ADVOKS GLOBAL · KENYA
Co-operative Societies Act
60E. Orders under sections 60B and 60C ancillary provisions
Edition: 2023-12-11 · In force
60E. Orders under sections 60B and 60C ancillary provisions
(1)An order under section 60B or section 60C with respect to a transaction or preference entered into or given by a co-operative society may, subject to subsection (2)—(a)require property transferred as part of the transaction, or in connection with the giving of the preference, to be vested in the society;(b)require the property to be so vested if it represents the application either of the proceeds of sale of property so transferred or of money so transferred;(c)release or discharge (in whole or in part) any security given by the society;(d)require any person to pay, in respect of benefits received from the society, such amounts to the liquidator as the Court may specify;(e)provide for any surety or guarantor whose obligations to a person were released or discharged (in whole or in part) under the transaction, or by the giving of the preference, to be subject to such new or revived obligations to the person as the Court considers appropriate;(f)provide —(i)for security to be provided for the discharge of an obligation imposed by or arising under the order;(ii)for such an obligation to be charged on specified property; and(iii)for the security or charge to have the same priority as a security or charge released or discharged (in whole or in part) under the transaction or by the giving of the preference; and(g)provide for the extent to which a person whose property is vested by the order in the society, or on whom obligations are imposed by the order, is to be able to prove in the liquidation of the society for debts or other liabilities that arose from, or were released or discharged (in whole or in part) under or by, the transaction or the giving of the preference.(2)An order under section 60B or 60C may affect the property of, or impose an obligation on, a person whether or not the person is the one with whom the relevant co-operative society entered into the transaction, or the person to whom the preference was given.(3)However, such an order—(a)may not detrimentally affect an interest in property that—(i)was acquired from a person other than the society; and(ii)was acquired in good faith and for value, or detrimentally affect any interest that is derived from such an interest; and(b)may not require a person who received a benefit from the transaction or preference in good faith and for value to pay an amount to the liquidator, unless —(i)the person was a party to the transaction; or(ii)the payment is to be in respect of a preference given to that person at a time when the person was a creditor of the society.(4)If a person has acquired an interest in property from a person other than the relevant co-operative society, or has received a benefit from the transaction or preference and, at the time of the acquisition or receipt, the person—(a)had notice of the relevant surrounding circumstances and of the relevant proceedings; or(b)was connected with, or was an associate of, either the relevant co-operative society or the person with whom that co-operative society entered into the transaction or to whom that co-operative society gave the preference,then, for the purposes of paragraph (a) or paragraph (b) of subsection (3), the interest is presumed to have been acquired, or the benefit to have been received, otherwise than in good faith.(5)For the purposes of subsection (4)(a) the relevant surrounding circumstances, in relation to a co-operative society, are—(a)the fact that the society entered into the transaction at an undervalue; or(b)the circumstances that amounted to the giving of the preference by that co-operative society,and subsection (6) has effect to determine whether, for those purposes, a person has notice of the relevant proceedings.(6)For the purposes of subsection (5), a person has notice of the relevant proceedings if the person has notice of the fact that a liquidator has been appointed in respect of the society.(7)Nothing in this section or sections 60B to 60D affects the availability of any other remedy, even in relation to a transaction or preference that the society had no power to enter into or give.(8)Nothing in subsection (1) limits the Court's powers under sections 60B (4) and 60C (3).