Section 383 of Insolvency Act CAP 53: Interpretation: Part VI
(1) In this Part—
"contributories"—
(a) means all persons liable to contribute to the assets of a company if it is liquidated; and
(b) for the purposes of all proceedings for determining, and all proceedings before the final determination of, the persons who are to be treated as contributories for the purposes of this Part—includes all persons alleged to be contributories;
"inability to pay its debts", in relation to a company, has the meaning given by section 384;
"liquidation committee meeting", in relation to a company, means a committee appointed by the creditors of the company in accordance with section 409;
"official rate", in relation to interest payable under this Part, is the rate fixed in accordance with subsection (3);
"resolution for voluntary liquidation" means a resolution passed under section 393(1)(a) or (b).
(2) The reference in subsection (1) to persons liable to contribute to the assets of a company does not include a person so liable because of a declaration by the Court under section 506 or 507.
(3) The Cabinet Secretary may, by order published in the Gazette, fix from time to time the official rate of interest for the purpose of any provision of this Part in respect of which the expression "official rate" is used.
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- Section 384 - The circumstances in which a company is unable to pay its debts
(1) For the purposes of this Part, a company is unable to pay its debts—
(a) if a creditor (by assignment or otherwise) to whom the company is indebted for hundred thousand shillings or more has...
- Section 385 - Liability as contributories of present and former members
(1) When a company is being liquidated, every present and former member is liable to contribute to its assets to any amount sufficient for payment of its debts and liabilities, and the expenses of the...
- Section 386 - Liability of past directors and shareholders
(1) In this section, "relevant payment" means a payment made out of capital in respect of the redemption or purchase by a company of any of its own shares.
(2) This section applies if a company is in...
- Section 387 - Position of limited companies that were formerly unlimited
(1) This section applies to a company that is in liquidation if it was previously registered as unlimited but has since become re-registered as a limited company.
(2) Despite section 385(2)(a), a...
- Section 388 - Position of unlimited companies that were formerly limited
(1) This section applies to a company in liquidation that has previously been registered as limited but has since become re-registered as unlimited.
(2) A person who, at the time when the application...
- Section 389 - Nature of contributory's liability
The liability of a contributory creates an ordinary contract debt due from the contributory at the time when the contributor's liability began, but payable at the times when calls are made to enforce...
- Section 390 - Death of contributories not to affect their liability
(1) If a contributory dies either before or after being placed on the list of contributories, the contributory's personal representatives are, in administering the contributory's estate, liable to...
- Section 391 - Liability of contributories who are adjudged bankrupt
If a contributory is adjudged bankrupt, either before or after being placed on the list of contributories, the following provisions apply—
(a) the contributory's bankruptcy trustee represents the...
- Section 392 - Liability of contributories to contribute to debts of company registered but not formed under Companies Act
(1) This section applies to a company in liquidation that is registered but was not formed under the Companies Act (Cap. 486).
(2) A person is, in respect of the company's debts and liabilities...
- Section 393 - Circumstances in which company may be liquidated voluntarily
(1) A company may be liquidated voluntarily—
(a) when the period (if any) fixed for the duration of the company by the articles expires, or the event (if any) occurs, on the occurrence of which the...
- Section 394 - Notice of resolution to liquidate
(1) Within fourteen days after a company has passed a resolution for its voluntary liquidation, it shall publish a notice setting out the resolution—
(a) once in the Gazette;
(b) once in at least...
- Section 395 - When liquidation commences
The voluntary liquidation of a company commences when the resolution for voluntary liquidation is passed.
- Section 396 - Consequences of resolution to liquidate
(1) On and after the commencement of voluntary liquidation of a company, the company shall cease to carry on its business, except in so far as may be necessary for its beneficial...
- Section 397 - Share transfers and attempts to alter member's status after liquidation resolution to be void
The following are void if made after the commencement of a voluntary liquidation of a company—
(a) any transfer of the company's shares (other than a transfer made to or with the sanction of the...
