The final supplementary roll to any general valuation roll

The final supplementary roll to any general valuation roll

This article examines the legal status of credits due to consumers as a result of a reduction in municipal property valuation or category change flowing from an appeal, objection or review decided in terms of the last supplementary valuation roll to any municipality's general valuation roll.

The final supplementary roll to any general valuation roll

In terms of section 78 of the Local Government: Municipal Property Rates Act – before 1 July 2015, a consumer whose municipal property valuation was reduced on objection, appeal or review, was entitled to a retrospective application of that reduced valuation back to the date of the commencement of the supplementary valuation roll on which the valuation of that property was argued and reduced. However, a consumer who successfully argued that its property rating categorisation was incorrect was:

(i) entitled to a retrospective application of the correct property categorisation to the date that the amended property categorisation became applicable; or
(ii) entitled to a retrospective application to the date of inception of the general valuation roll to which the supplementary valuation roll on which the property categorisation was successfully argued and changed.
Hence, the consumer was entitled to either (i) or (ii) depending on which occurred first.

Law after 1 July 2015

From 1 July 2015 onwards, however, the law was amended to provide that a consumer who successfully argues for a reduction of its municipal property valuation is entitled to:

(i) retrospective application of that reduced valuation from the date of the actual reduction in valuation of the property; or
(ii) retrospective application from the date of the inception of the general valuation roll to which the supplementary valuation roll that the reduction in value is argued on.
Hence, the consumer was entitled to either (i) or (ii) depending on which occurred first.

The law in relation to retrospective application of a category change remains unchanged from the position prior to 1 July 2015.

What does this mean?

The result of the above is that any consumer who successfully argued that their municipal property valuation should be reduced on the last supplementary roll to any general valuation roll in any municipal district before 1 July 2015 was not entitled to any credit as a result of the reduction in municipal property valuation.

This is because the last supplementary valuation roll to any general valuation roll commences after the closing date of the general valuation roll to which it relates. This means that, before 1 July 2015, the date that the reduction of any municipal valuation could legally be backdated to, was the date of commencement of that supplementary roll, which was after the closure of the general valuation roll to which it relates. There was thus no practical effect whatsoever as the law did not actually provide for any credit to flow from the reduced municipal valuation.

We are of the view that the above is nonsensical - if a consumer had argued the reduction on any other supplementary roll prior to the very last one, that consumer would have been entitled to a reduction in the amounts billed to it (but only with retrospective effect to the date of commencement of the supplementary roll on which that property valuation reduction was successfully argued). But at least that’s something.

How did this nonsensical situation arise?

The legislature must have accidentally omitted to deal specifically with how retrospective application of reduced property valuations on the last supplementary roll to a general valuation roll works in practice when writing the law. Precisely because this made no sense the law was amended as explained above with effect from the 1 July 2015.

Do the 1 July 2015 amendments solve the problem for everyone?

The short answer is no. In our law there is a presumption that a change in legislation will not apply retrospectively unless that legislation expressly provides that it does. In this case, what is means is that the change in the law only assists people with the problem after the date the law came into effect. Essentially, all consumers who face this problem prior to 1 July 2015 have not been assisted by the change in the law; which is odd considering the law was changed precisely in order to assist consumers in this situation.

What can be done about this?

A consumer facing this problem could bring an application to court for a declaratory order. This would be a court ruling about the presumption in our law that a change in the legislation does not apply retrospectively does not apply in this particular case. A consumer can argue that it is nonsensical for the law to have changed to assist consumers in this position, but then to failed to have expressly provided for this applying to consumers before 1 July 2015.

If this fails, a consumer could challenge the position in law prior to 1 July 2015 on the basis that it is irrational as it excludes all consumers who obtained a property valuation reduction before 1 July 2015 from obtaining any practical relief as a result of the reduced valuation.

Until such time as a court has ruled on either (or both) of these two legal issues, it is doubtful that any municipality will assist consumers facing this problem. This is because it firstly reduces the revenue owed to that municipality, and secondly the municipality technically speaking is not legally empowered to do anything either than follow the law as it presently stands. If you face this problem and it is financially feasible for you to do so, approach an attorney with expertise in the matter for assistance.

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