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COJ’s Latest Interpretation of the Credit Control Bylaws

In recent weeks Schindlers has been in court on countless occasions, arguing that COJ is not entitled to terminate the supply of electricity/water to our client’s buildings where:

(i)            No pre-termination notice was served; or

(ii)           There was a valid revenue related dispute pending; and

(iii)          The client had been paying the undisputed charges (or the average of the last three undisputed statements for that charge, whichever is applicable).

We have been met with very strong opposition on a number of fronts, which we find quite surprising and alarming, and we thought to share this with the industry, in order to better “arm” it against the “defences” that COJ might raise against your demand for reconnection in urgent court.

FIRST “DEFENCE” – CLIENT’S QUERY/DISPUTE IS NOT VALID BECAUSE IT DOES NOT SPECIFY A RANDS AND CENTS AMOUNT IN DISPUTE

COJ’s argument is that any query that does not put a specific amount in dispute does not count as a valid query for the purposes of the protection offered by section 102 of the Local Government:  Municipal Systems Act, and that such a query (that does not raise a specific amount) must be disregarded as it if didn’t exist.  This comes from some old case law.

We have argued in response that the old case law cannot be interpreted in this manner, because it is sometimes impossible for the consumer to know what the value of the query/dispute is.  Consider what happens when a faulty meter is removed, and the consumer is waiting for the meter report.  At this point no-one can quantify the dispute (unless the consumer had check meters in place which can be used to calculate the exact consumption).

However, no court has ruled on this aspect of the law recently based on our arguments, and as such, it is still open for COJ to raise this against you as a defense to your urgent application for reconnection.

SECOND “DEFENCE” – PROTECTION OF S 102 ONLY APPLIES TO AMOUNTS IN DISPUTE

Section 102 of the Local Government:  Systems Act basically says (amongst other things) that the COJ cannot take credit control action (summons or disconnection) against a consumer where that consumer has raised a dispute on an account.  However, it uses the words ‘specific amount’.

COJ thus tries to show in the court papers that even if there is a valid dispute on part of the outstanding balance, another part of that same outstanding balance is undisputed and unpaid – and therefore that COJ can cut off for that part of the outstanding balance.

COJ is going to great lengths to explain this to the court, in order to persuade the court that the disconnection was not unlawful.

This ties in with the first ‘defence’ referred to above, because in cases where the consumer has not quantified the dispute with a rands and cents amount, the consumer is then on the backfoot and must try to show that the whole of the outstanding balance is disputed in order to defeat COJ’s argument in court.

RECOMMENDATION

As such, it is best (where one can) to raise queries/disputes with a specific amount (even if you are unsure of this amount or if it later turns out to be wrong) and further to make sure that you have made payment in full of all undisputed amounts, such that you never fall victim to the above in urgent court.

Phindile Nxumalo
Schindlers Attorneys

2nd Floor, 3 Melrose Boulevard 
Melrose Arch, Johannesburg
Website: www.schindlers.co.za
Tel: +27(11) 448-9600

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