South African Municipal Workers Union (SAMWU) obo Members v Dr J S Moroka Local Municipality and Others (41601/2013) [2015] ZAGPPHC 1083 (18 September 2015)

REPUBLIC OF SOUTH AFRICA

IN THE GAUTENG DIVISION OF THE HIGH COURT OF SOUTH AFRICA,

PRETORIA

JUDGMENT

Date: 18/9/2015

Not reportable

Case no: 41601/2013

In the matter between:

SOUTH AFRICAN MUNICIPAL WORKERS

UNION (SAMWU) obo of Members

Applicant

and

DR J S MOROKA LOCAL MUNICIPALITY 1st Respondent

NKANGALA DISTRICT MUNICIPALITY 2nd Respondent

ZAMOKWAKHE WESLEY MCINEKA 3rd Respondent

THE MEMBER OF THE EXECUTIVE COUNCIL

FOR CO-OPERATIVE GEVERNANCE AND

TRADITIONAL AFFAIRS 4th Respondent

GRACE TINY MTHIMUNYE 5th Respondent

MNGQIBISA-THUSI, J

[1] In its amended notice of motion the applicant is seeking the following relief:

1.1 the declaration of the service level agreement ("SLA") concluded between the first and second respondents on or about 27 September 2012 be set aside;

1.2 the reviewing and setting aside of the decision of the first and second respondents to appoint the third respondent as acting municipal manager of the first respondent from 28 August 2012 to 28 February 2013 as being 'null and void" and in breach of section 54A (2A) read with section 54A (6) (a) of the Municipal Systems Act 32 of 2000.

1.3 the declaration of decisions taken by the third respondent from 28 August 2012 to 28 February 2013 as non-binding as the third respondent had no authority to take them.

1.4 costs to be paid by the fifth respondent in his personal capacity, alternatively, by the first and second respondents, jointly and severally, the one paying the other to be absolved.

[2] The salient facts, which are common cause, are the following.

[3] On 1 June 2012 the first respondent requested the MEC (The MEC") to appoint a certain Ms NP Busane ("Busane") as acting municipal manager of the first respondent in terms of section 54A( 1)(b) of the Local Government: Municipal Systems Act 32 of 2000 ("the Municipal Systems Act") 1, from 01 June 2012 and for a period of three months2.

[4] On 13 August 2012 the first respondent wrote a letter to the MEC seeking authorisation in terms of section 54A(2A)(b)3 of the Municipal Systems Act to extend the acting appointment of Busane for a further period of three months in view of Busane's

acting appointment expiring at the end of August 2012. In this letter, the first respondent specifically made the MEC aware that the municipal manager's position could not be filled as the previous municipal manager's services had been terminated and a dispute

arising from such dismissal was still pending in the Labour Court.

[5] On 28 August 2012 the MEC declined the request to extend Busane's acting appointment on the basis that the extension sought would be unlawful as it would be contrary to the provisions of the Municipal Systems Act, in particular, section 54A(2A)(a)4. In this letter, the MEC also stated that:

"4. In this instance, your attention is drawn to section 54A(6)(a) of the Act which, inter alia, states that:

'The municipal council may request the MEC for local government to second a suitable person, on conditions as prescribed, to act in the advertised post until such time as the suitable candidate has been appointed'."

[6] It is common cause that the MEC mistakenly refused to extend the acting appointment of Busane, which was allowable in terms of section 54A(2A)(b) of the Municipal Systems Act as he might not have been aware that this would have been the first extension of Busane's acting appointment.

[7] In light of the MEC's mistaken belief and response, and despite MEC's advice for a request for the appointment of a suitable

candidate in terms of section 54A (6) (a), the fifth respondent, acting as executive mayor of the first respondent, wrote a letter (dated 6 September 2012) to the executive mayor of the second respondent requesting it to second a suitable person to act as municipal manager of first respondent. The request was made in terms of section 88(3) of the Local Government: Municipal Structures Act 117 of 1998 ("Municipal Structures Act") which provides that:

"(1) A district municipality and the local municipalities within the area of that district municipality must co-operate with one another by assisting and supporting each other.

(2)(a) A district municipality on request by a local municipality within its area may provide financial, technical and administrative support services to that local municipality to the extent that that district municipality has the capacity to provide those support services.

…..."

