The City of Johannesburg has deliberately misinterpreted a Constitutional Court ruling and is misleading landlords, telling them to pay off their tenants' arrears in order to recover its R7,1-billion debt.

So says attorney Robert Martindale, who originally took the matter to the court on behalf of landlords whose tenants have run up bills as high as R2-million.

He said the city was now printing on its accounts: "Be advised that landlords are liable for their tenant arrears in terms of the Constitutional Court ruling on 6/10/2004."

Martindale accused the city of exploiting public ignorance and ignoring important issues that the Constitutional Court raised.

He said there was widespread misunderstanding of the ruling and that no court had made any such judgement that landlords were liable for their tenants' arrears.

"The court did not state this either directly or indirectly. It simply ruled on the validity of a section of the Local Government Municipal Systems Act and the Provincial Government Ordinance regarding the controversial clearance certificate laws, which require all debts to be paid before a certificate can be issued for the transfer of immovable property.

"It found that this was constitutionally valid. The validity of a law relating to the issuing of a clearance certificate is a very different legal issue to whether an owner is liable for his or her tenant's arrears.

"It is regrettable that the note on the accounts may indicate to the public either ignorance or a scheme of subterfuge," he said.

"The fact that the relevant portion of the note is in inverted commas and commences with the words 'be advised' indicates that the city is trying to create a definite impression that either the sentence is quoted from the Constitutional Court judgement or it is an authoritative legal directive."

Martindale said the note was disturbing because it "not only attributes something to the Constitutional Court that the court was at pains not to decide, but no doubt many landlords have simply paid their tenants' debt based on the misleading information."
He said the note should be removed immediately.

"The misleading statement will no doubt complicate a complex legal situation that is going to be difficult and

These, and a number of other issues, would be addressed in the pending Johannesburg High Court case of Transfer Rights Action Campaign versus Johannesburg and Ekurhuleni Metros.

Furthermore, the city was still not cutting people off when their arrears started growing, the excuse always being that the tenants illegally reconnected themselves.

"However, they do not prosecute or arrest people who do this and they are still not advising landlords when the arrears start mounting," Martindale said.

City of Johannesburg spokesperson Mandy Woods said: "We disagree that the message is intended to mislead ratepayers.

"If the statement creates any misconceptions insofar as the Constitutional Court judgement is concerned, these are unintentional and are regretted.

"The intention of the wording on the statements was twofold. Firstly, to ensure that landlords were made aware of their responsibility so that they would not be unpleasantly surprised when they attempted to sell their property and found that there were outstanding consumer amounts to be paid before the transfer could take place; and secondly, to advise landlords that they are entitled to request duplicate accounts.

"It is our intention to point out the practical effect of the judgement to ratepayers, which is that, in certain circumstances, landlords may have to see to it that tenants' arrears are taken care of before their properties can be sold.

"Unfortunately space constraints do not allow for a detailed explanation of the 83-page Constitutional Court judgement. However, the full judgement is available on the City's website at www.joburg.org.za

Woods said the city found it "regrettable that Mr Martindale has chosen to focus on an unintentional possible misconception rather than the true purpose of the statement, which is to alert the general public to the practical consequences of the judgement."

• This article was originally published on page 1 of The Star on January 18, 2005

Published on the Web by IOL on 2005-01-18 12:55:00

IOL website

Opposing the court decision, affected land claimants, through their representative body, the Concerned Land Claimants’ Organisation, filed for an urgent application in the Port Elizabeth High Court yesterday, seeking leave to appeal against the court ruling. The ruling was made by Land Claims Court Chief Justice Fikile Bam in November last year, giving the go-ahead for the servicing and re-distribution of the land. Bam reserved judgment in the leave to appeal application.

In view of the urgency of the matter, attorney Lionel Alexander expressed his hope yesterday that a decision on the application would be taken this week, as the visiting judge was in Port

CLCO argued in their application that there was a strong possibility that another court might come to a different conclusion in the matter. Pelrha opposed the application.

