select
|

Do you have to pay for past water bill discrepancies?

(Article by Nicholas Gangiah and Fatima Gattoo from Cliffe Dekker Hofmeyr)

A judgement has been handed down granting relief to property owners who have received exorbitant utility bills after a number of years.

If a consumer receives a utility bill citing for the first time for charges older than three years, they cannot be held liable for such amounts as the charges have prescribed.

Nicholas Gangiah and Fatima Gattoo from Cliffe Dekker Hofmeyr says this important judgment handed down by Judge S Yacoob, of Gauteng Local Division of the High Court, is one which many property owners will consider a much-needed victory.

Gangiah and Gattoo give an example of a case in which this judgment applies:

Facts of the case: For approximately five-and-a-half years, Argent, the party in question, was charged for their estimated water consumption. Argent duly paid these charges. During this period the Ekurhuleni Municipality failed to take actual readings of the water meter. In 2015, Argent received a bill for the difference between its actual usage and estimated consumption amounting to R1 152 666.98. Relying on prescription, Argent claimed that they were not liable for discrepancies in the costs, which were older than three years at the time when they finally received the bill.

The municipality challenged this argument on the following grounds:

- That the excess water charges older than three years had not prescribed because the prescription period only commenced when the client was billed by the municipality.

- The fact that the consumer regularly made monthly payments, based on their estimated consumption, amounts to an acknowledgement of its debt and as such it interrupts the prescription period.

The municipality lost on both of these points.

Precedent set by the judgment:

1. If a consumer receives a utility bill citing for the first time for charges older than three years, they cannot be held liable for such amounts as the charges have prescribed.

2. Where a consumer has made regular monthly payments based on their estimated consumption, their monthly payments do not interrupt the prescription of the actual water consumption.

3. It is not the duty of the consumer to read meters and determine their actual consumption. A consumer will not be considered to have acknowledged a debt of which they do not know the particulars. In other words, a consumer cannot acknowledge a debt when the creditor withholds particular and necessary details of the debt or when only the creditor has the ability to quantify the debt and fails to do so.

4. The prescription period commences when the municipality should have become aware of all the relevant facts, such as the actual water consumption, which give rise to its claim against the consumer, and not only when the municipality read the meter and the invoice was issued. The municipality could have taken an actual reading of the meter at any time.

5. This means that the prescription period commences when the municipality should have taken actual readings and invoiced the consumer. Judge Yacoob held that the municipality has a duty to carry out such readings and invoice consumers at its convenience, but at reasonable intervals.

And finally

6. Where no records of regular actual readings are available to ascertain how much of a bill for several years has prescribed, the industry standard should be applied: average the consumption out over the months between the two readings and then use that average to calculate the consumer’s liability for the remaining period.


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 17 Jan 2018
      While the current property market may still favour buyers, it doesn’t mean that they shouldn’t be well prepared before putting in an offer to purchase.
    • 17 Jan 2018
      Lightstone lists Blair Atholl as the most expensive suburb with an average house price of R11.2 million, followed by Westcliff (R10.5 million), Dunkeld (R9.3 million), Sandhurst (R9.1 million) and Inanda (R7.2 million).
    • 17 Jan 2018
      As it currently stands, there are four main ways in which a home can be bought in South Africa, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, who adds that deciding in which legal entity to purchase the property is not a decision that should be entered into lightly, as each has its pros and cons.
    • 16 Jan 2018
      The start of the new year is symbolic of new beginnings. A good time to take stock of one’s possessions as well as how necessary they actually are. However, seeing as the process may appear daunting – a plan goes a long way.
    • 16 Jan 2018
      The Western Cape is still in the throes of a severe drought and many households have to adjust the way they use and save water. It is a little more complicated in sectional title schemes, however, as it is not that easy to implement grey water systems for multiple users and it is also difficult to monitor water usage accurately if there are no separate water meters
    • 15 Jan 2018
      In ideal rental situations, when a lease is signed the tenant will stay for the full duration of his lease without any complications and the landlord will uphold his obligations, creating a win-win situation for tenant and landlord.
    • 15 Jan 2018
      The Atlantic Seaboard’s housing market has stoically withstood the brunt of the growing economic and political instability, consistently achieving double digit growth way above the national average, however, in 2017 South Africa’s most resilient market finally began to yield to the pressure.
    • 15 Jan 2018
      Sectional title insurance can be a little confusing and, as a new owner, you may be tempted to just assume your body corporate has you covered. While this may be the case, understanding the extent of your coverage and your personal liability is the only guaranteed way to protect yourself against potentially costly oversights.
        
    X
    Subscribe to the MyProperty Newsletter

    Name  
    Last Name  
    Email Address  
    Email Frequency
    select
    X
    Share this Page

       
    For Sale Property
    Rental Property
    More Options
    About
    Connect with us
    FEEDBACK