- Section 398 - Making and effect of declaration of solvency by directors of company
(1) If it is proposed to liquidate a company voluntarily, the directors (or, in the case of a company having more than two directors, the majority of them) may at a directors' meeting make a statutory...
- Section 399 - Appointment of liquidator in members' voluntary liquidation
(1) In a members' voluntary liquidation, the company in general meeting shall appoint one or more liquidators for the purpose of liquidating the company's affairs and distributing its assets.
(2) On...
- Section 400 - Power to fill vacancy in office of liquidator
(1) If a vacancy occurs (whether by death, resignation or otherwise) in the office of liquidator appointed by the company, the company in general meeting shall, subject to any arrangement with its...
- Section 401 - General company meeting at each year's end
(1) If the liquidation of a company continues for a period of twelve months or more, the liquidator shall convene a general meeting of the company—
(a) within three months after the end of that...
- Section 402 - Final meeting prior to dissolution: members' voluntary liquidation
(1) As soon practicable after the liquidation of the company's affairs is complete, the liquidator—
(a) shall prepare an account of the liquidation showing how it has been conducted and how the...
- Section 403 - Effect of company’s insolvency
(1) This section applies if the liquidator is of the opinion that the company will be unable to pay its debts in full (together with interest at the official rate) within the period stated in the...
- Section 404 - Conversion to creditors' voluntary liquidation
As from and including the date on which the creditors' meeting is held in accordance with section 403— (a) this Part has effect as if—
(i) the directors' declaration under section 398 had not been...
- Section 405 - Application of Division 4
(1) Except as provided by subsection (2), this Division applies in relation to a creditors' voluntary liquidation.
(2) Sections 406 and 407 do not apply if, under section 404, a members' voluntary...
- Section 406 - Meeting of creditors to be convened by company
(1) A company that is in the course of liquidation shall—
(a) convene a meeting of the company's creditors for a day not later than the fourteenth day after the day on which there is to be held the...
- Section 407 - Directors to lay statement of financial position before creditors
(1) The directors of the company shall—
(a) prepare a statement setting out the financial position of the company that complies with subsection (3);
(b) lay that statement before the creditors'...
- Section 408 - Creditors' voluntary liquidation: appointment of liquidator
(1) The creditors and the company at their respective meetings may nominate an authorised insolvency practitioner to be liquidator for the purpose of liquidating the company's affairs and distributing...
- Section 409 - Creditors may appoint liquidation committee
(1) The creditors at the meeting to be held in accordance with section 406 or at any subsequent meeting may, if they think appropriate, appoint a liquidation committee of not more than five persons to...
- Section 410 - Creditors' meeting if liquidation converted under section 404
If, in the case of a liquidation that was under section 404 converted to a creditors' voluntary liquidation, a creditors' meeting is held in accordance with section 403, any appointment made or...
- Section 411 - Cessation of directors' powers
On the appointment of a liquidator, all the powers of the directors cease, except so far as the liquidation committee, or if there is no such committee, the creditors, sanction their continuance.
- Section 412 - Vacancy in office of liquidator: creditors' voluntary liquidation
(1) If a vacancy occurs in the office of liquidator, the creditors may fill the vacancy.
(2) Subsection (1) does not apply to a liquidator appointed by, or by the direction of, the Court.
- Section 413 - Meetings of company and company's creditors to be held every twelve months
(1) A liquidator who continues in office for more than twelve months shall convene a general meeting of the company and a meeting of the creditors to be held—
(a) within three months after the end of...
- Section 414 - Final meeting prior to dissolution: creditors' voluntary liquidation
(1) As soon practicable after the liquidation of the company's affairs has been completed, the liquidator shall prepare an account of the liquidation and an explanation showing how it has been...
- Section 415 - Property of company to be distributed among members after satisfaction of liabilities
(1) On the liquidation, the company's property in the voluntary liquidation—
(a) are to be applied in satisfaction of the company's liabilities equally and without preference; and
(b) subject to...
- Section 416 - Appointment or removal of liquidator by the Court
(1) The Court may appoint a liquidator if for any reason there is no liquidator or the liquidator is unable to act.
