THE SUPREME COURT ALLOWED TO WRITE OFF PART OF THE DEBT UNTIL THE COMPLETION OF THE RESTRUCTURING

The Supreme Court of the Supreme Court of the Russian Federation considered a dispute in which the key issue was the possibility of releasing the debtor from part of its obligations if the restructuring plan was successfully implemented. The higher court indicated that such a write-off was acceptable, but stressed the need to clarify the creditor's position on this condition.

(No. A40-30773/2021). The basis for initiating the procedure was the subsidiary liability previously imposed on the debtor in the framework of the Monnik insolvency case in the amount of 7.5 million rubles. Subsequently, the rights of claim passed to the creditor Marina Kim. During the personal bankruptcy of a citizen, the court approved the restructuring plan developed by him.

According to its terms, it was supposed to repay 60% of the total debt (4.5 million). The payments were divided into equal parts over a two-year period. The outstanding part of the debt amount was supposed to be written off. The debtor has fulfilled its obligations set out in the schedule. After that, the litigation was terminated. But the creditor later initiated the issue, asking for a writ of execution to collect the outstanding portion of the debt.

The courts of two instances decided that the creditor's claims were limited to the scope of the approved agreement. Since the transaction plan was fully implemented, there was no reason to collect additional funds. The courts noted that in the past, a list had already been issued for the entire amount of the debt. Re-issuance would lead to duplication of documents for one obligation. 

The District Court, on the contrary, decided that the right to recovery remains in the part not covered in the bankruptcy procedure, and relief from the remaining debt is impossible. Disagreeing with this, the debtor appealed to the Supreme Court of the Russian Federation. He pointed out that such consequences can be applied only during the asset sale procedure, but not during restructuring. 

SKES drew attention to the fact that the rules allowing debt forgiveness can be applied during the execution of the plan. However, the courts did not clarify the main fact: whether the creditor agreed to write off part of the claims. 

The Economic Board pointed out that without analyzing the behavior of the parties at the time of the approval of the transaction, it is impossible to determine the fate of the remaining part of the debt, and, accordingly, to decide whether it is possible to issue a writ of execution. The arguments on the application of the rules of subsidiary liability outside the asset sale procedure were not considered due to their location outside the subject of the dispute. As a result, the Supreme Court of the Russian Federation referred the case for a new review in order to verify the actual expression of the creditor's will.


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