The National Land Commission (NLC) has suffered a fresh legal setback after the Court of Appeal refused to reopen a compensation dispute over land acquired for the Ndakaini Dam, leaving it exposed to a Sh608 million bill arising from decades of unpaid dues.

A three-judge bench comprising Justices Patrick Kiage, Jamila Mohammed and Sankale ole Kantai dismissed the commission’s challenge to an earlier decision denying it more time to appeal a High Court judgment ordering compensation to landowners in Murang’a County.

The judges agreed that the NLC had failed to provide sufficient grounds to justify the delay in challenging the February 29, 2024 judgment, which directed it and Nairobi City County to pay Sh113.6 million, together with interest running from July 6, 1990, until full settlement.

The accumulated interest has pushed the compensation claim to approximately Sh608 million.

“There was no material placed before the Judge to enable him to exercise his discretion positively in favour of the applicant,” the judges said.

The dispute involves Humphrey Crispus Mwangi and 33 others, who filed the case on their own behalf and for another 106 landowners whose properties were compulsorily acquired for the construction of Ndakaini Dam, a major water source for Nairobi and its surrounding areas.

The landowners maintained that the government took their properties but failed to honour compensation agreements reached in 1990 following 84 land acquisition appeals.

They sought payment of the agreed compensation, interest and a 15 per cent disturbance allowance.

In its defence, the NLC argued that the acquisition took place before its establishment under the 2010 Constitution and that the project had not been transferred to it as an incomplete undertaking by the former Commissioner of Lands.

The commission's legal affairs director, Brian Ikol, further argued that the NLC had not received the money and could not be expected to pay funds that were not in its possession.

Nairobi City County also denied responsibility, arguing that it was not a party to the original compensation proceedings.

However, Justice Anne Omollo ruled that the land had been acquired for the benefit of the former Nairobi City Council and held both the commission and the county responsible for resolving the outstanding payment.

“The Constitution and Statute law clearly demand prompt payment to the person whose land has been compulsorily acquired,” she said.

The NLC subsequently sought an extension of time to appeal, blaming delays on the relocation of its offices, a misplaced court file and changes in its leadership.

But Justice Stephen Radido rejected the explanation on February 26, 2026, noting that the commission had failed to provide dates or evidence linking the administrative changes to the 19-month delay.

The Court of Appeal found no reason to interfere with that decision, leaving the commission without the extension it sought as the decades-old compensation dispute continues to weigh on the public institutions involved.