THE COURT REJECTED LEGAL SUCCESSION AFTER SATISFYING ALL THE CREDITORS’ CLAIMS

The district court has recently considered the claim for procedural substitution in bankruptcy. It was supposed to take place on the initiative of a third party in connection with the satisfaction of all the register claims to the debtor's creditors.

However, the creditors did not agree with this state of affairs and contested the judicial acts of the courts of the first instance and appeal. When reconsidering the case, the district court took the side of the creditors, recalling that in such a situation, other legal consequences arise, for example, the termination of the bankruptcy case.

The cassation instance indicated that the substitution in bankruptcy can only be possible in a situation where the debt to the creditor was redeemed from him by a third party.

At the same time, if the third party made a decision to pay off all the register claims of creditors, such an action entails the termination of the bankruptcy case and the debt relationship that has arisen between the debtor and the third party must be resolved outside of it.

As a result, the district court rejected the legal succession made by the lower courts (judgment in case No. А40-118496 / 18 of November 10, 2020).