LHDA in M400m rent fix
RETHABILE MOHONO
MASERU – The Lesotho Highlands Development Authority (LHDA) owes M400 million to the Land Administration Authority (LAA) in outstanding ground rent. The debt that began accumulating in the 1992/1993 financial years was calculated at M240 265 097.38 in 2023, rising to the current outstanding amount of M387 211 668.10.
Ground rent is an annual fee paid by leaseholders for the use and occupation of land. Each land parcel has an individual ground rent fee specified in its lease agreement. While primary residential sites are exempt from paying ground rent, commercial sites and secondary residential plots are required to make payments.
Landowners must apply for exemptions through the LAA if their site qualifies. Ground rent was first introduced under the Land Act of 1979 (Section 69) and later reinforced by the Land Act of 2010 (Section 77). Payments must be made annually by March 31, either in full or in agreed-upon installments.
The LAA has taken legal action against the LHDA, filing a lawsuit for M240 million in unpaid ground rent dating back to 1991. The LAA has now petitioned the Land Court Division of the High Court to order the LHDA to pay its outstanding debt.
The LAA is responsible for land administration and registration in Lesotho, while LHDA oversees the implementation of Phase II of the Lesotho Highlands Water Project (LHWP). The LHWP, established by a 1986 treaty between Lesotho and South Africa, aims to supply water to South Africa’s Gauteng region and generate hydroelectric power for Lesotho. The project involves constructing a series of dams along the Senqu/Orange River.
Although the LAA’s court documents do not specify the land’s location, it is identified as plot number 36242-042. The LAA asserts that the LHDA was granted 86.37 square kilometers of land on November 14, 1991, under a Ministerial Grant of Title.
Consequently, LHDA is obligated to pay ground rent per Section 77 of the Land Act 2010.
The Act states: “There shall be payable ground rent in respect of leases, unless a lessee is exempted from such ground rent as the minister (of Local Government) may, by notice published in a gazette, determine.” The LAA claims it made multiple attempts to remind the LHDA of its obligations through official letters, but these were ignored.
The LAA argues in the lawsuit that:
“The applicant (LAA) specifically pleads that the Respondent (LHDA) breached its obligation as conferred by the law (Section 77 of the Land Act 2010) in that there was and there still remains failure or neglect to perform in terms of the lease conditions, which include, amongst others, the obligation to pay ground rent annually as and when it falls due.
The applicant served some reminders in the form of Letter of Demand and ground rent bills on the respondent. However, the respondent still has not paid the ground rent debt. The applicant specifically pleads that the respondent has despite formal and written demands, neglected and or refused to effect payment of ground rent to date and is thereby aggrieved as a result,” the papers before court say.
“The applicant specifically pleads that the respondent is indebted in the amount of M240 265 097.38 as ground rent and the said non-payment is both illegal and legally reprehensible, and for that reason, the applicant is aggrieved.” The LAA is requesting that the Land Court order LHDA to pay the full outstanding amount.
LAA Litigation Manager, Malunga Ndlovu, confirmed speaking to Public Eye that the case remains in court. He also provided details on past payments made by LHDA. He stated that “the last amount the LHDA paid was M11 294 282.96, from the amount M929 582.96 paid in the financial year of 1996/1997, in 2017/2018 they paid M5 182 700 and in 2018/2019 an amount of M5 182 000 was paid.”
Ndlovu also noted that other entities, such as Setleketseng Water Holdings, have similar debts but have opted to settle outside of court.
Meanwhile, the LHDA Public Relations Manager, Mpho Brown, acknowledged in an interview that there is an ongoing legal case but declined to comment further due to its sub-judice status.
“The case is in court and has not been heard. The LHDA is awaiting a new date of hearing after the case was consolidated with another case dealing with a similar issue,” he said.
“We will provide updates as and when it is possible to do so.”
The ongoing legal battle between the LHDA and LAA over unpaid ground rent has raised concerns about financial accountability in Lesotho’s land management. With M400 million in accumulated debt, the case’s outcome will likely set a precedent for how ground rent obligations are enforced in the future.
The LAA maintains that adherence to land laws is crucial in ensuring fair use and financial accountability, emphasizing that non-payment negatively affects the administration of land in the country.
Observers note that the verdict of this case could influence future policies and regulations regarding ground rent compliance in Lesotho.
Despite the ongoing court battle, stakeholders are hopeful for a resolution that will ensure ground rent obligations are met without setting an unsustainable financial burden on organizations involved in major national projects. Legal experts suggest that the case will determine how government entities balance infrastructural development and financial responsibility in managing land resources.
The outcome may encourage stricter enforcement of land policies while prompting leaseholders to prioritize compliance to avoid costly legal battles in the future.
As the legal proceedings continue, Ndlovu mentioned that LAA remains committed to its mandate of ensuring that leaseholders fulfill their financial obligations.
“With significant sums owed, the resolution of this case could mark a turning point in Lesotho’s approach to land administration, potentially strengthening financial compliance and land governance across the country.”
