- The court finds that the City was never meant to be the permanent owner of the properties.
- Transfers are held to be conditional and linked to the township registration process.
- The City’s claim is dismissed, and Valambya is confirmed as the legal owner of all four properties.
The City of Tshwane has lost its attempt to reclaim four properties in Ga-Rankuwa, Mabopane, and Kudube. The High Court in Pretoria dismissed the City’s claim and confirmed Valambya Energy Services and Projects (Pty) Ltd as the legal owner.
The City had taken action against Shell South Africa Refining (Pty) Ltd, the North West Provincial Government, Engen Petroleum Limited, Valambya Energy Services and Projects (Pty) Ltd, the North West Housing Corporation, and the Registrar of Deeds. It sought to have several property transfers declared unlawful and set aside.
The main issue was whether the transfers complied with the Municipal Finance Management Act and related regulatory rules. The City argued that the transfers were illegal because there was no council resolution, no public participation process, and no following of the rules for disposing of municipal assets. The court did not agree with this perspective and found that the case could not be seen as a simple municipal property dispute.
Judge MP Kumalo emphasised that the issue was not a common transfer of municipal properties. He pointed out that this case needed to consider the relevant history.
Background and competing claims
The City claimed it became the legal owner of the properties as the successor to the Mabopane Transitional Representative Council. Based on this claim, it sought orders to declare the transfer of Portion 7 of the farm Mabopane 702 JR to the North West Housing Corporation unlawful, along with the transfers of erven in Ga-Rankuwa Unit 4 and Unit 5 to Valambya Energy Services and Projects (Pty) Ltd.
Valambya opposed the claim and filed a counterclaim, seeking a court order to confirm its ownership of all four properties and to require the City to complete the outstanding transfers. Valambya argued that the properties were never supposed to belong permanently to the City and were transferred as part of a broader effort to establish townships and pass ownership to the intended beneficiaries.
Evidence showed that the properties originally came from the former Bophuthatswana government and were later handled through transitional arrangements involving the North West Housing Corporation and various state entities. A task team made up of members from the City, provincial governments, and the housing corporation was formed to manage the transfer of both residential and commercial properties.
Court rejects City’s case
The City focused on the lack of a council resolution and other compliance issues to claim that the transfers were invalid. An expert witness for the City testified that the transactions did not meet the requirements set out in the Municipal Finance Management Act and related regulations.
The court did not find this persuasive. Judge Kumalo ruled that the expert’s opinion on the legal questions was not acceptable, stating that “her expert opinion is, with respect, inadmissible.” The court determined that the evidence did not sufficiently consider the historical context of the transfers.
A key finding was that the City was never meant to be the permanent owner of the properties. Judge Kumalo stated, “It is clear from the evidence that the City was never intended to be the permanent owner of these properties,” and “the transfers were conditional and for the purpose of establishing township registers.”
The court also noted that the City was not merely a bystander. Its representatives participated in the task team and were involved in the process without raising any objections at the time. As Judge Kumalo remarked, “The Plaintiff, through its representatives in the Task Team, participated in these transfers.”
Regarding the legal basis of the claim, the court found that the City had simply chosen the wrong legal approach. Judge Kumalo remarked that the City “ought then to have reviewed itself and brought a review application rather than a rei vindicatio.”
The court also found no evidence to suggest that the transactions were tainted by fraud or wrongdoing, stating plainly that “there is no evidence suggesting fraudulent conduct or impropriety.”
Order and implications
The court dismissed the City’s claim entirely and declared Valambya Energy Services and Projects (Pty) Ltd the legal owner of all four properties: erven in Ga-Rankuwa Unit 4 and Unit 5, Mabopane Unit B, and Kudube Unit 2.
The City was ordered to take all necessary actions, including signing the required documents, to transfer the remaining properties within 120 days. The court also stated that Valambya is entitled to all rental income earned from the properties, both past and future, and ordered the City to pay for Valambya’s legal costs, including fees for both senior and junior counsel.
Judge Kumalo concluded, “In these circumstances, the transaction cannot be declared invalid.”
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