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Indemnification of Municipalities against liability

Written by  Meyer de Waal
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Indemnification of Municipalities against liability Indemnification of Municipalities against liability

“Court warns developers not to rely on local authorities to know the correct zoning of their property”

Historically municipalities were indemnified against liability for negligent omissions (failure to perform a duty that is legally due). However, one merely has to look at our case law to see that this has been done away with.

All bodies (public or private) exercising public power owe a duty of care to the public. In addition to this, section 33 of the Constitution of the Republic of South Africa (the Constitution) provides that everyone has a right to an administrative action (as defined by section 1 of the Promotion of Administrative Justice Act 3 of 2000) that is lawful, reasonable and procedurally fair. Therefore administrative actions such as decisions given by local authorities are subject to scrutiny so as to ensure compliance with legal principles.

As per the judgment in Faircape Property Developers (Pty) Ltd v Premier, Western Cape 2002 6 180 (C), a property developer who suffers a loss as a result of a local authority having exercised his/her statutory duties negligently has recourse against that local authority.

Judgments such as the above are in line with our Constitution, which is the supreme form of law in South Africa. Our Constitution is founded on values such as the values of democratic government to ensure accountability, responsiveness and openness. The value of an accountable government is promoted by ensuring that citizens have some form of relief against their government when the latter causes them harm.

Davis J In the Faircape Property Developers case said the following:
“… to find that a party who would be gravely prejudiced by gross negligence of an official enjoined to consider such an application, should be without any remedy and thus left to suffer considerable financial consequences of such a wrongful decision would offend the principle of accountable…”

In addition to the above, it is also important to note that when interpreting any legislation in South Africa, every court must promote the spirit, purport and objectives of the Bill of Rights. Section 195 (1) of the Constitution provides that public administration must be governed by the democratic values and principles enshrined in the Constitution, including a high standard of professional ethics, accountability and transparency. Section 152 (1) of the Constitution provides that the objects of local government include the provision of democratic and accountable government for local communities.

It is due to the above that I submit that the warning that was recently sent out by South African Property Owners Association (SAPOA)- court warns developers not to rely on local authorities to know the correct zoning on their property, can be deemed as superfluous; the public will always have recourse against a public official whose negligent conduct causes them harm, financial or otherwise.

The Consumer Protection Act (CPA) and municipalities:

• The application of the CPA to municipalities was delayed so as to give municipalities a chance to get their affairs in order. However, municipalities with high capacities such as Cape Town, Johannesburg and Tshwane were never exempted i.e. the CPA applied to these      municipalities with high capacity as soon as it came into effect.

If you would like a detailed article on the above, please contact the author.

Meyer de Waal

Meyer de Waal

Meyer de Waal (B Prok – University of the Orange Freestate) was admitted as an attorney, conveyancer and notary by the High Court of South Africa (Cape Provincial Division) in 1988. Meyer is the director at Oosthuizen & Co Meyer de Waal in Cape Town.

He concentrates on Property Law, Wills, Trusts and Estate Planning.

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