News

Supreme Court To Rule On Developer’s Sh1B Property On Grabbed Land

Published

2 years ago

December 19, 2021

The Supreme Court is set to rule on a long-standing case filed by a real estate developer seeking Sh1 billion compensation for a stalled project that involved construction of residential houses near Wilson Airport.

Mr Patrick Thoithi Kanyuira wanted to construct 24 maisonettes with the intention of offering them for sale.

But he was stopped by the Kenya Airports Authority (KAA) in September 2008 over safety and security concerns. It was also said the development posed negative impact on the immense revenue generation and economic potential of the airport.

The 1.1-acre land is located approximately 400 metres from the Wilson Airport, which is run and managed by the KAA.

To implement his project, Mr Kanyuira had even secured a Sh50 million loan from Kenya Commercial Bank Limited through its Savings and Loans Limited subsidiary.

Dispute with bank

After being stopped by KAA, Mr Kanyuira moved to court in 2009. The matter has been in court since then, with the developer claiming that his right to property had been violated.

The stop order exposed him to a dispute with the bank, which demanded payment for the loan.

However, he denied having defaulted in the repayment and asserted that if any default was proved, the same was caused by the Order and Notice made by the KAA. He said the decision by KAA had frustrated the performance of the agreement between him and the bank.

In the case that is now pending at the apex court, the businessman contended that KAA decision amounted to arbitrary deprivation of his right to develop the property. He said he was not only stopped from developing but also he is yet to be compensated for the loss of profits.

He sought a declaration that pursuant to the KAA’s notice and order made on September 30, 2008, the agency should compensate him for the loss and damages sustained as a consequence.

Threw out the case

But the High Court dismissed his case noting that KAA’s notice and action to prohibit him from using the property did not amount to compulsory acquisition and that KAA had authority to demand the demolition of his buildings.

In the judgment dated September 11, 2014, the court also said KAA had not acquired the property. Feeling aggrieved by the decision, the developer moved to the Court of Appeal where he lost again.

The judges threw out the case on grounds that Mr Kanyuira had proceeded with construction without the approval of the KAA.

Justices Alnashir Visram, Wanjiru Karanja and Festus Azangalala, in the 2017 judgement said that KAA had offered to exchange the parcel for another one elsewhere so that the matter could be resolved. The Supreme Court will give its ruling on notice.

The judges handling the case include Deputy Chief Justice Philomena Mwilu and justices Smokin Wanjala, Mohammed Ibrahim, William Ouko and Njoki Ndung’u.

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