INTRODUCTION
Section 62 : Local Government Municipal Systems Act 32 of 2000
(1) A person whose rights are affected by a decision taken by a political structure, political office
bearer, councillor or staff member of a municipality in terms of a power or duty delegated or
sub-delegated by a delegating authority to the political structure, political office bearer,
councillor or staff member, may appeal against that decision by giving written notice of the
appeal and reasons to the municipal manager within 21 days of the date of the notification of
the decision.
(2) The municipal manager must promptly submit the appeal to the appropriate appeal authority
mentioned in subsection (4).
(3) The appeal authority must consider the appeal and confirm, vary or revoke the decision, but
no such variation, or revocation of a decision may detract from any rights that may have
accrued as a result of the decision.
INTRODUCTION Continued
(4)…….
(5) …..
(6) The provisions of this section do not detract from any appropriate appeal procedure provided
for in any other applicable legislation.
Analysis: Person/affected rights
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“Person”: definition: Interpretation Act 33 of 1957
“includes –
any company incorporated or registered as such under any law and any body of persons
corporate or incorporate.
not confined to a natural person common law definition applies, i.e. includes companies and
other corporate bodies.”
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“whose rights are affected”
A. Land use/planning applications
1.
Walele v The City of Cape Town and Others 2008 (6) SA 129 (CC).
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Facts: high court review of City’s approval of building plans by aggrieved neighbour under PAJA
locus standi: “adversely affect” rights. (definition and section 3 of PAJA)
6/5 CC held in favour of upholding the review, but both majority and minority judgments found
that the approval of the building plans by municipality did not “adversely affect” the rights or
‘legitimate expectations “ of the neighbours” within the meaning of section 3 (1) PAJA.
Analysis: affected rights continued
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Jafta AJ writing for the majority in the CC held that the neighbour had not been a party to the
approval application. The plans were drawn at the owner’s instance. Therefore the granting of
approval could not -by itself – be said to affect the neighbour’s rights.
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The approval of the plans did not ( so Jafta held) encompass the subsequent erection of the
flats ( and potential devaluation of the neighbours property).
Analysis: affected rights
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Conclusion: for purposes of PAJA a neighbour’s rights were not adversely affected by the approval of
building plans, even if the implementation would adversely affect the value of the neighbour’s
property or affect his use and enjoyment of it.
2.
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The Municipality of the City of Cape Town v Reader and Others 719/07
Appeal by CCT to SCA re building plan approval: argued that applicant had not exhausted internal
remedy i.e. s62 appeal.
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SCA majority held: a person who was not an applicant in the approval of building plans cannot appeal
against the resultant decision in terms of section 62. Only the “ aggrieved” applicant could do so.
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Judgment by majority ( Lewis JA) foreshadowed by Reader, but rests on 2 presumptions:
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That a person who has not been an applicant for approval could not be a person whose “rights are
affected” within the meaning of section 62 (1)
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That the protection of accrued rights in terms of section 62(3) would make an appeal by anyone other
than an aggrieved applicant pointless.
Analysis : affected rights
Inherent reasoning that is being applied:
• “Our system of administrative justice seeks to encourage internal remedies to resolve disputes
tat arise out of administrative action…In my view s62 should be read in the light of this
commitment as it establishes an internal remedy.” (O’Regan J in Walele).
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Questions that arise:
1. Can a successful applicant in planning applications for land use concessions e.g. rezoning,
where conditions can be attached (e.g. under LUPO) lodge a s62 appeal against any conditions
to which the approval is made subject?
Lewis judgement in Reader case muddied the water when she said at para 31:
“ It seems plain the purpose of s62 as a whole is to give the dissatisfied applicant for permission –
and to no one else- an opportunity for the matter to be reheard by a higher authority within the
municipality. It is only the aggrieved applicant, who has failed to secure the permission sought in
his or her application, who is afforded a right of appeal under s62. “
Analysis : affected rights
Conclusion:
This statement should not be read as precluding appeals by applicants who are unhappy with
the conditions to which their permission by the municipality has been rendered subject. An
applicant can still be aggrieved in such circumstances, for example if he considers that the
conditions essentially render his proposed development unviable, or unprofitable i.e.
notwithstanding approval the conditions mean that he has “ failed to secure the permission
sought in his or her application”.
