Bid to wind up Karuturi hits rock
Karuturi flower farm employees spray the plants with insecticide. Allpack Industries Ltd, an unsecured creditor, filed a winding-up petition against Karuturi Ltd on August 5, 2013. PHOTO | PHOEBE OKALL | NATION MEDIA GROUP
What you need to know:
- Mr Gakuru argues that the acts of Mr Muniu and Mr Muchiru as insolvency practitioners are thus invalid in the letter also copied to PricewaterhouseCoopers and the pair.
The process of winding up the troubled Karuturi flower farm has run into fresh hurdles after the Attorney-General’s office declared that the current liquidators appointed by PricewaterhouseCoopers are not licensed to act in that capacity, and are thus in breach of the law.
This follows an application filed in court on May 11, in which lawyers representing Karuturi directors questioned the qualifications of the two officials.
“We would wish to confirm that neither Mr Thoithi Muniu and Mr Kuria Muchiru has ever applied to the official receiver for any authorisation to act as an insolvency practitioner nor had the official receiver issued any licence to them,” Senior Principal State Counsel Mark Gakuru says in a letter to the deputy registrar of Milimani Commercial Courts.
Mr Gakuru argues that the acts of Mr Muniu and Mr Muchiru as insolvency practitioners are thus invalid in the letter also copied to PricewaterhouseCoopers and the pair.
He warns that continuing to act in this capacity contravenes section 5 (1) of the Insolvency Act 2015 and the official receiver will take the necessary steps to prosecute them.
The fine for practising without a licence is up to Sh5 million.
In response to queries by the Nation, PricewaterhouseCoopers said that Mr Muniu and Mr Thoithi had notified the court that acceptance of their appointment as liquidators was in a temporary capacity pending further court orders.
PWC said that upon their appointment, Mr Muniu and Mr Kuria made it clear to the court and the creditors that their acceptance of the appointment was primarily to plug the gap in the active management of the company following the winding up order of March 30 this year, to avert a possible crisis and loss, given the perishable and sensitive nature of the flower crop.
Lawyers representing Karuturi directors had questioned the credentials of the current liquidators appointed by PWC to oversee the process.
In an application filed at the Milimani Commercial Court, the directors claimed that Mr Muniu and Mr Muchiru have no insolvency practitioners licence as provided for under the Insolvency Act 2015.
Allpack Industries Ltd, an unsecured creditor, filed a winding-up petition against Karuturi Ltd on August 5, 2013.
The case came up for hearing on 30 March this year before High Court Judge Charles Kariuki where it was unopposed.
