Property owners being 'duped'

The City of Joburg has resorted to allegedly conning unsuspecting property owners into paying arrears run up by their tenants. In terms of the Municipal Systems Act, the city is entitled to claim only two years of arrears from property owners.

However, since November last year, the city unilaterally decided to start charging full arrears, refusing to issue clearance certificates in terms of the act.

Property developers who buy up old derelict houses and renovate them have consistently been refused the certificates.

In one shocking incident, property owner Noreen Wade, who owns properties in Jeppestown that were hijacked, was promised an S118 certificate (clearance certificate) if she paid R43 000.

She took the money, in cash, and paid it over. The teller then said she was refusing to issue the certificate until the full arrears had been paid.

The developers have applied for an urgent interdict at the Johannesburg High Court to force the city to issue the certificates.

In her affidavit to the court, Wade said her properties had been hijacked. For years she battled to get the illegal squatters out, finally managing to do so in 1996.

She renovated the properties and now wants to sell them. Wade said she constantly asked the city to cut off services to the buildings when they were occupied by squatters, but it refused to do.

There is now R311 400 owing in arrears, but in terms of the S118, she is liable for only R43 000.

Wade, together with Mike Lingwood, who is trying to obtain certificates for about 70 properties he wants to renovate, applied for an urgent interdict in the Johannesburg High Court last week.

However, the city failed to submit its answering affidavit, and the court has given it until June 5 to do so.

Lingwood said the matter had not been taken off the urgent application list.

"We are now waiting for the city to reply. They offered us clearance certificates in the meantime, but we have refused, because we want a proper court ruling on what we believe is an illegal practice.

"We cannot continue being held to ransom by the city," he said, adding that he was losing thousands of rands a month in holding costs.

Lingwood said that in terms of the Prescription Act, only three years of services can be recovered.

The city can claim rates and taxes back for up to 30 years, but not for water and electricity. It can do so only if it can prove that it instituted legal action to recover the arrears.

If this was not done, the city can claim arrears of only three years.

"But many people do not know this and have already lost their homes because of this illegal action, Lingwood added.

"We are assisting the mayor's objectives of cleaning up the inner city. By refusing to issue the certificates, we will no longer be able to afford to buy properties and renovate them."

In response to questions from The Star last month, City of Joburg revenue department spokesperson Mandy Woods insisted that clearance certificate were still being issued if the owner paid only two years' arrears.

The Star, however, visited the department with Lingwood and witnessed staff refusing to issue the S118 certificates to him and other property owners.

  • This article was originally published on page 5 of The Star on May 27, 2008

Article by: Anna Cox - www.thestar.co.za