THE SUPREME COURT OF APPEAL
OF SOUTH AFRICA

Reportable

CASE  NO: 5/04

In the matter between :

BUFFALO CITY MUNICIPALITY
Appellant

and

WILLY GAUSS
First Respondent
THE PREMIER : EASTERN CAPE PROVINCE
Second Respondent
________________________________________________________________________
Before:
MPATI AP, NAVSA, NUGENT, CLOETE & COMRIE AJA
Heard:
19 NOVEMBER 2004
Delivered:
2 DECEMBER 2004
Summary:
Expropriation – Municipal Ordinance (Cape) 20 of 1974 – whether
owner entitled to be heard before preliminary steps taken by local
authority.
________________________________________________________________________

J U D G M E N T
________________________________________________________________________

NUGENT  JA

NUGENT JA:
[1] The Expropriation Act 63 of 1975 authorises (in specified
circumstances), and regulates, the acquisition of property by the state. Its
regulatory provisions are extended to local authorities by s 5, which provides
that ‘if a local authority has the power to expropriate property then such
power may only be exercised, mutatis mutandis, in accordance with the Act’.
[2] The acquisition of property is effected under the Act by serving upon
the owner a notice of expropriation containing certain information, including
the date of expropriation (s 7), and ownership of the property then vests in the
expropriator on that date (s 8). Compensation is payable to the owner for the
loss of the property in an amount that, if it cannot be agreed upon, is to be
determined by the High Court.
[3] A local authority – or at least one to which the Municipal Ordinance
(Cape) No 20 of 1974 applies – does not have the power to expropriate
property except with the prior approval of the provincial Premier.1 Approval
may be sought from the Premier only after the local authority has exhausted a
prescribed procedure. First, it must resolve by special resolution to
expropriate the property.2 Then it must serve on the owner and on the
Registrar of Deeds what is referred to as a ‘preliminary notice’, in which the
owner is informed of the local authority’s intention, and is informed that any

1 The Ordinance refers to the Administrator but in terms of Item 3(2)(b)(ii) of Schedule 6 to the Constitution
of the Republic of South Africa 1996 that is to be construed as referring to the Premier of the relevant
province.
2 Section 123(3).

objections to the proposed expropriation may be lodged with the Town Clerk
within thirty days of the service of the notice.3 Upon expiry of that period the
local authority must transmit to the Premier any objections lodged by the
owner, together with its comments and a copy of the preliminary notice, and
must seek the Premier’s approval for the proposal.4 If the Premier approves
the expropriation the local authority may proceed to expropriate the property
in accordance with the Act (by serving a notice of expropriation on the
owner). If the Premier does not approve the local authority must serve a
notice on the owner and on the Registrar of Deeds withdrawing its
preliminary notice.5
[4] In the present case the appellant – which is a local authority that is
subject to the Ordinance – wishes to expropriate a farm portion that is owned
by the respondent for the purpose of accommodating the expansion of an
existing informal residential settlement. On 3 May 1999 it decided – by
special resolution – to expropriate the property. A preliminary notice was
served on the respondent and on the Registrar of Deeds in the requisite form,
and the respondent was also informed that he would be offered compensation
in the sum of R60 000. The respondent lodged an objection to the proposed
expropriation on three grounds. He said that he was himself planning to
develop the property for medium and low cost housing and that preliminary
plans to that end had been established; he questioned the adequacy of the

