Containers waiting to be picked at the Inland Container Depot in Embakasi, Nairobi.
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Bank caught up in insurance firm’s Sh400m land dispute
What you need to know:
- In May 2016, the insurance firm charged the title deed of the plot to I&M Bank for a loan of Sh1 million.
- I&M Bank has stepped up its fight to retain the property, which it holds as collateral for a loan.
When GA Insurance Limited invested in a 3.1-acre prime land near Inland Container Depot in Nairobi’s Embakasi worth more than Sh400 million in October 2014, it had plans of venturing into the lucrative property market.
But those dreams violently came under threat on March 13, 2021 when agents from an entity claiming ownership of their property stormed it in the full presence of police officers, who were providing security for contractors hired by the firm to erect a perimeter wall; and made away with construction materials worth more than Sh700,000.
Dikus Transporters Limited claims to have bought the property for Sh98 million last year from city lawyer Stephen Ndenda Juma, who claims to have been allocated the property in 1999.
Documents held by the registrar of lands indicate that the land was originally allocated to Sadru Musa Ramji and Yasmin Sadru Musa Ramji in 1987. They then sold the property to Eldo Dwellers Ltd in December 2004 and the firm sold the land to Economic Industries Limited in June 2005 for Sh9 million.
Economic Industries then sold the land to GA Insurance in October 2014 for Sh92 million and paid Sh3.68 million in stamp duty, according to documents seen by the Nation. In May 2016, the insurance firm charged the title deed of the plot to I&M Bank for a loan of Sh1 million.
Account suspended
However, in early February this year, GA Insurance learned that something was amiss when it tried to pay rates at Nairobi City County as it had been previously doing. The firm was informed that it could not pay the rates since its account had been suspended.
“Our client was not informed of the arbitrary suspension of its account and would therefore wish to have the said account activated and regularised to enable them make the payments required,” wrote their lawyer Paul Mwangi of Njoroge Wachira & Company Advocates. Officials at the Nairobi City County had deactivated the account after they were informed that the land had changed hands.
“However, on May 14, 2020 are (sic) Stephen Juma Ndeda informed this office that L.R No. 209/10601/12 had been subdivided into three parcels namely LR No 209/22463, 22464 and 22465,” wrote Nyoike N I, chief lands valuer, to chief accountant for rates at Nairobi City County.
The sub-plots were subsequently valued provisionally on May 15, 2020 and delivered to your office.”
On the chief valuer’s recommendation, GA Insurance Ltd account was restored and allowed to pay rates, but the fight for the property seems far from over.
Collateral for loan
This week, Dikus Transporters Limited continued developments at the property undeterred. On the other hand, I & M Bank stepped up its fight to retain the property, which it holds as collateral for loan it advanced the insurance firm.
“Currently, the property is registered in the name of GA Insurance and we hold a legal charge over it together with the original document as security for facilities extended to GA Insurance Limited,” wrote Mr Andrew Muchina, the bank’s head of litigation, and Mr Srinivasan Parthsarathy in a joint letter dated March 19, 2021, which was copied to the Directorate of Criminal Investigations.
Last month GA Insurance sued Dikus at the Chief Magistrate’s Court, but the latter has challenged the lower court’s authority to hear or determine the dispute. The Chief Magistrate’s Court had issued orders barring Dikus from interfering with GA Insurance’s possession of the property.
GA Insurance has now filed a fresh suit before the High Court’s Environment and Land Division. Documents filed in court by Dikus claim that Mr Ndeda in turn bought the land from its original owners, Sadru Musa Ramji and Yasmin Sadru Musa Ramji, in 1999.
Court papers indicate that after Mr Ndeda acquired the land and subdivided it into three parcels, Dikus bought two of the new parcels and has attached both title deeds in court as it seeks to be declared the legal owner.
