Updated October 13, 2026 · Published by WKA Advocates
A company that cannot pay raises a different problem from a solvent customer who refuses to pay. Check whether insolvency proceedings, administration or liquidation are already underway. The creditor's rights may depend on security, the type of claim and any restrictions on individual enforcement.
What Matters in Insolvent company debt recovery
The Insolvency Act provides processes with procedural requirements and collective consequences. Insolvency should not be treated as an automatic shortcut for pressuring payment of a genuinely disputed debt. Gather the financial and contractual records, identify any security and obtain advice on notices, proof of debt and participation in the relevant process.
Practical Preparation Checklist
Check whether an insolvency process has already commenced.
Identify security and the legal basis of the claim.
Review filing, notice and proof-of-debt requirements.
Evaluate the Evidence and Recovery Route
Bring a reconciled balance that distinguishes the principal, agreed interest, payments and any disputed items. The chronology should explain when payment became due and what happened after default. Correct debtor identification is essential: a company, trading name and individual representative may have different legal positions.
Consider the contract’s notice and dispute terms alongside any existing proceedings. An advocate can assess the appropriate forum, limitation concerns and whether a demand, settlement or claim is proportionate. Do not assume that silence proves liability or that a payment promise guarantees collection.
Plan for Payment, Not Only a Claim
Compare the expected recovery with the time, fees and practical enforcement risks. If payment is offered, record the terms clearly and credit all amounts received. If proceedings become necessary, maintain complete evidence and service records. After judgment, check the decree and any stay before considering lawful execution.
Common Question
Should a creditor threaten liquidation in every demand?
No. Insolvency procedures require a proper legal basis and may be inappropriate for a disputed debt. Obtain advice before using an insolvency route.
General information for Kenyan debt recovery. The correct advice depends on the agreement, evidence, current law and circumstances. Updated 13 October 2026.
