THE SUPREME COURT COMPARED CHALLENGING OF TRANSACTIONS WITH CREDITORS WITH A CLASS ACTION LAWSUIT

The Board of the Supreme Court considered the case on the termination of proceedings at the request of one of the debtor's creditors. He first initiated a dispute to invalidate the transaction with the participation of the bankrupt company, but subsequently resigned the claims. The courts accepted the resignation and the proceedings were terminated, but the manager and other creditors did not agree with this state of affairs.

At the same time, the arguments of the judges of three instances boiled down to the fact that if the initiator of the case dropped his demands, this entails the termination of the proceedings. Forcing the applicant to continue to support a claim that is no longer interesting to him is contrary to the principle of free disposal of civil rights, and the rights of other persons are not violated, since they have the right to initiate a case to challenge the transaction as well.

However, the Supreme Court looked at the situation from a different angle and compared the actions of creditors to challenge the debtor's transaction with a class action lawsuit.

Willing to recognize any agreement as an invalid transaction, creditors in bankruptcy primarily act in the interests of the debtor's property, whose bankruptcy estate will be replenished if the claim is satisfied. And after that, the amount received will be divided between all the creditors in the queue, but not only will go to the one who challenged the deal.

Consequently, the termination of the proceedings directly affects the rights of other creditors, and the refusal of one of them from the claims should be considered as the refusal of the representative of the plaintiffs in a class action, concluded the Supreme Court of the Russian Federation. In this case, the court should postpone the session and invite the remaining parties to the dispute to replace its initiator (judgement No. 302-ES20-19914 of March 17, 2021).