Controversial Bankruptcy Case History

Controversial Bankruptcy Case History

During its practice, TEAM has repeatedly led and participated in court cases on the recognition of companies as insolvent (bankrupt), and sometimes we were able to either create a new court practice or change the existing one. One of the most recent cases was the bankruptcy of a client - large trading company. The client was forced to take up a bankruptcy decision and turned to TEAM lawyers for help.


Having studied the prerequisites of the case, prepared the necessary documents, we proceeded to the obligatory stage - the publication of a notice of intention to file an application for declaring the debtor bankrupt by including it in the Unified Federal Register of Information on the Facts of the Activities of Legal Entities. For this, a notice was published, but not by the debtor itself, but by the insolvency practitioner, with whom an agreement was concluded to instruct the implementation of these actions using an electronic digital signature (hereinafter - EDS), which is quite common in judicial practice.


The publication was successful, the application for recognizing the client as insolvent (bankrupt) was filed in court. At the same time, the client's creditor sent a similar statement to the court by mail to declare the debtor bankrupt. These statements were distributed to different judges. This led to two different bankruptcy court cases for one company.


At the same time, at our request, on behalf of the client, the court decided to refuse to accept and consider the application on the grounds that “the debtor did not follow the procedure necessary for filing an application for declaring the debtor insolvent,” since the law contains an exhaustive list of persons who can submit such notice and does not imply the possibility of filing an application on behalf of the insolvency practitioner.


According to the court, these persons are exclusively the debtor and the notary.

While at the request of the creditor, the court made the opposite decision and began the consideration of the case, although the publication was also made on behalf of a third party, but another judge did not pay attention to this and appointed a court session to check the validity of the application.


TEAM lawyers prepared and filed two appeals on behalf of the client against both decisions of the judges.


In the court case on the application of the creditor based on the results of the consideration of the appeal, we were refused on the grounds that “from the text of the message it is clear that it is the creditor who expresses his intention to apply to the court with an application for declaring the debtor insolvent (bankrupt), in connection with which the fact that the publisher was a third party, did not violate the rights and legitimate interests of the debtor ".

However, our appeal against the court's decision to refuse to consider the client's application was satisfied, because the published notice on behalf of the insolvency practitioner also clearly and very explicitly expressed the debtor's intention to go to court and in no way violated the rights of creditors and third parties.


As a result, the issue of opening bankruptcy proceedings at the debtor's application was sent for a new consideration to the court of first instance, and the TEAM client has a chance of becoming the initiator of bankruptcy.


Time will tell how the conflict between two simultaneously open bankruptcy cases of the same company will be resolved, but we believe that the decisive moment will be the primacy of filing an application in court, which means that our client will become the leading party in this process.