Toyota files R6. 5 billion lawsuit against KZN government for flood damages
Toyota's Prospecton plant was flooded in the April 2022 floods. | Supplied by Motor Industry Staff Association.
Image: Supplied
Toyota South Africa Motors has initiated a R6.5 billion lawsuit against the KwaZulu-Natal provincial government, Transnet, and the eThekwini Municipality, claiming damages from the April 2022 floods that severely impacted its Prospecton plant.
In summons filed in the Durban High Court, Toyota South Africa Motors Pty Ltd said it had suffered damages to the tune of R6.5 billion. This included costs in excess of R4 billion for repairs and reinstatement work at the storm-impacted plant and R2 billion for business interruption.
Transnet, the KZN Department of Transport, and the eThekwini Municipality have been cited as the defendants.
Craig Woolley, a director at law firm Norton Rose Fulbright South Africa Inc, which is acting for Toyota, said all three defendants had 'entered an appearance to defend.'
In the court papers, Toyota said that the three organisations had failed in their duty to maintain infrastructure and should have known that neglecting such responsibilities could lead to flooding.
During the April floods, the structural integrity of the Umlaas Canal and the diversion berm were compromised, leading to stormwater flowing into the Prospecton Industrial Area, where the Toyota plant is situated, causing extensive flooding and damage, read the court papers.
It stated that Transnet owned the Umlaas Canal and was responsible for its management and maintenance, as well as the flood risk associated with it. The concrete-lined canal is intended to channel and divert the uMlazi River around the Prospecton Industrial Area. Together with the diversion berm, it forms an integral part of the flood control and prevention mechanism for the Prospecton Industrial Area, it further stated.
It said the Department of Transport was responsible for the management and maintenance of the diversion berm, while the municipality owned, managed, and was responsible for the maintenance and control of the stormwater management system for the Prospecton Industrial Area.
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The Umlaas Canal, south of Durban, pictured yesterday. The canal was compromised during the April 2022 storm leading to extensive flooding of the Prospection Industrial Area, according to Toyota's court papers.
Image: Doctor Ngcobo Independent Newspapers
Detailing its court action against each of the defendants, Toyota said Transnet should have known that in the event of the Umlaas Canal and the diversion berm failing to manage this stormwater, the Prospecton Industrial Area was likely to be flooded, resulting in damage to the company's premises and property.
It said the defendants failed to ensure that these structures were functioning as required to prevent flooding in the Prospecton Industrial Area.
Additionally, it had neglected to carry out regular maintenance on the Umlaas Canal, resulting in structural weaknesses, and failed to repair previous flood damage.
It said it fell on the Department of Transport to ensure that the diversion berm and canal were functioning properly and it had failed to do so.
It added that the municipality should have known that in the event of the stormwater management system not functioning as required, the area where the plaintiff's business was situated was likely to be flooded.
'As a result of these failures, Toyota was compelled to engage various contractors to repair the damage caused by the flooding and hired specialist engineers to repair the structural damage to the premises, as well as damage to electrical installations, plumbing, air conditioning, and assembly systems.'
The company suffered 'damages to fixtures and fittings, office contents, and electronic equipment, and experienced losses due to vehicles being flooded and damaged.'
Furthermore, they were unable to conduct business activities during the repair period, leading to additional business interruption losses.
'As a result of the aforementioned issues, Toyota claims to have suffered damages amounting to R6 540 980 194.00, which includes R4 488 642 693.00 for the fair and reasonable costs incurred in the repair and reinstatement of the plaintiff's premises and property and R2 052 337 501.00 for business interruption.'
'The defendants are jointly and severally liable to compensate the plaintiff for the aforementioned amounts, along with interest thereon,' stated the court papers.
Ndabe Sibiya, the spokesperson for the KZN Department of Transport, said that MEC Siboniso Duma regarded Toyota as an important stakeholder in the province. 'Respectfully, he does not believe that it will be appropriate at this stage to engage on this matter through the media,' said Sibiya.
'We can only indicate that the cut-off low-pressure system continues to leave a trail of destruction across the province. It has triggered floods, mudslides, and a rise in the water table. Bridges, road infrastructure, and houses have been damaged, costing both the KZN Transport and Human Settlements Departments billions of rands. For instance, in 2022 alone, we needed more than R6 billion to repair roads, and we could only reprioritise R2 billion from our budget,' Sibiya said.
eThekwini Municipality spokesperson Gugu Sisilana said the municipality was aware of Toyota's action and had filed a notice to defend.
Transnet did not respond to a request for comment by the time of publication.
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