City of Tshwane Metropolitan Municipality v Glofurn (Pty) Ltd

The dispute arose from the City of Tshwane’s migration of Glofurn (Pty) Ltd from a post-paid electricity account to a pre-paid account. Glofurn continued paying into the old post-paid account, which accrued a substantial credit, while the City billed Glofurn on the new pre-paid account and alleged arrears exceeding R766 000. Glofurn denied liability, contending that it never applied for or was properly notified of the new account, and lodged a formal dispute under s 95(f) read with s 102(2) of the Local Government: Municipal Systems Act 32 of 2000. Despite this, the City threatened to disconnect Glofurn’s electricity supply. Glofurn approached the Gauteng Division of the High Court on an urgent basis and obtained an interim interdict preventing disconnection pending resolution of the dispute. The City appealed to the Supreme Court of Appeal.

The appeal was dismissed with costs, including the costs of two counsel where employed. The interim interdict preventing the City from disconnecting Glofurn’s electricity supply pending resolution of the dispute remained in force.

The judgment clarifies the protective scope of s 102(2) of the Municipal Systems Act by confirming that municipalities may not implement credit control measures while a properly lodged dispute remains unresolved. It reinforces procedural fairness obligations on municipalities in resolving billing disputes and underscores the importance of complying with statutory and policy-based dispute-resolution processes before disconnecting essential services such as electricity. The case also highlights the distinction between the validity and enforceability of municipal policies where by-laws have not been adopted.