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Section 342 of Insolvency Act CAP 53: Offence for debtor to obtain credit while summary instalment order has effect

    

(1) A debtor in respect of whom a summary instalment order is in effect commits an offence if, before all creditors have been paid the amounts to which they are entitled under the order, the debtor—
(a) alone or jointly with another person, obtains credit of one hundred thousand shillings or more;
(b) incurs a liability to another person for one hundred thousand shillings or more for the purpose of obtaining credit for another person; or
(c) enters into a credit purchase transaction under which the debtor is liable to pay one hundred thousand shillings or more.
(2) In proceedings for an offence under subsection (1), it is a defence to prove—
(a) in a case to which subsection (1)(a) applies, that, before obtaining the relevant credit, informed the credit provider that the debtor was subject to a summary instalment order;
(b) in a case to which subsection (1)(b) applies, that, before the defendant incurred the relevant liability, the credit provider was informed that the defendant was subject to a summary instalment order; or
(c) in a case to which subsection (1)(c) applies, that, before the defendant entered into the relevant agreement, the other parties to the agreement were informed that the defendant was subject to a summary instalment order.
(3) A person who is found guilty of an offence under this section is liable on conviction to a fine not exceeding one million shillings or to imprisonment for a term not exceeding twelve months, or to both.

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Disclaimer: This document is not to be taken as legal advise.

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