[8] On 7 September 2012 the second respondent's council resolved and nominated the third respondent for secondment to the first respondent from 17 September 2012. Pursuant thereto, on 27 September 2012 the first respondent and second respondent concluded a Service Level Agreement (SLA) dealing with the secondment of the third respondent and other ancillary matters. The secondment was for a period of three months. On 15 October 2012 the fifth respondent, on behalf of the first respondent, wrote a letter to the MEC apprising him about the developments in view of the MEC's refusal to extend Busane's acting appointment. First respondent further wrote a second letter on 15 October 2012 requesting the MEC to condone the continued use of Busane beyond 31 August 2012 whilst negotiations with the second respondent were on going.

[9] On 3 December 2012, the first respondent sought from the MEC an extension of the third respondent's acting period for a further

period of three months as the pending litigation involving the previous municipal manager had not been finalised. The second respondent also extended the secondment of the third respondent for a period of three months. On 2 May 2013, the MEC, post facto, approved, in terms of section 54A(6)(a) of the Municipal Systems Act, the secondment of the third respondent to the first respondent

with effect from 1 March 2013. The MEC did not, however, deal with the third respondent's appointment from 28 August 2012 to 28 February 2013, the period in dispute in this matter.

[10] The respondents have raised as a point in limine alleging that the applicant, as a trade union does not have locus standi to bring this application on the ground that their complaint does not concern direct application of a right contained in the Bill of Rights.

[11] It is apposite at his stage to point out that even though in its amended notice of motion the applicant had sought a declaration

invalidity of all decisions taken by the third respondent during the period of 28 August 2012 to 28 February 2013 in the event that a finding is made that his appointment was invalid, during argument this relief seems to have been abandoned. Mr Ncgukaitobi submitted that the applicant no longer seeks the setting aside of decisions made by the third respondent whilst acting as a municipal manager for the first respondent. However, counsel submitted that if the third respondent's appointment were to be declared to have been unlawful, any person affected by third respondent's decisions during his unlawful tenure would decide what course of action to take.

[12] Further it is apposite to indicate that in its founding affidavit, the applicant sought to review and set aside of the conclusion of the SLA between the first and second respondents and the appointment of the third respondent as acting municipal manager of the first respondent for the period 28 August 2013 to 28 February 2013 in terms of section 6(1) of the Promotion of Administrative Justice Act 3 of 2000 ("PAJA") which provides that "Any person may institute proceedings in a court or tribunal for the judicial review of an administrative action". However, after the respondents asserted in their answering affidavit that the applicant' could not rely on PAJA because the conclusion of the SLA was not administrative action5, in its replying affidavit the applicant implicitly conceded the point and claimed to rely on the doctrine of legality for the relief it seeks. An applicant is expected to make its case in the founding affidavit. I am satisfied, as correctly submitted by counsel for the applicant, that the doctrine of legality was implied in that one of the applicant's complaints was that the first respondent had acted unlawfully in appointing the third respondent as acting municipal manager in contravention of the Systems Act.

[13] The issues to be determined are the following:

13.1 whether the applicant has the locus standi to bring this application;

13.2 whether the service level agreement entered into between the first and second respondents was valid;

13.3 whether the decision of the first (acting through the fifth respondent) and second respondents to appoint the third respondent for the period 28 August 2012 to 28 February 2013 was valid; and

13.3 whether the fifth respondent should be made to pay the costs of this application in the event of the applicant being successful.

Locus standi

[14] The approach adopted by the respondents seems to imply that legal standing is only accorded to persons who allege an infringement or threat of a violation of a right in the Bill of Rights. However, as correctly pointed out by Mr Ngcukaitobi, the applicant has legal standing to bring this application in terms of section 38, in particular, section 38(d) of the Constitution in that its members, as residents and ratepayers within the area of jurisdiction of the first respondent, have an interest in the way in which public power is exercised. In this regard the applicant relies on the broad interpretation given to the concept of locus standi.

[15] Section 38 of the Constitution provides that:

"38. Enforcement of rights - Anyone listed in this section has the right to approach a competent court, alleging that a right in the bill of rights has been infringed or threatened, and the court may grant appropriate relief, including a declaration of rights. The persons who may approach the court are -

(a) anyone acting in their own interest;

(b) anyone acting on behalf of another person who cannot act in their own name;

(c) anyone acting as a member of, or in the interest of a group or class of persons;

(d) anyone acting in the public interest; and

(e) an association acting in the interest of its members."

