Friday 10 April 2015

Repossession of Goods or Chattels in Kenya - Lolwe Auctioneers

Lolwe Auctioneers are Licensed Repossessors by the Auctioneers Licensing Board of Kenya.

Lolwe Auctioneers boast a team of experienced staff who will collaborate with your credit department to ensure that accounts placed with us are dealt with within the shortest practicable time and to a logical conclusion.

Our Jurisdiction on Repossession:
In the matters of repossessions, being a Class"B" Licensed Auctioneers in Kenya, we are  Licensed by the Auctioneers Licensing Board of Kenya to operate throughout the Republic of Kenya.
What is Repossession is the seizure of goods or chattels where the correct documentation is held, and a debt is due. The repossession of property in Kenya is guided by the Chattels Transfer Act (Cap 28) and The Auctioneers Act 1996 and Rules, 1997 and 2010.

The repossession process does vary depending on the agreement between the parties(the Chargor (the person who owns the property being charged) and the Chargee (the lender in whose favour the Charge is created). In certain instances there will be 3 signatories to the Charge as is the case where the Chargor (the owner of the property over which a Charge is to be created) and the person to whom the funds are lent (borrower) are distinct persons and are hence required to execute the charge together with the Chargee) made at the time of the lease or hire purchase agreement, or loan/other agreement between parties. Title in the property is transferred back to the creditor as a result of a breach of contract.  For leases title is not transferred until the completion of the lease, a chattel mortgage grants title to the owner, but a security is held over the goods - this security is the basis of the repossession for failure to pay.  Any interest in the property by the debtor is destroyed by the process of a Public Auction.

Procedure in Repossession of Goods or Chattels

On receipt of instructions from the instructing officer to repossess a property, it is usually an immediate demand for payment, if the debtor fails to pay the full amount due, the property is repossessed after 7 days from the date of Proclamation.  The property is normally held for a set period within which it will be advertised for Public Auction and sold after 7 days, after advertisement appearance in the Daily Newspapers as per The Kenya Auctioneers Act, or a period as set down in the documentation of Repossession, and then sold at Public Auction to recover monies owed.A court application may be made which shortens or states the time for which the property is held. During this time the debtor may pay restitution (including monies owed, interest, fee's associated with the repossession and cost of storage), and recover their goods.

For hire purchase arrangements there are statutory requirements to be met before an Auctioneer can repossess the item. 

Auction of Chattels

An auction will not generally receive the same value as a shopfront sale - when talking about good and chattels - including motor vehicles  auctions receive lower prices.  The seizure of a car is probably the most common form of Commercial Agent seizure.If the auction fails to gain sufficient funds to cover the debt the difference is still the responsibility of the debtor.

Other forms of repossession include as the result of a court order, or as part of the winding up process undertaken during foreclosure or bankruptcy action.

Definition of 'Chattel Mortgage'

This is a term used to describe a loan arrangement in which an item of movable personal property is used as security for the loan. A chattel mortgage is a loan that is secured by chattel rather than by real property. In a traditional mortgage, the loan is secured by the property itself. With a chattel mortgage, the lender holds a lien against the movable property (chattel) until the loan has been satisfied, at which point the borrower resumes full control of the chattel.
In other words; Chattel mortgage is described as ; When an interest is given on moveable property other than real property (in which case it is usually a 'mortgage'), in writing, to guarantee the payment of a debt or the execution of some action.

Repossessions of Chattels

Repossession is generally used to refer to a financial institution taking back an object that was either used as collateral or rented or leased in a transaction. Repossession is a "self-help" type of action in which the party having right of ownership of the property in question takes the property back from the party having right of possession without invoking court proceedings. The property is then sold on by either the financial institution or 3rd party sellers. The extent to which repossession is authorized, and how it may be executed, greatly varies in different jurisdictions.
Lolwe Auctioneers recover possession of property acquired through hire purchase on behalf of the financial institutions and legal practitioners upon being instructed to do so once the purchaser is in default.

Our services have been of great value to:-

  • Motor Vehicle and other heavy Machinery dealers
  • Credit Companies
  • Hire Purchase Companies
  • Chattel Mortgage Companies
  • Tenant Purchase Scheme Organizations
  • Furniture dealers
  • Banks and Financial Institutions

In repossessions, you can instruct us either directly or through your lawyers/advocates.

Payment of Auctioneers' Fees on Repossession Services

Our fee's, and transport fee's, on repossession are regulated by the Auctioneers Act and Rules and are generally paid from the Auction sales proceeds after the Auction,if insufficient funds are generated from the Auction, then the judgement debtor or the instructing officer shall become liable for costs.

Contact Us for your Repossession Services:
Tell: +254 722 862727

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