The Ekurhuleni Metro Council’s (Kempton Park) firm offer of no compensation for a parcel of agricultural land designated for township development by the private owner could, according to Sakeliga, represent the country’s first test case for expropriation without compensation.
By Carien Kruger, senior journalist at African Farming and Landbouweekblad
The metro council expropriated 34 hectares, known as portion 406 of the farm Driefontein, on 30 April 2019. It only made its compensation offer in 2020, which was zero rand, and has since persisted in its position that there are valid reasons for providing no compensation.
The council even stated at one stage in court documents that the Land Court should declare the previous expropriation act (Act 63 of 1975) unconstitutional.
Business Venture Investments 900, the previous owner of the land before expropriation, states in court documents that the land is valued at a minimum of R30 million.
Sakeliga announced the developments in this six-year-long case over the weekend and states it is scheduled for court-mandated mediation on 31 October, as well as an 18-day hearing from 2 February 2026.
According to the organisation, more recent independent valuations of the land have reached as much as R64 million. “If market-related compensation is not restored, the case will trigger an economic, political and social crisis in South Africa,” says Sakeliga.
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Avenues Exhausted
The former owner has made “extraordinary efforts to avoid public controversy and find an amicable solution to reverse the ‘offer’ of zero compensation.”
“With all other avenues exhausted, however, and millions already spent on legal costs, lost development opportunities, and management time, the owner is now preparing for trial,” says the organisation.
Dr Imogen Mashazi, City Manager of Ekurhuleni, stated in April 2020 in legal documents to Business Venture Investments 900 that it is in the public interest, or for a public purpose, for the metro council to expropriate the property to fulfil its obligations under the Housing Act (Act 107 of 1997).
The council also stated that it is taking this action to enforce the Bill of Rights regarding the living conditions of poor people in squatter camps and hostels.
The previous owner’s stance is that R30 million is the fair market value between a willing buyer and a willing seller. In contrast, the metro council’s stance is that zero compensation is just and equitable, as outlined in Section 25 of the Constitution.
The metro council contends that section 25(3) does not limit the determination of compensation solely to “mathematical formulas or quantitative amounts,” but must also consider socio-economic circumstances and the lived experiences of landless people and individuals in squatter camps.
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Speculative Purposes
The municipality also contends, as part of its reasons for seeking no compensation, that the previous owner acquired the land in 2005 for R1 million from a related company, which, according to the metro, was well below market value, that it has remained vacant for over 30 years, and that it was purchased for “speculative purposes.”
The metro council believes that, considering all the factors such as the land having been acquired below market value, purchased for speculative purposes, and remaining unused for a long time, the balance between public interest and the previous owner’s interest is in favour of the public interest, and therefore, no compensation is payable.
The previous owner’s developers received permission from the council in August 2018 to develop the property. However, the appeals against this had not yet been finalised when the metro council expropriated the land.
The council states in court documents that the previous owner owes approximately R3.4 million in municipal taxes. Business Venture Investments 900 reports that the municipality’s property valuation for the land (covering 2017 to 2021) amounted to R26.4 million.
The company did not oppose the expropriation, but it did object to zero compensation.
In court documents, the company states that it is neither lawful nor just for it, as an individual entity, to bear the entire burden of the metro council’s land acquisition to fulfil its constitutional duty to housing, as this burden would be unfair and disproportionate.
Sakeliga states that even if the company settles through mediation or wins the court case, the process has already cost it a significant amount of money, partly due to the delays. In February 2021, the previous owner was required to obtain a court order to compel the metro council to submit its court documents within a specified timeframe.
Foreign Missions Informed
Sakeliga’s legal team is monitoring the progress of the case and will consider it when planning its and its partners’ upcoming legal steps regarding the new Expropriation Act (Act 13 of 2024).
The organisation has invited the DA, FF Plus, and IFP parties, who voted against the new Expropriation Act last year, for a discussion on appropriate political measures.
Dr Corné Mulder, FF Plus leader, says it is essential that stakeholders unite to prevent the metro council’s attempt to expropriate land without compensation from setting a legal precedent. The party plans to discuss this with, among others, Saai, TLU SA, and Sakeliga.
Sakeliga says it has informed local trade representatives of foreign missions about the case and is also monitoring other cases of expropriation.
