The Member of the Executive Council of the Department of Human Settlements, Free State Province v Ntsu Building Materials (Pty) Ltd

In 2010 the Free State Department of Human Settlements concluded building contracts with seven contractors for low-cost housing projects. The Department paid Ntsu Building Materials (Pty) Ltd approximately R34 million in 2010–2011 as advance payments for building materials to be supplied by Ntsu to those contractors. In 2019, the High Court reviewed and set aside the administrative decisions and agreements pursuant to which the advance payments were made, declaring them unlawful. Relying on this, the Department sued Ntsu for unjustified enrichment, alleging that the payments were made sine causa because no debt was due at the time or thereafter. Ntsu excepted to the particulars of claim on the basis that they disclosed no cause of action.

Special leave to appeal was granted, but the appeal was dismissed with costs.

The case clarifies the interaction between public-law invalidity and private-law enrichment claims in South African law. It confirms that the review and setting aside of administrative action does not automatically found a claim for unjust enrichment where payments were made pursuant to decisions that factually existed at the time, reinforcing the continued importance of the Oudekraal principle.