[16] Relying on Ferreira v Levin NO and Others; Vryehoek and Others v Powell NO and Others6 the court in Bio-Energy Afrika Free State (Edms) Bpk v Freedom Front plus and Freedom Front Plus v Moqhaka Local Municipality and Others7 the court held that:

"[15] It seems evident that the Constitutional Court has given an extended interpretation to Section 38 to incorporate violations of and threats to all rights, obligations, values and principles contained in the Constitution committed by public bodies or public officials. This would include "any executive or administrative act or conduct or threatened executive or administrative act or conduct of any organ of State, ...The rationale for this approach is the principle of legality , which is enshrined in the Constitution".

[17] In the Bio-Energy matter (supra}, the court held that the Freedom Front Plus, a political party, had locus standi in that it was acting "in the public interest as well as the interests of its supporters who are residents and ratepayers in the area of jurisdiction of the first respondent's municipality".

[18] I am satisfied that the applicant has locus standi to bring this application. The Service level agreement and the appointment of the third respondent as acting municipal manager

[19] It is the applicant's contention that the conclusion of the SLA by the first and second respondents and the appointment of the third respondent during the relevant period was in contravention of section 1(c) of the Constitution8 and the Municipal Systems Act. The effect of section 1(c) of the Constitution is that the legislature and the executive are precluded from exercising any power or performing any functions above the powers conferred on them by the law. In Affordable Medicines Trust v Minister of Health and others,9 it was held that the exercise of powers beyond those conferred is an infringement of the doctrine of legality10.

[20] On behalf of the applicant, it was submitted that the first and second respondents, by concluding a SLA through which the third

respondent was seconded to act as municipal manager of the first respondent, acted beyond their powers as the appointment and extension of the acting appointment of the third respondent as municipal manager fell within the purview of the MEC's authority. It was argued that the decision to appoint the third respondent was unconstitutional and therefor invalid. In effect, the main submission made by the applicant is that the MEC, under the circumstances of this case, had the sole authority to appoint the third respondent in terms of section 54A (6) (a) of the Systems Act. It was also contended on behalf of the applicant that the mistaken belief of the MEC in refusing to extend Busane's acting appointment was of no moment since it was incumbent on the first respondent through the fifth respondent to alert the MEC of his mistake. In the alternative, the applicant contends that the first respondent should have followed the advice of the MEC in his letter, dated 28 August 2012, to seek his assistance in appointing a suitable person pending the finalisation of the legal proceedings.

[21] It was further argued on behalf of the applicant that failure by the first respondent to comply with the provisions of section 54A(6)(a) rendered the appointment of the third respondent null and void and consequently this court had no discretion but to declare such appointment invalid in terms of section 172(1) of the Constitution which reads as follows:

"When deciding a constitutional matter within its power, a court-

(a) must declare that any law or conduct that is inconsistent with the Constitution is invalid to the extent of its inconsistency; and

(b) may make any order that is just and equitable11

including -

(i) an order limiting the retrospective effect of the declaration of invalidity; and

(ii) an order suspending the declaration of invalidity for any period and on any conditions, to allow the competent authority to correct the defect".

In this regard, the applicant relies on the provisions of section 54A (3) of the Systems Act which provides that:

"A decision to appoint a person as a municipal manager,12 and any contract concluded between the municipal council and that person in consequence of the decision, is null and void if-

(a) the person appointed does not have the prescribed skills, expertise, competencies or qualifications; or

(b) the appointment was otherwise made in contravention of this Act."

[22] Furthermore, it was argued that in appointing the third respondent as acting municipal manger, the first respondent had not shown good cause and the existence of special circumstances as required by section 54A(6) and that all decisions made by the third respondent during the period of invalidity could be rendered invalid.

[23] Even though it was conceded by counsel for the applicant that during the third respondent's invalid tenure as acting municipal manager of the first respondent, he made certain decisions which affected its members, for instance, instituted disciplinary inquiries against them, counsel submitted that the applicant was not at this stage seeking any other relief save for the declaration of invalidity of the conclusion of the SLA and the appointment of the third respondent as acting municipal manager of the first respondent.

[24] With regard to the assertion by the respondents that the applicant was not open with the court as to the real reason behind the application and that its main non-expressed intention was to launch a collateral challenge with respect to decisions made by the third respondent during the relevant period, counsel for the applicant submitted that the fact that some of its members might attack some of the third respondent's decision in future is not relevant to these proceedings. If such collateral attack is launched, it is up to the respondents to raise any available defences.

[25] Mr Ngcukaitobi also made submissions with regard to the time lapse between the time when the applicant got knowledge of the unlawfulness of the third respondent's appointment and the launching of these proceedings. Further, submission was made with regard to the fact that the issue for which relief is sought was academic as a new municipal manager has been appointed. Counsel submitted that the time lapse was not unreasonable and one could not rely on the periods set out in PAJA. Further that even if the events had run its course, the Constitutional Court had said that the principle of legality required the courts to examine whether the government's conduct was consistent with the law or not.

