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Nkonkobe Municipality v Water Services SA (Pty) Ltd (1277/2001) [2001] ZAECHC 3 (14 December 2001)

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20


IN THE HIGH COURT OF SOUTH AFRICA

(EASTERN CAPE DIVISION)

GRAHAMSTOWN

CASE NO.: 1277/2001

DATE: 14 DECEMBER 2001

5

In the matter between:

NKONKOBE MUNICIPALITY

versus

WATER SERVICES SOUTH AFRICA (PTY). LTD AND ANOTHER


10

JUDGMENT:

PICKERING J:


Fort Beaufort Transitional Local Council, ("TLC"), was established by Provincial Proclamation No. 69/94, Provincial Notice No. 29 dated 30 December 1994 issued in terms of the local Government Transitional Act 15 of 1993. In terms of the said proclamation the TLC was governed by Municipal Ordinance No. 20/1974 (the "Ordinance"). The Ordinance was, in terms of Proclamation 111. of 17 June 1994, published in Government Gazette 15813 assigned by the President to a competent authority designated by the Premier of the Province of the Eastern Cape.

20

The authority so designated by the Premier has, since the date of the Proclamation, been the Member of the Executive Council of the Government of the Province of the Eastern Cape responsible for Local Government, ("the MEC").


On 23 February 1995 the TLC caused a "tender notice", Annexure "HMM7", to be published in the newspaper whereby persons and institutions were invited to submit tenders for the management, operation and maintenance of the water and sewage treatment facilities of the greater Fort Beaufort region. First respondent submitted a tender where after the TLC intimated that it intended to procure expert advice regarding the project from its consultants Messrs Ninham Shand. The TLC thereafter resolved to award the tender to first respondent and advised first respondent thereof in writing. In due course the TLC unanimously resolved that first respondent's tender be accepted with effect from 15 October 1995 and that the contract be signed by its town clerk after approval thereof by Ninham Shand. Thereafter on 9 October 1995 the TLC purported to enter into a written agreement with the first respondent. In terms of this agreement the municipal functions relating to the management, operation and maintenance of the sewage system of Fort Beaufort, together with associated customer management, were to be performed by first respondent for a period of 10 years against payment of certain fees. In this agreement, hereinafter referred to as the "Main Agreement", the TLC and first respondent noted their intention to enter into a notarial agreement of lease for the "system" comprising inter alia all the different facilities such as water and sewage treatment plants, more fully described in the definition clause 1.1.e of the Main Agreement. It is common cause that a draft notarial deed of lease, (the "lease agreement") was prepared by the TLC's attorneys. This document was, however, never signed on behalf of either the TLC or first respondent and no record of any such agreement can be found in the relevant Deeds Offices. First respondent thereafter took occupation of the facilities and equipment referred to in the lease agreement. The Main Agreement itself was thereafter amended on a number of occasions. It is not necessary to detail these particular amendments.



First respondent commenced and continued rendering the services provided for in the Main Agreement and the TLC accepted and paid for such services. During May 1999, however, the TLC commenced defaulting in effecting its monthly payments to first respondent. By September 1999 the TLC requested first respondent's indulgence in liquidating arrear payments by means of installments. First respondent in the interim brought the matter of the TLC's default to the attention of the Department of Constitutional Development.


Following on certain correspondence, the Department of Local Government and Housing of the Eastern Cape Province on 30 November 1999 called upon first respondent to furnish to it detailed written statements of first respondent's account. During January 2000 the TLC commenced signing acknowledgments of debt in favour of first respondent. Eventually during June 2000 the TLC wrote to first respondent indicating that due to financial constraints it was not in a position to pay the outstanding account. On 14 September 2000 the Department of Housing and Local Government of the Eastern Cape intervened and a financial management committee was established tasked with managing the TLC's financial affairs. Despite this the arrears remained outstanding. The Fort Beaufort TLC was thereafter disestablished by Provincial Notice No. 80 dated 27 September 2000 issued in terms of section 12 of the Local Government Municipal Structure's Act, No. 117 of 1990. In terms of section 12 thereof the applicant was established as a new Municipality and, on 5 December 2000 after municipal elections, applicant's present council was elected. By July 2001 applicant had approached the Department of Local Government and Housing for financial assistance and was attempting to devise a payment plan for settlement of its arrears. Payment, however, was not forthcoming and during July 2001 first respondent's attorneys addressed a letter to applicant's then attorneys pointing out that applicant, by its failure to pay, had persistently breached the terms of the Main Agreement. In response thereto applicant's attorneys contended that the Main Agreement and the lease agreement were both invalid and of no force and effect. Eventually on 19 September 2001 applicant launched the present proceedings against first respondent citing also the Member of the Executive Council of the Provincial Government of the Eastern Cape responsible for Local Government (the "MEC") as second respondent. In this application reference is made in the Notice of Motion to the "respondent:. It is clear, however, that this is intended to be a reference to first respondent. The order sought by applicant reads as follows:




