The City of Cape Town is to petition the Cape High Court for clarity on its legal position after a dispute with the V&A Waterfront Company over the processing of development plans at the city landmark.

The city council has halted all building operations in the V&A on the grounds of noncompliance with the city's landuse planning ordinance, affecting projects totalling more than R1bn.

They include a parking garage, two office blocks and the extension of the V&A Marina residential complex.

Sol Kerzner's proposed R500m One&Only "seven-star" hotel project, scheduled to start in March, is among the projects being held up, and progress could be disrupted .

The dispute concerns a "package-of- plans" agreement put in place 15 years ago when Transnet owned the land where the development is sited.

This was to expedite the development by doing away with the need to file separate rezoning and building plan approval applications for each project.

The council says that as the property is no longer Transnet's, the agreement no longer applies, and the company must comply with the more cumbersome land-use planning ordinance, to which all developers in the city's jurisdiction are subject.

The company applied to the Cape High Court last month for a declaratory order confirming its view that the package-of-plans agreement was valid.

Acting city manager Mike Marsden says the city wanted to approach the high c ourt jointly with the V&A Waterfront Company to clarify the legal position, but the offer was declined.

"Our position is we have to defend our right to approve plans in terms of the legal requirements. We can't continue to treat the V&A differently to the rest of the metropolitan area," Marsden says.

The company's MD, Derick van der Merwe, says that if the city gets its way, there will be a "negative impact" on the timing of developments .

Van der Merwe says that the status quo allows the company to zone in phases, giving it the flexibility to react to changing market conditions .

Bruce Hutchison, One&Only's regional director for Africa, says the company is "extremely disappointed" with the council's stance, which he describes as "a little inconsistent".

"The interpretation the council's officials have taken is contrary to what the V&A Waterfront Company has been doing since 1993. Where have they been all this time?" he said .

Business Day