About a year ago, CLCO applied to the Land Claims Court seeking a restraining order against Pelrha, the minister of land affairs and other interested parties from proceeding with the transfer of the land to more than 500 claimants.

The claimants are families who were forcefully removed from Fairview and Salisbury Park under the Group Areas Act during the apartheid era.

One of the main gripes CLCO has against the land transfers taking place is that the claimants will not be getting their original plots back despite the fact that a large portion of the land remains undeveloped.

The Herald Online website

Port Elizabeth - A furious homeowner has put up a 2.4m x 1.2m board outside his house, lashing out at a court decision regarding tenants who refuse to pay rent.

"No rent from tenants for six months. Court gives them another five months," reads the board outside the Kabega Park house.

Buks Bekker, a Graaff-Reinet businessman, said the agent he had appointed to find tenants assured him they would pay rent.

"But, I never heard from her again," he said, adding that the people living in his house were "full of stories".

Bekker then decided to have the lease declared null and void and to give the tenants notice to vacate the property.

In December, he decided to let his employees move into the house. But, the tenants refused to budge and simply relocated to the garden cottage.

Husband on unpaid sick leave

This month, the case ended up in court. But the verdict upset Bekker even 

One of the tenants, Sharon Vosloo, 44, said she could not believe how she, her ill husband, John, her mother-in-law and three young sons had been treated by Bekker.

"We have had no money to pay rent because my husband is on unpaid sick leave.

"My husband is in a wheelchair after a motorbike accident. Everything has been going wrong for us, but Mr Bekker would not listen," said Vosloo.

"What has happened to human decency? All we want is time to get back on our feet.

"There have been threats to cut off the water and electricity to the cottage where we are all living. We also have rights," she said.

Edited by Iaine Harper

News24 website

Source : Alastair

Badplaas, Mpumalanga - Forensic auditors are preparing a hard-hitting "prosecution" dossier on alleged profiteering in the dodgy R72m land restitution deal in Mpumalanga's Badplaas valley.

National land claims commissioner Tozi Gwanya confirmed that two separate independent investigation teams had each been granted one week extensions to "beef up" their reports for possible criminal prosecution.

"I haven't yet seen even an executive summary, but it is already very clear that there are serious gaps in the (purchase) processes, and that there will in all likelihood be legal action," said Gwanya.

The investigations were sparked by a media expose last year into the apparent systematic manipulation of sales prices for 21 vegetable and dairy farms in the Badplaas valley.

Initial evidence indicates that land speculators, allegedly working with Land Commission officials, fraudulently inflated land prices on gazetted farms and then over-charged the taxpayer up to 2000% in one instance and 300% on at least six other transactions.

Forensic auditors Ernest & Young are taking sworn affidavits from witnesses.

"We initially thought that we'd get to the bottom of the allegations very quickly, but the case has turned out to be far more complicated than expected.

Mpumalanga land claims commissioner Nceba Nqana and local project manager Linda Mbatha were both suspended last year for their alleged roles in the scandal.

The issuing of guarantees

Gwanya also took personal control of the Nelspruit Land Claims Commission office.

The second leg of the investigation, by SA Institute of Valuers executive member Derrick Griffiths is meanwhile still probing possible criminal collusion by private sector land valuators.

Amongst the farm deals Griffiths is reviewing is the sale of Doornhoek which was sold to government for R5.7m in 2003 - just months after speculators bought it from the original owner for R250 000.

Local developers claim Nqana irregularly helped land speculators set up the deals by issuing illegal financial guarantees to help them bankroll the scam.

In one case, Nqana's office allegedly issued a guarantee in favour of local farmer Pieter Visagie, allowing him to purchase Vygeboom farm for R1.6m in 2002.

Nqana then bought the farm from Visagie just months later for R4.4m - even though the LCC's own experts warned that the property was worth a maximum of R2.9m.

Nqana has consistently refused to answer 51 detailed written questions on the matter, but Visagie has formally denied any wrongdoing and dismissed critics as opponents of land reform.

