IN a landmark judgment throwing down the gauntlet to government departments that refuse to obey court orders, the high court has found a municipal manager guilty of contempt of court and sentenced him to six months in jail.
The judgment (Matjhabeng local municipality v Eskom), delivered on 19 February by the Free State High Court in Bloemfontein, follows years of warnings by South Africa’s senior courts that officials who do not comply with judges’ orders would find tough action taken against them. This week’s decision, however, is the first time that a top official has been convicted and sentenced and it is likely to send shock waves through government administration many of whose officials have been ignoring the courts with impunity.
The official in this case was the acting municipal manager of Matjhabeng municipality, Mothusi Frank Lepheana. The municipality, second largest in the Free State, includes over 400 000 people in a number of towns and cities including Welkom.
Matjhabeng is hopelessly behind in its payments to Eskom from whom the municipality buys power to sell on to the people of the area. The court was dealing with almost R400-million in arrears, but the amount has continued to escalate over the period of the legal action and is understood to stand at well over R500-million now, a state of affairs that highlights another side to the problems being experienced by Eskom.
In this case the courts had made more than one order, by agreement between the parties, in terms of which the municipality had to carry out a number of tasks as part of a deal buying time to pay back the money owed to Eskom.
For example, the court ordered that the municipal manager – the accounting officer of the municipality – had to give Eskom copies of council resolutions related to approval of its budgets and its electricity tariffs in particular. It also had to supply specifically listed information about bad debt and recovery rates. This and other information had to be given to Eskom by Lepheana but he did not do so.
Even when a second court order was made, stipulating other information required, Lepheana failed to comply or to give reasons for the non-compliance. There was also no payment of the arrear amounts still outstanding or of the interest due.
Judge Daffue said that the courts faced a “major challenge” nowadays: the trend of non-compliance with judgments, particularly money judgments, made by the courts against the state and other public bodies.
However, he warned, “the courts are not powerless” to ensure compliance: ‘Wilful disobedience of an order of court made in civil proceedings is a criminal offence,’ he said, and municipalities had a constitutional duty to comply with court orders and thus ‘lead by example’.
Contrary to what should be expected from a municipal manager, Lepheana failed to ensure that the documents and information required under the court orders were provided to Eskom by the due date – or at all.
The explanation given by Lepheana for not complying was ‘totally improbable’, said the judge, and indicated the ‘lackadaisical approach’ of the municipality over a long period. He called the municipality a ‘mendacious’ – lying and dishonest – litigant as was Lepheana.
The acting municipal manager, who is an advocate, could now face additional sanctions if the bar council decides to take action against him based on his criminal record and the court’s assessment of his honesty.
Lepheana is no newcomer to municipal obligations as the court pointed out. He had previously been director of the municipality’s corporate services and in that capacity had to ensure compliance with all municipal legislation.
In addition to failing to fulfil his obligations in terms of the court orders he also asked the court to “condone in advance future non-payment of the monthly bills due and payable to Eskom”, something that the court refused to do. He failed ‘dismally’ in his primary duty to explain the municipality’s failure to comply with orders of the court and his excuse contrasted with expert reports that the municipality deliberately charged its consumers lower tariffs than those agreed to by the National Energy Regulator of South Africa.
Judge Daffue said he had reason to believe that Lepheana ‘deliberately tried to mislead the court’. Of his oral evidence during the hearing the court said: ‘His non-compliance was not only wilful and male fide (in bad faith), but an indication of the high-handed approach adopted by so many senior public officials. His lack of interest in being of assistance to the court is apparent …. His attitude throughout is baffling and his conduct undermines the esteem in which the office of municipal manager ought to be held.’
Speaking of Lepheana’s ‘recalcitrant attitude’ the court concluded that it was proven beyond reasonable doubt that he was guilty of contempt of court. A six months jail sentence would be appropriate: there would be no option of paying a fine because of the ‘disastrous financial situation’ of the municipality and because of the seriousness of the matter.
However the entire six months sentence would be suspended as a ‘weapon of deterrence’ and in the hope that the ‘element of coercion’ would ‘compel him’ to comply.
Judge Daffue said that if Eskom were to cancel its supply to the municipality as it was by this stage entitled to do it would have a ‘devastating effect’ on the law-abiding citizens of the area and ‘business in the Goldfields will come to an abrupt halt’. He therefore granted the municipality an extension to pay its arrears in full, including interest, by the end of September 2015.
If even one payment is missed the entire remaining amount would then become payable and Eskom would be entitled to cut off the supply of electricity.
And if Lepheana wants to stay out of jail he must comply equally strictly with the order applicable to him: he must report in writing to the court and to Eskom within 14 days, giving answers to a number of crucial questions relating to the municipality’s default. If he fails to comply with the court order this time the jail term will kick in.