Johannesburg — THE Land Claims Commission cannot afford to honour at least R10bn in outstanding commitments to land owners and claimants, Business Day has established.

This could result in huge damages claims against the commission and a ballooning bill for taxpayers as claimants and owners turn to the courts to enforce their rights. Rising tension may spark violence.

Sellers are being forced to go to court to enforce sale contracts for land worth hundreds of millions.

This raises questions about the state's ability to honour contractual obligations.

Claimants have been told new land purchases are on hold, and signed commitments for billions in post-settlement grants for land already transferred cannot be honoured.

The Treasury has rejected the commission's request for an extra R10,3bn for land restitution over the next three years.

A revised proposal for 70% less ( R3,1bn) is under discussion.

Commission legal head Thami Mdlalose said yesterday sale agreements signed this financial year for land worth R380m were now before the courts as the commission had no money to honour them.

Of these, the courts had already forced the commission to pay R113m, excluding legal costs and interest.

"Every court order against us has been honoured through budget reprioritising in the Department (of Rural Development and Land Reform)," he said.

The commission had signed further sale agreements for R1,19bn in land, but could not honour them until more funds were found, said Mdlalose. Payment was deferred to the next financial year, but there was no guarantee there would be funds then.

The commission also signed commitments for R8,8bn in post- settlement grants, for which it was awaiting business plans, but could not afford to pay.

The Treasury declined to say if it would consider making a special allocation to enable the commission to meet existing obligations, given the negative effect of failing to do so on confidence in enforcement of contracts in SA.

"Cabinet will finalise departmental allocations and those will be announced in February next year," spokeswoman Lindani Mbunyuza said last night.

Lawyers taking the commission to court said conveyancers were instructed not to lodge documents with the deeds office when it ran out of funds this year.

Several court orders seen by Business Day instructed the commission to lodge the registration papers within 48 hours and pay the purchase price. Land owners were awarded backdated interest of 15,5% plus costs.

The commission conceded its regional offices were instructed in April not to enter into new negotiations or sale agreements because of its budget crunch, but denied orders were issued to withdraw existing purchase offers. It declined to quantify what it had spent defending these cases.

Henk Havenga, advocate for several land owners, said the commission had made a "very expensive" mistake. "In some cases people were told to stop farming a year or two ago . I can foresee huge damages claims coming."

Claimants were informed that land purchases and post- settlement grants were on ice until funds were found, even for approved cases. Those with access to lawyers are likely to go to court, and there have been warnings of violence.

Land reform director-general Thozi Gwanya, the commission's accounting officer, recently disclosed to Parliament his department could not honour signed commitments totalling R8,8bn for development grants on restitution farms.

Lengthy delays in settling more than 4000 outstanding claims, some involving dozens of farms, have become an emotional political rallying point.

The commission has spent R20,3bn. It puts the restitution total at R60,3bn, of which R20bn is needed for claims on parts of the Kruger National Park.

Community leaders say they plan to go to court if they are not granted title to their ancestral land. Mangaliso Khubeka, head of the Landless People's Movement in volatile northern KwaZulu-

Natal, warned yesterday that the cash crunch would lead to unrest.

"There are definitely going to be land invasions, " he said.

"Here we have 11 farmers who are willing sellers, but government doesn't want to buy. They have a budget to buy nice cars, but not land for the people."

Farmers' union AgriSA said frustration was "paralysing investment to the detriment of food security, exports, job creation and stability".

Senior government officials, who did not want to be quoted, warned this week of a ticking time bomb waiting to explode.