The Reef Hotel in Johannesburg has been ordered by the South Gauteng High Court to pay R1.3 million to City Power for an outstanding R4.1 million electrical debt before reconnecting power service.
The order came after the hotel filed an urgent plea with the High Court to have power restored after it was shut off on September 12 during a revenue collection operation.
According to City Power spokesperson Isaac Mangena, the hotel was one of ten clients, including residential complexes and companies, targeted in the previous operation, which resulted in a combined electrical bill of R43.7 million.
Mangena stated that on January 22, 2024, the hotel met with the City’s business department to discuss its initial payment, which was R3.2 million at the time, and was encouraged to pay at least 50%.
“The hotel agreed to pay the remaining sum within a fair timeframe. As a result, the hotel asked a three-month grace period to raise approximately R1.6 million and agreed to settle by the end of April 2024,” revealed Mangena.
Mangena stated that despite assurances offered by the hotel’s legal counsel in a letter dated February 7, 2024, the debt rose to more than R4.1 million when the hotel failed to meet its payment obligations.
He stated that following the court order, the hotel expressed a readiness to make an initial payment of R1 million and signed an admission of debt agreement, with R300,000 due by September 23, 2024.
“The hotel intends to pay the remaining sum in the coming months while continuing to pay the present monthly costs. In response, Mangena stated that City electricity will restore electricity supply once proof of payment is received.
Mangena stated that the electricity provider had a backlog of more than R10 billion in unpaid bills, and that the legal victory strengthened the company’s determination to retrieving outstanding payments from defaulting consumers.
“We urge customers not to use the courts to delay payment for services they have used. We recommended people owing the city to just make payment arrangements rather than incurring further litigation fees,” he said.
