SC: A VALID AGENCY AGREEMENT REMAINS IN FORCE WHEN CHALLENGING A LOAN

A loan agreement was concluded between the plaintiff and a third party, which was subsequently invalidated in the framework of the bankruptcy case of a third party. In addition, an agency agreement was concluded between the defendant and a third party, payment for which was made by the plaintiff to fulfill obligations to a third party.

Believing that the recognition of the loan agreement as invalid entails the unreasonableness of the payment under the agency agreement, the plaintiff filed a lawsuit against the defendant.

The courts of three instances, taking into account that the plaintiff transferred funds to the defendant as part of the execution of the loan agreement, and not in the order of execution for a third party and that the limitation period was not missed by the plaintiff, concluded that the claims are subject to satisfaction in full.

The Supreme Court of the Russian Federation sent the dispute for a new consideration and noted that if the loan agreement was declared invalid as a transaction, the defendant, who is not a party to this transaction, could not be held liable for the obligations established by it, which means that the consequences of an invalid transaction in the form of restitution could not be applied to the defendant.

The courts of the first and appellate instances had to verify the defendant's arguments that the debtor under the agency agreement (a third party) did not transfer money to the creditor (defendant), another person-the payer (plaintiff) did it for him. The debtor's obligation under the agency agreement was thus terminated by proper execution.

Thus, the invalidation of the contract, the intended performance of which was made to a third party, does not create an obligation of the agent to return the payment within the framework of the dispute from the agency agreement on the claim of the lender.

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