2.
Is there more than one ‘internal appeal” that is applicable now regarding some land use
applications?
Yes, there is the potential for appeals under s 62 and any other Provincial planning ordinances
that apply e.g. S44 appeals under LUPO.
The municipalities are now bound to apply all of them and notify the applicant/ affected parties
of those rights.
Analysis : affected rights continued
B. Procurement
3.
CC Groenewald N.O. v M5 Developments [2010] ZASCA 47
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SCA differentiated procurement from planning matters and held that unsuccessful
tenderers are entitled to an appeal in terms of S62.
Distinguished from Reader because all bidders are parties to the tender approval process (i.e. a
neighbour is not in planning applications), accordingly all tenderers are entitled to appeal
under section 62.
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Questions that arise:
1. Duplicate process?
• Municipal Supply Chain Management Regulations: GNR 868 of 30 May 2005
Analysis: affected rights continued
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Regulations 49 and 50:
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The scm policy of a municipality must allow persons aggrieved by decisions or actions taken by
the municipality in the implementation of its supp0ly chain management system, to lodge within
14 days of the decision or action a written objection or complaint to the municipality against the
decision or action.
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The scm of a municipality must provide for the appointment by the accounting officer of an
independent and impartial person to … deal with objections, complaints or queries regarding
any such decisions or actions or any matters arising from such contract.
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A dispute, objection, complaint or query may be referred to the relevant provincial treasury if it
is not resolved within 60 days. If the pt. does not or cannot resolve the matter the dispute,
complaint or query may be referred to the NT for resolution.
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This regulation must not be read as affecting a persons right to approach a court at any time.
Affected rights continued
The Supply Chain Regulations also stipulate that provision should be made for unsuccessful
bidders to lodge their complaints or objections within 14 days after the notification of the
outcome of the award.
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This time period differs from the time period set out in Section 62, which allows for a 21-day
period. Both provisions can be applied at the same time by an unsuccessful bidder, but the
results will differ in legal result as one is an “ internal appeal” – which is necessary to trigger a
PAJA application, and the other is not – see below.
Analysis : affected rights
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Dual process of appeals?
Difference between “dispute/objection/ query and appeal?
Systems Act precedes SCM Regs ( and MFMA)
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Practical application :
Regulations of SCM do not replace section 62 process as they apply only in the context of SCM
and should rather be viewed as introducing a complimentary system for dispute resolution that
is not akin to an internal appeal.
Section 62 is an internal remedy of the purposes of PAJA but the regs are not given the wording
of regulation 50 (7) which states that the process does not detract from an affected persons
right to approach a court at any time, i.e. it does not equate to an internal process that has to be
exhausted before PAJA can be applied.
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Analysis: affected rights
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The powers of the impartial third party are not akin to the appeal powers of s62 –
“deal with and resolve” ( Regs) versus “ confirm, vary or revoke “ ( s62).
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See: Loghdey v City of Cape Town and others in re Advanced Parking Solutions CC and another
[2010] :
Binns Ward J held the following:
“ Regulation 49… does not appear to me to relate to s62 … Firstly it refers to objections and
complaints, not appeals; and secondly it affords a time period for the lodging of such complaints
or objections which is different from that allowed by the Systems Act for the lodging of appeals”.
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Analysis: affected rights
Conclusions:
• An unsuccessful applicant for zoning, subdivision or other town-planning, land use concession or
building rights, is permitted to appeal against a refusal of his or her application under s62 of the
Systems Act. In addition, where the application was brought and considered ito a section of a
provincial ordinance, for example, LUPO, the aggrieved applicant can also appeal under that
ordinance ( section 44 of LUPO).
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A person who has successfully applied for land use concessions, such as rezoning, can potentially
appeal under s62 of the Systems Act against any of the conditions to which the approval is
rendered subject and potentially under the applicable land use planning ordinance
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A neighbour who objects to an application is not permitted to appeal under s62 against any
approval or conditional approval; but is entitled to appeal ito an applicable planning ordinance
(LUPO) etc. where it specifically bestows a right of appeal on that person : ( LUPO “..a person
who has objected to the granting of an application.”)
