Jimmy Kibaki gets a slice of Sh2.4bn GSU land payment

Former President Mwai Kibaki’s son Jimmy is among beneficiaries of a Sh2.4 billion payout that the government made for the controversial 37.4-acre General Service Unit (GSU) land in Nairobi’s Ruaraka.

City tycoon Francis Mburu, who won the payout in a protracted court battle with the government, has now revealed that Jimmy was entitled to Sh100 million of the total amount “for services rendered” to his company, Afrison Export Import Limited.

Mr Mburu was to split some Sh400 million the government had paid him as instalment among Mr Kibaki (Sh100 million), Almasi Limited (Sh165 million), and a Mr F M Mulwa (Sh70 million).

The payment was to be made through two law firms — Harit Sheth Advocates and Mahmoud & Gitau Advocates — he hired in 2013 to oversee the settlements.

Harit Seth was to receive the Sh400 million from the government then hand it over to Mahmoud & Gitau for onward transmission to Mr Kibaki, Mr Mulwa and Almasi Limited.

A fight, however, ensued among the three parties, scuttling the planned disbursement of the funds and seeing the matter back to court.

Mr Mburu accuses Mahmoud & Gitau Advocates of fraud for attempting to pay people not included in his instructions. The Treasury was to release the funds to Mr Mburu in July.

Details of the payments have emerged in suit papers that Mr Mburu filed in court in July seeking to stop Harit Sheth Advocates from paying out any money to Mahmoud & Gitau Advocates.

Mr Mburu has sued the two law firms through Afrison Export & Import Limited — a company he wholly owns.

The businessman, however, holds that his biggest discontent is with Mahmoud & Gitau Advocates, which he claims wanted to sneak unauthorised individuals into the list of beneficiaries. Mr Mburu has not, however, named the said persons in court.

“In terms of the said undertaking, Mahmoud & Gitau Advocates were supposed to pay Mr Kibaki Sh100 million, Mr Mulwa Sh70 million and Almasi Limited Sh165 million,” Mr Mburu says, adding that he had within the month of June 2015 made numerous attempts to prevail upon the defendants to stick to his earlier instructions when executing the assignment but none of them had responded.

Mr Mburu did not disclose in the proceedings what services Mr Kibaki and the other beneficiaries offered his firm or whether the services were related to the land battle. 

READ: City tycoon to get Sh600m payout in GSU land dispute

The High Court has quashed the instructions Mr Mburu gave to the lawyers after finding that the letter with the instructions was vague and could not be said to be legally binding.

Justice Francis Gikonyo ruled that the instructions issued to Harit Sheth in June 2013 were too vague and ordered the payout stopped until a more descriptive set of instructions are issued.

The judge maintained that Mahmoud & Gitau did not provide a letter confirming its acceptance of Mr Mburu’s instructions, leaving the entire process vague and not legally binding.

“Based on the material before court, I agree with Afrison that the undertaking was vague and needed further and specific instructions to be effective,” said the judge.

Lawyer Harit Sheth said his firm was caught in the crossfire between Mr Mburu and Mahmoud & Gitau Advocates over the funds, adding that his firm had decided to file a suit to determine what action to take before Mr Mburu sued him and Mahmoud & Gitau Advocates.

Mr Mburu had asked him to cancel the June 2013 instructions while Mahmoud & Gitau had sent him a demand letter seeking release of the Sh400 million as soon as the government paid.

Harit Sheth Advocates in its response to Mr Mburu’s suit held that the Sh400 million was intended for Mahmoud & Gitau as legal fees the firm had offered Afrison. The firm denied knowing that Mr Kibaki or any other individual was to benefit from the Sh400 million payout.

Mr Kibaki is said to have initially demanded Sh150 million, but he agreed to a lower amount following negotiations at his Riverside Drive offices.

“Harit Sheth did not know the purpose of the payment. The firm only learnt later in November 2014 that part of the money was to be paid to Jimmy Kibaki who agreed to a reduction of the amount from Sh150 million to Sh100 million.”

Mr Mburu sued former President Kibaki in 2012 alleging that his firm owned the 37.4 acre piece of land and that the GSU had grabbed it to construct its headquarters.

Justice Alfred Mabeya found that the tycoon indeed owned the land and awarded him Sh4.2 billion, which the government later negotiated down to Sh2.4 billion.

The GSU officers occupy 380 houses that were initially built for employees of the defunct Kenya Posts and Telecommunications Corporation (KPTC), now Telkom Kenya.

The government claimed it bought the land from the KPTC, but the judge ruled that Mr Mburu had provided sufficient proof of ownership.

The Auditor-General Edward Ouko has since called for the arrest of Moi-era Internal Security ministry officials, arguing that numerous anomalies had occurred during the KPTC’s acquisition of the land and its subsequent transfer to the GSU.