The local farmers' union, Agri Badplaas, has also come to Visagie's defence and has condemned the investigation as a smear campaign.

Edited by Mahap Msiza

Finance24 website

Agriculture MEC Gabriel Ndabandaba and his department head, Jabulani Mjwara, will today visit Bergville for the first time since a farmer, Lister Vickers, dug a trench on November 10, 2004 in which five-year-old Mzanywa Mazibuko drowned in December.

Vickers ignored a court order instructing him to fill in the trench he dug around tenants' homes in a land dispute.

Ndabandaba said Vickers must explain why he did not fill in the trench when ordered to do so.

The purpose of the trip is for Ndabandaba and Mjwara to "visit the Bergville community to witness the situation in the area and listen to the people's needs and the Mazibuko family, while the case is pending".

On his way to attend Mzanywa's funeral three weeks ago, Ndabandaba's helicopter was grounded in the Drakensberg by bad weather.

Ndabandaba spent two days in the mountains, together with two reporters, the pilot and his bodyguard before being rescued on the Monday morning.

As a result, Ndabandaba could not attend the funeral, nor did he get a chance to speak to family members.

duma@witness.co.za

Witness website

Since 1995, 56 650 of a total of 79 000 land claims have been settled, and the remaining claims will probably be settled by 2006. Compared with Australia, New Zealand and Canada, the country’s restitution model is world-class. Not only does it offer claimants alternatives to restoring their right to the land, but it compensates owners to the value of the land too. In terms of agricultural land redistribution and land tenure reform, South Africa has avoided the

Excerpt from The Bones Foretell

Business in Africa website

Chief land claims commissioner Tozi Gwanya, who is holding his regular quarterly meeting with provincial commissioners in Cape Town, said most of the claims handled so far – 15 954 – had been in the Eastern Cape, followed by Gauteng with 11 945 and KwaZulu-Natal with 10 554.

Gwanya said urban claims, the bulk of which occurred in Gauteng and the Western Cape, were relatively simple to deal with because they were easier to research and secure documentation for.

"We find rural claims very challenging, very difficult to process," he said.

Rural claims were complicated by the high cost of land, which had to be paid out on a formula based on market value; the need for sometimes protracted negotiations with landowners and claimants; and resolving disputes within claimant communities themselves.

Particularly problematic claims were not being simply pushed to the back of the queue, as the attention they received from the media and politicians was "stretching us" to pay attention to them, Gwanya said.

The commission supported all the claimants who opted for land restoration and has spent R300,6-million on restitution discretionary grants and R132,5-million on settlement planning grants.

More than R2,3-billion has been spent

All 22 447 unresolved land restitution claims were likely to be settled by the end of this year, according to Gwanya.

"We have increased our staff capacity to ensure that each claim is prioritised. We are confident that we are doing everything possible," he said.

The outstanding 13 247 urban claims would be settled by the end of March, leaving 9 200 rural claims to be settled by the end of the year.

The commission would have to finish its business – including compiling a completion report – by the end of the year, as directed by President Thabo Mbeki.

"We don’t have a job (after that date)," he said. "But we have been committed to this process for some time and we would like to see it to the finish."

Critics have said the government has been too slow in dealing with land reform and that urgent action is vital to avoid land seizures such as those in Zimbabwe.

The government has long asserted that its land reform process will be done in an orderly, legal and transparent manner, unlike the invasions of white-owned commercial farms in Zimbabwe.

Land Minister Thoko Didiza said last October that South Africa would have to spend some R13-billion to resolve its outstanding claims.

The Herald Online website

Land reform is a highly emotive issue in SA, and its resolution is always tied up with the painful memory of a bloodied past and ideological rifts.

However, genuine grief and the need to restore dignity and sense of community are important motives for the return to lost land.

And along with these imperatives lies the prospect of a happy future once the land has been acquired. But claimants often expect too much.

Land reform's success is being measured by the number of land claims settled and land purchased through the official policy of willing buyer, willing seller. The official preoccupation is to ratchet up the land-transfer numbers. Little time is given to the post-settlement issue.

