City of Johannesburg provides clarity on Pirates Sports Club lease agreement

Pirates Sports Club is one of the three oldest sports clubs in South Africa, but due to a breach of contract, the City of Johannesburg may terminate their lease.

There has been outrage from the community regarding the alleged lease termination notice given to the club by the Johannesburg Property Company (JPC).

The MMC for Economic Development, councillor Leah Knott, released a statement on 3 September to address several media reports and provide clarity on the issue.

Knott stated that although Pirates has a long-term lease from the City for their current property, they are in violation of their contract. While part of their lease requires them to undertake programmes for the betterment of the community, Pirates has misinterpreted this clause by allowing WastePreneurs to permanently occupy a portion of the property.

Knott has said that the City is in full support of initiatives that can better the lives of reclaimers, who perform a valuable function in the society, but the City needs to ensure that all businesses operate within the confines of the law.

The running of a waste management facility requires proper environmental authorisation, and the site that WastePreneurs operate from does not have the authorisation required to adhere to either the national legislation or the municipal by-laws.

By allowing WastePreneurs to take permanent occupation of this site, Pirates is in violation of the Local Government: Municipal Finance Management Act 56 of 2003 (the MFMA), which prohibits sub-leasing of municipal property.

It has been three years since JPC brought this matter to the Pirates’ attention. Knott stated that the club has been given ample opportunity to remedy the breach of the lease over the past three years.

By 2018, nothing had been done to remedy the situation so a meeting involving all the relevant parties, was called in order to find an amicable solution. Pirates was advised to ask WastePreneurs to vacate the premises, and WastePreneurs was advised to apply to the JPC so the City could assist them in finding a suitable piece of land, which would then be subject to an environmental impact assessment.

In Knott’s statement, she said that by April 2019, neither the sports club nor WastePreneurs had done anything to resolve the issue. This is why a notice was given to Pirates stating that they needed to comply with the conditions of their lease, or it would be terminated.

Another meeting was held in June, when Pirates Sports Club members gave the executive of the club approval to take any action necessary to restore their lease. Pirates confirmed that they would ask WastePreneurs to vacate the site within 90 days; which the City found fair.

In August, WastePreneurs sent an application to the JPC to request the use of their current site. This request was denied. The JPC responded that the request would not be considered as WastePreneurs knew that occupying the current site was not possible, and that the Pirates’ lease had effectively been cancelled because they had not remedied the breach.

In keeping with the requirements of the MFMA, the next step in the process would be to place the property out on tender. Knott said that at no point was Pirates given an eviction notice. The deadline for the club to remedy the breach was extended by a further 60 days as of 2 September.

Councillor Knott concluded her statement by saying, “We have not entered into any litigation against the Club as we remain hopeful that Pirates, with its remarkable history as a key sports institution in Johannesburg, will heed the request to comply with the law and the terms of our agreement.”