AN INDIVIDUAL ALWAYS HAS THE RIGHT TO DEMAND RECOGNITION AS BANKRUPT

The citizen applied to the court for his own bankruptcy (case no. A56-69174/23).

Recognizing the application as unfounded, the courts of two instances proceeded from the fact that the debtor had not proved his insolvency, and applying to the court for bankruptcy did not meet the criteria of bad faith. At the same time, the debtor has not provided evidence of the expenditure of the funds received in the loan.

The applicant's argument about the fact of fraudulent actions by third parties and the initiation of criminal proceedings in this regard was rejected by the courts as not being an unconditional confirmation of the debtor's insolvency.

Referring the dispute for a new consideration, the cassation noted that since in this case the debtor had exercised the right provided for by the Bankruptcy Law to file an application for insolvency, indicated that it had terminated the performance of credit obligations and its inability to fulfill them in the future, the presumption of insolvency of the debtor was subject to application. The existence of circumstances that would refute the said presumption has not been established by the courts.

Contrary to the conclusion of the court of first instance, the mere fact of a citizen filing an application for his own bankruptcy in the exercise of the right provided for by the Bankruptcy Law cannot be qualified as a manifestation of bad faith.