Section 421 of Insolvency Act CAP 53: 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 of the Court; or
(b) in the case of a creditors' voluntary liquidation, so far as may be necessary to secure compliance with sections 406 and 407, during the period before the appointment or nomination of a liquidator of the company.
(2) Subsection (1) does not prevent the directors from exercising their powers—
(a) to dispose of perishable goods and other goods the value of which is likely to diminish if they are not immediately disposed of; and
(b) to do all such other things as may be necessary for the protection of the company's assets.
(3) If the directors of the company, without reasonable excuse, fail to comply with subsection (1), each of them who is in default commits an offence and on conviction is liable to a fine not exceeding five hundred thousand shillings.
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- 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...
- Section 434 - Duty of Official Receiver to conduct investigation into failure of company
(1) On the making of a liquidation order, the Official Receiver shall conduct an investigation—
(a) if the company has failed,to discover why the company failed; and
(b) generally, to investigate...
- Section 435 - Public examination of officers and former officers of company
(1) If a company is being liquidated by the Court, the Official Receiver may, at any time before the dissolution of the company, apply to the Court for the public examination of any person who— (a) is...
- Section 436 - Consequences of failure to attend public examination
(1) A person who, without reasonable excuse, fails at any time to attend the person's public examination under section 435 is guilty of a contempt of Court and is liable to be punished accordingly (in...
- Section 437 - Appointment and powers of provisional liquidator
(1) The Court may appoint a provisional liquidator either on or after, or at any time before, the making of a liquidation order in respect of a company.
(2) Only the Official Receiver or an...
- Section 438 - Functions and powers of Official Receiver in relation to office of liquidator
(1) Subsections (2) to (7) have effect, subject to section 441 when the Court makes an order for the company to be liquidated.
(2) The Official Receiver becomes the liquidator of the company and...
- Section 439 - Power of Official Receiver to appoint liquidator in certain cases
(1) In the case of a liquidation ordered by the Court, the Official Receiver (being the liquidator) may, at any time, appoint a qualified person as liquidator instead.
(2) If meetings are held in...
- Section 440 - Creditors' choice to prevail if meetings of creditors and contributors nominate different liquidators
(1) If a company is being liquidated by the Court and separate meetings of the company's creditors and the company's contributories are convened for the purpose of choosing a person to be liquidator...
- Section 441 - Appointment of liquidator by the Court following administration or voluntary arrangement
(1) If a liquidation order is made immediately on the appointment of an administrator ceasing to have effect, the Court may appoint as liquidator of the company the person whose appointment as...
- Section 442 - Creditors' meeting may appoint liquidation committee
(1) If, after a liquidation order has been made, separate meetings of creditors and contributories have been convened for the purpose of choosing a person to be liquidator, those meetings may...
- Section 443 - General functions of liquidator when company is liquidated by the Court
(1) The functions of the liquidator of a company that is being liquidated by the Court are—
(a) to ensure that the assets of the company are realised and distributed to the company's creditors;...
- Section 444 - Liquidator to assume control of company's property when liquidation order made
When—
(a) a liquidation order has been made; or
(b) a provisional liquidator has been appointed, in respect of a company, the liquidator or the provisional liquidator shall assume control of all the...
- Section 445 - Company's property to vest in liquidator
(1) When a company is being liquidated by the Court, the Court may, on the application of the liquidator, by order direct all or any part of the property belonging to the company or held by trustees...
- Section 446 - Duty of liquidator to convene final general meeting of company's creditors
(1) If, in the case of a company that is being liquidated by the Court, the liquidator (not being the Official Receiver) is satisfied that the liquidation of the company is for all practical purposes...
- Section 447 - Power of the Court to stay liquidation
(1) On the application of the liquidator, the Official Receiver or any creditor or contributory, and on proof to the satisfaction of the Court that all proceedings in the liquidation ought to be...
- Section 448 - Settlement of list of contributories and application of assets
(1) As soon as practicable after making a liquidation order, the Court shall—
(a) settle a list of contributories, with power to rectify the register of members in all cases in which rectification is...
- Section 449 - Recovery of debts due from contributory to company
(1) At any time after making a liquidation order, the Court may make an order in respect of any contributory who is for the time being on the list of contributories requiring the contributory to pay,...
- Section 450 - Power of the Court to make calls from contributories
(1) At any time after making a liquidation order, and either before or after the Court has ascertained the sufficiency of the company's assets, it may—
(a) make calls on all or any of the...
- Section 451 - Power of the Court to order money due to company to be paid into Central Bank
(1) The Court may order any contributory, purchaser or other person from whom money is due to the company to pay the amount due into the Central Bank of Kenya to the account of the liquidator instead...
