Section 655 of Insolvency Act CAP 53: Restrictions on disposal of property and making payments by company
(1) Subject to subsection (2), a company in respect of which a moratorium has effect may dispose of any of its property only if—
(a) there are reasonable grounds for believing that the disposal will benefit the company; and (b) the disposal is approved by the monitor.
(2) Subsection (1) does not apply to a disposal—
(a) made in the ordinary course of the company's business; or (b) made in accordance with an order of the Court.
(3) If a company disposes of any of its property in contravention of subsection (1), the company, and each officer of the company who is in default, commit an offence.
(4) A company that is found guilty of an offence under subsection (3) is liable on conviction to a fine not exceeding two million shillings.
(5) An officer of a company who is found guilty of an offence under subsection (3) is liable on conviction to a fine not exceeding one million shillings or to imprisonment for a term not exceeding two years, or to both.
Enhance Your Research with Bookmarks and Annotations
Here's how you can use these features:
- To bookmark this page, click the "Bookmark this Page" button below the document title.
- To add an annotation, highlight text in the document and select "Add Annotation" from the toolbar that appears.
- These features are great for organizing your research and keeping track of key information.
- You can view and manage your bookmarks and annotations on your Bookmarks and Annotations page.
- Section 656 - Restriction on company paying debts and other liabilities
(1) Subject to subsection (2), a company in respect of which a moratorium has effect may make a payment in respect of a debt or other liability of the company that was in existence before the...
- Section 657 - Circumstances in which company may dispose of property and goods that are subject to a security or held under credit purchase transaction
(1) This section applies to—
(a) property of the company that is subject to a security; and
(b) goods that are in the possession of the company under a credit purchase transaction.
(2) A company...
- Section 658 - Monitor's to monitor activities of company during moratorium
(1) During the moratorium, the monitor is responsible for monitoring the company's activities in order to ascertain whether the company is likely to have sufficient funds available to it during the...
- Section 659 - Withdrawal of monitor's consent to act
(1) Except with the approval of the Court, a provisional supervisor may withdraw consent to monitor a moratorium only if, during the moratorium—
(a) the monitor concludes that the company will not...
- Section 660 - Creditors and others may challenge monitor's conduct during moratorium by application made to the Court
(1) Any creditor, director or member of the company, or any other person affected by a moratorium, who is dissatisfied with an act, omission or decision of the monitor during the moratorium may apply...
- Section 661 - Creditor may pursue claim against monitor for loss
(1) If there are reasonable grounds for believing that—
(a) as a result of any act, omission or decision of the monitor during the moratorium, the company has sustained loss; and
(b) the company...
- Section 662 - Replacement of monitor by the Court
(1) An application may be made to the Court for an order under subsection (2)—
(a) if the monitor has failed to comply with any duty imposed on that monitor under this Part or has died, by the...
- Section 669 - Extension of moratorium
On the application of the directors, the Court may extend a moratorium for a period of at least thirty days if the Court believes that the extension is desirable in order to achieve the aims for which...
- Section 670 - Conditions for extension of moratorium
(1) The conditions that may be imposed when a moratorium is extended or further extended include a requirement that the monitor be replaced as such by another authorised insolvency...
- Section 671 - Decisions to extend or further extend moratorium
(1) If the Court extends, or further extends, the moratorium, the monitor shall within seven days of the order, lodge a copy of the order with the Registrar for registration.
(2) Deleted by Act No. 1...
- Section 674 - Member or creditor of company may challenge actions of directors
(1) This section applies to and in relation to acts or omissions of the directors of a company during a moratorium.
(2) A creditor or member of the company may apply to the Court for an order under...
- Section 675 - Offences under this Division
(1) This section applies to a company in respect of which a moratorium has or had effect.
(2) A person who, at any time during the twelve months immediately preceding the date on which the moratorium...
- Section 677 - Interpretation: Part X
In this Part—
"deliver", in relation to documents or other property, includes surrender and transfer;
"relevant office-holder" means—
(a) in relation to a company under administration, the...
- Section 678 - Realising property of company that is in liquidation or under administration
(1) This section applies to a company that is under administration or in liquidation.
