Few candidates attempted this question but majority of those who did answered it relatively well. Almost all the answers were able to identify the relevance of section 267 (Cap 32), where a company is being wound up, a charge which, when created, was a oating charge on the undertaking or property of the company and which was also created within 12 months of the connnencernent of the winding up shall, unless it is proved that the company immediately after the creation of the charge was solvent, be invalid, except to the amount of any cash paid to the company at the time of or subsequently to the creation of, and in consideration for, the charge, together with interest on that amount at the rate specied in the charge or at the rate 12% per annum, whichever is the less. Those who gave very good answers were also able to discuss that if the company was solvent at the time the charge was created, then the charge would be beyond the reach of section 26? and valid