Court blocks Zanzibar authorities from retaking developer’s land

Part of the villas that were under construction at the Blue Amber Resort by developers Pennyroyal in Matemwe, Unguja. The first phase of the project was set for delivery in December 2022.

What you need to know:

  • The decision follows an application by property developers Pennyroyal that sought court’s intervention to stop another company---Aecus Limited---from taking over section of land located at Matemwe Muyuni and Tazari area, North Region, Zanzibar.

Unguja. The High Court of Zanzibar has temporarily stopped the Isle’s minister for Land and Housing Development from interfering with the ownership of 411 hectares of land owned by Pennyroyal Limited, where the Blue Amber Resort was under construction.

The development of the Blue Amber Resort was brought to a halt last year after the Lands Ministry in Zanzibar earlier revoked the title deed of 411hectares where the property was being developed and the Zanzibar Investment Promotions Authority cancelled the building permit in July, 2022.

The decision follows an application by property developers Pennyroyal that sought court’s intervention to stop another company---Aecus Limited---from taking over section of land located at Matemwe Muyuni and Tazari area, North Region, Zanzibar.

Respondents in the application were Aecus Limited which is backed by the Zanzibar Minister for Land and Housing Development and the Attorney General who were the second and third respondents to the application.

“The respondents, or any other person acting on their behalf are restrained from interfering with the plot pending hearing and determination of the main suit,” said Judge Kazi in a recent ruling.

Pennyroyal which has massively invested in the land is facing an imminent eviction from the land it claims to be a valid purchaser following a court decision in a case they were not a party but related to the land.

The company has already been issued with a letter showing respondent’s intention to interfere with the ownership of the property, Pennyroyal claims to hold a valid title and has made substantial investment.

At the hearing of the application, Pennyroyal argued through its lawyer, Mr Elia Mgoya, that the court’s intervention was necessary to protect his client against the irreparable losses if the respondents would be allowed to evict them from the land.

State Attorney Saraha Khatau who represented the Zanzibar AG and the Land ministry, argued that the disputed lease and the whole project no longer existed.

“The applicants must first apply for reinstatement of the lease from the Ministry of Land and ZIPA (Zanzibar Investment Promotion Authority) for reinstatement of her project,” argued the state lawyer.

Respondent claimed Pennyroyal has never been a good-faith of the disputed land and that the bona fide purchaser was the first respondent (Aecus Limited) who bought the land from its original owner

The AG and the land minister have argued in the affidavit that Pennyroyal’s lease of the land was invalidated by the court order in 2018.

Delivering his ruling, Judge G Kazi said he was convinced that “there was a serious triable issues of ownership of the land which need to be determined by the court.”

“The applicant has clearly demonstrated how he has substantially invested in the development of the disputed land. Therefore, it is clear that the intervention of this court is necessary to protect the applicant from injury, which could be irreparable pending the determination of the main suit,” said the judge.

The court has also restrained the respondents from changing leasehold documentation, replanning and resurveying all and any land under the disputed land pending hearing and determination of a suit filed by pennyroyal.

Legal battle in the waiting

In another development, a legal battle is looming between clients who bought property at Blue Amber Resort developed by British developer Pennyroyal at Matemwe, Zanzibar.

The buyers, who contacted The Citizen at different times on condition of anonymity, say they have decided to take the legal action in order to recoup their monies because, ever since the building permit was cancelled, the developer has not said anything regarding their investments.

In one of the affidavits that The Citizen has seen, one of the buyers is also suing the Zanzibar Investment Promotions Authority and The Ministry of Lands, Housing for their role in the stagnation of the project.

Initial reports show that the buyers were supposed to receive their units (villa) in December 2022, and that initially everything was on schedule until they were informed that the building permit for the construction of the property had been cancelled.

"I was supposed to receive my villa in December, but when I visited the site sometime in October after I got the news, I found out that work had come to a standstill with no sign of construction taking place," said one of the prospective villa owners.

He added: This was my lifetime savings, and I hoped to move here in the earliest possible time. As a result, I have decided to go to the courts using local attorneys to recoup the money that I had paid.

In another email, another villa buyer puts the blame on local authorities, who assured them that the investment was safe only to cancel the building permit.

"I contacted the Zanzibar Investment Promotions Authority on every detail before I made the decision to start payments, and they were very positive, only to come to this," she says.

The Citizen reached out to the developer for clarification, but his local representative refused to comment on the saga, and it is not clear whether they had filed for arbitration either.

In October 2022, the Attorney General of the United Republic of Tanzania, Dr Eliezer Feleshi, told The Citizen that his office was aware of the case and that they were working on a few details before they met with the firm.

"Yes, I’m aware of this case. We have formed a government negotiation team that will look into the claims and then arrange to meet with the claimants. We shall handle it in accordance with the bilateral treaties that exist," he told The Citizen then.

It is not clear whether that meeting ever took place or what the outcome of the meeting was.