Jubilee Party Deputy Party leader Fred Matiang'i.
A land subdivision plan drawn up in the early 1980s lay dormant for more than three decades before exploding into one of Kenya’s biggest scandals.
What began as an ambitious private housing project on Nairobi’s northern edge evolved into a Sh3.2 billion compensation claim that drew in constitutional commissions, anti-corruption investigators and the courts, as officials struggled to answer a single question: Who really owned the land beneath two public schools?
Also drawn into the saga was then Education Cabinet Secretary Fred Matiang’i after his ministry accepted advice from the National Land Commission (NLC) and paid a first tranche of Sh1.5 billion for the acquisition of the land, leaving an outstanding balance of Sh1.7 billion.
The matter roped in NLC, Parliament, the Ethics and Anti-Corruption Commission (EACC), the Ministry of Education and, eventually, the courts, as judges were forced to reconstruct planning decisions made decades earlier.
At the centre of the dispute lies 13.7 acres occupied by Drive-In Primary School and Ruaraka High School.
Drive-Inn Primary School in Ruaraka, Nairobi. The land on which the school sits is a subject of controversy.
For years, the issue appeared straightforward: Should private landowners be compensated after the government occupied their land for public schools?
Yet as investigators dug deeper, the dispute shifted dramatically. The central question became whether the land had ceased to be private long before the Sh3.2 billion compensation was ever considered.
The Court of Appeal has now answered that question. However, the judgment also exposed deep disagreements among public institutions over ownership, compulsory acquisition and the protection of land reserved for public use.
The story begins in December 1981, during the era of the former Nairobi City Commission, when the capital was expanding rapidly, and developers were setting up new residential estates.
Read: Court upholds that Uhuru-era Sh1.5bn Ruaraka schools land payment to businessman Mburu was irregular
Afrison Export Import Limited and Huelands Limited bought land registered as LR No. 7879/4, a 96-acre parcel, from Joreth Limited.
At the same time, the two firms secured a Sh21 million mortgage from Continental Credit Finance Limited (in liquidation) to finance the construction of 500 maisonettes for Kenya Posts and Telecommunications Corporation (KPTC). The land was used as security.
Court records show the development was planned to include about 1,200 houses, roads, sewer lines, shopping facilities, community amenities and land reserved for public institutions, including a primary school and a secondary school.
Like many large developments of the period, the project required land subdivision approval. In September 1982, the proposal reached the then Nairobi City Commission's Town Planning Committee.
Officials recommended approval subject to 17 conditions, including the free surrender of land for schools, roads, shopping facilities, social amenities and other public utilities, before forwarding the plans to the Commissioner of Lands.
Those conditions would later become the most contested documents in the entire dispute.
Approval fees
Government agencies maintained that the developers accepted the approval process, amended the plans, paid approval fees and proceeded with surveys that gave effect to the subdivision. The developers consistently disputed that account.
Afrison Export and Import Ltd and Huelands Ltd director Francis Mburu at the Ethics and Anti-Corruption Commission offices on July 19, 2018. He claimed ownership of the controversial land in Ruaraka, Nairobi.
Francis Mburu, a director of Afrison Export Import Ltd and Huelands Ltd, told the court the companies rejected the planning conditions.
“The 1st and 2nd Interested Parties (Afrison Export Import Limited and Huelands Limited) did not authorise Drive-In Estate Developers Limited to write back to the Commissioner of Lands accepting the conditions because the conditions were punitive and financially impossible to meet,” he said.
Mr Mburu added that the companies resolved that land earmarked for schools and other public facilities would only be surrendered if the Nairobi City Commission bought it.
When that proposal was rejected, the developers cancelled the subdivision application in April 1984 and this was before any surrender could legally occur.
That disagreement would remain buried for years as government developments continued on the ground.
Ruaraka High School was established on the site in 1984, followed by Drive-In Primary School in 1987, with both operating as public schools.
Other sections of the property were developed into housing, with part of the estate later occupied by General Service Unit officers after KPTC became involved in financing the project. The Office of the President acquired 196 completed maisonettes.
For decades, the schools remained while ownership questions resurfaced periodically in court. The companies maintained they remained the registered proprietors of the entire parcel, continued paying rates and challenged what they described as unlawful allocations of parts of their land.
Government agencies, meanwhile, increasingly treated the land reserved for public amenities as vested in the State through the planning process.
The dispute entered a new phase in 2015 when Mr Mburu filed a historical land injustice claim before NLC. He argued that the government had occupied more than 13 acres of private land for over 30 years without compensating the registered owners.
