Gone with the wind: The curse of monies from compulsorily acquired state land

Masimba residents demolish their houses in preparation for the construction of the Standard Gauge Railway for which the state compensated them. PHOTO | JENNIFER MUIRURI 

In Summary

•  For instance, after purchasing a land, say, in an arid area, one can sink a borehole and take up farming or even supply water to the neighbourhood.
• Even as the outcry from the angry and disappointed who had yet to be paid continued, the few who had received their bounty wasted no time and spared no expense to celebrate.
• While one man was accused of abandoning his daughters, Ms Abigail Idi Wawuda — a widow and resident of Kaloleni estate, Voi — was conned by her own son.

By DELPHINE MUGO

On Monday, January 26 this year, DN2 ran a special report on construction of the Standard Gauge Railway line.

Out of the need to build the SGR, the government had compulsorily compensated land owners along the route, and ordinary wananchi  had been suddenly transformed into overnight millionaires.

Even as the outcry from the angry and disappointed who had yet to be paid continued, the few who had received their bounty wasted no time and spared no expense to celebrate.

In Manyani village, for instance, two teenage girls had been left in a dilemma after receiving a notice to vacate a house they had long known as home. They had no idea where their father, a widower, was.

Angela, the elder of the sisters, had been told that their father was off making merry after recieving the money. Rumour had it that the old man had bought an old van — which they had seen but could not confirm it was his —  and moved to Mombasa, where he was busy painting the town red.

What  could  be confirmed, though, was the old man’s actual compensation value. Public records at the Kenya Railways office in Voi indicated that he had received slightly above Sh5.5 million for a row of houses, some of which were rentals.

According to his friends, the old man had been spotted occasionally, hopping from one drinking den to another.

While this man was accused of abandoning his daughters, Ms Abigail Idi Wawuda — a widow and resident of Kaloleni estate, Voi — was conned by her own son.

BAD DECISIONS

Ms Wawuda had asked her 30-year-old son to receive the compensation money on her behalf as he was better versed in technology and also more flexible when it came to the time needed to follow up the documents with the bank.

However, her son, Mr Hamisi Kilunju Idi, vanished soon after receiving the money.

She was not sure the amount her son had received as compensation for the three-bedroom house she shared with her daughter and two grandchildren Idi had suddenly became uncooperative. Her daughter, however, thought the money could be in excess of Sh360,000.

These two cases depict a familiar story that has been ongoing for decades — one of compensation money spent as fast as it has been received. They also highlight the impact of a little-known law of compulsory acquisition.

“Enshrined in the Lands Act, Cap 3 of 2012, compulsory acquisition refers to the powers of the state to extinguish or acquire any title or other interests in land for public purpose subject to prompt payment of compensation,” explains Dr Jack Mwimali, a senior law lecturer at Jomo Kenyatta University of Agriculture and Technology.

The law, he continues, can be dated back to medieval international law, when a concept called eminent domain was spread by Hugo Grotius, an ancient philosopher. According to the doctrine of eminent domain, the state has the right to all land within its boundaries and each person holding land does it “on behalf of” the government.

According to Dr Mwimali, two concepts revolve around the doctrine. One is estate, where an individual holds land for a duration of time; and the other is tenure, where one receives land from the state in return for services provided to the nation.

These, he continues, are common law doctrines which are applicable in Kenya.

However, he notes that the new Constitution has made a few structural changes to the doctrine “to avoid abuse”, for instance, in situations where land is acquired for public use then used for private businesses.

As such, he adds, under Article 40, all land belongs to Kenyans even though the administration is with the National Lands Commission.

But who is to blame for the squandered money? Ms Dorothy Chepkoech, a finance auditor with the National Bank of Kenya, thinks both the payer and payee should shoulder the blame.

“We cannot just blame ordinary wananchi alone,” she says. “Should I be blamed for living like King Solomon when I know no better?