"1. The agreement entered into between the Applicant and Respondent for the management, operation and maintenance of the water and sewage systems of Fort Beaufort (incorporating Bhofolo, Hillside and Newtown) and associated customer management, as amended and as more fully described in Annexures "HMM5" and "HMM5(a) to HMM5(d)" to the Founding Affidavit, be and is hereby declared to be invalid, unenforceable and of no force or effect;


  1. The notarial lease agreement, more fully described in Annexure "HMM6" to the Founding Affidavit, entered into by the Applicant and Respondent in respect of certain facilities, buildings and equipment forming, and associated with, the water and sewage systems which constitute the subject matter of the agreement, as amended, and more fully described in Annexure "HMM5" and "HMM5(a) to HMM5(d)", be and is hereby declared to be invalid, unenforceable and of no force and effect;


3. The Respondent and any of its employees be and are hereby evicted from the facilities and buildings forming, and associated with, the water and sewage systems let by the Applicant in terms of the notarial

lease agreement more fully described in Annexure "HMM6";


4. The Respondent and any of its employees be and are hereby ordered to return to the Applicant forthwith any equipment forming, and associated with, the water and sewage systems let by the Applicant in

terms of the notarial lease agreement more fully described in Annexure "HMM6"."


Costs are also sought against first respondent. Second respondent has indicated his intention to abide the decision of the Court.


First respondent has opposed the relief sought and has filed a counter application for an order declaring that applicant's purported cancellation of the Main and Lease Agreements was invalid and that such agreements were valid and binding between the parties. First respondent seeks further an order directing applicant to pay to it the amount of R3 439 979-63 which, so it alleged, was due and payable by applicant in terms of the Main Agreement. In the alternative first respondent contends that its charge rates levied in respect of various services constitute a fair and reasonable rate and seeks an order directing applicant to pay to it the aforesaid amount of R3 439 979-63.


Although the papers filed are voluminous it is, in the view which I take of the matter, not necessary to deal with most of the various allegations and counter allegations contained therein. It is contended on behalf of applicant that, in respect of the Main Agreement, the provisions of section 173(4) (a) and (b) of the Ordinance were not complied with at any time and that accordingly the agreement was ultra vires and invalid. Whether or not the provisions of section 124 of the Ordinance had been complied with in respect of the lease agreement was also at issue in the papers, but at the hearing of the application yesterday Mr Wasserman, who with Mr Kru-qer appeared for first respondent, correctly and properly conceded that the fate of the lease agreement hinged upon the Court's finding in respect of the provisions of section 173 of the Ordinance inasmuch as the lease agreement was ancillary to the Main Agreement and could not exist independently thereof. First respondent contended, however, that the provisions of section 173(4)(a) and (b) had indeed been complied with.The alternative submission advanced by MrWasserman on behalf of first respondent, in the event of such non­compliance being established, was that applicant was, in the circumstances of this case, estopped from relying upon the fact of such non-compliance. Section 173(1) of the Ordinance reads as follows:


"A Council may enter into a contract with a local authority or other person for the exercise or performance either jointly or by any of the contracting parties of any power, duty or function whatsoever which a council is from time to time by law authorised or required to exercise or perform."

Section 173(2) is not here relevant.Section 173(3) provides that every contract contemplated by subsection (1) shall be reduced to writing and signed by the parties thereto and that such contract shall as far as necessary or expedient provide for certain matters such as the date upon which it would come into force; the period for which it would remain in force; and the terms and conditions on which the agreement might be terminated.Section 173(4) reads as follows:

"No contract contemplated by subsection (1) or (2) and noamendment to any such contract shall come into force until­

(a) the council has by publication in the press given notice of its intention to enter into such contract or to make such amendment; and

(b) the Administrator has approved such contract or amendment."


