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Issues of the secondary liability. Rules of the game. A comment «Kommersant» by Evgeniy Zverev, partner at S&K Vertical

11 May 2017

When a debtor does not have enough assets for settlements with creditors, the issue of bringing to the managers and business owners to secondary liability becomes very important. According to Alexander Ovesnov, head of the legal department of the ACG "MEF-Audit", lately there has been an expansion of the cases where secondary liability is allowed and of the possible subjects, i.e. those who could be held liable. "This entails an almost automatic transfer of all of the debtor's outstanding obligations in the order of secondary liability to third parties, which also does not stimulate official receiver to ensure financial recovery of debtors," Mr. Ovesnov believes.

However, according to the estimates of the expert of the portal "IfBankrot.rf" Artem Frolov, the share of satisfied applications for bringing to secondary liability is still low - about 12 per cent. "This may be due to the fact that many lawsuits are filed blindly, and the court sees no reason to recover debts from the poor director that could delay the procedure. This figure will increase significantly if both creditors and the receiver begin to prepare managers for the secondary liability from the very beginning of the bankruptcy procedures, instead of resorting to this tool as the last chance to recover the debts," explains Mr. Frolov.

Partner of law firm S&K Vertical" Evgeni Zverev noted that it is most difficult to win such a case when "bankruptcy is caused by unscrupulous or obviously erroneous management decisions", in such cases to prove liability is very difficult. Yuly Tay, managing partner of Bartolius Law Firm, is even more pessimistic: "Attraction to secondary liability is ineffective, and it is ineffective at all stages. It is difficult to prove the illegality of the actions, it is even more difficult to find the guilty person, it is even more difficult to find the controlling person, and it is almost impossible to find his property, especially when it is abroad. Such cases are rare, and even then it is not in a very large amount, as compared with the huge costs for creditors."

But even when someone is brought to secondary liability by the court it does not guarantee obtaining the money for creditors. "The reality of recovery depends on the scale of the recovered amount in the debtor's mind," says Evgeny Zverev. "In addition, it is necessary to understand that most owners are preparing for bankruptcy procedures in advance, therefore, on the site of allegedly guilty executives are the third parties, ready to be brought to secondary liability," - explains counsel of Liniya Prava Alexei Kostovarov. Most usually they do not have any property. As a result, notes Alexander Ovesnov, these liabilities become, in fact, eternal and cannot be written off even in the event of subsequent bankruptcy of these citizens. It's always easier for a bad faith entity, Yuliy Tay agrees: "It was prepared for bankruptcy in advance, it spends creditors' money on the war with them, while they have to spend their own money, besides, there are usually lots of creditors and they can be put against each other, and they must gather documents and traces of property, restore accounting, therefore it happens often in the middle of the way that the creditors run out of patience or money. "

Alexei Kostovarov assesses the chances of the execution of a court decision on bringing someone to secondary liability as being not more than 10%. The head of the practice of bankruptcy and restructuring at Pepeliaev Group Julia Litovtseva is more blunt: "Until recently, the claims towards the controlling persons brought to justice were to be sold with a huge discount at auctions because of the unlikeliness of prompt identification of the assets of such persons and enforcing them against these assets. Enforceability of such judicial acts does not exceed 5%." According to Yuliy Tay, it is about 2%.

In Alexei Kostovarov's opinion, the final beneficiaries could be held accountable, but such a mechanism has not yet been legislated: "There are several successful examples in the jurisprudence, for example, the case of Sergei Pugachev, but it's too early to talk about the tendency". In addition, notes Artem Frolov, "it is necessary to create the tools that would allow to identify and preserve the property of the executives available for collection, at the expense of which it would be possible to satisfy the demands of the creditors".

By: Anna Zanina, Andrey Raysky

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