- The City of Johannesburg delayed a temporary emergency accommodation report for about seven years.
- Purple Fountain could not regain control, develop or transfer its hijacked Johannesburg building while the eviction case remained stalled.
- The High Court ruled the delay unlawfully deprived the company of its property rights.
A seven-year delay by the City of Johannesburg left a property owner unable to regain control of its hijacked building after an eviction case stalled when the municipality failed to complete a temporary emergency accommodation report.
The High Court found that the prolonged delay transformed what should have been a procedural requirement into years of legal limbo for Purple Fountain Properties 59. The company was left unable to exercise the ordinary rights of ownership over its investment property.
One report stalled an entire eviction case
Purple Fountain bought Msibi House in Johannesburg’s inner city in 2009 as an investment property. Instead of taking possession, the company inherited a building occupied by unlawful residents and terminated municipal services before launching eviction proceedings in 2011.
The eviction could not be heard because the City first had to determine whether the occupiers qualified for temporary emergency accommodation. That investigation, expected to be a routine part of the process, dragged on for about seven years before the municipality finally filed its updated report in November 2018.
During that period, Purple Fountain said it could not regain control of the building, collect rental income, redevelop the property or transfer it to another owner. The occupiers eventually left the building voluntarily in December 2022.
Judge Verveen says constitutional duties have limits
Judge P Verveen held that municipalities have constitutional responsibilities towards vulnerable occupiers, but those duties cannot justify an indefinite restraint on the rights of private property owners.
Judge Verveen wrote, “The restraint lasted approximately seven years.” The judge found the delay was “not a short or incidental limitation arising in the ordinary course of a PIE enquiry.”
The judge found that the City’s failure to advance the accommodation process prevented Purple Fountain from exercising the ordinary rights of ownership, including using, enjoying, developing and transferring its investment property.
Judge Verveen concluded that “the prolonged restriction on Purple Fountain’s rights was substantial” and amounted to an arbitrary deprivation of property protected by section 25 of the Constitution.
Compensation now becomes the next legal battle
Purple Fountain argued that the City had effectively expropriated its property and violated its right of access to court. Judge Verveen rejected both claims, finding that the municipality never acquired ownership of the building and that no final eviction order had been frustrated.
Instead, the court held that constitutional compensation was the appropriate remedy. Judge Verveen said “a declarator alone will not afford effective relief for the established seven-year deprivation,” clearing the way for separate proceedings to determine the company’s financial losses and any issues relating to prescription.
R8.7 million municipal account comes under scrutiny
The litigation also exposed municipal charges that had grown to more than R8.7 million by September 2023. Purple Fountain maintains that many of those charges accumulated after municipal services had been terminated while the building remained hijacked.
Judge Verveen ordered the City of Johannesburg, Johannesburg Water and City Power to produce a detailed reconciliation of every service order, meter reading, disconnection, reconnection and municipal debit. The process will determine which charges are lawfully recoverable and whether any debts have prescribed.
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