Mlungisi July and Another v The Municipal Manager, KSD Municipality and Others

The fifth respondent was the previous owner of two properties: Erf No 38 (43 Callaway Street) and Erf 331 (70 Owen Street) in Mthatha. On 8 February 2022, a court order was issued setting aside the transfer of these properties to the fifth respondent as they had been fraudulently transferred by her late husband. The properties were then registered in the name of Linda Liziwe July (now deceased), the wife of the first applicant. However, the fifth respondent had accumulated substantial municipal debts on these properties. The third and fourth respondents issued tax invoices to the fifth respondent for water services totaling R833,958.21, including arrears from before the 2022 court order. The municipalities disconnected electricity and water supply to the properties due to non-payment. The first applicant paid R10,604.00 to negotiate reconnection. The applicants sought orders transferring historical debts to the fifth respondent and reconnection of services.

• Whether the applicants, as new owners, could be held liable for municipal debts accumulated by the previous owner before they acquired ownership
• Whether the municipalities' disconnection of water and electricity services was lawful
• Whether municipalities could be ordered to transfer historical debts to the previous owner
• Whether the applicants established a clear right to an interdict requiring reconnection of services
• Whether the applicants had an alternative remedy available through municipal procedures for opening new accounts

The first applicant's application is dismissed with costs.

For an interdict to be granted, an applicant must establish: (1) a clear right; (2) an actual or imminent threatened violation of that right; and (3) the absence of an alternative remedy that would provide adequate protection. Where municipal service accounts remain in the name of a previous owner and no contractual relationship exists between the municipality and the new owner, the new owner has not established a clear right to demand reconnection of services or transfer of historical debts. Municipalities have a constitutional obligation under section 96 of the Municipal Systems Act 32 of 2000 to collect all monies due and payable. Where an alternative remedy exists through municipal administrative procedures (such as applying to open a new account in accordance with municipal by-laws), a court will not grant an interdict. The lawful disconnection of services for non-payment of arrears does not constitute an unlawful violation of rights where proper municipal procedures have not been followed by the new owner.

The court referenced sections 152 and 153 of the Constitution regarding the objects and duties of local government, including the duty to provide democratic and accountable government and to structure administration to give priority to basic needs of the community. The court also noted section 73(1) of the municipal legislation regarding municipalities' duties to give priority to basic needs and ensure access to minimum levels of basic municipal services. These constitutional provisions establish the broader framework within which municipalities must balance their revenue collection duties against service delivery obligations. The court also referred to the municipal credit control by-law provisions requiring registered owners to apply for services, prohibiting applications from non-owners (such as tenants), and requiring outstanding debts to be paid before new accounts can be opened.

This case clarifies important principles regarding the transfer of municipal debt obligations when property ownership changes, particularly in cases involving fraudulent transfers that are subsequently set aside by court order. It affirms municipalities' constitutional and statutory duties to collect debts and reinforces that new property owners must follow proper municipal procedures to establish service accounts in their names. The case demonstrates that courts will not grant interdicts where alternative remedies exist through administrative processes, and emphasizes the importance of contractual relationships between municipalities and service users. It also highlights the tension between municipalities' duty to collect revenue and property owners' rights to access basic services following changes in ownership.