DELAY SETS THE TONE

Land reform laws should provide labour tenants with security — but 16 years after the closing date, 11,000 labour tenants’ claims remain unprocessed

Just where should courts start when compensating landowners who lose property as part of our constitutional commitment to apartheid redress? How should they decide on how much should be paid?

The issue was in the minds of everyone involved in an important case at the supreme court of appeal last week, on the value of land awarded to the Msiza family, labour tenants on the farm Rondebosch, outside Middelburg, since 1936.

As a group, labour tenants have been scandalously neglected. Land reform laws should provide them with land security, but 16 years after the closing date, 11,000 labour tenants’ claims remain unprocessed. The Msiza family is one of the few exceptions, but finality evades even them.

In 2004, the land claims court ordered that the family be given the land where they have lived and farmed.

But by 2016 there had still been no resolution of the key question: how much should the landowners be paid for the portion awarded to the Msiza family?

Eventually the matter came back to the land claims court, with evidence of two conflicting valuations. The owners’ expert put the value at R4.36m, the state’s valuer, R1.8m — a discrepancy that arose because the state valued the property based on its current use as agricultural land while the owners considered its potential for housing and other development.

The court held not just that it be considered agricultural land, but that R1.8m was too high, and that “just and equitable” compensation would be R1.5m.

In the process of arriving at this figure, the court questioned the way decisions about land value had previously been made, saying that market value was not “the basis” for determining what was “just and equitable” in a particular case.

It was simply one factor among many to consider in striking a balance between the private land owner and the public interest.

It could happen that compensation below market value would still be constitutionally compliant “if it qualifies as just and equitable”.

The landowner appealed against the R1.5m award, and from written argument of all the parties it seemed that debate might well focus on the relative weight to be given to the factors mentioned in the constitution: the use of the property, its acquisition history and use, its market value, the state’s investment in the property and the expropriation purpose.

In particular, some parties wanted to press for market value to be the first and key consideration while others wanted the purpose of the expropriation to be given more weight.

Equally hot was the question of whether to base value on current land use or intended use, and the impact on the national purse.

But in fact the debate in court last week dealt more with other issues.

If there were no comparable sales in the area from which to judge the development-related value of the land, was the higher valuation realistic?

Was it not in the interests of the Msiza family to push for the highest land value?

What about the complex web of legal costs in the case?

Holding the balance

And what about the state’s shoddy handling of the matter: in an obvious reference to its neglect, counsel for the state began his submissions by acknowledging that his clients “could have dealt with the matter better”.

The court remarked on several occasions that it “would hold the balance”, apparently indicating that no radical departure should be expected here from the approach so far adopted in such cases.

All parties will be anxiously awaiting the outcome – but the pressing debate about how to apportion the cost of this type of land reform seems headed for more delay.

Some parties wanted to press for market value to be the first and key consideration