## Facts

- Three KwaZulu-Natal Category C (district) municipalities alleged the Division of Revenue Act 1 of 2001 allocated equitable shares to Category A and B municipalities but omitted Category C municipalities.
- The municipalities sought a declaration that the omission was unconstitutional and an order compelling national government to pay their equitable shares.
- The Natal High Court declared the relevant provision unconstitutional and referred the declaration for confirmation by the Constitutional Court.
- Before confirmation proceedings, the 2001 Act was repealed and replaced for the next fiscal year.
- The municipalities did not first attempt resolution through available intergovernmental mechanisms, including the Local Government Budget Forum.

## Issues

1. Whether the Constitutional Court should confirm a High Court declaration of invalidity concerning a statutory provision that had been repealed before confirmation, given the requirement of a practical effect.
2. Whether organs of state may litigate an intergovernmental funding dispute without first making every reasonable effort to resolve it through constitutionally and legislatively provided intergovernmental mechanisms.

## Decision

- The Constitutional Court declined to confirm the High Court’s declaration of invalidity.
- The Court refused to grant coercive relief directing payment of equitable shares.
- The Court held the matter was an intergovernmental dispute and the applicants had not complied with the duty to exhaust reasonable nonjudicial dispute-resolution efforts before approaching a court.

## Legal Principles

- Disputes between organs of state in different spheres concerning funding allocations are intergovernmental disputes governed by constitutional principles of co-operative government.
- Organs of state must make every reasonable effort to resolve intergovernmental disputes through available mechanisms and exhaust other remedies before litigating.
- In confirmation proceedings, the Court may decline to decide constitutional validity where the impugned provision has been repealed and adjudication would inappropriately draw the judiciary into a dispute suited to political and administrative resolution.
- Even if a matter is not strictly moot because some practical effect remains, failure to comply with the constitutional dispute-resolution duty can justify judicial restraint and refusal of substantive relief.

## Conclusion

The Constitutional Court refused to confirm invalidity or order payment because the municipalities, as organs of state, bypassed required intergovernmental dispute-resolution processes, and the challenged provision had been repealed, making judicial intervention inappropriate in a funding dispute meant to be addressed through co-operative government mechanisms.


Uthukela Dist. Municipality v. President of the Republic of S. Afr., 2003 (1) S. Afr. L.R. 678 (S. Afr. Const. Ct. 2003)