But what happens afterwards? In a case study we have been working on in the Riemvasmaak area a number of issues regarding local support and community capacity are emerging. These hold lessons for future land claimants and also foretell the direction of rural development as prospects for success are dim in the remotest areas.

On March 27 1996 the Riemvasmaak people were officially handed back 70000ha of their land, and last year an additional 4500ha ( part of the Augrabies National Park). They were removed from this land in 1973 to make way for a military zone.

Riemvasmaak is a community of about 3000 people. Local employment is erratic and wages are low. The majority of households (76,7%) live below the poverty line, and the average net household income is R650 a month.

The main source of income is wage labour at nearby commercial farms, some income from livestock rearing and supplementary income from remittances or social grants to the elderly and for children.

This income provides too low a capital base to be meaningfully ploughed into useful enterprise s that would assures long-term selfsustainability. The Riemvasmaak area is typical of most community projects in SA and is a useful illustration of the post-settlement challenges we face in SA.

We found no shortage of government funds, donor grants and private philanthropy. In some cases grantees who had to form communal property associations to qualify and earn legal title found themselves in a poverty trap, worse off than they were before. Factors such as conflicts over distribution of benefits among association members, inappropriate land use, lack of capital, inexperience, and distant markets and services worsen poverty.

The road to economic opportunity is unfamiliar to many communities because of the new skills required to tap into unconventional areas of production and enterprise. This is made worse by a history of loss of local knowledge and deskilling due to poor education.

At Riemvasmaak turning former farm labourers into ecotourism operators was not an easy step. Since 1999 several ecotourism projects have been initiated in the area with help from local municipalities, nongovernmental organisations (NGOs) and donors, but they were not entirely successful.

Northern Cape is also notorious for having a significant problem with brain drain; the best and most skilled go to

Second, without sustained local economic development, local government cannot retrieve levies, rents or fees for services rendered because of high unemployment and no commerce. Local governments thus become cash-strapped.

All this raises the question of whether it is worthwhile spending scarce public funds on rural development in these areas.

Assisting community development is fraught with difficulties, and well- intentioned government officials and NGOs often find themselves in a moral twist.

Some successes do happen, however, such as the Makuleke community, which won the right to land in the north of the Kruger National Park. With considerable outside assistance and willing private-sector investment in an ecotourism venture, prospects for the Makuleke look promising.

But this case cannot necessarily be replicated or guaranteed because of its reliance on external expertise and knowledge.

Riemvasmaak, for example, does not have the advantage of the stellar attraction which the Makuleke have the Kruger National Park and other private game reserves, which serve as a magnet for tourists.

Riemvasmaak also suffers from weak social capital among its communal property association members, indecision about how to use outside help, and how to use the land (livestock herders tend to dominate the water holes) and distance from major markets. These factors make an investment a risky venture. However, the capacity to organise, maintain internal solidarity and ensure equity among members is critical for success.

Despite these hurdles, things can be changed. Prospects for Riemvasmaak's people are better than those of most other communities. There is the possibility of planting vineyards on 10ha of prime land, there are small mining opportunities and the possibility of game farming on the newly acquired 4500ha (which can also be leased to the conservation authority). These options can open the doors to income diversification.

But at the moment these prospects lie dormant due to lack of entrepreneurial skill and capital, and the need to fend off the encroachment of more established enterprises. Riemvasmaak, like many communities, has an uncertain future; in each direction they face a heap of challenges.

Like the Makuleke they need considerable external assistance to lay a foundation for the future. Some of this is being provided by local government, the national parks authority and NGOs.

But this aid cannot last forever. And can the Makuleke and Riemvasmaak projects be replicated for thousands of other land claimants not lucky to be the darlings of donors and NGOs, and have a high public profile ? What then of their future, and who should fill the gap?

Fakir is director of the IUCN (World Conservation Union) office in SA.

AllAfrica website

Role players in the agricultural sector certainly are not a homogenous lot. Farmers vary in the scale, location and type of their operations; their access to education, finance, inputs and markets differ. Then there are the related industries, which range from cooperatives to companies, who sell inputs ranging from seed to services; these, too, vary in size and sophistication.

