice.

[11] At the hearing of the appeal, counsel for the Appellant, Mr Schoeman, conceded that although the Appellant plainly was no longer a member of the Respondent, as a current resident, he fell within the definition of “belanghebbende” or interested party, as this term is defined in the relevant rules. Mr Schoeman conceded that, on this basis, the Appellant was bound by the rules of the Respondent, even though he was no longer a member.

[12] This concession was correctly made. There is no doubt that the definition of “belanghebbende” is wide enough to include a former member, who remains a resident on the Respondent’s property.

[13] The result of this concession is that the first of the two issues in dispute between the parties fell away, leaving only the second issue open for determination.

[14] The crisp question for purposes of this appeal, therefore, is whether the learned Magistrate erred in finding that the Respondent had acted lawfully by proceeding as it did in terminating the Appellant’s electricity supply.

The statute and rules of the Respondent

[15] The affairs of the Respondent are administered on the basis of its Statute and Rules. It is common cause that when the Appellant became a member of the Respondent, he bound himself to the statute and rules. It is further common cause, by virtue of Mr Schoeman’s concession, referred to above, that the rules and statute apply not only to members, but also to “interested parties”, and that the Appellant falls within the definition of an interested party.

[16] The following rules are relevant to the present appeal:

16.1 Rule 10 in general deals with “Nakoming van Geldelike Verpligtinge” or compliance with financial obligations.

16.2 Rule 10.1 provides that: “Lede en belanghebbendes onderneem om die betaling van hulle heffingsrekenings en leningsrekening (...) sowel as enige ander geldelike verpiigting what mag onstaan, stiptelik no to kom en aanvaar dat die Direksie by magte is om stappe to neem om betaling af te dwing en om teen wanbetalers op to tree."

16.3 Rule 10.3 provides that: “Indien h lid of belangebbende agterstallig is met betaiings, sal gelde wat wel ontvang word, in the volgende volgorde

aangewend word: eerstens agterstallige leningrekening teen die maandelikse bedrag soon ooreengekom in the betrokenne se skuldonderneming; daarna vir boetes deur KBK Bpk opgele; daarna vir enige diverse bedrae ann KBK Bpk verskuldig; daarna vir vaste diensteheffings; daarna for waterberbruik en daarna vir elektrisieteitsverbruik. ”

16.4 Rule 10.4 provides that: “D/e Raad behou die reg voorom, indien enige lid of belanhebbende bly versuim of weier om die ooreengekome dedrae to betaal, alle dienste na die betrokke perseel to staak

16.5 Rule 11, which is headed “Kredietbeleid” provides that: “Heffingsrekeninge is streng binne 30 dae betaalbaar en die Direksie behou die reg voor om in terme van die kooperasie se kredietbeleid agterstallige rekeninge aggressief in to vorder.”

[17] The rules make it clear that:

17.1 Members and interested parties undertake timeously to pay their accounts and they accept that the Respondent’s management is entitled to take steps against those in arrears.

17.2 These steps include terminating all services to the relevant property in circumstances where a member or interested party refuses or neglects to pay the amounts due.

17.3 Where a member or interested party is in arrears, the Respondent is entitled to allocate any payments that are made in accordance with a set order of preference against the outstanding amounts. In terms of this order of allocation of payments, water and electricity arrears are allocated last.

[18] It should be noted that the rules do not make it clear what process must be followed before the Respondent can exercise its right to terminate the provision of services when a member or interested party falls into arrears under rule 10.4. The rules do not provide for a set notice period, or require that on Order be obtained from a court before disconnection can be effected.

[19] In order to determine whether the learned Magistrate was correct in finding that the Respondent acted lawfully in terminating the Appellant’s electricity, it is necessary, in addition to the rules, to consider all the other facts peculiar to this case.

Did the Respondent act lawfully in terminating the Appellant’s electricity supply?

[20] In effect there are two parts to the inquiry regarding the lawfulness or otherwise of the Respondent’s action in disconnecting the Appellant’s electricity supply. The first part of the inquiry concerns whether the Respondent was entitled to

take any steps whatsoever. In other words, was the Appellant indeed in arrears? If so, the second part of the inquiry comes into play, viz. whether the manner in which the Respondent acted was lawful, or whether it was instead the equivalent of it taking the law into its own hands?

