Gladwin

Gladwin v Ekurhuleni Metropolitan Municipality: The Municipality’s entitlement to disconnect or refuse to supply electricity or water to a property based on amounts owed by a prior owner of the property 

Introduction
As the subheading of this article suggests, it examines the entitlement of a municipality to disconnect the supply of services (electricity or water) to a property or to refuse to connect up or restore that supply to a property on the basis that amounts are owed to the municipality by prior owners of the property.

Gladwin v Ekurhuleni Metropolitan Municipality
In this case ( Louise Gladwin v Ekurhuleni Metropolitan Municipality (unreported case no. 14497/2016 (Weiner J)), the owner had a tenanted property, and the tenant had (without the owner’s knowledge) bypassed the prepaid electricity meter situated at the property. The owner did not detect that this was the case as the owner did not reside at the property and further did not receive any municipal statements in respect of electricity charges, and believed that all was well in relation to the supply to the property.

The tenants (that bypassed the supply) subsequently moved out, and the landlord re-tenanted the property, only to be advised shortly after the new tenants moved in that the prior tenant had bypassed the prepaid meter. Shortly after this occurred the Ekurhuleni Municipality picked up that the prepaid meter was bypassed and terminated the electricity supply to the property on the basis of its bylaws allowing it to do so without sending the owner or the tenant a pre-termination notice warning that disconnection would occur. The owner and tenants were initially happy that the municipality had realised that there was a problem as they initially believed that this would lead to a speedy resolution (in the form of the municipality correcting the bypass such that the tenant could pay for its own prepaid electricity).

However the municipality demanded that the owner of the property make payment of amounts related not only to the theft of electricity by the prior tenant (which the owner had agreed to make payment of and in relation to which there was no dispute) but also in respect of over R40 000.00 which the municipality claimed was owing to it by the prior owner of the property. The municipality ultimately refused to reconnect the disconnected prepaid meter on the basis of the arrears purportedly owed by the prior owner. Furthermore the owner requested on numerous occasions that the municipality furnish it with information as to what the charges purportedly owing by the previous owner were for and when those charges where incurred (as it is trite law that if those charges were incurred in relation to electricity and water services more than 3 years ago, they would have prescribed and would no longer be legally claimable by the municipality from the prior owner or the current owner.

The municipality failed entirely to provide the owner with any information relating to the arrears purportedly owing by the prior owner, and never furnished the owners with any invoices showing the raising of such charges despite repeated requests.

Legal Issues
There were two important legal issues that came before the court in this case. These were:

(i) whether a municipality is entitled to disconnect the supply of services to a property, or refuse to reconnect or restore that supply, on the basis of amounts owed to the municipality by a prior owner of the property; (ii) whether a municipality is entitled to do the above specifically in the case where it has not notified the current owner of what the charges owed by the prior owner are made up of or when they were incurred, or has not invoiced the current owner in relation to those charges.

Course of Legal Proceedings
It is very important to understand that this case did not play out as most litigious matters do. The owner originally instituted urgent legal proceedings for an order that the municipality restore the supply to the property based on the owner’s understanding of the law (namely that a municipality is not entitled to terminate the supply or refuse to restore the supply to the property in respect of amounts purportedly owed by prior owners). At the urgent court hearing the municipality agreed to restore the electricity supply and tendered the owner’s legal costs for the bringing of the urgent application, subject to the proviso that the two issues referred to above (the “merits of the matter”) would be fully argued before the court in the ordinary course (to which the owner readily agreed). When it came time, however, for the municipality to file its answering papers in the matter, no papers were filed by the municipality. The owner accordingly applied to court for an order to be made in her favour as a result of the municipality failing to file any papers to contradict her argument set out in the founding affidavit. The municipality further withdrew its opposition to the application entirely 2 days before the hearing of the matter by the Gauteng Local Division of the High Court, meaning that it had taken a conscious decision to no longer fight the relief sought by the applicant (the owner) in the matter, knowing full well that this would result in the owner obtaining the court order as prayed for in the court application.

It has been suggested by some that the fact that the municipality did not oppose the relief sought on the day of the hearing means that the relief was granted by the court without having considered the issue and can be challenged by the municipality at a later stage should it choose to do so. The authors are in strict disagreement with this, however, for the following reasons:

1. The Judge had read all of the papers in this matter and was fully prepared (should it have been necessary) to hear argument from both sides on the day of the hearing, and the Court transcripts will bear this out;


2. The Judge accordingly granted the order after having applied her mind to the situation and having read the papers. The order was not granted simply as a formality by the Court because there was no opposition in the matter;


3. The order granted did not contain the usual interdictory relief (ordering the municipality to restore the supply of electricity to property, because this had already happened), but rather declared that the municipality had acted unlawfully in refusing to restore the supply on the basis of the arrears purportedly owing by the old owner. This type of relief is referred to as declaratory relief, and because the nature of this court order is that the declaratory relief so clearly prohibits the Ekurhuleni Municipality from acting in this manner in future, it sets a precedent for future cases;


4. Although the municipality withdrew its opposition at the last minute, it did this knowing full well that a judgement would be granted containing the declaratory relief referred to above. If it did not want an order to be granted in these terms it would then have defended the application. Accordingly, although technically speaking the municipality withdrew its opposition, in essence it decided to give-up the fight and concedes the relief sought. This must be understood in the circumstances referred to above as the municipality agreeing that it was no longer worth fighting the issues because the Court’s conclusion was foregone in this instance.

Conclusion
The Gladwin case sets a precedent that other consumers can use in use in court as authority for the proposition that a municipality is not entitled to terminate the supply of services to a property, or to refuse to reconnect or restore the supply of services to a property, in relation to amounts purportedly owed by prior owners of that property. A municipality is especially not entitled to do this in a case where it has not invoiced the current owner of the property in relation to the charges purportedly owed by the prior owner. This judgement represents one small step forward for consumers who are facing abuse from the municipalities (much of which flows from a misunderstanding by municipalities of the decision handed down by the Supreme Court of Appeal in the case of City of Tshwane v Joseph Perregrine Mitchell¹ . Hopefully the Gladwin order will serve to carve out a little bit of clarity in respect of precisely what it is that municipalities are and are not entitled to do when it comes to debts purportedly owed by prior owners.

1 City of Tshwane Metropolitan Municipality v PJ Mitchell (38/2015) [2015] ZASCA 1 (29 January 2016).

Chantelle Gladwin, Partner and Rogan Heale, Candidate Attorney
Schindlers