THE SUPREME COURT INDICATED THE NEED FOR PERSONAL INTEREST WHEN CONTESTING A JUDICIAL ACT

The judicial board of the Supreme Court of the Russian Federation has recently considered the complaint of one of the registered creditors of the debtor in bankruptcy. He contested the intention of a third party to pay off the debt to creditors included in the Register of the creditors’ claims in order to terminate the debtor's insolvency case.

At the same time, the Court of Appeal rejected the third party's intention for a number of reasons. Among them, there were:

-          The fact that the bankruptcy estate of the debtor has already been formed, and it was enough to pay off not only the register claims, but also the moratorium interest, as well as the debts that were not included in the register and are behind its limits;

-          in case of debt repayment by a third party, only the claims of registered creditors will be satisfied.

However, the Supreme Court considered this position untenable, indicating that it was a registered creditor whose claims would have been satisfied in any attempt to contest the intention of a third party to repay the debt. In the first case, this would have happened at the expense of the debtor's property while continuing the bankruptcy case, in the second - at the expense of the funds of a third party, which expressed its intention to pay off the debts.

Thus, the creditor contesting the judicial act had no personal interest in the appeal, which contradicts the principles and rules of bankruptcy legislation.

In addition, as noted by the Supreme Court of the Russian Federation, in the event of the repayment of the claims of registered creditors and the termination of the bankruptcy process, the persons whose debts were in the register are not deprived of the right to re-initiate the debtor's insolvency case (definition No. 305-ES17-3119 (5, 6) of 1 October 2020).