John Michuki's heirs battle for vast empire

Njoroge Michuki is widely acknowledged as one of the best performing ministers in former President Mwai Kibaki’s government, thanks to his no-nonsense attitude.

As Transport minister, he is particularly remembered for restoring order in the chaotic matatu industry by introducing the famous “Michuki Rules”, which required all public service vehicles to install speed governors, fit passenger safety belts and operate in clearly defined routes as well as carry a stipulated number of passengers.

These rules, which had restored some semblance of sanity on Kenyan roads, would flounder almost as soon as he was moved to the environment docket. The late Michuki, who was 80 at the time of his death, was born in Kangema, Murang’a County, into a poor family. He joined primary school in 1941, but two years later, dropped out because his mother could not afford to educate him. He would go on to complete primary school years later, eventually joining Mang’u High School, where he met Mwai Kibaki, under whose presidency he served in various high profile capacities.

OXFORD UNIVERSITY

With a bachelor’s degree in Economics, Finance and Public Administration from Oxford University in the UK, thanks to a government scholarship, Michuki became the first African District Commissioner of Nyeri District. He would go on to serve as the Kenya Commercial Bank chairman, Finance minister, Transport and Communications minister, as well as Internal Security minister, during which he gave a shoot-to-kill order against the outlawed Mungiki sect, which was roundly condemned by human rights groups.

At the time of his death, he was handling the environment docket. Among the projects he initiated was the ambitious rehabilitation of the Nairobi River and the reclamation of Kenya’s five water towers.

He was an astute businessman, too. When he breathed his last, he was worth billions of shillings. His assets included several parcels of land, shares in various companies and ownership of several buildings, including Cargen House along Harambee Avenue in Nairobi.

According to court documents, Michuki owned 1,536 shares at Kenya Airways, 10,400 at Ndarugu Plantations, 502 at Silver Homes , 502 at Coots Holdings, 502 at Snipe Investments, 20 at Kangema Farmlands, 100 at Agricultural and Industrial Holdings, 56,900 at Mountain Lodge, one at Mika Estate, one at Nairobi Golf Hotels Kenya, 12,500 at New Kenshoes Company, 2,000 at Fairview Investments, one at Highland Tea Company and two accounts at Standard Chartered Bank's Koinange Street branch.

Perhaps the best-known business he founded was the luxurious Windsor Golf Hotel and Country Club, a Victorian-style recreation facility located in Nairobi’s upmarket Ridgeways Estate, which he began building in 1988. It sits on more than 200 acres.

When he passed away at the Aga Khan Hospital due to a heart attack, his wife, Josephine Watiri, who was actively involved in running their businesses and also supported his political career, took over the reins. Six months later, however, she too died. With her death, the couple’s six children began fighting over the enormous wealth left behind.

"They have hoodwinked the beneficiaries"

In May, their last-born daughter, Yvonne Wanja, filed a case seeking to revoke a document that gave her two older siblings the authority to manage their parents’ multi-billion-shilling estate.

Ms Wanja, a chartered financial analyst, accused two of her siblings, who were given the authority to manage their parents’ estate, of mismanaging the property, including channeling money generated from the properties into personal use.

“The respondents have willingly failed to diligently administer the estate. They have hoodwinked the beneficiaries that they wish the estate to be distributed. All businesses under the estate have performed worse, year after year and debts have increased,” Ms Wanja says in court papers.

According to her suit, the current liabilities of Nairobi Golf Hotels, which owns Windsor Golf Hotel & Country Club, have mushroomed to Sh625 million.

She also says two companies with a similar name, Mika Holdings were incorporated, ostensibly for the purpose of selling the family’s Windsor Park Phase 1 houses, whose proceeds have never been accounted for, and which in her estimation amount to not less than Sh1.6 billion. The said Mika Holdings are registered in foreign jurisdictions.

Ms Wanja points out that her siblings have not declared income received from the sale of the Windsor Park houses or the collections of monthly service charges from homeowners therein, amounting to Sh60,000 per house, per month.

She also says that Windsor Park Phase I and the inventory of houses it holds, income received from sales and the collection of a monthly service charge of Sh60,000 per house, per month, have not been disclosed. In addition, she points out that Fairview Investments is owed money by Mika Holdings to the tune of Sh215 million. It is not clear, she says, what this money went towards.

She also accuses one of her sisters, Anne Wanjiku Mutahi, of conceptualising projects whose “soundness and sheer scale defy financial logic”. She names the Ndaragu Metropolis, which she says is envisaged to cost Sh2.35 billion.

THREE MORTGAGES

She also says that there was an attempt in January 2014 to create three mortgages over the Windsor Park houses in favour of Family Bank . In response, her siblings termed the contents in Ms Wanja’s affidavit as “malicious and untrue.” Missing links in the will left behind by their mother, Josephine, as well as the unclear probate that Ms Wanja’s siblings have over the property is an issue that dogs many families of the wealthy and famous upon their deaths.

While the affidavit is the only testament about the fresh battles in the management of the late Michuki’s estate, there are no prizes to be won for guessing what will eventually happen to the estate if the protracted court cases and alleged management disputes are not conclusively resolved.

In July, the National Environment Management Authority ordered the closure of Windsor for discharging untreated effluent into a river.

The directive was a trending topic on social media, with many Kenyans pointing out the irony of the accusation. As Environment Minister, Michuki had introduced tough laws that would, among other habitats, protect rivers.

Nema however reversed the order a day later, explaining that the hotel had “initiated compliance and put measures to prevent waste water flowing into environment”.