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Court stops Sh7bn church project over title deed row

The High Court has stopped a Pentecostal church’s firm from going ahead with a Sh7 billion housing project at an upmarket  Nairobi suburb pending the determination of a dispute over failure to issue title deeds to members.

Justice Louis Onguto on Thursday issued the directive following failed mediation attempts in the dispute between La Nyavu Gardens Ltd, which is a business arm of La Nyavu Savings and Credit Co-operative Society, whose membership is drawn from worshippers at the Nairobi Pentecostal Church (NPC) and Bogani Gardens Management Limited.

“Let La Nyavu Gardens Ltd preserve all assets of its ambitious housing development project pending the outcome of the dispute since  the warring parties have not agreed on whether to resolve their differences through arbitration,” said Justice Onguto.

One of the prospective home owners, who secured a Sh9 million loan six years ago to finance the purchase and development of the proposed project, had moved to court seeking to compel directors of La Nyavu Gardens to issue title deeds to the church members.

BREACHING AGREEMENT

While accusing the firm of breaching their mutual agreement,, the investor, through lawyer Tom Macharia said the firm should identify, sub-divide and demonstrate clear demarcation of the property to allow proper ownership.

The investor argues that the title documents will also assist members who secured bank loans that continue to attract high interest rates.

La Nyavu Gardens invited prospective land owners in 2009 to invest in the faith-based gated-community housing.

The firm was to purchase the entire shareholding in Metcourt Hostels Ltd that was to translate to ownership of 114 acres of land in Karen.

La Nyavu Gardens managed to secure majority shareholding after its member’s contributions paid off an Equity Bank loan held by Metcourt Hostels, which was then allowed to retain 41 acres that was then sub-divided for sale.

According to Mr Macharia, the firm’s directors have deliberately frustrated the completion of the transaction for the last two years by imposing unreasonable conditions and threats on the aggrieved member, who has never been issued with a duly registered sub-lease and a share certificate in Bogani Gardens.

FRUSTRATE TRANSACTION

Mr Macharia claimed that the investor had secured a house loan on June 26, 2008 and successfully applied for allotment of half an acre of land by paying a deposit of Sh1.2 million.

The full purchase price of Sh4, 733,202 was reportedly settled but the management of La Nyavu Gardens declined to accept the balance of Sh2,841,500 payable towards infrastructure costs and consultancy fees in March 2012.

Mr Macharia claimed the firm’s directors have deliberately frustrated the completion of the transaction for the last two years by imposing  what he termed unreasonable conditions and threats against the aggrieved member, who has never been issued with a duly registered sub-lease and a share certificate in Bogani Gardens Management Ltd.