Section 279 of Insolvency Act CAP 53: Composition not binding unless approved by the Court
(1) A composition is not binding until it is approved by the Court.
(2) When approved by the Court, a composition binds all the creditors in respect of provable debts due to them by the bankrupt.
(3) The Court may refuse to approve a composition if it finds that—
(a) section 276 or 277;
(b) the terms of the composition are not reasonable or are not calculated to benefit the general body of creditors;
(c) the bankrupt is guilty of misconduct that justifies the Court in refusing, qualifying, or suspending the bankrupt's discharge; or
(d) for any other reason it should not approve the composition.
(4) The Court may not approve a composition if the composition does not provide for the payment, before any other debts are paid, of those debts that have priority under the Second Schedule.
(5) The Court's approval is conclusive as to the validity of the composition.
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- Section 280 - Procedure for court approval of composition
(1) The bankrupt or the Official Receiver may apply to the Court to approve the composition.
(2) The Court may hear the application only if satisfied that each creditor who has submitted a claim in...
- Section 281 - Deed of composition to be executed
(1) As soon as practicable after the Court has approved a composition—
(a) the bankrupt and the Official Receiver shall execute a deed of composition for putting the proposal into effect;...
- Section 282 - Effect of deed of composition
When the Court has confirmed the deed and quashed the bankruptcy order—
(a) the deed binds all the creditors in all respects as if they had each executed the deed; and
(b) subject to the provisions...
- Section 283 - Bankrupt remains liable for unpaid balances of certain debts
(1) A bankrupt who makes a composition with the bankrupt's creditors remains liable for the unpaid balance of a debt if—
(a) the bankrupt, by means of fraud—
(i) incurred or increased the debt;...
- Section 284 - Deadlines for steps to approve composition and execute deed
(1) The deadlines for steps to approve the composition and execute the deed are as follows—
(a) the confirming resolution has to have been passed within one month after the preliminary resolution is...
- Section 285 - Procedure following approval of composition by the Court
(1) The Registrar of the Court shall, after recording the deed of composition— (a) endorse on the deed that it has been recorded in the Court registry; and
(b) if requested to do so by the Official...
- Section 286 - How composition may be enforced
(1) On the application of any person aggrieved by a failure to pay an amount payable in accordance with a composition approved by the Court, the Court may order that the failure to pay be...
- Section 287 - Jurisdiction of the Court in relation to composition and deed of composition
(1) After the preliminary resolution has been passed, the Court continues to have exclusive jurisdiction in relation to the composition and the deed of composition, and their administration.
(2) On...
- Section 288 - Law and practice in bankruptcy to apply to deed of composition
The Court shall decide a question arising under a deed of composition according to the law and practice of bankruptcy, in so far as that law and practice is relevant.
- Section 289 - Offences in relation to debts
(1) A bankrupt commits an offence if the bankrupt did not, when contracting a debt, have the capacity to pay the debt when it fell due for payment, as well as to pay all the bankrupt's other...
- Section 290 - Offences in relation to property
(1) A bankrupt commits an offence if the bankrupt—
(a) conceals, or removes from Kenya, any part of the bankrupt's property—
(i) during the two months immediately preceding the date on which an...
- Section 291 - Offence in relation to written statement to creditor, etc.
(1) A bankrupt commits an offence if, during the three years immediately preceding the time when the bankruptcy order was made in respect of the bankrupt, the bankrupt makes or produces to a material...
- Section 292 - Offence in relation to documents, etc.
(1) A bankrupt commits an offence if, during the two years immediately preceding the making of the application to the Court for a bankruptcy order in respect of the bankrupt, or at any time after the...
- Section 293 - Offence in relation to fictitious losses or expenses
A bankrupt commits an offence if, during the twelve months immediately preceding the making of the application to the Court for a bankruptcy order in respect of the bankrupt, or at any time after the...
- Section 294 - Offences in relation to credit, etc
(1) A bankrupt commits an offence if, during the three years preceding the making of the application to the Court for a bankruptcy order in respect of the bankrupt, or at any time after the...