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Analysis: affected rights
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An unsuccessful bidder for a tender can appeal to the granting of the tender to another bidder
under s62 (1) because the bidder was a party to the application process and thus is a person
who was directly affected by the outcome. This process must hence be completed prior to that
party initiating a PAJA review of that tender in the High Court.
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An unsuccessful bidder can also object /comment or complain to an independent third party
with respect to a tender process ito the SCM Regs, but does not need to complete this process
prior to initiating any High Court review under PAJA.
Analysis: delegating authority
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Definition of delegating authority :
“delegating authority”(a) in relation to a delegation of a power or duty by a municipal council, means
the municipal council;
(b) in relation to a sub delegation of a power or duty by another political structure,
or by a political office bearer, councillor or staff member of a municipality,
means that political structure, political office bearer, councillor or staff
member.”
Two scenarios: delegation and sub delegations
Analysis: delegating authority
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This definition limits the application of section 62 because it means that for it to apply the power
being exercised must have been delegated or sub-delegated to the person exercising it.
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This means that :
if the power or duty is exercised by the original source of the power eg council or the MM
section 62 is not of application, i.e. no internal appeal.
If the MM is using his or her inherent statutory powers ( see section 55 of the Systems Act) , no
delegation is in place accordingly section 62 not of application.
If the MM delegates his statutory power, this is a delegation and not a sub- delegation and
accordingly section 62 not of application.
Analysis : “Notification” / Time periods
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“ within 21 days of the date of notification of the decision”.
“Notification”: not defined: proof is essential : fax, email, registered letter.
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Concurrent “appeals” may now run with different time periods e.g:
. S44 of LUPO, read with regs and s62:
“ …within 21 days of the date of registration if the letter informing him/her by post of the
council's decision” v “ within 21 days of notification”.
S62 and SCM: 21 days v 14 ( see above).
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Municipalities not entitled to “: stagger” appeals i.e. let s62 appeal first run its course and then
apply the 21 day period under LUPO this is because decision will have been communicated to
the applicant ito the section 62 notice and hence unlawful not to inform them of their s44 LUPO
right of appeal given then 21 day clock that is ticking ( see regulation 19 and 21 of LUPO as well).
Analysis : Who hears the s62 appeal
“(4) When the appeal is against a decision taken by(a)
a staff member other than the municipal manager, the municipal manage is the appeal
authority;
(b)
the municipal manager, the executive committee or the executive mayor is the appeal
authority, or if the municipality does not have an executive committee or executive
mayor, the council of the municipality is the appeal authority; or
(c)
a political structure or political office bearer, or a councillor-
(i)
the municipal council is the appeal authority where the council consists of less than
15 councillors; or
(ii)
a committee of councillors who were not involved in the decision and appointed by
the municipal council of this purpose is the appeal authority where the council
comprises more than 14 councillors.”
Analysis: who hears s62 appeals
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Consistency with section 117 of the MFMA ( 56 of 2003)?
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“No councillor of any municipality may be a member of a municipal bid committee or any other
committee evaluating or approving tenders, quotations, contract or other bids, nor attend any
meeting as an observer.”
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Clear purpose is to remove councillors from participation in the evaluation and adjudication
process and thereby avoid any suggestion of political interference with the process of the
awarded of tenders.
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Accordingly how do you give effect to section 62 (4) (b) which dictates that the executive mayor
is the appeal authority with respect to decisions taken by the MM and not contravene section
117?
Analysis : who hears s62 appeals
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No case law on point.
Do the provisions of the MFMA impliedly repeal section 62 to this extent?
It is a well established approach in the interpretation of statutes which appear to conflict is to
presume that the legislature did not intend to amend the law more than is necessary and that
the courts have e duty to resolve conflicts in legislation by reconciling the apparent conflict if
possible.
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Two possible approaches to resolving the apparent conflict:
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1.
the reference to “ councillor” in section 117 includes the executive mayor sitting as an
appeal authority and this hence amounts is an implied repeal of section 62 in so far as an
appeal to the executive mayor is involved.
