[2008] KEHC 1144 (KLR)

[2008] KEHC 1144 (KLR)

The court found that both the Official Receiver and the Debtor sought rescission of the Receiving Order, and there was no contest on this point. The court exercised its power under Section 103 of the Bankruptcy Act to rescind the Receiving Order. However, the court found credible evidence that the Debtor had transferred property to his father prior to filing for bankruptcy and failed to disclose certain assets, actions which contravened Section 138(1)(a), (b), and (d) of the Bankruptcy Act. The court was not convinced by the Debtor's explanations regarding the ownership and registration of a motor vehicle and found grounds to recommend prosecution for offences under the Act. The Debtor's...

Citation
[2008] KEHC 1144 (KLR)
Parties
Debtor: Kenneth Maina Karite; Respondent: Official Receiver; Interested Party: Duncan Karite; Creditor: Creditor (Jane Njeri Maina)
Court
High Court
Court Station
High Court at Nairobi (Milimani Commercial Courts)
Jurisdiction
Kenya
Judgment Date
31 October 2008
Case Number
Bankruptcy Cause 12 of 2007
Procedural Posture
Bankruptcy Cause / Ruling on Applications to Rescind Receiving Order and for Prosecution
Outcome
Receiving Order rescinded; prosecution recommended; Debtor's application dismissed; costs to creditors and Official Receiver.
Judges
CJ Kendagor
Legal Topics
Bankruptcy Proceedings, Fraudulent Conveyance, Asset Disclosure, Receiving Orders
Source Language
English
Commercial and Corporate Bankruptcy Proceedings Fraudulent Conveyance Asset Disclosure Receiving Orders

Case Brief

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Parties

Kenneth Maina Karite

Debtor

Official Receiver

Respondent

Duncan Karite

Interested Party

Creditor (Jane Njeri Maina)

Creditor

Procedural Posture

Bankruptcy Cause / Ruling on Applications to Rescind Receiving Order and for Prosecution

Legal Issues

  1. 1 Whether the Receiving Order against the Debtor should be rescinded.
  2. 2 Whether the Debtor should be prosecuted for offences under the Bankruptcy Act for fraudulent transfer and non-disclosure of assets.
  3. 3 Whether the Debtor's application for unconditional lifting of the Receiving Order and investigation of State Counsel is merited.

Ratio Decidendi

The court found that both the Official Receiver and the Debtor sought rescission of the Receiving Order, and there was no contest on this point. The court exercised its power under Section 103 of the Bankruptcy Act to rescind the Receiving Order. However, the court found credible evidence that the Debtor had transferred property to his father prior to filing for bankruptcy and failed to disclose certain assets, actions which contravened Section 138(1)(a), (b), and (d) of the Bankruptcy Act. The court was not convinced by the Debtor's explanations regarding the ownership and registration of a motor vehicle and found grounds to recommend prosecution for offences under the Act. The Debtor's...

Court Disposition

Receiving Order rescinded; prosecution recommended; Debtor's application dismissed; costs to creditors and Official Receiver.

Orders

  • The Receiving Order issued on 13th February, 2007 is rescinded.
  • The court recommends to the Attorney General that the Debtor be charged with offences under Section 138(1)(a), (b), and (d) of the Bankruptcy Act.