THE UNDERLYING PRINCIPLE
Municipal planning plays a crucial role in South Africa’s urban and rural development framework. The Spatial Planning and Land Use Management Act, 16 of 2013, as amended (“SPLUMA”) aims to create a uniform regulatory system for land use planning across the country. However, recently the Constitutional Court in Govan Mbeki Local Municipality v Glencore Operations South Africa (Pty) Ltd and Others; Emalahleni Local Municipality v Glencore Operations South Africa (Pty) Ltd and Others [2024] ZACC 25 has underscored the challenges of enforcing municipal planning compliance within constitutional bounds.
This article examines the constitutional issues surrounding municipalities’ use of transfer embargoes, as highlighted in this landmark case, and explores its implications for municipalities, property owners, mining operations and legal practitioners.
WHAT IS SPLUMA?
SPLUMA establishes the legal framework for spatial planning, land use management, and development application processes, including mining operations. A key provision of the Act, section 53, mandates municipalities to certify compliance with planning requirements before property transfers can occur. This ensures that all conditions related to land development and zoning have been met.
The Govan Mbeki and Emalahleni municipalities relied on SPLUMA to justify their by-laws, which sought to impose additional compliance requirements for property transfers. However, these by-laws raised questions regarding the balance between municipal authority and constitutional principles.
THE CASE AT HAND
Facts
- Glencore Operations South Africa Proprietary Limited, and associated entities, sought to transfer mining and property assets located with the Govan Mbeki and Emalahleni Local Municipalities.
- The respective municipalities enacted by-laws (namely, section 76 of the Govan Mbeki By-Law and section 86 of the Emalahleni By-Law) that imposed “transfer embargoes”. These provisions prohibited the transfer of properties unless municipalities issued certificates confirming compliance with extensive planning, engineering, and financial requirements.
Legal Proceedings
- High Court: Declared the by-laws unconstitutional for exceeding municipal powers and conflicting with section 118 of the Municipal Systems Act, 32 of 2000, as amended.
- Supreme Court of Appeal (“SCA”): Upheld the High Court ruling, finding that municipalities lacked authority to regulate property transfers.
- Constitutional Court: Affirmed the SCA’s findings, emphasising the municipalities’ overreach and the arbitrary deprivation of property rights.
Key legal issues considered
- Legality of transfer embargoes – The court found that the by-laws improperly extended municipal authority into areas of property transfer and registration; a competence reserved for national legislation under the Deeds Registries Act, 47 of 1937, as amended. By requiring compliance certificates for all property transfers, the by-laws infringed on property owners’ rights and bypassed constitutional limits on municipal powers.
- Conflict with the Municipal Systems Act – The by-laws conflicted with section 118 of the Municipal Systems Act, which already establishes requirements for rates clearance certificates before property transfers. The additional requirements imposed by the municipalities created inconsistencies and administrative barriers.
- Right to property – Under section 25 of the Constitution, the by-laws amounted to an arbitrary deprivation of property. The requirement for retrospective compliance with planning and development obligations, even for historical liabilities, undermined property owners’ rights.
IMPLICATIONS FOR MUNICIPALITIES AND PROPERTY OWNERS
For Municipalities
- The ruling limits municipalities’ ability to enforce compliance through transfer embargoes.
- Municipalities must explore alternative, constitutionally sound mechanisms to enforce planning and land use compliance.
- Proactive enforcement through planning inspectorates and compliance notices is critical.
For Property Owners
- The case highlights the importance of understanding compliance obligations before engaging in property transactions.
- Property owners must remain vigilant about municipal requirements and seek legal advice to navigate complex by-laws.
- Due diligence is essential when acquiring properties to avoid unforeseen liabilities.
THE ROLE OF LEGAL COUNSEL
Experienced legal counsel is indispensable in navigating the complexities of SPLUMA and municipal planning by- laws. Experienced attorneys can –
- Assist municipalities in drafting enforceable by-laws;
- Guide property owners through compliance requirements; and
- Represent clients in disputes involving municipal planning compliance and property transfers.
CONCLUSION
This case reinforces the importance of adhering to constitutional principles in municipal planning enforcement. While municipalities play a vital role in ensuring sustainable development, their powers are not unlimited. Property owners, developers and mines must also prioritise compliance to avoid costly legal battles.
For expert legal advice on SPLUMA compliance, municipal by-laws, or property rights, contact Bishop Fraser Attorneys.
