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+ IN THE HIGH COURT OF SOUTH AFRICA, FREE STATE DIVISION, BLOEMFONTEIN Reportable: YES/NO Of Interest to other Judges: YES/NO Circulate to Magistrates: YES/NO Case number: 901/2020 In the matter between: LETSEMENG LOCAL MUNICIPALITY Applicant 1st Applicant and ESKOM HOLDINGS SOC LIMITED 1st Respondent NATIONAL ENERGY REGULATOR OF SOUTH AFRICA 2nd Respondent MINISTER OF ENERGY 3rd Respondent MINISTER OF PUBLIC ENTERPRISES 4th Respondent THE MEC OF DEPARTMENT OF COOPERATIVE GOVERNANCE, HUMAN SETTLEMENTS AND TRADITIONAL AFFAIRS, FREE STATE PROVINCE 5th Respondent 2 CORAM: LOUBSER, J _______________________________________________________ HEARD ON: 25 JUNE 2020 DELIVERED ON: 23 JULY 2020 [1] The Applicant makes application on an urgent basis for an interim interdicted against the First Respondent (Eskom) in the following terms: “That, pending the outcome of an application to review the decision of the First Respondent to interrupt bulk supply of electricity to the Applicant, and further pending a determination of a dispute by the Applicant against the First Respondent, to be referred to the Second Respondent, in accordance with the provisions of the Electricity Regulation Act 2006 (which dispute will be formally lodged within one month of an order being granted in this application), First Respondent is interdicted and restrained from implementing its decision dated 31 January 2020 (“the interruption decision”) to interrupt the bulk electricity supply to the entire Letsemeng Local Municipality.” [2] The application has been postponed by agreement between the parties on four different occasions, the last one having been necessitated by circumstances surrounding the Corona virus pandemic. As a consequence, the urgency of the application is no more relevant, more so since Eskom had undertaken on each 3 occasion not to interrupt the electricity supply until such time as the application is heard. In the course of the proceedings so far, Eskom has filed a counter application to the effect that the Applicant be ordered to honour its obligations towards Eskom. I will return to the counter application later herein. [3] In all applications where an interim interdict is sought, the Applicant has to satisfy the following requirements: a) a prima facie right to the relief sought, even if it is open to some doubt; b) a reasonable apprehension of irreparable and imminent harm to the right if an interdict is not granted; c) the balance of convenience must favour the grant of the interdict; and d) the applicant must have no other remedy.1 [4] The question whether the Applicant has satisfied these requirements in the present application, must be considered with reference to the factual matrix of the matter before the court. It appears from the founding affidavit of the Applicant, deposed to by its municipal manager Mr. Tshemedi Lucas Mkhwane, that the municipal district of the Applicant includes, inter alia, the towns of Jacobsdal, Koffiefontein, Luckhoff, Petrusburg, Ratanang, Relebohile, Boitumelong, Bolokanang and Diamant Hoogte. During or about 2017 the Applicant fell into arrears with payments of its current accounts for the bulk supply of electricity to Eskom. These 1 Setlogelo v Setlogelo 1914 AD 221 and Webster v Mitchell 1948 (1) SA 1186 (WLD) 4 arrears have escalated to a massive present amount of more than R 41 million Rand. [5] According to the Applicant, it is in no position to pay that amount. Its financial woes were caused by the same problems which are endemic to many other municipalities in the country. Because of those problems, and its inability to settle the full account of Eskom on a monthly basis, Eskom has made many demands for payment in the past, but notwithstanding, Eskom has allowed the Applicant to slip further and further into arrears. That is until the decision was made to cut the bulk supply on every day of the week from 06h00 to 20h00 until the breach is remedied. The problems of the Applicant can only be resolved with assistance coming from the Provincial or National Government, the Applicant says. [6] The Applicant alleges that an interruption as envisaged by Eskom would result in no electricity for homes, businesses, schools, clinics, old-age homes, police stations and courts for the entire working day and beyond. In addition, such interruption would result in, inter alia, the total disruption of the water supply and the destruction of the sewerage network. [7] On the other hand, Eskom points out in the papers that the Applicant has acknowledged its debt to Eskom on numerous occasions in writing, and has undertaken to make payment time and again without honouring its obligations. The last occasion was on 19 February 2020, when the Applicant promised payment of R 5 million on 25 February 2020, which amount the Applicant was 5 to receive from Treasury on that date. However, on the eve of the date set by the Applicant