Durban - Dozens of Durban residents, who fear eviction from their homes, have blown the lid off an alleged multimillion-rand housing development scandal in which they claim the eThekwini Municipality violated housing legislation by failing to ensure the projects were properly managed.
The city is named among the respondents in a case in the Durban High Court brought by the Phoenix Residents’ and Tenants’ Association against Woodglaze Trading, a company linked to controversial businessman Jay Singh.
On Friday, a consent order was granted in which the parties agreed to try to resolve the matter in one month.
Woodglaze and other companies were also ordered not to evict any of the residents, remove their goods, or transfer any of the properties.
In court papers, association chairman Kissoon Sahadeo claims Woodglaze bought infill sites at cost prices, at between R30 000 and R100 000, from the municipality in 2009 to develop housing projects for indigent people.
He alleges that, according to an agreement between the city and Woodglaze, the housing units in Phoenix, Chatsworth, Newlands and KwaMashu were meant to be sold to low-income earners.
He said there was no decision to vary the agreement, but the company built 56 complexes and listed units as being for rent, instead of for purchase, with no option to buy in the lease agreement.
“People were told to fill in offer-to-purchase applications, but later the words ‘for rental’ were appended on documents, and residents were given rental registration forms,” Sahadeo said.
Tenants had paid rent for the past four years, which amounted to money far in excess of what they would have paid to buy the properties.
He said the matter had become urgent, as Woodglaze had sold at least 13 complexes to a rental housing company, First Metro Housing, for more than R200 million, and another company, Aplo Flash, had bought two sites for R7.8m.
Speaking outside court, the residents’ attorney, Ramesh Luckychund, said people were left in limbo after the complexes were sold.
Some of them had already had eviction proceedings brought against them because they had withheld rent, as they were unsure what would become of their homes.
Luckychund added that 18 families, who had bought properties from Woodglaze in 2009 but did not receive the title deeds to their homes, now faced losing their homes, as the whole complex had been bought.
Sahadeo said the city’s housing department had not followed supply chain management policies, and had failed to ensure the developments were administered in a transparent manner.
“They failed to monitor the projects, despite having the capacity to do so.”
In its answering papers, Woodglaze’s general manager, Pravesh Inderjeeth, said the application was “defective” and should be dismissed.
He also disputed that the residents were in imminent risk of being evicted.
“One hundred and seventy-three people are in arrears with their rental, but the company has only instituted eviction proceedings against 33.
“The applicants signed lease agreements agreeing to pay rentals.
“If a tenant cannot afford to pay the rental, then the premises should be vacated,” Inderjeeth said.
The Mercury