Fedsure Life Assurance Ltd and Others v Greater Johannesburg Transitional Metropolitan Council and Others[1] is an important case in South African law, heard in the Constitutional Court on 18 and 20 August 1998, with judgment handed down 14 October.

The bench was occupied by Chaskalson P, Langa DP, Ackermann J, Goldstone J, Kriegler J, Madala J, Mokgoro J, O'Regan J, Sachs J and Yacoob J. DJB Osborn (with him PJ Van Blerk) appeared for the appellants, RM Wise (with him J. Kentridge) for the first respondent, and CZ Cohen (with him M. Chaskalson) for the second, third, fourth and fifth respondent.

The interim Constitution recognises and makes provision for three levels of government: national, provincial and local.

In terms of section 175 (2), the competent authority is also obliged to assign to a local government "such powers and functions as may be necessary to provide services for the maintenance and promotion of the well-being of all persons within its area of jurisdiction."

The deliberation ordinarily takes place in the assembly in public, where the members articulate their own views on the subject of the proposed resolutions.

[5] The Court accordingly held that the rates imposed by the first respondent, the transitional metropolitan council, and its four metropolitan substructures, the levies paid by two of the substructures to the first respondent and the subsidies paid by the first respondent to the other two substructures, in terms of the powers conferred on them by the interim Constitution, read with Premier's Proclamations 24 of 1994 (Gauteng), 35 of 1995 (Gauteng) and 42 of 1995 (Gauteng), which were enacted in terms of section 10 of the Local Government Transition Act,[6] did not constitute "administrative action" under section 24 of the interim Constitution.

[8] The Court held further that the applicants' constitutional challenge to the validity of the levying of the rates in question by the second respondent (the Eastern Metropolitan Substructure) based on the alleged non-compliance with section 178(2) of the interim Constitution and the challenge to the validity of the budgets of the first and second respondents, based on non-compliance with section 58 of the Local Government Ordinance 17 of 1939 (T), had on an analysis of the facts to fail.

[10] Whether item 23(c) of Annexure A to Premier's Proclamation 35 of 1995 (Gauteng), which is the same as item 23(c) of Schedule 2 to the Local Government Transition Act 209 of 1993, is construed as a condition for raising a levy prescribed in the Local Government Transition Act by a competent authority as contemplated by section 178(2) of the interim Constitution, or as a power vested in the Greater Johannesburg Transitional Metropolitan Council independently of section 178(2), the "levy," held the court, has to comply with the provisions of item 23(c).

In a joint judgment by Chaskalson P, Goldstone J and O'Regan J (Ackermann J and Madala J concurring), it was held that meaning and significance had to be attributed to the distinct requirements of item 23(c).

The mere fact that a levy might be said to be equitable in all the circumstances did not dispense with or detract from the stipulation that it had also to be based on gross or rates income.

[12] Per contra, Kriegler J (Langa DP, Mokgoro J, Sachs J and Yacoob J concurring) held, firstly, that the attack on the imposition of the levy based on the contention that it fell foul of the requirement of section 178(2) of the interim Constitution, because it was not "based on a uniform structure for its area of jurisdiction," could not succeed.

In the result the appellants' attacks based on the alleged non-compliance with the requirements of section 178(2) of the interim Constitution and item 23(c) of Annexure A to Proclamation 35 of 1995 had to be dismissed.

[15] The Court accordingly held that, because it was unanimous that the rates levied by the second respondent were lawful, the attack made on them by the appellants had to be dismissed.

Its exercise of that jurisdiction, however, will not affect the principle articulated in S v Mhlungu[17] and Du Plessis v De Klerk[18] in terms of which the constitutionality of an act is to be determined by the substantive provisions applicable at the time.

[19] The decision in the Witwatersrand Local Division, in Fedsure Life Assurance v Greater Johannesburg Transitional Metropolitan Council,[20] was thus confirmed.