If the bankruptcy creditor resigns the claims, the class action rules will be applied
April, 26 2021

The bankruptcy creditor, supported by other creditors, challenged the debtor's deal, but then changed his mind and resigned his claims. The bankruptcy commissioner objected to the termination of the case.

The courts of three instances considered the creditor's refusal to be lawful. He should not be forced to participate in the case. The deal could be challenged by other creditors in a new process.

The Supreme Court pointed out the fallacy of such approach. If the debtor's transactions are successfully challenged, the bankruptcy estate is restored.

This result affects all creditors in any case. Therefore, the one who disputes the transaction indirectly represents the group of creditors.

The courts were supposed to apply the rules of class actions: to invite other creditors and the trustee to become new applicants in the case, and if no one agrees, to stop the proceedings. The Supreme Court emphasized that if the case is terminated, neither the trustee nor any of the creditors will be able to file the same claim again.

A similar conclusion on the application of the rules of class actions was made by the Plenum of the Supreme Court in 2017 in relation to the consideration of cases on bringing to subsidiary liability.

In addition to the impossibility of resubmitting an application, the Supreme Court of the Russian Federation pointed out another feature of class actions in bankruptcy proceedings. An applicant in a separate dispute is not obliged to notify anyone if it is decided to resign the claims. The trustee is already involved in each dispute, and other creditors can track the progress of the case through electronic services after the first court notice.


Tatyana Dzhulai
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