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The onset of signs of insolvency of the guarantor

The onset of signs of insolvency of the guarantor

In the Ruling of the Supreme Court No. 304-ES21-9960 in the case of contesting a real estate donation transaction two and a half years before entering the bankruptcy procedure, it was formulated, according to which the guarantor's loan obligations don't stop when refinancing, despite the fact, that formally there are two surety agreements.

Factual circumstances of the case:

  • In october 2016 y. a gratuitous transaction was made to donate real estate to a relative of citizen X.
  • In April 2019 y. the arbitral tribunal instituted bankruptcy proceedings against X, later, the bankruptcy trustee filed a lawsuit with the court to invalidate the transaction of donation of real estate and to return it to the bankruptcy estate.
  • Х. owned majority stakes in the authorized capital of three different LLCs. Subsequently, all of them were declared bankrupt.
  • As it was found out by the court, at the time of the donation transaction, the LLC could no longer carry out economic activities without attracting credit funds.
  • At the time of donation of real estate X. уже являлась заемщиком кредитных средств на сумму свыше 29 million rubles.
  • Later, the debt was repaid at the expense of credit funds, provided by the same bank under the new credit line.

The Board for Economic Disputes of the Supreme Court of the Russian Federation pointed to the content of Art.. 62.1 Federal Law "On Insolvency" (Bankruptcy)" according to which a combination of factors is necessary, that allow you to recognize a suspicious contract, concluded less than three years before filing an application for bankruptcy of a person, as invalid:

  • Causing harm to the property rights of creditors as a result of the transaction
  • Whether the debtor has the purpose of causing harm
  • Knowledge of the other party to the transaction of its illegality at the time of conclusion of the contract.

SC agreed with the arguments of the lower courts, that the debtor was actually re-credited, which did not lead to a real repayment of the claims, because the claims remained unfulfilled and included in the registry.

Besides, the existence of a kinship relationship between the donor and the donor was also assessed by the courts as a circumstance, which allows to conclude that the other party to the contract is aware of the illegality of the gratuitous transaction.

Thus, The Supreme Court concluded, that at the time of the gratuitous transaction X. had signs of insolvency as a guarantor and had the purpose of causing harm to the property interests of the creditor. The transaction was declared invalid by the court, а имущество — возвращено в конкурсную массу.

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