3 Section 123(4).
4 Section 123(5).
5 Section 123(6) of the Ordinance.

compensation that was to be offered; and he questioned whether the
expropriation was truly in the public interest.
[5] About three months later the respondent received from the appellant
what purported to be a notice of expropriation together with a cheque for
R60 000. Apparently the appellant had overlooked the fact that it had no
authority to expropriate without the Premier’s approval. When that was
brought to its attention by the respondent’s attorney the notice of
expropriation was withdrawn and the cheque was returned.
[6] The appellant then sought the Premier’s approval. Discussions and
correspondence ensued but none of that is material to the issues that arise in
this appeal. It is sufficient to say that before the Premier had either approved
or disapproved the proposal (he had still not done so when the present
proceedings were commenced) the respondent’s attorney wrote to the
appellant alleging that its decision to expropriate the property (taken by the
special resolution of 3 May 1999) was unlawful because the respondent had
not been given prior notice of the appellant’s intention nor an opportunity to
make representations before it was taken. The appellant was called upon to
withdraw its preliminary notice, which the appellant declined to do,
whereupon the respondent applied to the Eastern Cape High Court for an
order reviewing and setting aside the decision and the resultant preliminary
notice on the grounds foreshadowed in the letter. The application succeeded
in the court a quo (Jones J) and this appeal is with the leave of that court.

[7] It has for long been a principle of our law – the common law at one
time being its source6 – that
‘when a statute empowers a public official or body to give a decision prejudicially
affecting an individual in his liberty or property or existing rights,7 the latter has a right to
be heard before the decision is taken (or in some instances thereafter – see Chikane’s case8
…at 379G), unless the statute expressly or by implication indicates the contrary.’9
[8] When the Constitution assumed sovereignty the principle was
inevitably subsumed in constitutional principles regulating the exercise of
public power. For as pointed out in Pharmaceutical Manufacturers
Association of SA: In re Ex parte President of the Republic of South Africa
2000 (2) SA 674 (CC) para 45:
‘It shifted constitutionalism, and with it all aspects of public law, from the realm of
common law to the prescripts of a written constitution which is the supreme law. That is
not to say that the principles of common law have ceased to be material to the development
of public law. These well-established principles will continue to inform the content of
administrative law and other aspects of public law, and will contribute to their future
development.  But there has been a fundamental change … Whereas previously
constitutional law formed part of and was developed consistently with the common law,
the roles have been reversed.’
[9] The principle to which I have adverted is thus inherent in s 33 of the
Constitution (read, at the time that is now relevant, with Item 23(b) of

6 South African Roads Board v Johannesburg City Council 1991 (4) SA 1 (A) 10 G-I
7 The principle was extended in Traub, infra, to cases in which an affected person had a legitimate
expectation of being heard.
8  Cabinet for the Territory of South West Africa v Chikane  1989 (1) SA 349 (A).
9 Administrator, Transvaal v Traub 1989 (4) SA 731 (A) 748G-H.  See too South African Roads Board v
Johannesburg City Council 1991 (4) SA 1 (A) 10 G-I; Transvaal Agricultural Union v Minister of Land
Affairs 1997 (2) SA 621 (CC) para 25.

Schedule 6), which guarantees, amongst other things, the right to
administrative action that is procedurally fair. Seen in that context the
principle affords a right to be heard in the circumstances that I have described
but any purported statutory exclusion of that right will necessarily be invalid
if it results in administrative action that is procedurally unfair.
[10] The respondent has not as yet been deprived of his property. It is not
disputed that ample opportunity has been afforded to him to be heard before
that will occur, if it occurs at all, bearing in mind that the power to deprive
him of his property does not lie with the local authority but with the Premier,
and that the Ordinance makes express provision for the respondent to be heard
before that power is exercised. We are thus not called upon to reconsider the
question whether, in general, expropriation must be preceded by an
opportunity for the owner to be heard.10  The argument before us was rather
that the respondent was entitled to be heard before the appellant’s decision
was taken, because the effect of its decision (once conveyed in the
preliminary notice) was to restrict the use of the property. For once a
preliminary notice has been served on an owner and the Registrar of Deeds
then the Ordinance provides in s 123(4) that
‘(i)
such owner shall not alienate, dispose of, let or in any other manner deal with the
immovable property concerned unless and until such notice is withdrawn;

10 Cf Pretoria City Council v Modimola 1966 (3) SA 250 (A), but see MD Southwood The Compulsory
Acquisition of Rights by Expropriation, Ways of Necessity, Prescription, Labour Tenancy and Restitution
52-3.