It is common cause that the reference to "Administrator" in section 173(4)(b) should be read as a reference to the second respondent. The provisions of the definition section of the Ordinance with regard to the meaning of the phrase used in section 173(4)(a), namely 'publish in the press' are also relevant. Section 2(LXXvii) reads as follows: "'Publish in the press' means­

(a) to publish in accordance with the provisions of section 109 and 110 of the Republic of South Africa Constitution Act, 1961, Act 32 'of 1961, in 25 such newspaper or newspapers as the person authorised or required so to publish may from time to time determine;(b) where a council is authorised or required to publish in the press­

(i) to publish in accordance with the provisions of paragraph (a) a notice setting forth the substance of the matter authorised or required to be so published and specify the place, where and hours during which particulars thereof will be available for inspection;

(ii) as soon as possible after publication contemplated by subparagraph (i) to post at the Municipal Office a copy of such notice; (iii) to keep such copy so posted for a period or not less than 21 days from the day on which such notice was so published."

In support of its contention that the provisions of section 173(4) (a) were complied with first respondent relied upon the tender notice to which I have referred above, Annexure HMM7. Mr Wasserman submitted that the requirements of the section were met by this notice (which, I should state, is the only document relevant to the determination 20 of this issue) insofar as the notice sets forth, so he submitted, the substance of the matter required to be published as well as the availability of particulars thereof for inspection. I am not, however, persuaded that this is so. In my view the requirements of section 173(4)(a) are not met by a tender notice such as that in the present 25 matter. In my view regardless of whether the publication requirement was enacted for the benefit of persons other than ratepayers, it cannot be gainsaid that it is also intended for the benefit of ratepayers on whose behalf a local authority intends contracting with other local authorities or persons for the purpose of municipal functions. Their rights and interests could be affected in a very real sense by such a contract entered into by their local authority and they require protection from a possibly profligate or incompetent council especially when, as Mr Quinn, who appeared for the applicant submitted, such contract relates to the privatisation of an essential service such as the provision of water and the maintenance of sewage works.


In these circumstances a tender notice cannot in my view be equated with a notice of intention to enter into a contract such as is contemplated by section 173(1). Both subsections 173(4)(a) and (b) refer to 'such contract'. It could never be suggested that a tender notice could constitute 'such contract' for purposes of the second respondent's approval in terms of subsection (4)(b). Obviously the second respondent would require details of the terms of the contemplated contract as set out in section 173(3), including, at the very least, information as to the parties thereto, so as to enable him to come to a decision thereanent. I do not see why the words 'such contract' when used in subsection (4) (a) should be interpreted differently. In my view the notice published in terms of subsection (4)(a), if it were not to be a meaningless exercise, would have to impart more information to the reader than that contained in the tender notice. The tender notice evinces no more than an intention on the part of the council to consider entering into a contract for the management of their water affairs, depending, obviously, on whether any suitable tenders were received. Only once such tenders had been received and considered, would a to applicant once applicant had commenced experiencing financial difficulties in complying with its obligations thereunder. Since at least 1999, according to first respondent, the second respondent was actively involved in assisting the TLC.In my view Mr Wasserman's submissions in this regard 'are entirely without substance. Mr Mamase, the MEC at 5 the time the Main Agreement was concluded, has denied under oath that he ever saw, much less approved of, the Main Agreement. In my view none of the circumstances put forward by Mr Wasserman are such as to cast any doubt upon Mr Mamase's veracity and to create a genuine dispute of fact. The fact that financial assistance was rendered to 10 applicant by the Eastern Cape Government and that since at least 1999, some four years after the conclusion of the Main Agreement, the second respondent became involved in assisting the TLC, cannot, in the face of second respondent's denial, be construed as evidence to the contrary. There is no suggestion on the papers that second respondent was ever 15 pertinently made aware in 1999 of the fact that the contract had never been approved and that he thereafter ratified it with retrospective effect, if indeed he had such power to do so.


Mr Wasserman submitted further that it is clear from the papersthat second respondent has neither adopted nor applied a process for the approval of contemplated contracts in terms of section 173(4)(b). This was an indication, so he submitted, that neither applicant nor second respondent ever intended to implement the provisions of that subsection. In these circumstances applicant should be held to the contract. accept for present purposes that no approval process has been shown to exist. This, however, does not avail first respondent. In GORDON v SOUTH AFRICAN HERITAGE RESOURCES AGENCY AND ANOTHER unreported Eastern Cape Division case No. 720/2001 KROON J stated as follows at page 21 of the unreported judgment:

"[281 The relief reflected in the first order and the first alternative order sought by the applicant may be dealt with simultaneously. The same grounds were invoked for both.

