State pays KZN farmers R800m for land

After a 13-year court battle, willing seller land owners will get fair compensation for their undervalued land

Government has finally admitted that the Valuer-General undervalued land belonging to 20 farmers by almost half of their worth.

The department of land reform and rural development has reached a settlement with landowners from Melmoth in KwaZulu-Natal in terms of which price to be paid for the land will be substantially more than that determined by government through government policy.

The farmers are set to receive a total R805 million for their land.

The Valuer-General had previously determined an amount of R420 million in terms of government’s formula for what constitutes reasonable compensation for land that is acquired for land reform.

The farmers are selling the land to the state voluntarily and previously agreed to a purchase price of R761 million.

Government, however, did an about-turn and said the purchase price should be determined by the Valuer-General, whose formula does not only take into account market value, but also other factors such as how the land was acquired, the need for land reform and what the land is presently being used for.

Last week, government abandoned its court case which sought to confirm the formula.

The settlement brought an end to 13 years of court battles.

Bertus van der Merwe, an attorney from Cox and Partners in Vryheid, which has been representing the farmers for the past two years, said there was a turnaround in government’s attitude after Thoko Didiza took over from Maite Nkoana-Mashabane as minister of agriculture, land reform and rural development.

“The previous minister adopted the view that land owners and even the minister were bound by the Valuer-General’s determination. The court expressly rejected this point of view,” he said.

The Durban Land Claims Court decided that the Valuer-General’s valuation was not decisive and that a court could establish what constitutes reasonable compensation.

“The Valuer-General’s formula is draconic and infringes on all established principles of value determination that are applied worldwide,” he said.

Van der Merwe said Didiza had offered the land to the owners at the price they had originally asked for.

Annelize Crosby, head of land at AgriSA, said the claim could have been finalised a year ago.

“The intervention of the Valuer-General and the previous minister dragged out the court process. Now the state has to pay millions in legal fees,” she said.

According to Crosby, the previously agreed on R760 million escalated to R805 million because the parties agreed that the value of the land had increased over time.

She said the land owners were prepared to present expert evidence and were ready to fight the state when it gave up the fight.

“The result is that the owners will now receive roughly twice the amount that the Valuer-General previously determined, she said.