(ii)
the Registrar of Deeds shall not register transfer of the immovable property
concerned to any person except the municipality unless and until such notice is
withdrawn, and
(iii)
any person who demolishes, damages, alters or in any other manner impairs the
immovable property concerned shall be guilty of an offence.’
[11] There is no suggestion that these restrictions have had any practical
effect in the present case. It is not suggested that the respondent would have
dealt with his property in some way that has now been prevented. Rather, it
was submitted on his behalf that the respondent is prejudicially affected by
the fact alone that the restrictions exist. Assuming that to be so the question
that then arises is whether the Ordinance validly excludes the right to a
hearing before those restrictions take effect.
[12] Whether the Ordinance, properly construed, excludes the right to a
prior hearing by necessary implication (for it does not do so in terms) must
necessarily be informed by whether such an exclusion would be procedurally
fair in the circumstances (and thus consistent with s 33 of the Constitution),11
bearing in mind that if it is possible to do so a court will avoid construing
legislation into constitutional invalidity.12
[13] The reason that the Ordinance subjects the property to restrictions once
the owner has been informed of the intention to expropriate is plain enough to
see. It is to maintain the status quo until the Premier has approved or

11 Cf Transvaal Agricultural Union v Minister of Land Affairs 1997 (2) SA 621 (CC) paras 30 and 31.
12  Olitzki Property Holdings v State Tender Board 2001 (3) SA 1247 (SCA) para 20; National Director of
Public Prosecutions v Mohamed NO  2003 (4) SA 1 (CC) para 35; Zondi v Members of the Executive Council
for Traditional and Local Government Affairs, unreported Constitutional Court Case 73/03 dated 15 October
2004 para 102.

disapproved expropriation. It is to avoid the expropriation meanwhile being
frustrated or subverted. (A similar restriction that arises in the process for land
restitution was said in Transvaal Agricultural Union v Minister of Land
Affairs 1997 (2) SA 621 (CC) para 36 to serve a legitimate purpose.)
[14] Even when pressed to do so, the respondent’s counsel could not tell us
in what manner the temporary preservation of the status quo without a prior
hearing operated unfairly upon the owner of property that was marked for
expropriation. Nor can I see how it might operate unfairly. (I have already
drawn attention to the fact that it had no adverse effect in the present case.) Its
effect will be felt only by an owner who would otherwise have acted to alter
the status quo; yet it is in precisely such a case that the Ordinance and the
public interest requires that he be prevented from doing so. It is not the
preservation of the status quo itself that prejudices the owner but rather the
fact that he might be dispossessed of his property, but he has a full
opportunity to be heard before that occurs. The learned judge in the court a
quo stated that the respondent was prejudiced procedurally by the failure to
hold a hearing before the resolution was taken and the notice was issued but
did not expand on why that was so. It also needs to be borne in mind that it is
open to the owner in an appropriate case (it is difficult to envisage one) to
make representations to the local authority to withdraw its notice and to
rescind its resolution if, unbeknown to the local authority when the decision
was made, there was good reason not to expropriate, and more importantly,

not to restrict the use of the property while the merits of expropriation were
being considered. But once the local authority has marked the property for
expropriation I can see no reason why the failure to afford the owner an
opportunity to be heard before the status quo is temporarily preserved will
operate against him unfairly.
[15] Clearly the Ordinance does not envisage a hearing before the local
authority’s decision is taken – that the owner is invited to object only after the
decision is made necessarily means that no objection before then is
contemplated – and this construction is not in conflict with the Constitution.
In those circumstances the appellant’s decision and the consequent
preliminary notice were lawful and the application ought to have failed.
[16] The appeal is upheld with costs. The order of the court a quo is set
aside and the following order is substituted:
‘The application is dismissed with costs’.

___________________
R W NUGENT
JUDGE OF APPEAL

MPATI AP)
NAVSA JA)
CLOETE JA)
CONCUR
COMRIE AJA)