(2) If a person has control over money, documents or other property to which the company appears to be entitled,...
- Section 679 - Duty of certain persons to co-operate with relevant office-holder
(1) In this section, “relevant office holder", in relation to a company, also includes the Official Receiver even if not the liquidator.
(2) This section applies to the following persons—
(a) those...
- Section 680 - Power of the Court to conduct inquiry into insolvent company's dealings, etc., on application made by relevant office-holder
(1) In this section, "relevant office holder", in relation to a company, includes the Official Receiver even if not the liquidator.
(2) On the application of the relevant office-holder, the Court may...
- Section 681 - Court's enforcement powers under section 680
(1) If, after considering the evidence obtained under section 680 or this section, it appears to the Court that a person has control over property of the company, the Court may, on the application of...
- Section 682 - Power of the Court to set aside transaction that is under value
(1) This section applies to a company that is under administration or in liquidation.
(2) In this section, "relevant time" has the meaning given by section 684.
(3) On forming the reasonable belief...
- Section 683 - Power of the Court to void certain preferences
(1) In this section, "relevant time" has the meaning given by section 684.
(2) If of the view that a company has at a relevant time given a preference to a person, the relevant office-holder may...
- Section 684 - What "relevant time" means in sections 682 and 683
(1) Subject to subsection (3), the time at which a company enters into a transaction at an undervalue is a relevant time if the transaction is entered into at a time—
(a) during the two years...
- Section 685 - Orders under sections 682 and 683: ancillary provisions
(1) An order under section 682 or 683 with respect to a transaction or preference entered into or given by a company may, subject to subsection (
2)—
(a) require property transferred as part of the...
- Section 686 - Power of the Court to set aside certain extortionate credit transactions
(1) This section applies to a transaction to which a company is, or has been, a party to a transaction for, or involving, the provision of credit to the company.
(2) The relevant office-holder may...
- Section 687 - Circumstances in which floating charge on company's undertaking or property to be invalid
(1) Except as otherwise provided by this section, a floating charge on the company's undertaking or property created at a relevant time is invalid except to the extent of the aggregate of—
(a) an...
- Section 688 - Lien in respect of company's documents unenforceable if it would deny their possession to relevant office-holder
(1) This section applies to a company that is under administration or in liquidation.
(2) A lien or other right to retain possession of any of the documents of the company is unenforceable to the...
- Section 689 - Supply of utility services to companies in liquidation or under administration
(1) This section applies to a company—
(a) that is under administration or in liquidation; or
(b) in respect of which a moratorium or voluntary arrangement under Part IX has effect.
(2) In this...
- Section 690 - Appointment of administrative receiver in respect of company prohibited
(1) In this section, "administrative receiver", in relation to a company, means—
(a) a receiver or manager of the whole (or substantially the whole) of the company's property appointed by or on...
- Section 691 - Enforcement of company's obligations to lodge documents with, or give notice to, the Registrar of Companies
(1) If a company has failed to comply with a requirement under this Act—
(a) to lodge a document with the Registrar for registration; or
(b) to give notice to the Registrar of any matter, the...
- Section 692 - Power of the Court to grant injunctions in certain cases
(1) The Official Receiver, or a person who claims to have been, to be or to be about to be adversely affected—
(a) by the past or continuing conduct of, or by a threat to engage in conduct made by, a...
- Section 693 - Liability of officer who are in default
(1) If a provision of this Act provides that an officer of a company who is in default commits an offence, the officer commits the offence only if the officer—
(a) authorises or...
- Section 694 - Offences by bodies corporate
(1) If—
(a) a body corporate commits an offence to which this section applies; and
(b) the offence is proved to have been committed with the consent or connivance of, or to be attributable to...
- Section 695 - Admissibility in evidence of statement prepared for purpose of provision of this Act or the insolvency regulations
(1) In any proceedings (whether under this Act or any other written law)—
(a) a statement of the financial position or affairs of a bankrupt, company or other person prepared for the purpose of any...