[21] As far as the first part of the inquiry is concerned, this question must be answered in the affirmative. The Appellant was an interested party or “belanghebbende”. As such, he was bound by the provisions of the Rules regulating his financial obligations to the Respondent. The fact that his membership had been terminated did not relieve him of these obligations. Accordingly, the Appellant was bound timeously to make payment to the Respondent of all amounts claimed under the monthly accounts submitted to him.

[22] The Appellant avers, however, that he was not in arrears with his electricity account because he made payment every month for the amount of electricity he actually used. This averment cannot be sustained: the rules clearly determine how all amounts paid are to be allocated. It is not open to the Appellant to decide how the allocation of his payments is to be made. In other words, under the rules the Appellant cannot elect what services and other levies to pay for and then to argue that he is not in arrears for these services. On the contrary, under rule 10.3, until the Appellant has paid for all arrear levies, no payment will be set off against his electricity and water account. Furthermore, under rule 10.4, the Respondent reserved the right to terminate all services in the event of there being any amounts outstanding.

[23] Therefore, it is clear that in terms of the rules, which governed the Appellant’s financial obligations to the Respondent, the Appellant effectively was in arrears with the payments due to the Respondent.

[24] In the circumstances, I am satisfied that the Respondent was entitled to take action against the Appellant under the rules for his non-payment despite the Appellant’s monthly payments of the amounts he claims were due in respect of his individual water and electricity usage.

[25] The question that remains is what action was the Respondent lawfully entitled to take, and did it include disconnecting the Appellant’s electricity supply by way of the notice given to the Appellant on 3 July 2012?

[26] The Appellant submitted that the Respondent acted unlawfully, and took the law into its own hands by disconnecting his electricity supply. In this regard, Mr Schoeman submitted that:

26.1 The Respondent could not claim to have acted in terms of the Bertelsman J Order in disconnecting the Appellant’s electricity supply. This is because this Order required the Respondent to serve notice on both the Appellant and on his attorney. It is common cause that it failed to give notice to the Appellant’s attorney. Accordingly, the Respondent had not acted in accordance with the

Bertelsman J Order in disconnecting the electricity, and its actions were not lawful in this respect.

26.2 Further, Mr Schoeman referred us to the recent, unreported decision of the Honourable Tuchten J, in this Court in the matter of Van Gulden & 8 Others v Kleinfontein Boerebelang Kooperasie Bpk (Case no 6273/2013, unreported judgment dated 2 May 2013). In that matter, it was held (in an urgent application) that the applicants were entitled to an order restoring their electricity supply which had been disconnected by the Respondent following a formal dispute between the parties about the amounts properly owed by the applicants to the Respondent. The Honourable Tuchten J held that the use of electricity is an incident of the right of possession of one’s home, and that section 26 of the Constitution is applicable. He found that regardless of the contractual relationship between the parties, the Respondent had no right to disconnect the applicants’ electricity supply without an order of court. Mr Schoeman sought to persuade us that the Van Gulden case was similar to the present matter and that we should similarly find that the Respondent could not act without a further court order against the Appellant.

[27] Mr Havenga SC for the Respondent submitted, to the contrary that:

27.1 There was, at least, substantial compliance with the Bertelsman J Order in that it was undisputed that the Appellant had received notice of the Respondent’s intention to terminate his electricity supply. The purpose of the Order was achieved, even though the Respondent did not also give notice to

the Appellant's attorney. Accordingly, he submitted that the Respondent had acted lawfully, in terms of the Bertelsman J Order, in terminating the Appellant’s electricity supply.

27.2 Furthermore, the fact that the Bertelsman J Order was granted by consent meant that there was implicit consent by the Appellant of the Respondent’s right to disconnect the electricity supply if the Appellant fell into arrears.

27.3 Mr Havenga submitted further that quite apart from the Bertelsman J Order, the Respondent was contractually entitled, under the rules, to disconnect the Appellant’s electricity supply in the event of non-payment. The only caveat here is that the Respondent must follow a fair procedure in doing so. He submitted that the Respondent had done so in this case.