Many will be touched this year by the process of completion of land restitution, the establishment of a BEE charter for the industry, drought in parts of the country, slipping grain prices, the vagaries of a still-strong exchange rate, minimum-wage legislation and property taxes.

Christo Luüs, Absa chief economist, suggests that successful farmers will be those that apply innovation and business sense, who think and plan carefully, and who run their operations along business principles.

Lourie Bosman, president of the agricultural union AgriSA, told RSG se Geldsake met Moneyweb that progress with the formulation of a BEE charter for the industry is one of this year’s challenges.

Having accepted comments on the draft document, the steering committee tasked with drawing up a charter has made this feedback available to all role players for discussion. Participants are expected to negotiate around a number of thorny issues, including black empowerment through access to land, participation in the industry and economic development, in the hope of reaching agreement.

Graham Ebedes, non-executive deputy chairman of the agricultural services business Afgri, is emphatic that the industry’s BEE efforts have to consider the huge disparities amongst farmers. "One cannot consider treating all farmers – whether they have a thousand head of cattle or ten cows – the same way; in what other industry is a three-man business, say, expected to demonstrate how it has empowered its staff?".

There are other points of contention, too. Bosman expresses concern about the inclusion of new targets for land reform in the guideline BEE document. "The suggestion that land should be made available to employees is a highly emotional issue that could put existing farmers’ survival at risk". He argues that land ownership is guaranteed by the constitution, and that any proposed change to the status quo does not belong in a BEE charter.

Ebedes argues that the crux of empowerment in agriculture ought to be skills transfer; without it empowerment will fail. "Farming is an incredibly

Parched land, poor profits

Bosman says drought in regions across the country, including the Western Cape and parts of the Free State, will have a material effect on farming production. This, the downward pressure on the international prices of grains and rand strength, are placing financial strain on a notable portion of farmers. "Low prices are preventing farmers from functioning profitably; meanwhile rand strength is squeezing exporters’ returns. These factors have an impact on farmers’ ability to survive," Bosman says.

Although Bosman says that those in the agricultural sector are accustomed to the changeability of nature and markets, it is essential that they are aware of the cycles of drought and rain that may create crisis situations. "We suggest that farmers plan for these crises through building up reserves".

Land restitution is another item on this year’s agricultural agenda; its conclusion would end the uncertainty that pending claims has created in agriculture – for both claimants and those whose properties are the subject of claims. Bosman is pleased at the chief land claims commissioner Tozi Gwanya’s estimate that all rural land claims will be settled by the end of this year. Of the 22 447 outstanding claims, 9 200 are for rural properties. But Bosman is sceptical about the viability of the deadline, pointing out that there is a significant budget shortfall for the land claims process. "R4-bn has already been spent and another R13-bn will be needed to finalise the process. However, the fact that there is only R4-bn left in the budget could get in the way of a speedy conclusion of the matter".

Despite the landmark and potentially thorny events on the agricultural calendar this year, the sector is blessed with a number of pluses, too. Luüs points to low interest rates and firm domestic demand, ongoing productivity improvements and better access to international markets.

Erika van der Merwe is a presenter of "RSG se Geldsake met Moneyweb"; weekdays 5pm-6pm on Radiosondergrense.

Moneyweb website

Cape Town - The consumer spending spree of the past two years has not only been good for retailers, but also for the landlords of shopping centres, who have seen their turnover clauses kicking in and securing them extra income on top of the base rentals they charge.

Neil Schloss, sector head of retail property management at Investec Property Group, said that the landlords of shopping centres negotiated a base rental with tenants as well as a turnover clause - a percentage of sales - which kicked in if sales exceeded a certain level.

"Turnover clauses have secured the landlords of shopping centres a meaningful amount on top of the base rental they formally receive for at least the last two years, and this is at no additional cost to them," he said.

Schloss added that the growth in retailers' turnovers was in excess of the escalation rate on rentals, which for national retailers was around 7 percent to 8 percent.

