Unpaid invoices, loans to friends that are never repaid, and customers who stop answering calls are among the most common problems small businesses and individuals face. The law gives you several ways to recover what you are owed. Choosing the right one early saves time and money. This guide walks through the options in Kenya, from the first letter to enforcing a judgment.
Before you start: gather your evidence
The strength of your claim depends on what you can prove. Collect:
- the contract, quotation, local purchase order (LPO) or loan agreement;
- invoices and delivery notes;
- bank and M-Pesa statements showing payments made or received;
- any acknowledgement of the debt, including emails, text messages and WhatsApp messages; and
- dishonoured cheques, if any.
Electronic records are admissible in evidence under the Evidence Act, usually accompanied by a certificate confirming how they were produced.
It is also worth asking a practical question at the outset: if you win, does the debtor have money or assets from which you can be paid?
Check the time limit
A claim based on a contract must generally be filed within six years of the breach, under the Limitation of Actions Act. A written acknowledgement of the debt, or a part payment, restarts the clock. Do not let a debt drift for years in the hope that it will be paid.
Step 1: send a demand letter
A demand letter sets out the amount owed, the basis of the claim, a deadline for payment (often 7 or 14 days) and what will happen if payment is not made. A letter from an advocate often prompts payment, and it lays the ground for recovering your legal costs if the matter goes to court.
Step 2: consider a negotiated settlement
Many debtors cannot pay in full but can pay in instalments. A written settlement agreement with a clear payment schedule, and a term that the full balance falls due on any default, is often the quickest route to recovery. Mediation can also help where the relationship matters.
Step 3: choose the right forum
- The Small Claims Court hears claims of up to KSh 1 million. Its procedure is simple, you do not need an advocate, and claims are meant to be decided within 60 days. See our guide to filing in the Small Claims Court.
- The Magistrates’ Courts and the High Court hear larger claims, according to their financial limits. Large commercial disputes are often heard in the Commercial Division of the High Court.
- Arbitration applies if your contract contains an arbitration clause.
Faster routes in court
You may not need a full trial.
- Default judgment. If the debtor fails to enter an appearance or file a defence within the time allowed, you may apply for judgment without a hearing.
- Summary judgment. Under Order 36 of the Civil Procedure Rules, where you claim a liquidated (fixed) sum and the defence raises no genuine triable issue, the court may enter judgment without a full trial.
When the debtor is a company
Under section 384 of the Insolvency Act, 2015, a company is deemed unable to pay its debts if a creditor owed more than KSh 100,000 serves a formal statutory demand and the company fails to pay, secure or settle the debt within 21 days. The creditor may then petition for the company to be liquidated.
A statutory demand is a powerful tool, but it should be used only for debts that are not genuinely disputed. Courts can restrain a liquidation petition that is being used to pressure a company over a disputed debt, and the creditor may be ordered to pay costs.
When the debtor is an individual
A creditor owed more than the prescribed bankruptcy level may petition for an individual debtor’s bankruptcy. Bankruptcy is a drastic step and is usually worthwhile only where the debtor has assets. In most cases, an ordinary suit followed by enforcement is the better route.
Enforcing a judgment
A judgment is only as good as its enforcement. Depending on the debtor’s circumstances, the court can order:
- attachment and sale of the debtor’s property by a licensed auctioneer;
- garnishee orders, which require a bank or another person holding money for the debtor to pay it to you instead; and
- other measures available under the Civil Procedure Rules.
Interest continues to run on most judgment debts until they are paid.
Stay on the right side of the law
Frustration with a debtor is understandable, but it does not justify threats, harassment or public shaming. Posting a debtor’s name or photograph on social media can expose you to claims for defamation or breach of the Data Protection Act, 2019. Keep your communications firm, factual and private.
Frequently asked questions
Can I charge interest on a late payment?
Yes, if your contract provides for it. If it does not, the court may still award interest on the sum owed, from a date and at a rate it considers appropriate.
Is a WhatsApp message admitting the debt enough?
It is valuable evidence and can restart the limitation period if it is a written acknowledgement. It is best supported by other documents, such as invoices and payment records.
The debtor has died. Can I still recover?
Yes. The claim survives against the deceased person’s estate and can be pursued against the administrators or executors.
How we can help
We recover debts for businesses and individuals, from demand letters and statutory demands to summary judgment and enforcement. Contact Odek Law Advocates to discuss what you are owed.
This article provides general information on Kenyan law as at October 2026 and is not legal advice. Please seek advice on your specific situation.