27.4 Mr Havenga submitted further in this regard that the Respondent is in the same position as a municipality in that it supplies basic services to persons within its jurisdiction. This being the case, the present matter was akin to the situation dealt with by the Supreme Court of Appeal in Rademan v Moqhaka Municipality & Others 2012 (2) SA 387 (SCA). In that case it was held that a municipality is entitled to terminate the electricity supply to defaulters who fail to pay their monthly levies even if they are not in arrears with their actual electricity account. The SCA held that it would be unrealistic and untenable for municipalities to obtain a court order against each defaulter before disconnecting the electricity supply.

27.5 Mr Havenga urged us to adopt the approach applied in Rademan rather than that applied in the Van Gulden case, or in Naidoo v Moodie 1982 (4) SA 82 (TPD), on the basis that this case can be distinguished from the situation dealt with in these latter two cases.

[28] As regards the issue of whether there was due compliance with the Bertelsman J Order, I find that there was such compliance. In my view, the critical aspect of the notice requirement contained in this Order is the following: the Order required written notice to be given “aan die applicant” (to the applicant) “by beide sy woonadres en die adres van sy prokureur van record” (at both his residential address and the address of his attorney of record). It is plain from this that the material requirement was that there had to be notice to the applicant. The provision did not require that there was to be notice to the applicant and notice to his attorney of record. The requirement of where such notice was to be given, i.e. at both addresses, must be read as being subsidiary to the material requirement. In other words, the purpose of listing two addresses at which the notice should be given must be read as being to ensure that the required notice would be received by the applicant. Provided the applicant received notice, the main purpose and material component of the notice requirement was met. Accordingly, it did not matter that

the notice was sent to, and received at only one of the two listed addresses: the important point is that the purpose of the requirement

was fulfilled in that it is undisputed in this case that there was notice “to the applicant".

[29] For this reason, I find that the Respondent acted lawfully, in accordance with the Bertelsman J Order in giving the required notice to the Appellant. The Order permitted the Respondent, without more, to disconnect the Appellant’s electricity supply if he remained in arrears after receiving such notice. The Appellant remained in arrears. In the circumstances, the Respondent acted lawfully, and with the prior consent of the Respondent (which consent was inherent in the Bertelsman J Order) in disconnecting his electricity supply.

[30] In addition, and in any event, I find that this matter is clearly distinguishable from the situation that prevailed in the Van Gulden case and in Naidoo v Moodley. Here we have an extensive history of litigation between the parties, with an interim order governing the situation regarding electricity supply. Save for securing the ex parte rule nisi against the Respondent, the Appellant has been unsuccessful in defending his position through litigation.

[31] Taking this into account, the prevailing situation between these two parties can hardly be said to be such as to amount to the Respondent taking the law into its own hands and summarily disconnecting the Appellant’s electricity supply. I do not need to go so far as to make a finding, as Mr Havenga invited us to do, on whether the Respondent is indeed in the same position as a municipality, and I refrain from making any finding on this issue. However, what is clear is that, taking into account the relevant facts, including the fact that the Respondent was required to act for the common benefit of all residents and members of Respondent in collecting outstanding arrears, in this case the Respondent

acted fairly, in accordance with due process, and hence lawfully in disconnecting the Appellant’s electricity supply.

[32] Accordingly, 1 cannot fault the finding by the learned Magistrate that the Appellant had failed to establish that there was an unlawful deprivation of the Appellant’s electricity supply by the Respondent. The learned Magistrate was also correct in finding that the Appellant had failed to make full disclosure to the court at the ex parte stage of the proceedings, more particularly by failing to disclose to the court the notice given to him by the Respondent on 3 July 2012, and the subsequent correspondence that ensued between the parties before the Respondent disconnected his electricity.

[33] For these reasons, I conclude that the learned Magistrate correctly set aside the rule nisi on the return day, with a punitive costs award against the Appellant.

[34] I make the following order:

a) The appeal is dismissed with costs.

R. M. KEIGHTLEY

ACTING JUDGE OF

THE HIGH COURT

1 agree.

D.S, MOLEFE

JUDGE OF THE HIGH

COURT

APPEARANCES:

Counsel on behalf of Applicant Adv. Z Schoeman

Instructed by : Marius Coertze Attorneys

Counsel on behalf of Respondent : Adv. H S Havenga SC Instructed by Daniel s Goosen Attorneys

Date Heard : 21 November 2013

Date Delivered 03 December 2013