Property valuations: objecting outside of advertised roll inspection periods

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Window period for submission of objections

The Local Government: Municipal Property Rates Act 6 of 2004 ("the Act") governs municipal property valuations. The municipality is legally obliged to advertise every roll for public inspection, for a minimum period of 30 days (although most municipalities leave the roll open for inspection for longer than this). The municipality is also legally obliged to post notices to property owners to warn them that their property is being placed on a roll for valuation. During this period it is the property owner's responsibility to examine the roll and determine if his/her property is on it, and if the owner is dissatisfied with the municipal property valuation attributed to such property, to take the necessary steps to submit an objection within the prescribed 'window period' for submission of same (which runs until the roll closes for inspection). Ordinarily, a municipality will not permit the late filing of objections, although in exceptional circumstances some municipalities will make an exception and allow same.

Lodging an objection outside of the window period

The Act states in section 80 that non-compliance with any time period in the Act can be condoned by the MEC for the province concerned. This means that a would-be late objector can make application to the MEC for permission to file an objection late. However, it is the personal experience of the author that this is not going to achieve much in Gauteng, as the present MEC is (bizarrely) of the view that the late filing of an objection, renders him unable to consider an application for condonation. Although this a legal option that must be exhausted before an application can be brought to a court for a review of a valuation decision (or failure to take a decision, or refusal to condone the submission of a late objection), it is one that practically achieves nothing.

Properties sold since the last General Valuations (GV)

Leaving aside the possibility of obtaining condonation for the late filing for the moment, the Act does not make provision (otherwise) for the re-valuation of any property outside of the prescribed procedure, which requires putting the property on a roll, advertising that roll for inspection, and following the lengthy valuation process set out in the Act to its natural conclusion. However many properties require re-valuation, for any of the reasons listed below and contained in section 78, and for the additional reason that they have been sold since the last GV. In such an instance the purchaser would now be paying inflated rates because the municipal property valuation is inflated, and the prior owner failed to object to the inflated valuation within the prescribed window period. Such a purchaser's only recourse is to either apply for condonation for the late filing of an objection (which, as explained above, is not a practical solution to the problem) or to otherwise deal with the property in terms of section 78 of the Act.

Section 78 of the Act

Section 78 of the Act provides that a supplementary roll must be published at least once every year (following on from the publication of a GV) and contains a closed list of reasons for the inclusion of a property on that roll. These reasons essentially relate to properties that either did not exist (or did not exist in their present form) at the date of the publication of the GV, alternatively properties that need to be re-valued because, their value has changed substantially. An example of a property in the first category might be a property that has been subdivided, and an example in the second category would be of a vacant stand that has, since the GV, been developed.

Section 78 also includes a category to the effect that a property that has been "substantially incorrectly valued during the last general valuation" can be included on a supplementary roll. This is contained in section 78(1)(e) of the Act. It is precisely this subsection that allows purchasers of property to object to their property valuation, even though the property was valued on a GV that was published prior to them becoming the owner.

Submitting a Section 78 enquiry

A Section 78 enquiry is essentially a submission made to the municipality that a property has been incorrectly valued, coupled with a request that the municipality re-consider the valuation of such property. The Act does not expressly provide for the concept of a Section 78 enquiry, but it has become common practice (because it is common sense) for a property valuation that is queried after the publication of the GV, to be re-valued on the next supplementary roll, at which point the full valuation process as set out in the Act will apply, and both the property owner and the municipality will be given the opportunity to debate the valuation thereof.

Once a Section 78 enquiry has been submitted, the property should then appear on the next supplementary roll, and the property owner can then object formally to the valuation. If the valuation is ultimately reduced, then the property valuation should be reduced with retrospective effect to the date of commencement of the GV, which will mean that the rates charged to the purchaser will be reduced by the passing of a credit to the amount by which the inflated property valuation caused inflated rates to be billed. Note that the backdating to the commencement of the GV does not apply to all types of properties re-valued on a supplementary roll. In other instances not dealt with herein (for example subdivision), the date to which the rates are retrospectively adjusted, will differ, depending on the reason for the re-valuation.

What if the property is not on the next supplementary roll?

The Act provides in section 50(1)(c) that an objector may lodge an objection to any information contained in or omitted from a roll. This means that if the property should have appeared on a supplementary roll (because a Section 78 enquiry was submitted) but when the roll is published, it is not there, then an objection can still be submitted to the fact that the property is not on the roll, in which objection the valuation of the property can be dealt with as if the property were on the roll.

Rates refund after successful objection

The Act obliges the municipal manager (Trevor Fowler) to ensure that after a property valuation has been reduced on objection/appeal, a rates refund is effected to adjust the account accordingly. If this does not take place within a reasonable time after notification of the outcome has been released, then you may need to seek legal assistance, because this is dealt with by the municipality's billing department and is not a function of the valuations department. So the usual billing dispute/query mechanisms must be brought into play, and these mechanisms utilized to procure a resolution of the query in the ordinary course.