- Section 295 - Offences in relation to obtaining consent of creditors
A bankrupt commits an offence if the bankrupt—
(a) makes a false representation; or
(b) does any other fraudulent act, for the purpose of obtaining the consent of any one or more of the bankrupt's...
- Section 296 - Offence for bankrupt to leave Kenya without consent
(1) A bankrupt commits an offence if, during the twelve months immediately preceding the making of the application to the Court for a bankruptcy order in respect of the bankrupt, or at any time after...
- Section 297 - General penalties for bankruptcy offences
A bankrupt who is found guilty of an offence under a provision of sections 289 to 296 is liable on conviction to a fine not exceeding two million shillings or to imprisonment for a term not exceeding...
- Section 298 - Failure to keep and preserve proper record of transactions
(1) A bankrupt commits an offence if, at any time during the three years immediately preceding the date on which the bankrupt was adjudged bankrupt—
(a) the bankrupt had failed to record of the...
- Section 299 - Failure to keep proper records with intent to conceal
(1) A bankrupt commits an offence if, with intent to conceal the true state of the bankrupt's affairs, the bankrupt has failed to keep and preserve a proper record of the bankrupt' s...
- Section 300 - When bankrupt presumed not to have kept or preserved proper records
(1) For the purposes of sections 298 and 299, a bankrupt is, in the absence of evidence to the contrary, presumed not to have kept a proper record of the bankrupt's transactions if, being engaged in a...
- Section 301 - Offence by bankrupt in relation to management of companies
(1) A bankrupt who—
(a) acts or purports to act as a director of a company or as a partner of a firm or limited liability partnership; or
(b) fails without reasonable excuse to comply with section...
- Section 302 - Other bankruptcy offences
(1) A bankrupt commits an offence if the bankrupt—
(a) in the course of the administration of the bankrupt's affairs, makes to the bankruptcy trustee or the Official Receiver (if not the bankruptcy...
- Section 303 - Interpretation: Division 1
(1) In this Division—
"debtor" means a debtor who is a natural person;
"interim order" means an order made under section 306;
"proposal" means a proposal made by a debtor to the debtor's creditors...
- Section 304 - When application for interim order can be made
(1) An application to the Court for an interim order may be made if the debtor intends to make a proposal to the debtor's creditors under this Division for a composition in satisfaction of the...
- Section 305 - Effect of application for interim order
(1) While an application under section 304 for an interim order is pending, the following provisions apply:
(a) a landlord or other person to whom rent is payable by the debtor may exercise a right...
- Section 306 - Power of the Court to make interim order
(1) On the hearing of an application made under section 304, the Court may make an interim order if satisfied—
(a) that the debtor intends to make a proposal under this Division;
(b) that on the day...
- Section 307 - Provisional supervisor to report on debtor's proposal
(1) As soon as practicable after the making of an interim order, the provisional supervisor shall, before the order ceases to have effect, submit a report to the Court stating—
(a) whether, in that...
- Section 308 - Debtor's proposal and provisional supervisor's report
(1) This section applies if—
(a) a debtor intends to make a proposal under this Division;
(b) no interim order has been made in relation to the proposal and no application for such an order is...
- Section 309 - When provisional supervisor is to convene creditors' meeting to consider debtor's proposal
(1) If it has been reported to the Court under section 307 or 308 that a meeting of the debtor's creditors should be convened, the provisional supervisor shall, unless the Court otherwise directs,...
- Section 310 - Conduct of creditors' meeting: consideration of debtor's proposal
(1) The main purpose of a creditors' meeting convened under section 309 is to decide whether to approve the debtor's proposal (with or without modifications).
(2) At the beginning of the meeting,...
- Section 311 - Approval of debtor's proposal
(1) This section applies to the decisions taken at the meeting of creditors held in accordance with section 310 to consider a debtor's proposal (with or without modifications).
(2) The debtor's...