for the payment of the R 5 million, the Applicant served Eskom with the papers for this urgent application, instead of making the promised payment. According to Eskom, this conduct illustrates the bad faith on the part of the Applicant. [8] Eskom further places heavy reliance on the provisions of Section 21(5) of the Electricity Regulation Act 4 of 2006. These provisions contemplate the supply of electricity only to the extent that the customer keeps its side of the bargain and pay Eskom. A customer’s default on its payment obligations entitles Eskom to reduce or terminate the supply of electricity to that customer. As for the apprehended disaster in the event of Eskom interrupting the power supply, it is the view of Eskom on the papers that such a disaster would be the direct result of the Applicant’s failure to meet its financial obligations to Eskom. It is therefore impermissible for the Applicants to take advantage of its own wrongdoing in order to obtain certain relief in these proceedings, Eskom says. [9] It is against this background that the first question has to be considered, namely whether the Applicant has established a prima facie right to the relief sought. In the recent past, our courts have constantly been confronted with the same question where defaulting municipalities and Eskom have been involved. It is therefore incumbent upon this Court to have regard to the views expressed in those cases, and especially so in the cases where interim interdicts against Eskom were sought. 6 [10] In the case of Resilient Properties (Pty) Ltd v Eskom Holdings SOC Limited and Others (11316/2016) ZAGPJHC the Applicant was a shopping mall owner in the area of jurisdiction of the Gamagara Local Municipality. He sought an interim interdict against Eskom from interrupting the supply of electricity to Gamagara pending a review of Eskom’s decision. In considering the question as to the prima facie right of the applicant, Van der Linde, J remarked as follows: “(74) In my view, therefore, in principle Eskom has the power under Section 21(5) of the Electricity Regulation Act to terminate or interrupt the supply of electricity to Gamagara, given its contractual default. Given the nature and source of Eskom’s power it’s exercise is, however, administrative action for the purposes of Section 33 of the Constitution and PAJA, and constrained if not by the baseline standard of rationality. (75) If it acts irrationally in exercising that public power to terminate or interrupt, its decision is thus potentially open to attack under Section 6 of PAJA for offending Section 33 of the Constitution. It would act irrationally if the exercise of the power is not rationally connected to the purpose for which it was given.” [11] The learned Judge then proceeded to state that the power could not have been intended to be exercised in such a manner that it would in any given circumstance result in widespread human catastrophe. He found that the applicant has established a prima facie case, although open to some doubt, for a review down the line at the hearing of the particular decision. 7 [12] In Mieliehoofstad Sakekamer and Another v Eskom Holdings SOC Limited and Others (Case number 4045/2018) a similar application for an interim interdict was heard by Reinders, J in this Division. She referred with approval to the views expressed by Van Der Linde, J in the above-mentioned case, and went on to state the following: “(19) The Applicants in their papers aver that the implementation will lead to a human catastrophe and to a huge extent destruction of infrastructure. Notwithstanding realizing this, Eskom has preferred to apply this option which, on face value, appears to be irrational, or differently put, a decision by Eskom which knowingly would result in human catastrophe could not be rational. As such I am convinced that the Applicants at least have a prima facie right though open to some doubt.” [13] Another application of the same kind was heard by Mathebula, J in the case of Tokologo Local Municipality v Eskom Holdings SOC Limited and Others (2020) JOL 46522 (FB). In that application the learned Judge stated the following: “(19) It is unquestionable that the first respondent is permitted to interrupt and disconnect electricity against defaulting customers. My view is that this power which has serious implications when exercised must be subjected to judicial scrutiny. I say so because the provision and supply of electricity is recognized as a constitutional right. It is also a fact that the applicant has not complied with the payment conditions of the first respondent. The applicant is not only owing money for past accounts but accumulating debt for current consumption. 8 (20) I am convinced that the applicant has demonstrated a clear right in this regard. The applicant brings this application protecting the interest of the residents within its jurisdiction.

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