Supreme Court of Russia indicated the case of abolition of subsidiary liability

The Economic Board of the Supreme Court of Russia considered a dispute on bringing the head of debtor to subsidiary liability.  The reason was the failure to transfer the company's documentation to the bankruptcy trustee, which significantly hampered the latter's activities related to the bankruptcy process.

The court of first instance satisfied the claim, citing formal grounds, but the court of appeal cancelled the decision and noted that in the case under consideration, brining the head of debtor to subsidiary liability was unlawful.

Such a decision was made due to the corporate nature of the dispute between the debtor's creditor and the defendant in a separate dispute.

The fact was that the procedure was initiated by a former member of the company, who announced a five-million debt of the company to him as part of the obligation to pay dividends. The second creditor was the tax inspectorate, the debt to which was ten times less.

However, the district court did not take the arguments of the court of appeal into account and upheld the decision of the court of first instance.

When considering the case, the Economic Board of the Supreme Court of Russia supported the position of the court of appeal. The trio of judges noted that there was a corporate dispute between a former member of the company and its current leader. In such a situation, the subsidiary liability of the latter could not become an instrument in the hands of the creditor. Consequently, the bringing of the head of debtor to subsidiary liability was not justified, and the decisions made by the court of first instance and the district court were subject to cancellation (decision № 305-ES21-25552 of April 7, 2022).