The Federal High Court recently ruled they had no jurisdiction over a disputed plot leased from the city administration.
The Eighth Civil Bench of the Federal High Court, presided by Judge Abbas Mohammed, ruled on July 14, 2009, that matters relating to land lease are beyond the jurisdictions of the Federal High Court and declined to rule on the case brought before it.
This is an unprecedented verdict because it creates a precedent hindering federal courts from passing judgments in civil suits that involve land leased from the city government.
Dink Sirra Plc, a trade company formed by nine businessmen, sued the Land Lease Boards of the Addis Abeba City Administration and the Kirkos District, disputing a decision by the city administration on a 1,194sqm tract of land located west of Bambis Supermarket, off of Jomo Kenyatta Street.
The company leased the land from the Kirkos District However, the Land Lease Board reconsidered the decision and gave the land to the Hotel de Leopol, a four star hotel property established in 1997, located adjacent to the disputed land.
The dispute between Dink Sirra Plc and the hotel intensified following the hotel's disclosure that it would use the plot in front of its compound as green space. Dink Sirra was already bulldozing the same tract in order to erect a 10-storey multi-purpose building. The controversy culminated when the Kirkos District gave the plot to Dink Sirra Plc.
The company had leased the plot for 1,700 Br per square meter, for a period of 50 years.
Lobbying by the owners of Hotel De Leopol, Fitawrari Damena Simma and his family, resulted in the City Administration's Lease Board, reversing the decision and deciding in favour of the four-star hotel in April, 2008.
Lawyers for Dink Sirra Plc. argued the measure taken by the District was unlawful because it violated a proclamation on urban land leasing which says one cannot be deprived of previously leased land unless the government plans to develop the land or the lessee fails to undertake a project for that fulfils the intended purpose of the land.
However, lawyers from Kirkos District Land Lease Board filed a preliminary objection appealing to the court not to entertain the case because it lacked jurisdiction. Any complaint relating to a decision of the land lease board should be submitted to the board itself, their application states. An appeal can be made only to the city's expropriation appellate counsel, the district's land lease board argued.
The Addis Abeba City Administration has two functions concerning land in the city, the court said in its verdict. One is renting the land in the city by concluding a lease contract with individuals as a contracting party, which is governed by private law. While the other function of the municipality is administering the land in the city, which is governed by public law.
The court further pointed out that the claim of the company is not related to the content of the lease contract, or its performance. The claim, according to the court, is originated from the decision of the city's land administration board taking away the plot from the company and handing it over to the hotel.
This measure by the District's land lease board is purely an administrative measure that falls under the municipality's power to govern the land in the city, the court said.
It ruled that the Federal High Court cannot judge whether the measure taken by the municipality to give the plot for the hotel is in compliance with the law because it is beyond its jurisdiction. The court closed the case.
Judge Abas Mohammed said any complaints about the decisions of the land lease boards of the district or the city should be made to the court and an appeal can be made to the appellate council.
The judge added, it is not only the council that rules on the appeals. Those not satisfied with the decision there could take their case to the Addis Abeba City Courts. This is based on the Addis Abeba City Charter which proclaims, cases arising from the monitoring powers and functions of the city's administrative agencies are under the jurisdiction of Addis Abeba City Courts.