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ELCPartially AllowedNot stated in judgment· [2016] KEELC 481 (KLR)

Stanley Munga Githunguri & another v National Land Commission& another [2016] KEELC 481 (KLR)

Environment and Land Court
1 July 2016
2,866 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~11 min to read original · ~4 min brief

The bottom line

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A Kenyan court raised compulsory acquisition compensation for Karen land by over Kshs.2.8 million because the National Land Commission ignored the property's approved change of user.

What this practically means

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Executive summary

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The Appellants, registered proprietors of LR No. 1055/31 (about 9.6 acres) along Ngong Road in Karen, Nairobi, appealed under section 128 of the Land Act, 2012 against an award of Kshs.4,574,700/= made by the National Land Commission on 20/12/2013 as compensation for the compulsory acquisition of 0.1142 acres of their land for the Southern Bypass. They sought substitution with an award of Kshs.19,866,250/= based on a valuation by Ragos Valuers and Estate Agents Ltd. The Respondents, through the affidavit of Chief Valuer Fedelis K. Mburu, defended the award, contending that the suit property's user was residential cum commercial (not commercial), that the Appellants' comparables were from a different zone, and that the claim for costs of the suit and the inflated wall valuation were unjustified. The court, applying Article 40(3) of the Constitution and section 111 of the Land Act, and guided by the principles in the schedule to the repealed Land Acquisition Act (no rules having been made under section 111(2)), found that the Commission misapprehended the approved change of user from residential to residential cum commercial, which rendered its award unfair. However, the Appellants' own comparables were not in the immediate neighbourhood and did not reflect true market value. The court adopted the Commission's comparables of Kshs.30,000,000 per acre, adjusted upwards by 40% to Kshs.52,000,000 per acre, valuing the acquired portion at Kshs.5,938,400/=. The wall valuation of Kshs.555,000/= was upheld for want of proof of error, and the Kshs.500,000/= claim for costs of the suit was rejected. The appeal succeeded in part: the award was set aside and substituted with Kshs.7,467,410/= (land value plus wall value plus 15% for disturbance), with each party bearing its own costs.

Key legal issues

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01

Fairness and justness of the compulsory acquisition compensation under Article 40(3) and section 111 of the Land Act

Holding

The 1st Respondent misapprehended the nature of the user of the suit property and arrived at an award that was not fair; the award was set aside and substituted with a higher one.

Reasoning

The court applied the principles in the schedule to the repealed Land Acquisition Act for want of rules under section 111(2) of the Land Act. Finding the Respondent's valuation deficient for ignoring the approved change of user, but the Appellants' comparables unsuitable, it adopted the Respondent's comparables and adjusted the value upwards by 40% to arrive at a fair market value of Kshs.52,000,000 per acre.

p. 5
02

Burden of proof on the landowner challenging the acquiring authority's valuation

Holding

The Appellants bore the onus of proving the Respondent's award wrong; lacking material, the court declined to disturb the award for the damaged wall.

Reasoning

The Appellants sought Kshs.2,500,000 for a broken perimeter wall against the Respondent's Kshs.555,000, but neither valuation laid a basis for the figures. As no material was placed before the court showing the Respondent erred, the court upheld the Respondent's valuation of the wall.

p. 5
03

Claim for litigation costs as a head of compensation

Holding

Costs of the suit are not compensable as part of the award for compulsory acquisition.

Reasoning

The Appellants did not demonstrate how the claimed Kshs.500,000 in legal costs related to the value of the acquired property. The court accepted the Respondents' submission that litigation costs should follow the event and be recovered at source rather than being embedded in the compensation award.

p. 5

Legal principles established

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  • Just compensation for compulsory acquisition must be assessed on principles underpinned in Article 40(3) of the Constitution and section 111(1) of the Land Act, 2012; pending rules under section 111(2), the principles in the schedule to the repealed Land Acquisition Act (Cap 295) may be used for guidance.
  • Market value is the value of land at the date of publication of the notice of intention to acquire, and 15% of market value is added for disturbance.
  • Land whose user is residential cum commercial is more valuable than land whose user is purely residential, and a failure to consider an approved change of user renders an award unfair.

Court orders

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  1. 1.Set aside the award of Kshs.4,574,700/= made by the 1st Respondent as compensation to the Appellants
  2. 2.Substitute therefor an award of Kshs.7,467,410/= made up of value of land Kshs.5,938,400/=, value of damaged wall Kshs.555,000/=, plus 15% for disturbance (Kshs.974,010/=)
  3. 3.Each party to bear its own costs of the appeal

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 40(3)
  • Land Act, 2012Sections 107(1), 111(1), 111(2), 112, 113, 128
  • Land Acquisition Act (repealed), Chapter 295 Laws of KenyaSchedule (principles for determining compensation)
Jurisdiction invoked
Section 128 of the Land Act, 2012 - 'Any dispute arising out of any matter provided for in this Act may be referred to the Land and Environment Court for determination.'

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Stanley Munga Githunguri & another v National Land Commission& another [2016] KEELC 481 (KLR)", Case Analysis (2016). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2016/481/eng@2016-07-01

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.