(2) The Court may, on cause shown, remove a liquidator and appoint another...
- Section 417 - Notice of appointment to be published by liquidator
(1) Within seven days after being appointed as liquidator of a company, the liquidator shall publish a notice of the liquidator's appointment—
(a) once in the Gazette;
(b) once in at least two...
- Section 418 - Power of liquidator to accept shares or membership rights as consideration for sale of company's property
(1) In this section—
(a) the transferor company is a company to which this section applies; and
(b) a transferee company, or a transferee limited liability partnership, is the company or partnership...
- Section 419 - Dissenting member may require liquidator to refrain from giving effect to arrangement under section 418 or to purchase member's shares
(1) This section applies to a voluntary liquidation in relation to which the transferor company has passed a special resolution, for the purposes of section 418(3) or (5), providing the approval...
- Section 420 - Questions relating to liquidation may be referred to the Court for determination
(1) The liquidator, or a contributory or creditor, may apply to the Court to determine any question arising in the liquidation of a company, or to exercise, with respect to the enforcing of calls or...
- Section 421 - Restrictions on directors' powers to appoint or nominate liquidator of company in voluntary liquidation
(1) If, in the case of a company that is in voluntary liquidation, a liquidator has not been appointed or nominated by the company, the directors may exercise their powers only—
(a) with the approval...
- Section 422 - Saving for certain rights
The voluntary liquidation of a company does not prevent a creditor or contributory from seeking to have the company liquidated by the Court, but in the case of an application by a contributory, the...
- Section 423 - Jurisdiction of High Court to supervise liquidation of companies
(1) Only the High Court has jurisdiction to supervise the liquidation of companies registered in Kenya.
(2) Subsection (1) does not apply to a company that is in voluntary liquidation in accordance...
- Section 424 - Circumstances in which company may be liquidated by the Court
(1) A company may be liquidated by the Court if—
(a) the company has by special resolution resolved that the company be liquidated by the Court;
(b) being a public company that was registered as...
- Section 425 - Applications to the Court for liquidation of companies
(1) An application to the Court for the liquidation of a company may be made any or all of the following
—
(a) the company or its directors;
(b) a creditor or creditors (including any contingent or...
- Section 426 - Application for liquidation of company on grounds of public interest
(1) If, in relation to a company, it appears to the Attorney-General—
(a) from a report made or information obtained from investigations carried out or inspection of documents produced under the...
- Section 427 - Powers of Court on hearing of liquidation application
(1) On the hearing of a liquidation application, the Court may make such of the following orders as it considers appropriate—
(a) an order dismissing the application;
(b) an order adjourning the...
- Section 428 - Power to stay or restrain proceedings against company when liquidation application has been made
(1) At any time after the making of a liquidation application, and before a liquidation order has been made, the company, or any creditor or contributory, may—
(a) if legal proceedings against the...
- Section 429 - Dispositions of property by company after commencement of liquidation to be void unless the Court otherwise orders
(1) In a liquidation ordered by the Court—
(a) any disposition of the company's property; and
(b) any transfer of shares, or alteration in the status of the company's members, made after the...
- Section 430 - Attachments and other forms of execution against company in liquidation to be void
If a company is being liquidated by the Court, any attachment, sequestration, distress or execution instigated against the assets of the company after the commencement of the liquidation is void.
- Section 431 - When liquidation of company by the Court commences
(1) If, before the making of an application for the liquidation of a company by the Court, a resolution has been passed by the company for liquidating the company voluntarily— (a) the liquidation...
- Section 432 - Consequences of liquidation order
(1) Within seven days after a liquidation order is made in respect of a company, the company shall lodge a copy of the order with the Registrar for registration and also lodge a copy of it with the...
- Section 433 - Official Receiver may require certain persons to submit statement relating to company's affairs
(1) If the Court has made a liquidation order or appointed a provisional liquidator in respect of a company, the Official Receiver may require some or all of the prescribed persons to make out and...