TLU SA notes the ruling by the Gauteng High Court in Pretoria in the matter against the Minister and Department of Water and Sanitation concerning outstanding water use charges and the application of prescription to such charges.
Although the court dismissed the application for declaratory relief, TLU SA believes that important legal questions regarding the application of prescription to water use charges remain unanswered. TLU SA supported the case alongside Sakeliga, which has taken the lead in the litigation, as the outcome may also have significant implications for farmers and TLU SA members.
The case was brought, among other reasons, to obtain clarity on the period within which outstanding water use charges may be recovered by the state. The applicants argued that water use charges in terms of the National Water Act should be subject to the ordinary three-year prescription period provided for in the Prescription Act.
The court, however, did not grant a declaratory order on this question. It found, among other things, that the issue of prescription only properly arises once a claim has been instituted and prescription is raised as a defence.
According to TLU SA, this leaves an important practical question for farmers unanswered.
“Farmers must be able to determine with certainty what they are being held liable for, how an amount was calculated and how far back the state is entitled to claim payment. Legal certainty is essential, particularly where substantial historical amounts are involved,” says Bennie van Zyl, General Manager of TLU SA.
An important aspect of the ruling is that the Department of Water and Sanitation was ordered to provide the relevant applicants, within 60 calendar days, with complete statements together with all relevant invoices relating to the accounts concerned.
TLU SA welcomes this part of the ruling. Water users must have sufficient information to determine whether amounts claimed from them are correct. This includes what the amount was charged for, the period to which it relates and how the amount was calculated.
“When the state demands payment, the basis of that claim must be clearly and properly set out. Farmers cannot be expected simply to accept historical amounts without the necessary details and supporting documentation being made available,” says Van Zyl.
Legal advice obtained by TLU SA following the ruling indicates that there are arguable grounds for challenging the court’s approach to the issue of prescription on appeal. The potential appeal relates primarily to the application and interpretation of the law rather than a dispute over the facts.
Sakeliga, which is leading the matter, has decided to appeal the ruling. TLU SA supports this decision and will remain involved in the further legal process in co-operation with Sakeliga. For TLU SA, it is important that the legal question surrounding prescription is properly tested and that greater legal certainty is obtained for water users.
For TLU SA, the significance of the matter extends beyond the individual accounts currently at issue. A clear and consistent legal position on water use charges and prescription is important for farmers’ financial planning and for proper administration by the state.
“TLU SA’s position is not that legitimate accounts should not be paid. Our position is that any amount claimed must be correctly calculated, properly substantiated and recovered within the applicable legal framework. Where uncertainty exists regarding that legal framework, it should be properly clarified,” says Van Zyl.
TLU SA will therefore, in co-operation with Sakeliga and in support of the further legal process, appeal the ruling. Sakeliga will continue to take the lead in the matter, with TLU SA supporting the process in the interests of its members and the broader agricultural community. The objective remains to obtain greater legal certainty regarding water use charges, the application of prescription and their accountable administration.
