Sh5.8bn windfall for five Kwale residents after land case

Five residents of Diani in Kwale County have been awarded Sh5.8 billion as compensation for their 317.16 acres of land whose title was cancelled in 1979.

The High Court awarded Mr Rahimkhan Afzalkhan, his mother Shamshad Afzalkhan, Mr Daniel Mwangi, Ms Pauline Mwongela and Mr Sayed Mushtaq Hussain following a directive from the Court of Appeal to conduct assessment of compensation due to them.

Justice Dora Chepkwony ruled that the petitioners were entitled to compensation of the benefits they would have drawn had they been left to continue occupying the land.

“This can only be achieved by assessing the value of suit land as at the time when the claim was filed in court,” said the judge.

Justice Chepkwony said she was satisfied that a valuation report by a valuer appointed by the president of the Institute of Surveyors of Kenya as per the court directive took into account change of use of the land from exclusively agricultural to partly commercial, residential and agricultural.

She said that if the assessment of the value of the land was to be back-dated to 1979, the court would be aiding the respondents, who are the Chief Land Registrar, the Attorney General and the then-Commissioner of Lands) to right the wrongs they had done back then.

According to the five residents, their lawful ownership to the land was interfered with by the respondents and had that not happened, the five individuals would be beneficiaries of the current developments on the land.

They also argued that the lease on the land was set to expire in 2013 and that under Section 13 of the Land Act, they would still have been eligible to apply for its renewal.

Value of the land 

The residents said that just compensation ought to include both present and potential value of the land being acquired had the owner been allowed to continue using it for the purpose intended.

The five Diani residents had argued that the land was never compulsorily acquired by the government, but the respondents facilitated its fraudulent transfer to a third party. 

For their part, the respondents had faulted the valuer’s report, saying it took into consideration extrinsic factors about the land, including an estimation on the current market value as opposed to going by the market rate as at 1979.

According to the respondents, it would be an injustice to value the land as at 2012 as opposed to 1979 because commercial developments were not in place 42 years ago, and the valuation ought to reflect it was agricultural land as at 1979.

In 2019, the Court of Appeal spared the government from paying Sh9.8 billion as compensation to the five. It also set aside a Sh60-million award to the residents as damages for loss of use of the land, and for physical, mental and psychological torture.

The Court of Appeal had directed the case file be placed before the High Court for assessment of compensation due to the residents, taking into account the encumbrances registered against the title.

The AG and the Chief Land Registrar had appealed against the decision of Justice Eric Ogola in 2017, in which he declared that the constitutional rights of the residents were violated and they were entitled to compensation, prompting the Court of Appeal directive.

The AG’s appeal succeeded in part to the extent that a declaration that the residents’ rights to protection from discrimination, protection of the law, protection from inhuman treatment, human dignity, fair administrative action and fair trial were violated was set aside.

The dispute over the ownership of the land in Diani dates back to 1978 when the registered owner, Mrs Reaby Eleanor Vere Wailes engaged Afzalkhan Rahimkhan (now deceased), Mr Daniel Mwangi, Ms Pauline Kavinya Mwongela and Mr Sayed Mushtaq Hussain in a sale transaction of the land for Sh140,000.

Mrs Wailes obtained consent for the transaction from the Kwale Land Control Board on March 22, 1978 since the suit property was agricultural land and subject to the provisions of the Land Control Act.

Thereafter, a transfer of the lease dated April 7, 1978 in favour of Rahimkhan, Mr Mwangi, Ms Mwongela and Mr Hussain was registered and a certificate of lease issued on April 8, 1978.

Controversy over title 

Weeks later, a controversy over the title cropped up and the director of Agriculture by a letter dated April 28, 1978, addressed to Mr Mwangi, sought to bar the four from dealing in any way with the land.

The court heard that the reason adduced was that a Mr Kahara had an interest in the land, and afterwards it would appear the four residents were directed to surrender their title, which they declined.

Through a letter dated May 16, 1978, the Land Registrar reprimanded the four residents for not surrendering their title and on May 17, 1978, the director of Agriculture wrote to Mr Mwangi concerning the surrender of the title to Mr Kahara to facilitate the process of registration of the land in his favour.

Later, the court heard that a consent for the transfer of the land to Kasika Developers Ltd was issued by the Kwale LCB on May 24 1978.

The consent, the court further heard, was obtained after the Chief Land Registrar cancelled the initial consent granted with respect to the transaction between Mrs Wailes and the four residents.

The explanation advanced for cancellation of the initial consent was that it was issued in contravention of section 15 of the Land Control Actsince at the time, the quorum of the Land Control Board had not been met.

And by a letter dated March 19, 1979, the Chief Land Registrar directed the land registrar Mombasa to invoke the powers conferred by Section 17of the repealed Registered Land Act (RLA) and cancel registration of the title in favour of the residents.

In 2012, Mr Rahimkhan Afzalkhan and Ms Shamshad Afzalkhan, the son and wife of Mr Rahimkhan, who had died, filed a constitutional petition at the High Court against the AG and the Chief Land Registrar, saying their rights and those of the other three respondents had been violated.

Justice Ogola had ruled that although the land was no longer available to the residents because it has been sub-divided and sold to third parties, they were entitled to full compensation at the current market rates.