On 24 March 2025, the Constitutional Court upheld the appeal of Ekapa Minerals (Pty) Ltd and set aside the order of the High Court. The appeal related to whether the Constitutional Court could interfere with the High Court’s exercise of its true discretion under section 172(1)(b) of the Constitution by deciding to grant a retrospective remedy on the basis that doing so would be disruptive or result in dire consequences for the municipality.

The ratepayer applicant sought to review the decision of the municipal council to impose excessive rates ratios on properties categorised as mining. The applicant contended that the differentiation in rates payable between an owner of mining property and owners of non-residential property (industrial property within the same municipal area) is unlawful, irrational and procedurally unfair. The High Court declared the decisions of the municipal council to be unconstitutional in terms of section 172(1)(a) of the Constitution. The High Court further declared that the order of invalidity would only have a prospective effect.

In the Constitutional Court, the ratepayer argued that the case engages a constitutional issue in that it relates to the constitutional discretion exercised by the High Court in terms of section 172(1)(b) of the Constitution. The crisp legal issue in the Constitutional Court was whether the High Court was correct in only granting a prospective order on the facts and section 172(1)(b) of the Constitution. Section 172(1)(b) allows the court to make an order that is just and equitable including an order limiting any retrospective effect.

The Constitutional Court held that the High Court had misdirected itself in that it had only confined itself to the fiscal interests of the municipality without having due regard to the principle of legality, the ratepayer’s rights and the substantial prejudice in having to pay R30 million rand in unlawful property rates. The Constitutional Court reasoned that if the High Court order were to remain in effect, that the municipality would stand to gain the unlawfully imposed excessive property rates which had been charged on an incorrect basis and on an unlawful tariff. All the several competing interests must be taken into account in considering the exercise of the discretion under section 172(1)(b) of the Constitution.

This judgment serves as notice to all municipalities in South Africa to ensure that any differential rates tariffs on properties must be lawful, rational and procedurally fair.

Ekapa Minerals (Pty) Ltd and Another v Sol Plaatje Local Municipality and Others [2005] ZACC 1; 2025