- Section 312 - Effect of approval of debtor's proposal by meeting of creditors or by the Court
(1) A debtor's proposal (with or without modifications) takes effect as a voluntary arrangement by the debtor on the day after the date on which it is approved by the Court by order made under section...
- Section 313 - Additional effect on undischarged bankrupt
(1) If the Court has approved a debtor's proposal in accordance with section 311(7)(a) and the debtor is an undischarged bankrupt—
(a) the bankrupt; or
(b) if the bankrupt has not made an...
- Section 314 - Right to challenge decision taken at creditors’ meeting
(1) Subject to subsection (3), any of the persons specified in subsection (2) may make an application to the Court on either or both of the following grounds—
(a) that a debtor's proposal approved by...
- Section 315 - Implementation and supervision of voluntary arrangement
(1) The supervisor is responsible for implementing and supervising a voluntary arrangement that has taken effect under section 312 or 319 and has such powers as are necessary to enable that...
- Section 316 - Expedited voluntary arrangement procedure: availability
(1) This section applies if a debtor intends to make a proposal to the debtor's creditors for a voluntary arrangement and—
(a) the debtor is an undischarged bankrupt;
(b) the Official Receiver is...
- Section 317 - Duty of Official Receiver to report result to the Court
As soon reasonably practicable after the arrangements under section 316 have been implemented, the Official Receiver shall report to the Court whether the proposed voluntary arrangement has been...
- Section 318 - Approval of expedited voluntary arrangement
(1) If the Official Receiver reports to the Court that the debtor's proposal has been approved, the proposal takes effect as a voluntary arrangement.
(2) On taking effect as a voluntary arrangement,...
- Section 319 - Power of Official Receiver to make application for annulment of bankruptcy order where debtor is an undischarged bankrupt
(1) In addition to making the arrangements under section 316(3), the Official Receiver may, if the debtor is an undischarged bankrupt, make an application to the Court to make an order under...
- Section 320 - Revocation of expedited voluntary arrangement
(1) The Court may make an order revoking a voluntary arrangement that has effect because of section
318(1) on the ground—
(a) that it unfairly affects the interests of a creditor of the debtor;...
- Section 321 - Offence for debtor to make false representation for purpose of obtaining creditors' approval
(1) A debtor commits an offence, if for the purpose of obtaining approval to a proposal for a voluntary arrangement, the debtor—
(a) makes a representation knowing it to be false or misleading; or...
- Section 322 - Prosecution of delinquent debtors
(1) This section applies to a voluntary arrangement that has taken effect in accordance with section 312(1) or 319(1).
(2) As soon as practicable after forming a reasonable suspicion that a debtor...
- Section 323 - What is a summary instalment order?
A summary instalment order is an order made by the Official Receiver directing the debtor to pay the debtor's debts—
(a) in instalments or in some other way; and
(b) in full or to the extent that...
- Section 324 - Who can apply for summary instalment order
The Official Receiver may make a summary instalment order on the application of—
(a) a debtor; or
(b) a creditor with the debtor's consent.
- Section 325 - Requirements for applications made by debtors
(1) The Official Receiver may refuse an application for a summary instalment order if the application does not comply with subsection (2).
(2) An application does not comply with this subsection...
- Section 326 - Official Receiver may make summary instalment order
(1) The Official Receiver may make a summary instalment order if satisfied that—
(a) the debtor's total unsecured debts that would be provable in the debtor's bankruptcy do not exceed the amount...
- Section 327 - Power of Official Receiver to make additional orders
In addition to an order for the payment of the debts in instalments, the Official Receiver may make all or any of the following orders—
(a) an order regarding the debtor's future earnings or...
- Section 328 - Appointment of supervisors
(1) Except as provided by subsection (2), a summary instalment order is ineffective if it does not provide for the appointment of a suitable and willing person to supervise compliance by the debtor...
- Section 329 - Role of supervisors
(1) The supervisor is responsible for supervising the debtor's compliance with the terms of the summary instalment order and any other orders made under section 327.
(2) The supervisor may charge the...