Developers deny sidelining homeowners in managing city posh estate

Karen Hills Estate. [Courtesy]

Developers of Karen Hills Estate have denied claims they have sidelined homeowners in the management of the posh estate.

Karen Hills Limited and Lordship Africa Fund Management Limited, through lawyer Walter Amoko, denied claims they refused to account for millions of shillings paid as service charge saying the accounts have been prepared and are currently being audited.

“In any event, the homeowners are not entitled to access the audited accounts of the management company. But they are aware there had been challenges in preparing the accounts. However, these have now been resolved and the accounts are being audited,” said Amoko.

The homeowners had argued, in their suit, that the developers have been charging Sh30,000 per month from each of the more than 30 households but the money has not been accounted for.

But Amoko said the claims are not true, stating the amount of service charge was to be ascertained annually after the expiry of each financial year, which was to be calculated as a fraction of the costs of the management company for providing services.

The homeowners had also claimed the lease agreement provided that they should be made part of the Karen Hills Management Company Limited that manages the estate. However, the developers dismissed the claim as a lie, "since the buyers were only to own one per cent".

The 64-acre land on which the estate rests was originally owned by the two firms, Karen Hills Limited and Lordship Africa Fund Management Limited, which sold it to the homeowners. Under the lease agreement, the companies and homeowners agreed to form another company to manage the estate. They registered Karen Hills Management Company Limited.

“Their demand for issuance of shares in the management company and inclusion in the board of management is premature as the sale of all units and the subsequent registration of all leases has not been completed,” said Amoko.

In any event, the lawyer said there are already two homeowners appointed as members of the Karen Hills Management Company Limited.

He added that the homeowners were insincere in their pleadings, accusing them of rushing to court when the lease agreement has provided mechanisms for dispute resolution which have not been exhausted.

The developers also denied accusations they have been billing exorbitant rates for water averaging Sh8,000 per month. They said they have not exaggerated the water bill as claimed. The said developers have been installed water meters for each house so they can monitor their consumption.

“The management company charges a rate of Sh55 per unit for water as compared to the rate of Sh62 per unit charged by the Nairobi Water Sewerage Company. The charges are pegged on the home owner’s manual which gives the management company the responsibility to bill for water,” he said.

According to Amoko, it is not also true that the developers have exposed the residents to rodents such as snakes by failing to utilize unoccupied spaces stating that the remaining units have not yet been purchased.

The residents of Karen Hills Estate had sued Karen Hills Limited and Lordship Africa Fund Management Limited to stop them from further collecting the service charges. They also want the respondents to disclose the amounts they have collected since 2011 and how the money has been utilised.

The residents claimed the developer had not done anything to improve their surroundings leading to invasions of rodents including snakes which put their lives at risk.

The upmarket Karen Hills Estate sits on a 64-acre land sub-divided into 60 plots of one-acre each which was sold to the homeowners. The rest of the land was left for social amenities.