[26] With regard to costs in the event of the applicant being successful, even though it was conceded on behalf of the applicant that the fifth respondent acted in her official capacity on behalf of the first respondent, it was argued that the fifth respondent should pay the costs because as executive mayor, she had the responsibility of advising her council that its resolution to seek the assistance of the second respondent was unlawful in the light of the advice given by the MEC.

[27] On behalf of the respondents it was submitted that the issue relating to the appointment of the third respondent has become academic and of no consequence since his appointment has come and gone. It was contended that due to the MEC's erroneous understanding of the first respondent's request, the first respondent sought the assistance of the second respondent. It was submitted that the provisions of the Systems Act had not been contravened as the first and third respondent had not signed any employment contract. However, the parties have made common cause that the second respondent did not have the power to appoint the third respondent as acting municipal manager of the first respondent beyond 31 August 2012. Counsel submitted that the SLA was to provide the first respondent with administrative capacity and that it was the decision of the first respondent's council to appoint the third respondent as acting municipal manager. Counsel further submitted that on failure by the MEG to extend Busane's acting appointment, the first respondent acted out of necessity deciding to approach the second respondent for assistance as it could not leave the post of municipal manager vacate for an extended period.

[28] In argument counsel for the respondents challenged the applicant's motive for bringing this application, submitting that if an order is granted declaring the appointment of the third respondent inl(alid, it is the intention of the applicant to use such order so as bring a collateral challenge to try to invalidate some of the third respondent's decisions

which could relate to the institution of disciplinary proceedings against some of its members, as such challenge would not be available to it based on what was said in Oudekraal Estates (Pfy) Ltd v City of Cape Town and Others that:

"[78] It will generally avail a person to mount a collateral challenge to the validity of an administrative act where he is threated by a public authority with coercive action precisely because the legal force of the coercive action will most often depend upon the legal validity of the administrative act in question. A collateral challenge to have the validity of the administrative act will be available, in other words, only "if the right remedy is sought by the right person in the right proceedings". Whether or not it is the right remedy in any particular proceedings will be determined by the proper construction of the relevant statutory instrument in the context of the principles of the rule of law."

[29] Respondents' counsel urged the court not to allow the applicant to litigate in a piecemeal fashion in that in its papers it did not disclose the real motive behind this application. Furthermore, respondents' counsel further submitted that even if an invalidity

declaration was made, the court should consider ameliorating the consequences of such declaration.

[30] As I have already alluded to the fact that the applicant does have locus standi based on the extended interpretation of section 38 of the Constitution, the respondents' point in limine in this regard ought to fail.

[31] The MEC was given the opportunity to extend the acting appointment of Busane. However, due to no fault of the first respondent and second respondent but the MEC's mistaken belief or understanding of the context in which the extension was sought, incorrectly refused to approve the extension. Throughout these papers filed of record, there is no acknowledgement either by the applicant or the respondents that when the third respondent was seconded to the first respondent that that was done in terms of the Municipal Systems Act. It is common cause that the third respondent was seconded to the first respondent in terms of section 88 of the Structures Act after a resolution to second the third respondent to the first respondent on its request. Essentially the third respondent acted in terms of powers granted to the second respondent to assist the first respondent with capacity. Also relevant in this regard is section 83(3) of the Structures act which provides that:

"A district municipality must seek to achieve the integrated, sustainable and equitable social and economic development of its area as a whole by -

(c) building the capacity of local municipalities in its area to perform their functions and exercise their powers where such capacity is Jacking".

[32] There is nothing untoward in the second respondent providing administrative capacity to the first respondent by seconding the

third respondent to the first respondent. In turn, nothing prevented the first and second respondent from entering into a SL.A in order for the required capacity to be provided. I am therefore of the view that the SL.A concluded between the first and second respondent was valid as it was done it terms of a power conferred by the Structures Act on the second respondent. From the facts relevant to this matter, I am of the view that the applicant has not shown sufficient cause why the SL.A concluded between the first and second respondents should be set aside. In passing the resolution to second the third respondent to the first respondent, the third respondent was exercising powers conferred on it by the Structures Act in order to promote cooperate governance between the local and district councils. During argument, it was conceded by counsel by for the applicant that both the Structures Act and the Systems Act provide for the appointment of an acting municipal manager. The only distinction between the two Acts being that where the Systems Act prescribes the period of an acting municipal manager, no such prescription is prescribed under the Structures Act. However, the appointment of a municipal manager for a local council now resides within the purview of the Systems Act after section 54A was introduced in 2011.

