Former Cabinet Secretary Raphael Tuju has suffered a fresh set back in his bid to overturn the sale of Dari Business Park, after the Environment and Land Court ruled that it lacked jurisdiction to hear his petition challenging the valuation and disposal of the property.
Mr Tuju and Dari Limited had challenged the sale of the prime Nairobi property to Ultra Eureka Limited, a company owned by Stabex International Limited co-owner Jackson Kiplimo Chebett, for Sh450 million in October 2024.
The court held that although the petition raised constitutional questions and sought orders affecting the registration and ownership of the property, the substance of the dispute concerned whether the lender had complied with statutory requirements governing the valuation and sale of charged property.
“The principal question is whether the exercise of the statutory power of sale complied with Section 97 of the Land Act,” the court said.
The judge said the fact that the petition invoked constitutional rights did not automatically give the court jurisdiction to determine a dispute whose substance fell outside its mandate.
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“Having found that this court lacks jurisdiction, it would be improper to delve into the merits of the allegations of undervaluation, breach of statutory duty or violation of constitutional rights. These matters fall for determination before a court of competent jurisdiction,” the court ruled.
Mr Tuju argued that the process leading to the forced sale of Dari Business Park was based on stale, desktop, inaccurate and grossly undervalued valuation reports, contrary to Section 97 of the Land Act.
He contended that the valuation of approximately Sh450 million failed to account adequately for developments on the property, its commercial occupation, rental income, prevailing market conditions and existing improvements.
The former Cabinet Secretary further argued that the property was an active commercial establishment occupied by tenants, businesses and leaseholders whose interests and operations were threatened by the sale.
He accused the East African Development Bank (EADB) and the auctioneers involved in the transaction of violating Articles 40, 46 and 47 of the Constitution, which protect property rights, consumer rights and the right to fair administrative action.
Mr Tuju wanted the court to declare the auction, sale and transfer of the properties unconstitutional, illegal, null and void.
Former Cabinet Secretary Raphael Tuju.
Photo credit: File | Nation Media Group
He also sought cancellation of the sale and transfer, as well as general damages for alleged unconstitutional deprivation of property, loss of business, breach of statutory duty, gross undervaluation and unlawful sale below the statutory threshold.
In the alternative, he asked the court to order the respondents to compensate Dari Ltd for the full current market value of the properties, including developments, lost business, rental income and consequential losses, together with interest, if restoration proved impracticable.
“The court further notes that the petition also seeks rectification of resultant registrations. However, these prayers arise consequentially from the challenge to the valuation and statutory sale. They do not, in the circumstances disclosed in the petition, constitute an independent dispute concerning title or occupation sufficient to alter the predominant character of the proceedings,” the court said.
The dispute over Dari Business Park stems from a loan facility advanced by EADB to Dari Limited in April 2015.
Mr Tuju had used Dari Business Park and Entim Sidai Wellness Sanctuary as collateral for a $9.3 million loan extended to the company by the regional lender.
The lender later sought to recover approximately $35.05 million, equivalent to about Sh4.5 billion, a figure Mr Tuju previously challenged as far exceeding the principal amount borrowed.
He also accused the bank of breaching the loan agreement and disputed the valuation reports used in the process of seeking buyers for the properties.
EADB subsequently exercised its statutory power of sale and sold Dari Business Park to Ultra Eureka Limited for Sh450 million on October 1, 2024.
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Following the acquisition, Ultra Eureka disclosed that it had charged the title to the property to Kenya Commercial Bank (KCB) to secure a $2.5 million loan, equivalent to approximately Sh324 million.
The lender has also sought to sell Entim Sidai Wellness Sanctuary as it pursues recovery of the outstanding debt from Dari Limited.
According to valuation reports cited in the dispute, Tamarind Karen and Dari Business Park were valued at Sh590 million as their combined market value, with a forced-sale value of Sh442.5 million.
Entim Sidai Wellness Sanctuary was valued at Sh1.395 billion, with a forced-sale value of Sh1.046 billion.
The reports are said to have been prepared in July 2025, a date that requires clarification in relation to the October 2024 sale of Dari Business Park.
Mr Tuju maintained that the valuation process failed to reflect the true worth of the properties and did not adequately account for their developments and income-generating potential.
