Organization of landscaping works: reality check of execution

The manager applied to the court for invalidation of transactions involving the transfer of funds in favor of the entrepreneur (case no. A40-241878/22).

In rejecting the application, the courts of the two instances proceeded from the absence of signs of insolvency as of the date of the transaction, the lack of affiliation between the debtor and the defendant, and the lack of evidence of the defendant's lack of work under the aforementioned contracts.

The cassation sent the dispute for reconsideration, pointing out the following. The lower courts incorrectly distributed the burden of proof, effectively relieving the defendant of the need to prove the reality of fulfilling obligations.

The cassation noted the need to investigate whether the defendant has employees, own equipment and other production resources to perform the work.

It is noted that the courts did not investigate the issue of debt owed to other creditors of the debtor before the disputed transactions.
The Court of Cassation pointed out the need to verify the reflection of the work performed in the accounting and tax reports of the parties.

It is emphasized that the courts did not take into account the existence of reasoned objections regarding the reality of the execution of contracts and did not investigate these circumstances properly.
It is noted that the conclusion of the court of first instance on the rejection of the defendant's arguments on the destruction of documents contradicts the obligation to keep primary accounting documents.


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