[33] It was, therefore, not open to the first respondent to appoint the third respondent as acting municipal

manager. When the second respondent seconded the third respondent to the first respondent, it was done in terms of section 88 of the Structures Act in order to provide administrative capacity to the first respondent. The second respondent could not have appointed the third respondent as acting municipal manager. As rightly pointed out by counsel for the applicant, it was open to the first respondent to act on the advice of the MEC. Even if the first respondent did apprise the MEC about the third respondent's secondment that did not clothe the appointment of the third respondent as acting municipal manager with legality. I am therefore of the view that the appointment of the third respondent as acting municipal manager for the first respondent before march 2013 was in contravention of the provisions of the Systems Act and therefore invalid. I am, however, not inclined to deal with the consequences, which may arise from the declaration of the appointment of the third respondent invalid. I cannot speculate about the possible future actions of the applicant and its members.

[34] With regard to costs, I am of the view that the applicant has not shown that the fifth respondent, in seeking assistance from the second respondent acted in bad faith. Her main concern was to have capacity in order to provide service to the community. I furthermore, see no reason why the first respondent should not be liable for the costs of this application.

[35] Accordingly the following order is made:

1. The decision of the first respondent to appoint the third respondent as acting municipal manager of the first respondent from 28 August 2012 to 28 February 2013 is reviewed and set aside.

2. The first respondent is ordered to pay the costs of this application.

________________________

MNGQIBISA-THUSI J

Appearances:

For Appellant: Adv Ngcukaitobi

Instructed by: Ruth Edmonds Attorneys

For 1st 2nd, 3rd and 5th Respondents: Adv Watt-Pringle, SC

Instructed by: Allardyce & Partners

1 Section 54A(1)(b)) provides that "The municipal council must appoint an acting manager under circumstances and for a period as prescribed".

2 Section 54A(2A)(a) provides that "A person appointed in terms of subsection (1)(b) may not be appointed to act for a period that exceeds three months'.

3 Section 54A(2A)(b) provides that "A municipal council may, in special circumstances and on good cause shown, apply in writing to the MEG for local government to extend the period of appointment contemplated in paragraph (a), for a further period that does not exceed three months'.

4 Sections 2A(a) provides that "A person appointed in terms of subsection (1)(b) may not be appointed for a period that exceeds three months."

4 Sections 2A(a) provides that "A person appointed in terms of subsection (1)(b) may not be

appointed for a period that exceeds three months."

5 In terms of section 1 of PAJA, administrative action means "any decision taken, or any failure to take a decision, by (a) an organ of state when (i) exercising a power in terms of the Constitution or a provincial constitution or (ii) exercising a public power or performing a public function in terms of any legislation."

6 1996 (1) SA 984 (CC), where the Constitutional Court stated that "[165] Whilst it is important that this Court should not be required to deal with abstract or hypothetical issues, and should devote its scarce resources to issues that are properly before it, Ican see no good reason for adopting a narrow approach to the issue of standing in constitutional cases. On the contrary, it is my view that we should rather adopt a broad approach to standing. This would be consistent with the mandate given to this Court to uphold the Constitution and would serve to ensure that constitutional rights enjoy the full measure of the protection to which they are entitled. -Such an approach would also be consistent in my view with the provisions of section 7(4) of the Constitution on which counsel for the Respondents based his argument".

7 2012 (2) SA 88 (FB).

8 Section 1(c) of the Constitution provides that "The Republic of South Africa is one, sovereign, democratic state founded on the following values ...(c) Supremacy of the constitution and the rule of law."

9 2006 (3) SA 247 (CC) at paragraph 49.

10 In the Affordable Medicines Trust matter (supra) and at para [49], the Constitutional Court held that "The exerr;ise of public power must therefore comply with the Constitution, which is the supreme law, and the doctrine of legality, which is part of that law. The doctrine of legality, which is an incident of the rule of law, is one of the constitutional controls through which the exerr;ise of public power is regulated by the Constitution. It entails that both the Legislature and the Executive 'are constrained by the principle that they may exerr;ise no power and perform no function beyond that conferred upon them by law'."

11See also section 8(2) of the PAJA "The court or tribunal, in proceedings for judicial review in terms of section 6(3), may grant any order that is just and equitable."

12 In terms of section 1 of the Systems Act a 'manager' includes an acting manager.