[291 The first ground was founded on the fact that the MEC has not utilised the power afforded to him in terms of section 23 to establish a PHRA for this province. In short, the submission, if I understood it correctly, was that if the authority which s 34(1) decreed should adjudicate on an application for a permit did not exist, the section was incapable of being implemented, and the applicant was, as a matter of law, relieved of the obligation to secure a permit to effect the alterations he proposes.

[30] The submission cannot be upheld:

(1) The intention behind the enactment of s 34(1), as is the case with the whole Act, is the preservation of the heritage resources, or potential heritage resources, of the country;

(2) The circumstance that the authority to adjudicate on applications for permits to alter structures is not yet in existence, does not suspend the obligation to secure a permit as envisaged in the section; the obligation remains in force. The contrary interpretation, which would give structure owners carte blanche, as it were, to proceed with alterations to structures, would frustrate the purpose of the Act.

(3) In the event of the requisite authority, which in terms of the section is to adjudicate on applications for permits, not having been established, the applicant's remedy is to seek a mandamus on the MEC, who is responsible for establishing that authority, to comply with that responsibility (thereby enabling the applicant to make application to the proper prescribed authority): the word 'may' in s 23 not only empowers the MEC to establish the authority, but also couples therewith a duty to do so. If a refusal or failure to establish the authority persists, different considerations may come into play and the applicant may be entitled to other relief, an aspect on which I do not find it necessary to express any view."

In the light of what is stated by KROON J, with which I respectfully agree, Mr Wasserman's submissions in this regard cannot be upheld. It is clear, in my view, that there was no compliance with the provisions of section 173(4) (b).


I turn now to consider the question of the application of the doctrine of estoppel and whether first respondent can rely thereon in the face of the non-compliance with the statutory provisions contained in section 173(4)(a) and (b).


The principle that a thing done contrary to the direct prohibition of the law is void and of no effect has been stated in SCHIERHOUT v THE MINISTER OF JUSTICE 1926 AD 99 at 109-110 to be fundamental. In that matter INNES CJ stated further as follows:

"So that what is done contrary to the prohibition of the law is not only of no effect, but must be regarded as never having been done - and that whether the lawgiver has expressly so decreed or not; the mere prohibition operates to nullify the act. The maxim "Quod contra legem fit pro infectro habetur" is also recognised in English Law. And the disregard of peremptory provisions of a statute is fatal to the validity of the proceeding affected."



In STRYDOM v LAND- EN LANDBOU BANK VAN SUID-AFRIKA 1972(1) SA 801 (AD) the following was stated by BOTHA JA at 815G-­816B:

"Versuim deur 'n statutere liggaam, soos die Landbank, omorskrifte na to kom wat die Wetgewer vir die geldigheid van 'n bepaalde handeling van daardie statutere liggaam voorgeskryf het, kan nie deur estoppel aangesuiwer word nie, want dit sou aan 'n handeling wat ultra vires is regsgeldigheid verleen. SPENCER BOWER ESTOPPEL BY PRESENTATION 2de uitg., stel dieselfde beginsel, soos deur die Engelse Howe toegepas, soos volg op bl. 132: 'Nor can the lack of such essential formalities as the consent of a Minister of the Crown or the making of a contract under seal or other particular formalities prescribed by statute, be remedied by estoppel, when a statute has made them the necessary conditions of entering into the transaction.'Hierdie beginsel is in die Engelse Howe toegepas in, onder meer RHYL UDC v RHYL AMUSEMENTS LTD, op bl. 266; SALLOW & PEARSON v MIDDLESEX COUNTY COUNCIL, (1953) 1 All E.R. 580. Waar'n handeling van 'n statutere liggaam, soos die Landbank, ultra vires is, hetsy omdat by sy verleende bevoegdhede to buite gegaan het, hetsy omdat by in gebreke gebly het om voorskrifte na to kom wat die Wetgewer vir die regsgeldigheid van daardie handeling voorgeskryf het, het by in regte glad nie gehandel nie. (Vgl MINISTER OF AGRICULTURE v ATTHEWS (1949)1 All E.R. 724 op bl. 729.) 'n Handeling van 'n statutere liggaam at in regte geen bestaan het omdat dit ultra vies daardie statutere liggaam is, kan klaarblyklik nie deur estoppel tot 'n geldige of wesenlik afdwingbare handeling verhef word nie. (Vgl ABRAHAMSE v CONNOCK'S PENSION FUND 1963(2) SA 76 (W) op bl. 79-80)."

