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7. Public Examination of the Debtor


Section 17 Bankruptcy Act as read with BR 151-159. Where a receiving order has been made the official receiver applies to the court for the appointment of a time and place for the public examination of the debtor. The examination must be held as soon as is convenient after the expiration of the time for the submission of the debtor’s statement of affairs. The court may adjourn it from time to time.

The official receiver must notify the debtor and creditors of the time and place of the examination and must advertise the order in the Kenya Gazette and in local daily papers. The public examination may be dispensed with where the debtor suffers from any mental or physical affliction or any other disability which makes him unfit to attend, or where a composition or scheme has been proposed by joint debtors and one of them is unable to attend because of illness or absence from Kenya.
If the debtor fails without sufficient cause to attend the examination the court may issue a warrant for his arrest. In this case and also if the debtor fails to disclose his affairs or comply with an order of court in relation to his affairs the court may adjourn the examination sine die. It may then adjudge the debtor bankrupt forthwith and he will be unable to obtain discharge until he can obtain an order of the court for the examination to be continued. Any creditor who has lodged proof of his debt or his representative authorized in writing may put questions to the debtor concerning his affairs and causes of his failure.

The official receiver or trustee if one has been appointed and the court take part in the examination and put questions to the debtor. The debtor’s advocate may also attend the examination but not ask any questions or address the court. The debtor is examined on oath and must answer all questions which the court may put or allow to be put to him. Notes of the examination are taken down in writing and after being read over to or by the debtor and signed by him may be used in evidence against him in other proceedings. These notes are open to the examination by the creditors’ at all reasonable times.

When the court is of the opinion that the affairs of the debtor have been sufficiently investigated it makes an order declaring that the examination is concluded but the order cannot be made until after the day appointed for the first meeting of creditors.

The power to arrest the debtor

Under section 26 BA the court may order the arrest of the debtor and the seizure of any books, papers or goods in his possession in the following circumstances:

1.      If after a bankruptcy notice has been issued or after a petition has been presented by or against him, there is a probable reason for believing that he has absconded or is about to abscond with a view to avoiding payment of the debt in respect of which the bankruptcy notice was issued or avoiding service of a bankruptcy petition or attending an examination or otherwise delaying or embarrassing the proceedings against him
2.      The debtor may also be arrested if after presentation of a petition by or against him there is cause to believe that he is about to remove his goods with a view of preventing or delaying possession being taken of them by the official receiver or trustee or that there is ground for believing that he has concealed or he is about to conceal or destroy any of his goods or any books, documents or writings which might be of use to his creditors
3.      If after service of a petition or the making of a receiving order he removes any goods in his possession above the value of 5 pounds without the leave of the official receiver or trustee
4.      if without good cause shown he fails to attend any examination ordered by the court.

It should be noted that no arrest is valid upon a bankruptcy notice unless the notice is servable upon the debtor before or at the time of his arrest.

 
 
 

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