Water Resources Management Authority v Kensalt Limited [2016] eKLR

Key Facts

Issues

• whether the Water Act is a taxing or a regulatory statute.
• whether sea water is res nullius and incapable of ownership.
• as between the appellant and the National Land Commission which one has the mandate to regulate the use of water resource
• whether the appellant had the power to control or regulate the use and levy charges for the use of sea water.
• whether sea water is a water resource within the meaning of the Water Act, and

Holdings

• The court allowed both the appeal and cross-appeal, setting aside the previous ruling. The action will be retried by a different judge to ensure impartiality, given the prior decision's influence on the cross-appeal.
• The court determined that sea water is no longer res nullius and is vested in the State as public land under the Constitution and the Maritime Zones Act. However, the National Land Commission (NLC) is the sole body with authority to manage public land, including sea water, and cannot impose taxes or licensing fees for its use.
• The court concluded that the Environment and Land Court (Angote, J.) erred in determining the merits of the case via a summary application, as procedural rules (Order 2 Rules 3 and 15) require such applications to be decided based on pleadings without evidence. The case must proceed to trial.
• The court found that the Water Act is a regulatory statute, not a taxing one, and its provisions for levying water use charges apply only to 'internal waters' on the mainland. Parliament did not explicitly include sea water in the definition of a 'water resource' in the Act.
• The court held that the Water Resources Management Authority (WRMA) does not have the power to levy charges for the use of sea water under the Water Act, as sea water is not defined as a 'water resource' within the Act's scope. The judge concluded that WRMA's suit disclosed no reasonable cause of action in law.

Remedies

• The Court set aside the Environment and Land Court's ruling and order dated 17th October 2014, which had dismissed the suit.
• The Court directed that the action be retried by a judge in the Environment and Land Court other than the original judge (Angote, J.).
• The Court of Appeal allowed both the appeal and the cross-appeal with costs, overturning the Environment and Land Court's decision.

Legal Principles

• The court applied a purposive approach to interpret the Water Act, emphasizing Parliament's intent to limit the definition of 'water resource' to inland waters rather than seawater. This interpretation was critical in determining the jurisdiction of the Water Resources Management Authority.
• The court emphasized the principle that courts should not summarily dismiss actions unless they are 'obviously hopeless,' requiring careful scrutiny of pleadings to avoid premature termination of legitimate claims.

Precedent Name

• The Co-operative Merchant Bank Ltd v George Fredrick Wekesa
• Walter v Sunday Pictorial Newspaper Ltd
• D.T. Dobie & Co.(K) Ltd v Joseph Muchina & Another
• Baldey Raj Aggarwal v Kamal Kishore Aggarwal
• Diamond Trust Bank (K) Ltd V Martin Ngombo & 8 others
• Vensan Insurance Brokers Ltd & Another v Kenindia Assurance Co-Ltd

Cited Statute

• Environment Management and Co-ordination Act
• United Nations Convention on the Law of the Sea
• Water Act
• National Land Commission Act
• Maritime Zones Act
• Constitution of Kenya

Judge Name

• M'Inoti
• Ouko
• Makhandia

Passage Text

• Sea water, otherwise known as marine water in the territorial sea, just like land as is traditionally known and the internal waters, is vested in the State notwithstanding the fact that it is unidentifiable and keeps on moving. ...Marine water in the territorial sea is indeed "public land" and can only be used in accordance with the laws of this country, including international law.
• The plaintiff cannot therefore lawfully levy taxes for the usage of a water resource as defined in the Water Act on behalf of the National Government... Sea Water is not included in the definition of the word water resource. Consequently... the plaintiff cannot impose charges for the use of such water pursuant to the provisions of the Water Act... The plaintiff therefore does not have the locus standi to levy charges for the use of sea water under the Water Act and Water Resource Management Rules
• We allow both the appeal and the cross appeal with costs and set aside the ruling and order rendered on 17th October, 2014. The action will be tried by a judge in the Environment and Land Court other than Angote, J.