Reinsurer stares at ex-Kenyatta land loss

Twenty years after it purchased a multi-billion-shilling land once owned by First President Mzee Jomo Kenyatta on Kiambu Road, Kenya Re is now close to losing the claim.

The High Court last week refused to grant the listed reinsurance company an order to retrieve the “forged title” of the prime property from the Director of Criminal Investigations.

Justice George V. Odunga described the orders sought as “incompetent”, saying the application contained “a comedy of errors and omissions which, without any explanation being offered, cannot be excused”.

Although the  controversial land was LR 216/8, the title sold to Kenya Re bears LR 12236 with IR No. 73976.

KANU

Bought at the height of the Kanu rule, four months to the 1997 General Election, it was sold for Sh550 million to Kenya Re by Mr S. K. Macharia, then-chairman of a Kanu lobby, Central Province Development Support Group (CPDSG), and Mr Joseph Gilbert Kibe, a former Permanent Secretary in the Ministry of Commerce. The then-Kenya Re managing director William Mbote was a member of the lobby.

The land was sold in 1982 by former First Lady Mama Ngina Kenyatta to Scenaries Limited, whose shareholders included Mr Macharia, Mr Kibe and former Gatundu MP Ngengi Muigai.

The National Land Commission (NLC) has said the title of the land sold to Kenya Re was fraudulent while DCI Ndegwa Muhoro has described LR 12236/IR 73796 as “pure fraudulent”.

On April 28, last year, Kenya Re, through their advocates Okwatch and Co, wrote to the DCI seeking to get the title back. But Mr Muhoro replied that the title “was confirmed through investigations as a Kirinyaga Road/River Road title which was purely fraudulent … consequently, the DCI has declined to release the fraudulent title to you. Our inquiry file is still with the Director of Public Prosecutions awaiting his advice in relation to prosecution”.

TITLE

Kenya Re had been asked to surrender the title after Mr Muigai moved to court in 2000 seeking to have his Scenaries co-directors charged with forgery. But the High Court barred the police from pursuing criminal investigations on the matter.

The three-judge Bench ruled that Mr Muigai was using the case to bring pressure to bear upon his co-directors to settle what was a civil dispute. Then-Attorney-General Amos Wako said he would not press any charges.

Court records indicate that Kenya Re could not have bought LR 216/8 because it was then the subject of a caveat lodged by Mr Muigai and which was the subject of a 1991 case.

It has also emerged that the title LR 12236 was first prepared for a 1.9-hectare (4.7-acre) portion of land excised from Karura Forest to allow the Kenyatta land to border Kiambu Road. It was to be consolidated with LR 216/8, which Kenyatta had bought from an Israeli tycoon, Mr Jacob Hirschfeld.

Kenyatta was to give an equal part of his land to the government. This is the land where the National Intelligence Service (NIS) headquarters stands.

RIGHTFUL PORTION

But then, government officials hived 15 acres off Karura. And although Kenyatta had indicated that he only wanted his rightful portion, when he died in 1978 he left an unfinalised LR 12236 in the books complete with an IR number (given by the Director of Surveys confirming the boundaries of a portion of land).

When Scenaries bought the land the consolidation was not complete. It later became the subject of the Ndung’u Report, which recommended that the Karura land be returned to the State.

Records show what was sold to Kenya Re was the consolidated parcel, LR 12236 IR 73976, but which the NLC and the DCI say is a “fake title”.

Mr Muhoro has said he is holding on to the title just in case the DPP, Mr Keriako Tobiko, wants to use it as evidence of fraud.

COURT ORDER

There is a separate court order asking the NLC to undertake a review of propriety and legality of LR 12236, LR 216/8 and LR 12261.There is a separate court order asking the NLC to undertake a review of propriety and legality of LR 12236, LR 216/8 and LR 12261.

It is on record, however, that Mr Macharia and Mr Kibe instructed Sceneries’ lawyers Kirundi and Co Advocates on how to share the money from Kenya Re. The August 25, 1997 letter states: “This is the full and final authority for you to pay and/or distribute the proceeds from the buyer.”

CERTIFICATES

They were to buy 15 bearer certificates of deposit of Sh10 million each, another 10 each of Sh5 million, Sh1 million and Sh500,000 and 11 more of Sh5 million, totalling Sh270 million.

Mr Kibe and Mr Macharia’s Royal Credit Limited got Sh112.5 million each while Sh55 million was to be paid to the law firms of Kirundi and Co. (Sh15 million) and Mohammed and Muigai (Sh20 million) for their legal services as J. M. Githongo got Sh10 million and Lee Ngugi Sh10 million.