SCA Upholds City Of Cape Town's Discretion In Rezoning Dispute

Background

Sterea Digital CC (“Sterea”) purchased a residential property at 1 Basson Street, Durbanville, intending to convert it into offices for Sandenbergh Nel Haggard, a mid-sized law firm. The property was zoned Single Residential 1 (SR1). Before the purchase, the City had granted a temporary two-year consent use for a private, special-needs school, which fell within the SR1 zoning and therefore did not require rezoning. Sterea subsequently applied to rezone the property to Local Business 1 (LB1).

In March 2020, the Municipal Planning Tribunal refused the rezoning on the basis that it was inconsistent with the Northen District Plan (“NDP”), the district spatial development framework, in that, inter alia, the property lies outside the Durbanville CBD demarcation; the neighbourhood was earmarked for the retention and protection of its residential character; and Sterea had not justified a deviation from the NDP.

In October 2020, the Appeal Authority dismissed Sterea's internal appeal, emphasising that deviation from the NDP is permissible “only if the circumstances justify the deviation,” and that Sterea had failed to establish such circumstances in the rezoning application.

In April 2022, the High Court, as the court of first instance, reviewed and set aside the City's decisions. In November 2023, on appeal, a full bench of the High Court, reversed that outcome, and upheld the City's decision-making. Sterea therefore appealed the full bench's decision to the SCA.

Issues

The case turned on two review grounds under the Promotion of Administrative Justice Act:

1. whether the City's appeal decision was tainted by actual or reasonably suspected bias, including whether adherence to the NDP reflected impermissible predetermination or permissible reliance on the NDP; and
2. whether relevant material factors, relating chiefly to the prior temporary consent use, were ignored by the City.

SCA

On the allegation of bias, the SCA, applied the test laid down in President of the Republic of South Africa and Others v South African Rugby Football Union and Others 1999 (4) SA 147 (CC) for a reasonable apprehension of bias and emphasised that a public decision-maker may be predisposed by policy without being biased. The SCA held that adherence to established policy, including the NDP, is not “objectionable bias” but part of lawful and good administration. The record showed that the Appeal Authority considered each ground of appeal and not merely the NDP in isolation; it brought an open mind to the case, while reasonably applying the NDP.

On the alleged failure to consider relevant considerations, the SCA found that the prior consent use of the property had, indeed, been considered by the City and that despite this consideration, the prior consent use did not transform the property's character from residential to business use because the prior consent use was a) in keeping with the residential zoning of the property; b) granted for a limited period; and c) did not change the character of the area. The rezoning application therefore did not justify a deviation from the NDP for a permanent business rezoning. Sterea's disagreement with the weight placed on this factor did not amount to a reviewable irregularity.

Consequently, the SCA upheld the appeal in part; it set aside the full court's costs order while confirming the ultimate refusal of the rezoning application.

On the issue of costs, the SCA, recognising the constitutional dimension of an administrative-law review, applied the Biowatch principle and declined to saddle Sterea with costs.

Conclusion

This judgment resolved several crucial questions. First, it confirmed that municipalities are to be guided by their spatial development frameworks and may refuse rezoning where a deviation from such frameworks is not convincingly justified. Second, it clarified that adherence to policies does not equate to bias and that “departmental bias” remains lawful where decision makers apply their minds independently. Finally, it endorsed a restrained approach to reviews in that courts assess the regularity of the decision-making process rather than substituting their own views for those of the decision-makers.

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