IN THE CONSTITUTIONAL COURT OF SOUTH AFRICA Constitutional Court case no.: /2013 SCA case no.: 796/2011 WCHC case no.: 14190/2010 In the matter between: BRITANNIA BEACH ESTATE (PTY) LTD First applicant BRITANNIA BAY DEVELOPERS (PTY) LTD Second applicant SANDY POINT BEACH PROPERTIES (PTY) LTD Third applicant WEST COAST MIRACLES (PTY) LTD Fourth applicant and THE SALDANHA BAY MUNICIPALITY Respondent FOUNDING AFFIDAVIT IN APPLICATION FOR LEAVE TO APPEAL I, the undersigned, HORST PSOTTA, declare the following under oath: 2 1. I am an adult businessman and managing director of the fourth applicant, which has its registered office situated at Tygerforum B, 53 Willie van Schoor Drive, Tyger Valley, Bellville, Western Cape. 2. The contents of this affidavit are within my own knowledge, except where the context indicates otherwise, and are true and correct. Where I make legal submissions I rely upon the advice of the applicants’ legal representatives, which advice I verily believe to be correct. 3. The applicants have all duly resolved to institute these proceedings, and I am authorised to depose to this affidavit on their behalf. The parties 4. The first applicant is BRITANNIA BEACH ESTATE (PTY) LTD, a private company with limited liability duly incorporated in accordance with the company laws of the Republic of South Africa, with its registered office situated at Tygerforum B, 53 Willie van Schoor Drive, Tyger Valley, Bellville, Western Cape. 5. The second applicant is BRITANNIA BAY DEVELOPERS (PTY) LTD, a private company with limited liability duly incorporated in accordance with the company laws of the Republic of South Africa, with its registered office situated at Tygerforum 3 B, 53 Willie van Schoor Drive, Tyger Valley, Bellville, Western Cape and its principal place of business situated at the Waterfront Terraces, Block 1, 3rd Floor, Tyger Waterfront, Bellville. 6. The third applicant is SANDY POINT BEACH PROPERTIES (PTY) LTD, a private company with limited liability duly incorporated in accordance with the company laws of the Republic of South Africa, with its registered office situated at the Zomerlust Estate, Berg River Boulevard, Paarl, Western Cape and its principal place of business situated at 20 Fountain Street, Brackenfell, Western Cape. 7. The fourth applicant is WEST COAST MIRACLES (PTY) LTD, a private company with limited liability duly incorporated in accordance with the company laws of the Republic of South Africa, with its registered office situated at the Tygerforum B, 53 Willie van Schoor Drive, Tyger Valley, Bellville, Western Cape. 8. The respondent is the SALDANHA BAY MUNICIPALITY, a municipality established in terms of section 12 of the Local Government: Municipal Structures Act, 1998, with its principal administrative office at the office of the Municipal Manager, 12 Main Road, Vredenburg, Western Cape. 4 The purpose of this application 9. This is an application for leave to appeal against the whole of the judgement and the order (including the order as to costs) dated 30 November 2012 of the Honourable Acting Justice of Appeal Erasmus (the Honourable Justices of Appeal Cloete and Tshiqi and Acting Justices of Appeal Swain and Mbha concurring) in the Supreme Court of Appeal (“the SCA”). A copy of the judgment, including the order, is annexed hereto, marked “HP1” (“the SCA judgment”). 10. The applicants were the respondents in the Supreme Court of Appeal, and the respondent was the appellant, having appealed against the judgement and order dated 6 June 2011 of the Honourable Acting Justice Cloete in the Western Cape High Court, Cape Town (“the High Court”). A copy of that judgment is annexed, marked “HP2” (“the High Court judgment”). 11. The applicants contend that the SCA should have dismissed the respondent’s appeal, with costs. In particular and with respect, it is submitted that the SCA failed as a result of a fundamental misdirection on its part to address the crucial question of the applicants’ constitutional entitlement to an accounting from the respondent, in respect of overpayments which had been demanded from the applicants by the respondent in respect of development contribution levies in terms of section 42(1) and (2) of the Land Use Planning Ordinance 15 of 1985 (Cape) (“LUPO”). The applicants had been obliged to make payments, under protest, in a total amount of several million 5 rand in order to enable transfer of erven in their various developments to proceed. It was clear from the papers in the application that on any basis over a period of time the respondent had extracted payments from the applicants which had been calculated by the respondent upon an irregular basis. This aspect of the matter raised important constitutional issues, relating to in particular a local authority’s constitutional obligations of accountability and transparency. Regrettably this aspect of the matter was effectively ignored by the SCA. The issue was adverted to in a single paragraph of the judgment, with the SCA (for no good reason) concluding that it was not required to address what was one of the core questions in the matter. Condonation 12. As the SCA delivered its judgment on 30 November 2012, the applicants had, in terms of Rule 19(2), fifteen court days within which to make application for leave to appeal to this Court. The application should accordingly have been instituted by 24 December 2012. 