The norm for national supermarkets' turnover clauses was between 1.5 percent and 2 percent of turnover, while national clothing retailers like Edgars, Foschini and Truworths normally had a rate of between 3.5 and 6 percent.

Restaurants' turnover clauses were normally closer to 10 percent, while the broader service industry did not have any turnover clauses in their contracts.

Schloss said the company seldom set turnover clauses higher than 10 percent, as it could be detrimental to the financial viability of the tenant.

A core aspect in determining the rate of

That is why supermarkets, which traditionally have very low margins, had such low turnover clauses, and why clothing retailers that had higher margins had their turnover clauses set at superior rates.

Traditionally national retailers also paid a lower rate than comparable independent retailers. However, although most lease negotiations were done around the benchmark, different approaches could be followed.

For instance, Schloss said a tenant could opt for a lower base rate in return for a higher-than-normal turnover clause.

He added that there was always downward pressure on turnover clauses from tenants, more so in good times when the clauses kicked in. This was because the turnover payable according to the turnover clause was an extra cost on top of the base rental.

Property economist Francois Viruly said retailers were always out to improve their trading densities, which of course was good for landlords' turnover clauses.

Angelique de Rauville, chief executive of property asset management company Provest, said the buoyant performance in the retail market would transpire into listed property, where funds that had exposure to quality retail properties were expected to outperform the market.

These included Grayprop, Sycom and Hyprop, which she projected to show earnings growth in excess of the broader sector's forecast of 4 percent to 6 percent.

Business Report website

A new global survey shows that nowhere else in the world have house prices increased more than in South Africa.

According to the survey, house prices in South Africa increased by an average of 32,6% in 2004, followed by Hong Kong at 27,2% and Spain at 17,2%.

The survey was undertaken by ResearchWorldwide.com - a commercial real-estate information portal. The Economist provided ResearchWorldwide.com with the figures for South Africa.

With this global assessment on property prices, ReasearchWorldwide.com warns against rumours of a pessimistic future view.

"Booming house prices in many countries worldwide over the past few years have prompted such august bodies as the International Monetary Fund, The Economist and many others to predict that the global house-price bubble will inevitably burst. These predictions, which started in 2002, are currently intensifying.

"Like everywhere else in the world, opinions have been expressed of the possibility of a bubble situation in South Africa. Those rumours should not be taken too serious," Andrew Golding, chief executive of the Pam Golding Property Group, told the Mail & Guardian Online this week.

"An increase of 32,6% is not sustainable but we believe that, given the dynamics in the South African property market, an increase of 12% over 2005 can be expected.

"There are a number of reasons why the South African market is a bubble that is not about to burst," said Golding.

"The economic indicators point to a strong real-estate market. The South African economy is still growing and the

sentiment is high.

"Secondly, there is an emerging middle class that is benefiting for the first time from this economic growth. For this group, home ownership is an absolute priority.

"Real estate has proven to be a solid investment; we see more and more investors choosing property".

ResearchWorldwide.com emphasises that rumours of a bursting bubble in some countries must be assessed individually. The property market cannot be compared with the stock market.

"Individual peculiarities of each country must be assessed from a demand, supply and affordability point of view to arrive at a realistic outlook for worldwide house prices in 2005.

"Each country has its own unique set of circumstances, which affect demand, supply and the affordability of housing. The residential market is an imperfect and inefficient market and should not be compared to the perfection and efficiency of stock markets and bond markets around the world," says ResearchWorldwide.com.

"South Africa ... long suffered from political uncertainty, which caused reduced demand from 1984 to 1999," states ResearchWorldwide.com.

"The housing market in South Africa took off strongly in 2000, six years after the first democratic elections ... During the boom phase since 2000, South Africa has experienced a 17% [a year] rise in house prices in nominal rates, and 11% [a year] in real terms.

"After 15 years (1984-1999) of negative growth in house prices, in real terms, 11% [a year] since 2000 is still playing 'catch up'".

Mail & Guardian website