The Thaba Chweu Rural Forum and Others v The Thaba Chweu Local Municipality and Others

The appellants, comprising the Thaba Chweu Rural Forum and its farmer members, challenged the lawfulness of municipal property rates levied by the Thaba Chweu Local Municipality on agricultural properties between the 2009 and 2018 financial years. Historically, farms were not rateable, but following constitutional changes and the enactment of the Local Government: Municipal Property Rates Act 6 of 2004, municipalities could levy rates on agricultural land subject to statutory limits and procedures. The Rates Act Regulations capped agricultural property rates at 25% of residential rates. The municipality repeatedly levied rates exceeding this cap, failed to ensure proper public participation, and did not comply with valuation and objection procedures, particularly regarding the 2014/2015 second valuation roll, records of which were missing. These unlawful actions led to drastic increases in property valuations and rates. Although the municipality conceded the unlawfulness and invalidity of its conduct, it opposed retrospective relief on the basis of delay and potential prejudice to municipal budgets.

The appeal succeeded. The SCA set aside the Full Court’s order and declared the impugned rates notices and related council resolutions unlawful and invalid insofar as they applied to agricultural properties used for crop and/or animal farming. The municipality was permitted to recover only lawfully calculated rates within the prescribed limits and ordered to credit amounts overcharged between 2009 and 2018. The municipality was interdicted from levying unlawful rates in future and ordered to pay the appellants’ costs, including costs of two counsel.

This case affirms that municipalities must strictly comply with the Municipal Property Rates Act and its Regulations when levying rates, particularly on agricultural land. It clarifies the application of section 172(1)(b) of the Constitution in crafting just and equitable remedies despite substantial delay, and confirms that conceded and egregious illegality may outweigh concerns about retrospective budgetary disruption. The judgment strengthens the principle of legality in local government finance and protects agricultural property owners from unlawful municipal taxation.