Robarts Flagship Trust v Drakenstein Municipality

The appellant, Robarts Flagship Trust, is the registered owner of a commercial property in Paarl divided into six units rented to tenants. In 2009, a prepaid electricity meter was installed in one of the units at the request of a tenant's representative, without the appellant's direct authorization. The tenant vacated the premises in 2012, and no further prepaid electricity purchases were made thereafter. Daily fixed charges continued to accrue on the meter from 2012 to 2021, amounting to R71 052.68. The appellant only became aware of the meter in 2018 and requested its removal, but the municipality refused until the outstanding debt was settled. The municipality added the accumulated charges to the appellant's municipal account in March 2021 and issued summons in October 2021 (served February 2022) for the full amount. The appellant contested liability on the basis that it did not authorize the installation, had no knowledge of the meter, and had no use for it after the tenant vacated. The magistrate's court granted judgment for the full amount, leading to this appeal.

• Whether the appellant as property owner is liable for prepaid electricity meter charges accruing after a tenant vacated, even where the appellant did not authorize the meter installation.
• Whether the municipality failed to mitigate its losses by refusing to remove the prepaid meter when requested by the appellant in October 2018.
• Whether the municipality's claim for prepaid meter charges accruing from 2012 to 2021 had prescribed in whole or in part under the Prescription Act 68 of 1969.

The appeal was upheld. The magistrate's court order of 1 December 2023 was set aside and replaced with an order directing the municipality to reverse all prepaid fixed charges added to the appellant's account, present an invoice for electricity consumed only for the period 28 October 2019 to 29 October 2021, and requiring the appellant to pay that limited amount within 21 days. The municipality was ordered to pay the appellant's costs on scale A. A copy of the judgment was directed to be served on the Drakenstein Municipality Manager.

1. The owner of immovable property bears ultimate liability for municipal electricity consumption charges attached to the property by virtue of ownership, regardless of whether a tenant installed the meter or the owner was unaware, as the property is the link between the owner and the consumption charge (following Mkontwana v Nelson Mandela Metropolitan Municipality). 2. Electricity charges prescribe after 3 years under the Prescription Act 68 of 1969, and where a prepaid meter accrues a daily tariff, prescription runs daily from each date the charge falls due. 3. A municipality's policy of refusing to remove a prepaid meter until arrear debt is settled is a valid exercise of its incidental constitutional power to collect revenue and does not constitute a failure to mitigate loss.

The court strongly criticized the municipality's conduct in billing for almost a decade of accumulated charges without notifying the owner, describing it as 'opportunistic' and an abuse of its position. The court noted that the municipality should have voluntarily adjusted the claim to the prescribed 3-year period. Due to concerns about the prevalence of such municipal conduct, the court directed that a copy of the judgment be served on the Drakenstein Municipality Manager. The court also commented that the municipality's silence on the prescription defence at trial and on appeal was 'telling'.

This case reinforces the principle in South African municipal law that property owners bear ultimate responsibility for consumption charges linked to their property, even where tenants are the direct users. It confirms that electricity charges prescribe after 3 years and that municipalities cannot recover charges older than 3 years. The judgment also clarifies the scope of a municipality's incidental powers to implement debt collection policies, while emphasizing that such powers must be exercised reasonably and constitutionally. The court's criticism of the municipality's conduct in billing for prescribed debts serves as a reminder of municipalities' obligations of good governance under the Constitution and the Municipal Systems Act.