WISE DECISION

We’ve heard stories of people in Masaailand who are selling land and buying cars (a liability). That is a mistake. Usually, the conventional advice we give to clients who approach us for financial advice is to ‘make the money earn money for them’,” she says.

For instance, after purchasing a land, say, in an arid area, one can sink a borehole and take up farming or even supply water to the neighbourhood.

Ms Chepkoech says being creative and innovative is the secret. As such, she advises, the compensated landowners should keep the bounties in a bank. Better still, you should invest in an idea you have tested over time, she advises.

“Do not bury the compensation amount under your mattress,” she cautions. “With inflation and time, the value of money will erode. It is advisable to lock that money in a bank account that earns you cash, however little. Meanwhile, develop a comprehensive budget to guide you.” 

Ms Chepkoech says the government should adopt a partnership programme with banks instead of depositing money into people’s accounts and leading them to make poor decisions. Were there a formal arrangement, the banks would do capacity building and also offer financial advice to those who have been compensated.

In regard to valuation, Dr Mwimali, the property lawyer, says it is a Herculean task to obtain a land valuation. However, he explains, valuation in compulsory acquisition cases should be carried out by the NLC valuers. 

Residents of Kifuduni village in Mariakani exhuming the bodies of their dead relatives for reburial at a new site after they were compensated to pave way for the construction of the Standard Gauge Railway line. One grave was compensated at Sh50,000 and 45 graves have to re-transfered in accordance to the Duruma traditions. PHOTO | FILE

“The value of the property is arrived at on the basis of the market value — for instance, if the land is agriculturally viable or not — and its location. Also, any structures on the land determine influence it value.”

However, serious procedural questions arise with compulsory land acquisition, and Dr Mwimali  acknowledges these. Why can’t the landowner have his or her own valuers enjoined in the valuation exercise, for instance?

One of the reasons tendered for this is cost: if you bring in too many experts, the overall cost may rise beyond manageable limits.

RIGHT OF OWNERSHIP

The NLC, which is designed to be an independent constitutional commission, takes over this mandate on a purely intermediary basis, and as such they should work without fear or favour, states Dr Mwimali.

It is your entitlement  to get the best value for your land. Therefore, private valuers can be enjoined in the valuation exercise, even though the ultimate value decision will be made by the NLC value experts.

“That is not to say that the value given (by NLC) is cast in stone. If you are discontented, you have a right to appeal — challenging valuation as being unreasonable, or on lack of prompt and adequate compensation grounds — including making complaints that are not appropriate to acquire that property,” says Dr Mwimali.

According to him, the landowner valuation experts’ evidence is admissible in a court of law.

This, however, calls for some soul searching on the land owners’ part as “adequate compensation is weighted against public interest”.

Consequently, the landowner should consider the states’ interest and should not make excessive and exorbitant claims.

Still, compulsory acquisition uproots people from places they have long known as home and as such there should be a balance between public and individual rights.

To ensure the status quo is maintained, the government should consider issuing alternative lands instead of just making compensation and leaving people frantically dashing for the next available piece of land.

 “A well thought and planned programme should be rolled out. The National Housing Commission can prioritise the interest of compulsory acquisition recipients and issue them houses,” says Dr Mwimali.

Also, since people have the right to proper housing, other rights notwithstanding, the government can come up with a formal settlement with extra amenities such as schools, hospitals, and developed access roads.

PROMPT COMPENSATION

The new Constitution has modified the unlimited powers given to the government in regard to compulsory acquisition, which is now subject to human rights provisions in Article 40 about the right of ownership.

In fact,  the provision on eminent domain itself is found in Article 40, which says everyone has a right to own land anywhere in Kenya without interference.

However, the government can acquire land subject to prompt and adequate compensation.

On March 13 last year, the National Lands Commission was put to task and warned of a possible lawsuit by the Parliamentary Public Investment Committee (PIC) for flouting the law on compulsory acquisition.

The lands commission had gazetted the intention to acquire 27 parcels of land in Taita Taveta, Kwale and Makueni counties (for the SGR construction) without funds for compensating the affected landowners.