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Two activists have moved to court seeking to stop Kenya Ports Authority (KPA) over its alleged intention to pay Sh715 million for a disputed land lease.
The payment originates from a dispute regarding a lease agreement between KPA and a private company, Memphis Limited.
Memphis has obtained an arbitration award of Sh715 million against the KPA over the lease of the seven-acre piece of land that was to run for 33 years from 2009.
The KPA took over the land in 2017 to construct a public road from Mombasa port to Kipevu, claiming Memphis had breached terms of lease agreements that demanded the development of the property within two years from 2009.
The activists are accusing the KPA of failing to follow due diligence to protect taxpayers from losing millions of shillings.
Caleb Ngwena and Millicent Adhiambo, have sued KPA and Memphis and want the decision of the arbitrator awarding the firm the millions quashed forcing the dispute to be referred for arbitration under lawyer Ambrose Rachier.
“The claimant is awarded the total sum of Sh715 million as compensation for loss of its leasehold,” ruled Rachier.
“Interest of the above will be at court’s rates from the day of judgment and payment in full.”
They have also accused KPA of failing to appeal against the arbitrator’s decision.
“Pending hearing and determination of this application interparties, conservatory orders be issued restraining KPA, its agents, employees or any other person acting on its instructions, from authorising, approving, allowing and/or permitting it to pay Memphis Ltd money awarded by the arbitrator on June 15, 2020,” say the petitioners
The petitioners have expressed fear that Memphis will at any moment demand settlement of the award, which payment if made, shall further overburden the taxpayers.
They also argue that when a State agency requires to acquire land for its use, the entire process of acquisition is to be done by the National Land Commission, which has the sole responsibility to value the property and advise accordingly.
Further, the activists noted that the entire transaction from the lease, the acquisition, the arbitration are marred with irregularities.
“The respondents from the foregoing have been working in cahoots to defraud the public, thus KPA inertia to appeal against the unfounded award of the skewed arbitration,” say the petitioners.
The company leased the land for the development of a container freight station (CFS) for loading and clearing cargo from ships docking at the Mombasa port.
The firm took possession of the plot in 2009 and was required to fund the cost of constructing street lighting, sliding roads, drain waters and sewers and to maintain the same.
The hearing of the case is scheduled for May 6
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