Who hears s 62 appeals
2. The reference to “ councillor “ in section 117 does not include the Executive Mayor .
3. The main argument in support of option is the policy considerations and based on the fact that
section 117 refers specifically to a councillor in the context of a committee but when the
executive mayor sits as an appeal authority in terms of section 62 he or she sits as an individual.
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Practical solution is to try and eliminate the executive mayor as the appeal authority as often as
possible to avoid potential controversy, i.e. by way of the system of delegations, eg delegate all
procurement matters to a committee which then has the MM as the appeal authority as
opposed to the Executive Mayor.
No detraction from “accrued rights”
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Detraction from any rights that have accrued.
Prelim question: Is there a wide ( rehearing ) or narrow appeal under s62?
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The Groenewald case referred to above determined the ambit of a section 62 appeal, i.e. is it a “
wide appeal” involving a rehearing of the issues or a “ narrow appeal” i.e. no rehearing of the
issues.
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In that case the SCA Held :
“ [23]section 62 (1) defines the ambit of the appeal, the sole use being whether the aggrieved
person should succeed for the reasons it has advanced. It is not for the appeal authority to
reconsider all the tenders that had been submitted, if that had been the legislature's intention ,
it would have said so… There is a need in ,matters of this nature ,for decision to be made without
unreasonable delay. If each and every tender had to be revisited it could easily become an
administrative nightmare with the appeal authority having opt hear representations from all
parties who tendered….This could never have been the legislature's intention.
Detraction from accrued rights
Thus, while I accept that the appeal is a wide one in the sense of a re-hearing, it is a re-hearing
related to the limited issue of whether the party appealing should have been successful.”
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What are “accrued rights”
See: Loghdey v Advanced Parking Solutions CC Case 20766/2008 (W) [2009] ZAWCHC 15 25
In this case, the City of Cape Town awarded a tender to Loghdey for a kerbside parking
management service and concluded a contract.
An unsuccessful bidder, appealed against the award, relying on Section 62 and after some
postponements of the matter Loghdey approached the court for an order that no appeal was
available on the basis of its understanding of s62(3)
Accrued rights continued
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i .e. because rights had already accrued to it because of the
unconditional award of the tender and the contract Section 62(3) applied.
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The court found in favour of Loghdey and held that unconditional rights had vested in Loghdey
following the award of the tender and the conclusion of the contract.
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Section 62(3) of the Municipal Systems Act thus also limits the ambit of the internal appeal
procedure envisaged by section 62 (1).
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Is this simply the functus officio rule now being applied via a statutory regime?
Conclusions
Section 62( 1) of the Municipal Systems Act makes provision for the filing of internal appeals but
has been curtailed by the rest of the section and the Act and our courts in their interpretation
of when and how it applies.
It does not apply:
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to objectors in land use /planning matters;
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Where the decision maker has used original powers to make the decision e.g. council or the
MM;
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Where rights have accrued due to an unconditional award of the tender.
Conclusions
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Furthermore the appeal authority is confined to the subject matter of
the appeal and may not revisit all the tenders and hence re-award
the tender to another bidder who did not appeal.
The duplication of internal “ appeal” processes is also problematic in that:
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SCM regs also apply to tenders.
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LUPO and other provincial and/ national legislation applies to land use matters.
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The duplicate procedures that apply are not uniform in terms of timing or application, some
being more vague than others.
Conclusions
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For example:
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the Supply Chain Regulations are silent as to the nature of the power of the independent and
impartial third party with respect to "interfering" with the award decision and are also unclear
on the procedures to be followed during an objection process.
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The SCM regs do not distinguish between original powers and delegated powers and hence are
wider in effect than s 62 in this respect too.
Conclusions
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The question that has yet to answered by our courts is whether municipalities can effectively
avoid almost all these problems with respect to tenders and “abort” an applicant’s right of
internal appeal by preventing Section 62 from having application with respect to tenders by
making unconditional awards and/or concluding unconditional contracts, i.e. with the result that
rights will have accrued to the preferred bidder, which cannot be disturbed by an appeal under
Section 62.
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The answer seems to be no, at least not systematically, given the constitutional imperative of
fair administrative action which includes a scm incorporating concepts of fairness, equity,
transparency, and competitiveness.
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Fiona Stewart
Thank you