The companies argued there could never have been a lawful surrender because the subdivision was abandoned before completion. They said no surrender instrument was registered, no separate titles were created for the public utility plots, and their mortgagee never gave the consent required to release any part of the land.
That claim transformed what had largely been a historical land dispute into one of the country’s public finance controversies.
EACC presented a markedly different reconstruction. Investigators traced correspondence exchanged between planning officials, the Commissioner of Lands and survey authorities from 1982 through 1985.
Deed plans followed
They argued the planning process had moved beyond preliminary approval. Survey plans were prepared. Deed plans followed. Roads, schools, community facilities and housing were eventually built substantially in line with the approved layout.
According to the commission, the developers could not later rely on their own failure to complete registration formalities to deny the legal effect of the planning process they had initiated.
However, NLC investigated the historical injustice claim and concluded that Afrison and Huelands remained the registered proprietors of the mother title.
Acting on that understanding, it commenced compulsory acquisition proceedings for the land occupied by the two schools.
In September 2016, the NLC chairperson informed the Ministry of Education about the complaint that the schools had occupied private land without compensation.
NLC then valued the 13.7 acres at Sh3.26 billion, gazetted the intended acquisition and later approved the compensation.
It said that on February 17, 2017, the Director of Development Management and Regularisation in the Nairobi County government responded to a letter by one of Mr Mburu’s companies. The county stated that the 1984 development application for the suit land was halted, and no further processing was done.
Further, NLC said that other portions of the companies’ land had previously been compulsorily acquired through the commission, and compensation was fully paid.
Mr Mburu and the companies gave a history similar to that given by NLC, asserting that the suit property belonged to them.
The Ministry of Education accepted NLC’s advice, according to then Basic Education Principal Secretary Belio Kipsang.
The PS told the court the ministry relied on the commission’s constitutional mandate and believed it had verified all relevant land records before recommending acquisition.
That process resulted in a partial payment of Sh1.5 billion in 2018, while the Sh1.7 billion balance remained pending. The money was paid through the companies’ nominated agent, Whispering Palms Estate Ltd.
Dr Kipsang stressed that the appellants were in possession of the instruments of ownership of the land and that due diligence was exercised in the process of compulsory acquisition.
The payment transformed what had largely been a land dispute into a national governance issue.
Parliament questioned whether taxpayers were compensating private owners for land that had already become public through the subdivision process.
The EACC opened investigations and public attention shifted from the size of the compensation to whether any compensation should have been paid at all.
Confronted with conflicting conclusions from public institutions, NLC took an unusual step.
Rather than proceed with the acquisition, it sought the Environment and Land Court’s opinion on fundamental questions surrounding the ownership of the school land, the validity of the compulsory acquisition, the legality of the Sh1.5 billion payment and the person entitled to receive compensation.
A three-judge bench advisory in 2019 fundamentally altered the trajectory of the dispute.
The judges acknowledged that Afrison and Huelands remained the registered owners of the land. But they found that the government’s interest in the plots reserved for public amenities crystallised once the subdivision scheme was approved and implemented on the ground.
In the judgement dated June 28, 2019, the judges concluded Drive-In Primary School and Ruaraka High School stood on public land, declared the compulsory acquisition irregular and held that the Sh1.5 billion already paid constituted a loss of public funds.
The developers appealed, insisting the advisory rested on planning documents they considered unreliable, ignored their cancellation of the subdivision and overlooked the absence of any registered surrender.
The Court of Appeal examined those competing accounts alongside evidence from NLC, EACC, Chief Land Registrar, Director of Surveys, Ministry of Education and the developers.
It upheld the central finding that the school land formed part of land reserved for public purposes and rejected the developers’ attempt to overturn the Environment and Land Court’s conclusions. The judgement also extinguished their claim for the outstanding Sh1.76 billion they argued remained payable after the initial Sh1.5 billion compensation.
“It follows from our finding that the schools are located on public land by virtue of the surrender, that the NLC had no legal basis upon which it could compulsorily acquire them,” said the Court of Appeal.
The court found that the housing project was approved and the appellants facilitated the construction of 196 housing units for the GSU in accordance with the approved scheme.
“The evidence on record further demonstrates a clear de facto surrender. The letter of July 4, 1984, from the appellants’ agent stating ‘we hereby surrender’ and the final approval of the subdivision scheme on March 22, 1985, confirm the consensual nature of this surrender,” said the judges.
Follow our WhatsApp channel for breaking news updates and more stories like this.
