Eastern Metropolitan Substructure of the Greater Johannesburg Transitional Metropolitan Council v Venter N O

Etruscan Development Corporation CC was placed in liquidation. Its liquidator, Venter N O, sold 60 immovable properties situated in Sandton. Transfer could not be registered without municipal clearance certificates under s 50 of the Local Government Ordinance 17 of 1939 (Transvaal). The Eastern Metropolitan Substructure demanded payment of R353 616.74 for outstanding assessment rates, interest, rezoning fees, water and sewerage charges, and sundries before issuing the certificates. The liquidator paid the amount to secure transfer but later claimed that a portion (R131 311.72) was not lawfully payable and sought repayment, contending that these amounts were not “taxes” under s 89 of the Insolvency Act and were merely concurrent claims.

The appeal succeeded. The order of the Witwatersrand Local Division directing repayment of R131 311.72 was set aside, except to the extent of the conceded amount for sundries. The liquidator was not entitled to repayment of rezoning fees, water and sewerage charges, or water consumption charges.

The case clarifies the interaction between municipal clearance certificate requirements and insolvency law. It confirms that liquidation does not negate the enforceability of statutory embargo provisions preventing transfer of property and that non‑tax municipal charges may still be demanded before transfer. It affirms that such payments are costs of realising property and reinforces earlier authority on the continued existence of pre‑insolvency debts after liquidation.