Wresting a straight answer from Sito Nchindo to direct questions is like wringing water from a dirty wash cloth – something comes out, but is murky and smells a little off.
Hiding behind a smokescreen of weasel words, the Tourism Development Company (TDC) boss’ answer to a Sunday Standard questions was more concealing than illuminating: “We trust that the above responds to your queries, however any omission in doing so should not be construed as an admission thereof”, reads the answer in part.
Nchindo’s trickstering is hardly surprising. TDC, the developer of Setlhoa private residential enclave stands accused of extorting hundreds of thousands Pulas from plot owners who have fallen behind their development covenant timelines.
The big scandal, however, is the judiciary’s apparent wink wink nudge nudge to big private estates property developers like Setlhoa and Phakalane Estates who are cashing in on unfair contracts with plot owners.
Phakalane and Setlhoa are upmarket enclaves ranging from middle class suburbia to opulence, fenced off from Botswana’s socio-economic reality.
These high-end enclaves sell a lifestyle and trade on status and a sense of luxury and exclusivity. For the country’s nouveau riche these manicured confines hold an irresistible allure. In their mad rush to buy into this fantasy respite removed from the Gaborone grit, the country’s gilded class never stood a chance against the city’s estate developers who are behaving like a cartel. More often than not, the gullible lot buyers overlooked the small print and signed away their lives.
As it turns out, when appending their signatures to the Memorandum of Agreements of Sale, put together by Collins Newman and Company, the impressionable lot buyers signed blank checks payable to Setlhoa and Phakalane Estates for an amount up to and including their own homes.
Clause 18.2 of the Setlhoa agreement entitles the estate owner to repossess the property of lot owners who have fallen behind the development covenant timelines and refund them only 80% of the purchase price of the plot. Thereafter, TDC would sell the property with the developments at market value and pocket the proceeds. Phakalane Estates has a similar agreement. And these land Shylocks never hesitate to come for their pound of flesh.
Aided by the courts, Botswana’s private estates developers have pushed scores of Batswana into foreclosure and financial ruin, driving some to an early grave. Most are either still nursing blood pressures and broken hearts from shattered dreams or buried deep under huge debts.
The Covid-19 pandemic has brought this lopsided power dynamic into sharp focus and indications are that there is going to be more blood on the floor.
Botswana relies heavily on imported building materials which are now in short supply because of the movement restrictions. The situation is not helped by Covid-19 protocols which require
building contractors to decongest construction sites and to send back labourers who present flu-like symptoms. Some construction hands were put on isolation after being identified as contacts. As a result, dozens of lot owners have fallen behind their development covenant timelines and the only thing standing between them and the loss of their homes is the empathy of the country’s predatory estate owners.
While the Magang family in Phakalane has extended lot owners development covenant by six moths to make up for the time lost to Covid-19, The Nchindo family on the other hand has no problem extending the lot owners’ development covenants — as long as they get a little something extra for their trouble. This little something which sometimes runs into hundreds of thousand Pulas is not provided for in the agreement and the calculation is the sole discretion of the Setlhoa estate owner.
Nchindo is clearly shaking down lot owners. But in his response to Sunday Standard questions, he offers a highly stylised version. The Setlhoa boss engaged in complex gymnastics of the English language to avoid fessing up to the inconvenient truth: “In selling plots to purchasers, TDC insists that those plots be developed within a specified time period.
The benefits of this development covenant to the neighbourhood as a whole, include:
• a safer environment, as there will be fewer vacant lots that present security risks for the residents;
• a faster rise in the value of the neighbourhood; and
• more opportunity for additional developments in the neighbourhood e.g., shopping malls, schools, offices etc.
In the event that a purchaser is unable to satisfy the development covenant (for whatever reason), he/she may approach TDC to negotiate an extension of the development covenant.
All the terms and conditions of TDC’s sale agreements are in line with the laws of Botswana and have been entered into freely by the purchasers.
We trust that the above responds to your queries, however any omission in doing so should not be construed as an admission thereof”, he states.
Nchindo’s response that “all the terms and conditions of TDC’s sale agreements are in line with Botswana laws is a moot point. On the face of it, the TDC contract contravenes Section 26 (b) of the Consumer Protection Act, 2018 which addresses unfair contract terms or “prohibited terms and conditions in the Agreement”.
The Sunday Standard can reveal that the Competition and Consumer Authority has been tipped off about the bargaining power imbalance between private estates developers and lot owners which is underpinned by unfair contract terms.
The Competition and Consumer Authority can invoke Section 34 of the Consumer Protection Act, 2018 to vary or set aside the unfair agreements.
Up until now, the private estates development industry was the wild wild west. The country’s highest court upheld these unfair contracts and scores of lot owners were disposed of developed plots.
For now, The Competition and Consumer Authority is the only hope for lot owners who face losing their homes and life savings.
