Comment on Current Canal Position by SFBRA

The St Francis Bay Residents’ Association has been accused of “vindictive administrative obstruction” by the DA in a recent communication sent out to St Francis residents regarding the plan to privatise the maintenance of the canal system. As riparian residents on the canals, and as members of the Residents’ Association, we wish to make it absolutely clear that we as individuals, and the Resident’ Association itself, fully support the proposal in principle. In addition, we applaud the Canal Committee for the effort they have put in to reach the point where they have support from both the municipality and many of the riparian owners.
We do, however, have a number of concerns over the details of the negotiations. These relate to the proposed agreement with Council, and the process followed to-date. We believe that these could jeopardise the rights of riparian owners. To put the record straight, we list below the points which we raised with the Canal Committee, and which they agreed to address at a meeting held with them on Wednesday, 15 March, 2006, and confirmed at the public meeting held on 16 March, 2006.

The Draft Agreement

With regard to the draft agreement with Council, specific points raised with the Committee are the following:

• lack of protection against liability for latent defects in the canal system. A legal process presently in progress may lead to claims against council worth millions.
• the condition of the municipal dredger.
• the lack of any clause indemnifying directors and members of the Section 21 Company from personal liability.
• the need for a careful assessment of any existing contracts drawn up between the Municipality and dredging contractors.
• the need for an independent professional assessment of the canal situation, particularly in regard to design of the system and recent extensions.
• the need for an independent annual audit of both income and expenditure on the project.
• the desirability of incorporating the canal dredging into an integrated management plan for all the waterways, to include the canals, the Kromme River, the adjacent sea front and the protective dune along the Ski canal.
• the need to have the final draft vetted by an independent attorney prior to signature.
• There was also concern that there was so far no business plan for the project.

The SFBRA offered to pay for an initial professional assessment of the canal problems, and for the vetting by an independent firm of attorneys of the proposed agreement.

The Residents’ Association was puzzled by the requirement by the municipality that a Homeowners’ Association be established prior to establishment of the Section 21 Company. This appeared to mean much duplication, and was not a typical Homeowners’ Association function. It was not clear why a Section 21 Company was not a sufficient vehicle for such an undertaking.

All of these points were raised with the Canal Committee at a specially convened meeting on Wednesday, 15 March, and were welcomed as constructive and helpful.

Public Meeting of 16 March, 2006

At the public meeting in St Francis Bay held on 16 March, the Residents’ Association made a number of proposals, which were attached to the agenda, and received the assurance by the Canal Committee that these would be addressed before entering into an agreement with Council.

It subsequently emerged that the Chairman had already signed the agreement in February of this year, apparently without the knowledge of his Committee, and allegedly under pressure from the Municipality to do so.

The Residents’ Association has a serious problem with this. At the time, the Chairman had no official status, and no mandate from the riparian owners to act on their behalf, and the agreement he signed was clearly deficient in a number of respects. This meant that there was little point in discussing changes to the agreement, since it had already been signed.

Fortunately, the Municipality has not signed the agreement, and has undertaken not to do so before the general public has had the opportunity to comment. The Acting Municipal Manager knew nothing about any municipal pressure, and it is not clear from whom this emanated. Had the agreement been signed by the Municipality, the riparian owners could only have been released from its terms by challenging the validity of the Chairman’s signature. This might well have required legal action.

Conclusion

In view of the fact that the Residents’ Association has been accused of “administrative obstruction” to the canal privatisation and maintenance agreement, it has been felt necessary to place the facts before the public, and to let them make up their own minds. We repeat that we fully support the project in principle, but that it must be managed correctly, and in the interest of all parties involved. Above all, all parties involved should be aware of the detail of their commitment before being asked to assume responsibility for implied liabilities that go with any agreement.

All interested parties are invited to view the proposed Agreement and the correspondence with council on the matter on www.stfrancisbay.org under Waterways Project.

Hilton Thorpe & Harry Weistra

St Francis Residents Association & Canal Residents

31 March, 2006