- Section 452 - Order made by the Court against contributory to be conclusive evidence that money ordered to be paid is due
(1) An order made by the Court on a contributory is conclusive evidence that any money appearing to be due or ordered to be paid by the contributory is due.
(2) Subsection (1) is subject to the...
- Section 453 - Power of the Court to fix deadlines for proving claims
The Court may fix deadlines by which creditors are required to prove their debts or claims or are to be excluded from the benefit of any distribution made before those debts are proved.
- Section 454 - Court to adjust rights of contributories
The Court shall adjust the rights of the contributories among themselves and distribute any surplus among the persons entitled to it.
- Section 455 - Power of the Court to make orders enabling creditors and contributories to inspect company's records
(1) At any time after making a liquidation order, the Court may make such order for inspection of the company's records by creditors and contributories as the Court considers appropriate.
(2) The...
- Section 456 - Payment of expenses of liquidation
(1) If the assets of a company are insufficient to satisfy its liabilities, the Court may—
(a) make an order for the expenses incurred in the liquidation to be paid out of the company's assets;...
- Section 457 - Power to arrest absconding contributory
(1) If, at any time either before or after making a liquidation order, the Court is satisfied on reasonable grounds that a contributory is—
(a) about to leave Kenya or otherwise to abscond;...
- Section 458 - Powers of the Court to be cumulative
Powers conferred on the Court by this Part are in addition to any existing powers to bring legal proceedings against a contributory or debtor of the company, or the assets of a contributory or debtor,...
- Section 459 - Power of the Court to delegate its powers to liquidator
(1) The insolvency regulations may enable or require all or any of the functions imposed or powers conferred on the Court with respect to the matters specified in subsection (2) to be performed or...
- Section 460 - Style and title of liquidators
(1) The liquidator of a company is in all documents and communications relating to the liquidation of the company to be referred to—
(a) if a person other than the Official Receiver is liquidator, as...
- Section 461 - Offence to make corrupt inducement affecting appointment of liquidator
A person who gives, or agrees or offers to give, to any member or creditor of a company any valuable consideration with a view to obtaining the person's own appointment or nomination, or to obtaining...
- Section 462 - Liquidator's functions: voluntary liquidation
(1) This section has effect if a company is in voluntary liquidation, but subject to section 463 (liquidator's functions, creditors' voluntary liquidation) in the case of a creditor's voluntary...
- Section 463 - Liquidator's functions: creditors' voluntary liquidation
(1) If, in the case of a creditors' voluntary liquidation, a liquidator has been nominated by the company, the powers conferred on the liquidator by section 462 may not be exercised, except with...
- Section 464 - Liquidator's functions: liquidation by the Court
(1) If a company is being liquidated by the Court, the liquidator may—
(a) with the approval of the Court or the liquidation committee (if there is one), exercise any of the powers specified in Parts...
- Section 465 - Liquidator's functions: supplementary powers
(1) If a company is being liquidated by the Court, the liquidator may convene general meetings of the creditors or contributories for the purpose of ascertaining their wishes.
(2) The liquidator...
- Section 466 - Enforcement of liquidator's duties to lodge, deliver and make returns, accounts and other documents
(1) If a liquidator has—
(a) in lodging, delivering or making a return, account or other document—
(i) failed to prepare, make or lodge a return, account or other document as required by a...
- Section 467 - Circumstances in which liquidator may be removed from office in the case of a voluntary liquidation
(1) This section applies to the removal from office and vacation of office of the liquidator of a company that is in voluntary liquidation.
(2) Subject to subsection (2), a liquidator may be removed...
- Section 468 - Liquidator may be removed only by the Court or by general meeting of creditors in the case of company being liquidated by the Court
(1) This section applies with respect to the removal from office and vacation of office of—
(a) the liquidator of a company that being liquidated by the Court; or (b) a provisional liquidator.
(2) A...
- Section 469 - Release of liquidator in the case of company liquidated voluntarily
(1) This section applies with respect to the release of the liquidator of a company that is in voluntary liquidation.
(2) A person who has ceased to be a liquidator is entitled to be released from...
- Section 470 - Release of liquidator in the case of company liquidated by the Court
(1) This section applies with respect to the release of the liquidator of a company that is in liquidation by the Court, or of a provisional liquidator.
(2) On ceasing to be liquidator and being...
- Section 471 - Preferential debts (general provision)
(1) The liquidator of a company that is in liquidation shall distribute the assets of the company available for the payment of creditors in accordance with the Second Schedule.
(2) Subsection (1) is...