- Section 696 - Legal proceeding under this Act not to be invalidated or set because of a defect unless person detrimentally affected
(1) A proceeding under this Act may not be invalidated or set aside for a defect in a step that is required to be taken as part of, or in connection with, the proceeding, unless a person is...
- Section 697 - Power to make insolvency procedure rules
(1) The Rules Committee, with the addition of the Official Receiver, may make rules providing for either or both of the following—
(a) the procedure of the Court under this Act;
(b) appeals to the...
- Section 698 - Power of the Court to review, rescind or vary order made under this Act
The Court may review, rescind, or vary any order of the Court under this Act.
- Section 699 - Right of appeal to Court of Appeal
(1) Any person dissatisfied with a decision of the Court under this Act may appeal to the Court of Appeal against the decision.
(2) Except as otherwise expressly provided by this Act, a notice of...
- Section 700 - Suspension of bankruptcy, liquidation or administration pending determination of appeal
(1) If an appeal has been lodged against a bankruptcy order or an order for the liquidation or administration of a company, any interested person may apply to the Court or the Court of Appeal for an...
- Section 701 - Appointment of Official Receiver and others
(1) The Cabinet Secretary shall, as and when necessary, appoint suitably qualified persons to the positions of—
(a) Official Receiver; and
(b) one or more Deputy Official Receivers.
(2) The...
- Section 702 - Deputy Official Receiver may act on behalf of Official Receiver
A Deputy Official Receiver may act for, or in the place of, the Official Receiver or another Deputy Official Receiver, and in that capacity has all the authority and powers of the Official Receiver or...
- Section 703 - Incorporation of Official Receiver as a corporation sole
(1) The Official Receiver is, for the purpose of performing the functions imposed and exercising the powers to be conferred on the Official Receiver by or under this or any other Act, incorporated as...
- Section 704 - Vacation of office by Official Receiver and Deputy Official Receiver
(1) The office of Official Receiver or Deputy Official Receiver becomes vacant if— (a) the person dies;
(b) the person's term of office expires without the person being reappointed;
(c) the person...
- Section 705 - Protection of Official Receiver and Deputy Official Receivers from liability
Neither the Official Receiver nor a Deputy Official Receiver is liable in civil proceedings for any act that the Official Receiver or Deputy Official Receiver has done or omitted to do for the purpose...
- Section 706 - Official Receiver and Deputy Official Receivers may charge fees
(1) The Official Receiver and Deputy Official Receivers may charge fees for performing their official functions, and exercising their official powers, at the rates (if any) prescribed by the...
- Section 707 - Rates of Official Receiver's fees
(1) The insolvency regulations may fix or prescribe the amount or rates of fees chargeable under section 706.
(2) Those regulations may, for example, prescribe—
(a) hourly or other...
- Section 708 - Insolvency Services Account to be established and maintained
(1) The Official Receiver shall establish in the Central Bank of Kenya an account, to be called the "Insolvency Services Account".
(2) The Official Receiver shall pay into the Insolvency Services...
- Section 709 - Official Receiver to pay certain unclaimed dividends and undistributed balances into Insolvency Services Account
The Official Receiver shall from time to time pay into the Consolidated Fund out of the Insolvency Services
Account so much of the amounts standing to the credit of that Account as...
- Section 710 - Application of Division 2
This Division applies to a public register established under section 47, 337 or 350.
- Section 711 - Official Receiver to ensure access to public registers
(1) The Official Receiver shall ensure that all public registers are available for access and inspection by members of the public during the Official Receiver's ordinary business hours.
(2) However,...
- Section 712 - Purposes of public registers
(1) The public register kept under section 47 has—
(a) the purpose of providing information about bankrupts and discharged bankrupts; and (b) the further purposes specified in subsection...
- Section 713 - General information to be included in public registers
(1) The Official Receiver shall ensure that the public registers contain the prescribed information in respect of the following persons—
(a) a person who is or has been bankrupt;
(b) a person who is...
- Section 714 - Information kept indefinitely on public register after multiple insolvency events
(1) This section applies to a person who—
(a) is or has been bankrupt on two or more occasions; or
(b) is or has been both bankrupt and discharged from the no asset procedure under section...