In EASTERN CAPE PROVINCIAL GOVERNMENT AND OTHERS v ONTRACTPROPS (PTY) LTD 2001(4) SA 142 (SCA) MARAIS JA stated as follows at 148F-G:

"It is settled law that a state of affairs prohibited by law in the public interest cannot be perpetuated by reliance upon the doctrine of estoppel. (See TRUST BANK VAN AFRIKA BPK v EKSTEEN 1964(3) SA 402 (A) at 411 H-412B.) "

Mr Wasserman, however, drew to his aid the decision in the matter of EASTERN METROPOLITAN SUBSTRUCTURE v PETER KLEIN INVESTMENTS PTY LTD 2001(4) SA 661 (W).In that matter BORUCHOWITZ J dealt exhaustively with the authorities relating to the rule of the common law that an estoppel could not be raised to prevent or secure the performance of a statutory duty. He held that whilst the rule itself did not infringe any provision of the Bill of Rights of the Constitution and was in conformity with the doctrine of legality implied in the Constitution, the blanket application thereof might in certain circumstances run counter to a fundamental rights provision or value which underpinned the Constitution. The headnote of that case reads further at 665B-D:


"A rule of law which permitted an organ of State, through its own carelessness or neglect, to deprive the defendant of a statutory right of recourse and then to render itself immune from a defence to that deprivation, which estoppel would offer 'the defendant, was inconsistent with the culture of justification of which the right to reasonable administrative action was an important part. To .permit the plaintiff to take advantage of the established rule against the raising of an estoppel, where there was no alleged or minimal countervailing benefit to the plaintiff, would be inconsistent with the entrenched constitutional value of reasonable public administration. To allow a plea of estoppel in the limited and peculiar circumstances of the present case would prevent hardship and injustice and give content to the object of the Constitution and the basic values underlying it. Estoppel was after all an equitable doctrine which was pertinently concerned with questions of fairness in a particular context."

BORUCHOWITZ J concluded that the proper approach, consistent with section 39(2) of the Constitution, was that the Court should balance the individual and public interests at stake and decide on that basis whether the operation of estoppel should be allowed in a specific case.


Mr Quinn, however, submitted that the decision of BORUCHOWITZ J was clearly wrong, alternatively, that the case was clearly distinguishable. In the view I take of the matter it is not necessary for me to consider the correctness or otherwise of that decision. In my view Mr Quinn is correct in his submission that the case is clearly distinguishable, dealing, as it does, with the positive duty imposed by statute upon a local authority to recover certain charges from owners and occupiers of premises in respect of which services were rendered. As was stressed by Mr Quinn the present case is not an instance of ultra vires based on the manner or circumstances surrounding the conclusion of the Main Agreement. In the present matter the Court is concerned with the situation where the Legislature has, in the public interest, expressly decreed that no contract shall come into force until the provisions of section 173(4) have been complied with. Absent such compliance there is therefore no valid contract.


To allow a plea of estoppel to prevail in these circumstances would, in my view, be to reduce the ultra vires doctrine to a complete nullity (compare ABRAHAMSE v CONNOCK'S PENSION FUND supra) and would defeat the provisions of section 173(4) which were obviously intended in the public interest to be peremptory and binding. I have not lost sight of the fact that it is necessary as far as possible to ensure that the underlying values and objectives of the Constitution are achieved, but, in my view, there is in the circumstances of a case such as the present no basis upon which the application of the rule against the raising of an estoppel could or indeed should be changed.


Even were I to be wrong in coming to this conclusion and even were I to be wrong in my view that the EASTERN METROPOLITAN SUBSTRUCTURE case supra was distinguishable, I would in any event in balancing the individual and public interests at stake as enjoined to do by BORUCHOWITZ J at 685H, decline to allow the operation of estoppel in this case. In the EASTERN CAPE PROVINCIAL GOVERNMENT v CONTRACTPROPS case supra MARAIS JA stated as follows at 148, paragraph 12:

"It was not the Tender Board which conducted itself in a manner which led respondent to act to its detriment by concluding invalid leases of property specially purchased and altered at considerable expense to suit the requirements of the Department. It was the Department. If the leases are, in effect, 'validated' by allowing estoppel to operate, the Tender Board will have been deprived of the opportunity of exercising the powers conferred upon it in the interests of the taxpaying -public at large. Here again the very mischief which the Act was enacted to prevent would be perpetuated. (Cf STRYDOM v DIE LAND-EN­LANDBOUBANK VAN SA 1972(1) SA 801 (AD) at 815E-F.) At paragraph 13 MARAIS JA stated:


"This is not a case in which 'innocent' third parties are involved. It is a case between the immediate parties to leases which one of them had no power in law to conclude and had been deprived of that power (if it ever had it) in the public interest. The fact that respondent was misled into believing that the Department had the power to conclude the agreements is regrettable and its indignation at the stance now taken by the Department is understandable. Unfortunately for it, those considerations cannot alter the fact that leases were concluded which were ultra vires the powers of the Department and they cannot be allowed to stand as if they were intra vires."


