Creditors of flower company Karuturi may have to wait longer to get their dues after it emerged the current liquidators appointed by PricewaterhouseCoopers are not licensed to do so.
This follows an application filed in court on May 11, in which lawyers representing Karuturi’s directors, questioned the qualifications of liquidators Thoithi Muniu and Kuria Muchiru. In a certificate of urgency, lawyer Samora Owino of Kimani Michuki Advocates had argued that under Insolvency Act of 2015, the two officials were not qualified to handle the liquidation.
Karuturi ceased trading on May 6 following a winding up order issued by the court. In court papers, Owino, also acting for two companies – Surya Holdings and Rhea Holdings – that guaranteed a loan given to the flower company by CfC Stanbic, accused the two of mismanaging the liquidation process.
“The guarantors are not under receivership by the bank, but are seriously affected by the mismanagement of the receivership process,” the lawyer states in court papers. The liquidators are accused of intention to sell properties belonging to the guarantors despite various offers by Surya and Rhea to settle. In a response on Tuesday, the office of the Attorney General said only one person – Ponangipalli Venkata Ramana Rao – has been licensed so far in Kenya under the new insolvency law to operate as a liquidator, adding that Thoithi and Muchiru could be prosecuted for their role.
“We would wish to confirm that neither Thoithi Muniu nor Kuria Muchiru has applied or has ever applied to the official receiver for an authorisation to act as an insolvency practitioner, nor has the official receiver issued any license to them,” states the letter dated May 17, signed by senior principal state counsel Mark Gakuru.
A liquidator is a person appointed by the shareholders or unsecured creditors, or on a court order, to manage the winding up of a firm by selling off its assets to settle claims.
