Abstract
The Constitution brought about a new compensation regime for expropriations. Compensation for expropriation must now be "just and equitable". Whereas before the Constitution came into force market value played a central role in compensation for expropriation, market value is now only one factor or aspect of compensation that the court needs to take into account. Yet we find that courts tend to focus on market value and to still employ the valuation methods used to calculate market value. This article argues that the methods used to calculate the market value, once thought to be objective, are not as objective as was believed. While it is impossible to give judges specific tools for the assessment of market value, this article provides guidelines on how the calculation of compensation should be approached.
Highlights
The Constitution established a single system of law shaped by the Constitution itself. 2 It protected certain existing rights but it initiated certain reform measures
Pre-1994 legislation such as the Expropriation Act 63 of 1975 and common law protecting vested rights are still valid, but only insofar as they are reconcilable with the Constitution
The Constitution provides a new framework in which the Expropriation Act should be interpreted
Summary
The Constitution established a single system of law shaped by the Constitution itself. 2 It protected certain existing rights but it initiated certain reform measures. Khumalo v Potgieter 24 stated that compensation is paid to ensure that the expropriatee is justly and equitably compensated for his loss, while Hermanus v Department of Land Affairs: In Re Erven 3535 and 3536, Goodwood ruled that the expropriatee is compensated for the loss of the property This sentiment was echoed in Ex Parte Former Highlands Residents, where it was found that the interest of the expropriatee requires full indemnity when expropriated, and it is possible to pay more than market value. They are the comparative approach, the economic approach and the land residual technique. These methods present the court with evidence relating to the estimation of the market value of the property
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