So too in the present case it was not the second respondent who conducted himself in a manner which led first respondent to act to its detriment by concluding an invalid agreement. If anybody, it was applicant who did so. On a parity of reasoning with that in the CONTRACTPROPS case, supra, if the Main Agreement is validated by allowing estoppel to operate the second respondent will have been deprived of the opportunity of exercising the powers conferred upon him in the public interest and the interests in particular of the ratepayers. The mischief which section 173(4) was enacted to prevent would thereby be perpetuated.


The facts with which the EASTERN METROPOLITAN SUBSTRUCTURE case (supra) were concerned were also very different from those in the present case. There, as was pointed out by BORUCHOWITZ J, the defendant was by the negligent actions of the plaintiff deprived of his own right of statutory recourse to recover from his tenants amounts claimed from him by plaintiff. In those circumstances, so BORUCHOWITZ J held, the defendant had on the face of it been irreparably prejudiced as a result of plaintiff's conduct. In the present case, however regrettable the conduct of applicant may have been in not ensuring that the provisions of section 173(4) were complied with and however indignant and frustrated first respondent may be at applicant's belated reliance upon such non-compliance the fact remains that first respondent is not remediless. It has a claim based on unjust enrichment for payment of its fair and reasonable charges. Indeed applicant admits that it is obliged to pay first respondent in respect of such fair and reasonable charges as may be proved to have been made. The assessment of the quantum thereof should not be a particularly difficult matter.


In these circumstances the interests of first respondent are to my mind far outweighed by the interests of the public and in particular of the relevant ratepayers in ensuring by compliance with the provisions of section 173(4) that the purported contract entered into by the TLC was indeed to the benefit of the inhabitants of the municipal area and that not only was the party contracting to perform the particular functions competent to do so, but also that the terms of such contract were not financially burdensome to the extent that the local authority would be unable to meet its obligations under the contract. Because the applicant has breached the terms of the Main Agreement by failing to pay first respondent amounts due and owing thereunder the first respondent has indicated that it will be obliged over the Christmas season to begin reducing the water supply. The impact of such action on the inhabitants of the municipal area is not hard to imagine. It is in my view, therefore, clearly in the public interest that first respondent not be allowed to raise a plea of estoppel.


In the result the application must succeed and those prayers of the counter application seeking to validate the agreements must be dismissed. Mr Wasserman submitted, however, that in the event of the application succeeding, paragraph 5 of the counter application dealing with first respondent's claim for its fair and reasonable charges should be postponed sine die in order for the question of that claim to be determined.I agree, however, with Mr Quinn that it would be inappropriate for that issue to be determined on these papers.


In the result the counter application must be dismissed in its entirety with costs.

The following order is accordingly made:

1. The agreement entered into between the applicant and first respondent for the management, operation and maintenance of the water and sewage systems of Fort Beaufort (incorporating Bhofolo, Hillside and Newtown), and associated customer management, as amended, and as more fully described in Annexures "HMM5" and "HMM5(a) to HMM5(d)" to the founding affidavit be and is hereby declared to be invalid, unenforceable and of no force or effect.

2. The notarial lease agreement, more fully described in Annexure "HMM6" to the founding affidavit, entered into by the applicant and first respondent in respect of certain facilities, buildings and equipment forming, and associated with, the water and sewage systems which constitute the subject matter of the agreement, as amended, and more fully described in Annexure "HMM5" and "HMM5(a) to HMM5(d)", be and is hereby declared to be invalid, unenforceable and of no force and effect.

  1. The first respondent and any of its employees are hereby evicted from and ordered to vacate the facilities and buildings forming, and associated with, the water and sewage systems let by the applicant in terms of the notarial lease agreement more fully described in Annexure "HMM6", on or before 21 December 2001.

4. The first respondent and any of its employees be and are hereby ordered to return to the applicant, on or before 21 December 5 2001, any equipment forming, and associated with, the water and sewage systems let by the- applicant in terms of the notarial lease agreement more fully described ..in Annexure "HMM6".

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

6. The first respondent's counter application is dismissed with costs.





JD PICKERING

JUDGE OF THE HIGH COURT