13. The period leading up to the December holiday period was very busy, and the applicants did not have the opportunity of discussing the outcome of the appeal in detail with counsel prior to the latter (and the applicants’ representatives) going on holiday. Senior counsel only returned to chambers on 17 January 2013, and the matter was taken up again at that stage. After counsel was able to consider the matter and thereafter furnish advice, the applicants decided to institute the present 6 application, and counsel were instructed accordingly. 14. I have been advised that condonation will be granted if the interests of justice will be served thereby. The applicants contend that this is indeed the case. The issues for determination in this matter are constitutional in nature, and will probably arise more and more frequently in the course of interactions between developers and local authorities. It is respectfully submitted that the applicants enjoy reasonable prospects of success in the appeal. In this regard, the applicants point to the careful treatment by the High Court of the important constitutional issue of the nature and extent of the respondent’s duty to account to the applicants, and the unfortunate and cursory manner in which the SCA saw fit to deal with this question. The respondent will not be prejudiced by the failure to adhere to the prescribed time period, as the application will only be some 25 days late, most of which days fell over the holiday period when, I believe, the respondent and its representatives would also have taken some rest. As will be clear from what is set out below, the applicants have not withheld any disputed payments from the respondent, and they have no intention of doing so. 15. In these circumstances, the applicants apologise for the delay, and request that condonation be granted and that this application be entertained. Background 16. The High Court and the SCA judgments set out the relevant facts in this matter, and it 7 is not necessary to repeat such material in this affidavit in any detail. 17. “Capital contributions” is a commonly used description for the sums of money payable in terms of conditions imposed in terms of section 42(2) of LUPO, which sum or sums are determined to cater for the requirements resulting from the approval of development applications in respect of the provision of necessary services or amenities to the land concerned. The contributions are levied in terms of a tariff calculated and adopted by a local authority, and are payable upon the grant of rates clearance applications made in respect of the individual erven comprising the relevant township development. 18. Each of the applicants has, over the last decade, successfully applied to the respondent in terms of LUPO for the rezoning or subdivision (or, in some instances, both rezoning and subdivision) of land for development purposes. The grant of such applications gave rise to the creation of certain land use rights entitling the applicants to develop the land to which such applications pertained, subject, inter alia, to the payment of capital contributions. 19. As pointed out in the judgments, three resolutions by the respondent determining a tariff for the levying of capital contributions are especially relevant to the application, namely: 19.1. R55/9-97 dated 23 September 1997, relating to what is referred to hereafter 8 as the old tariff; 19.2. R35/6-07 dated 26 June 2007, relating to what is referred to hereafter as the new tariff; and 19.3. R43/12-07 dated 4 December 2007, relating also the new tariff. This resolution was rescinded on 2 February 2010, by way of resolution R105/1- 10. The relief sought in the High Court 20. In the notice of motion the applicants sought, inter alia, the following relief: 20.1. an order directing the respondent to, within a period of 3 (three) months of the date of an order being granted in the application, account to the applicants in respect of the sums overpaid by the applicants in respect of capital contributions unlawfully levied by the respondent in accordance with the respondent’s resolution R43/12-07 dated 4 December 2007; 20.2. an order declaring that the tariff for the calculation of capital contributions as set out in resolution R43/12-07, read with resolution R35/6-07 dated 26 June 2007, was of no force and effect; 9 20.3.