MERAFONG Local Municipality squared off against AngloGold Ashanti in the Constitutional Court on Thursday in a case that will test the boundaries of authority between the local and national spheres of government.
The municipality wants to overturn last year’s Supreme Court of Appeal judgment in which it was ordered to comply with a 2005 national government directive that it renegotiate a surcharge with AngloGold Ashanti.
The court found Merafong had failed to take, upon legal review, a decision taken in 2005 by the then minister of water affairs and forestry that its surcharge was excessive and that it should renegotiate the terms of its industrial water with AngloGold Ashanti.
It held that even if the minister’s directive was invalid it had to be legally considered after the municipality said the instruction went beyond the jurisdiction of national government.
In 2007 Merafong, on Gauteng’s West Rand, started charging AngloGold Ashanti mines extra fees for water even after the company had lodged complaints, and the Department of Water Affairs said in 2005 the municipality could not institute the "excessive" extra charge. However, the department said the municipality could levy the company for domestic water use.
Merafong had reportedly added levies of up to R500,000 a month despite not providing extra services.
Both parties are seeking the cost of legal counsel, with Merafong arguing that "to sanction a recovery of many millions of rand otherwise properly due on the grounds of this procedural deficiency would … be unconscionable".
Chief Justice Mogoeng Mogoeng questioned both legal counsel on the possible implications of the court upholding their arguments.
Both parties maintain the amount that may be recovered by AngloGold Ashanti was "substantial" but not immediately quantifiable.
"We do accept the practicalities, but I can’t distance my client from any rights they may have," said Noel Graves SC on behalf of AngloGold Ashanti.
The court reserved judgment.
Picture: THINKSTOCK
MERAFONG Local Municipality squared off against AngloGold Ashanti in the Constitutional Court on Thursday in a case that will test the boundaries of authority between the local and national spheres of government.
The municipality wants to overturn last year’s Supreme Court of Appeal judgment in which it was ordered to comply with a 2005 national government directive that it renegotiate a surcharge with AngloGold Ashanti.
The court found Merafong had failed to take, upon legal review, a decision taken in 2005 by the then minister of water affairs and forestry that its surcharge was excessive and that it should renegotiate the terms of its industrial water with AngloGold Ashanti.
It held that even if the minister’s directive was invalid it had to be legally considered after the municipality said the instruction went beyond the jurisdiction of national government.
In 2007 Merafong, on Gauteng’s West Rand, started charging AngloGold Ashanti mines extra fees for water even after the company had lodged complaints, and the Department of Water Affairs said in 2005 the municipality could not institute the "excessive" extra charge. However, the department said the municipality could levy the company for domestic water use.
Merafong had reportedly added levies of up to R500,000 a month despite not providing extra services.
Both parties are seeking the cost of legal counsel, with Merafong arguing that "to sanction a recovery of many millions of rand otherwise properly due on the grounds of this procedural deficiency would … be unconscionable".
Chief Justice Mogoeng Mogoeng questioned both legal counsel on the possible implications of the court upholding their arguments.
Both parties maintain the amount that may be recovered by AngloGold Ashanti was "substantial" but not immediately quantifiable.
"We do accept the practicalities, but I can’t distance my client from any rights they may have," said Noel Graves SC on behalf of AngloGold Ashanti.
The court reserved judgment.
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