Nature’s Choice Farms (Pty) Ltd v Ekurhuleni Metropolitan Municipality

Nature’s Choice Farms (Pty) Ltd (NCF), a producer of frozen vegetables, consumed large quantities of water supplied by Ekurhuleni Metropolitan Municipality. Due to an error, NCF’s water meter was recorded as a factor 1 meter instead of a factor 10 meter, resulting in underbilling for water usage for several years. After discovering the error in 2010, Ekurhuleni later debited NCF’s account in September 2013 for historical undercharged water usage for the period September 2007 to July 2010. NCF resisted the charge, contending that Ekurhuleni was limited by paragraph 12 of its water tariff schedule to correcting errors only for a maximum of 36 months and that the claim for earlier periods had ‘prescribed’. NCF sought a declaratory order that it was not indebted to Ekurhuleni. Ekurhuleni counterclaimed for payment, and NCF raised prescription as a defence. The High Court upheld NCF’s claim; the full court reversed it; and the matter came before the Supreme Court of Appeal.

The appeal succeeded. The orders of the full court and the trial court were set aside. NCF’s claim was dismissed. Each party was ordered to pay its own costs in all courts.

This case clarifies the dangers of poorly defined issue separation under Rule 33(4) and reinforces that courts may only decide issues arising from the pleadings. It confirms that municipal tariff provisions limiting retrospective billing do not equate to statutory prescription unless clearly framed as such. The judgment also emphasises contextual and purposive interpretation of municipal bylaws within the framework of the Municipal Systems Act.