The case how a shareholder obtained the ownership of the Corporation building by fraud and how the company regained the building

Preview

The case how a shareholder obtained the ownership of the Corporation building by fraud and how the company regained the building

Description of the problem

In 2012, the joint-stock company needed funds to fulfill the state contract. The shareholder suggested that the director of the joint-stock company would sell him the building of the company, receive money and fulfill the contract

The shareholder developed a transaction scheme with several links in the chain and a number of specific conditions, explaining this by the fact that the director would receive the money faster. After registration of the ownership of the building for the shareholder, no settlement was made

The Joint-stock Company asked us to protect its interests

Significance of the case for the Client

The cost of the building was significant for the Client, in addition, the building was bringing regular income, since it was almost completely leased. The enterprise as a result of the illegal transaction lost both the building and the income from it

Difficulties

The complexity of the project was that:

The building was sold through a chain of transactions: (a) the joint-stock company sold the building to a nominee individual who acted in the interests of the shareholder, (b) the nominee individual sold the building to the shareholder’s nominee company, (c) the nominee shareholder company transferred the building to the shareholder’s second nominee company . All parties involved in the transaction were not affiliated between themselves and the shareholder
The nominee individual issued receipts that allegedly received cash for the building from the nominee company of the shareholder. In fact, the money was not transferred. The individuals did not have any property to which the Joint-Stock could foreclose.
Before the joint-stock company adressed us for help, the joint-stock company filed a lawsuit in court to declare the sale of the building invalid. The court rejected the lawsuit and declared the transaction legal.

Protection plan

We appealed to the arbitration court with a claim for the recovery of property. The court declined the claim

We appealed to law enforcement agencies with a criminal complaint and a civil claim for damages in the amount of the cost of the building. We represented the interests of Joint Stock company in a criminal case

A few years after the filing of the crime report, the court passed a sentence by which (a) established the fact of theft of property and the absence of settlements (b) found the shareholder guilty of fraud (c) granted a civil lawsuit, but in a much smaller amount than the damage caused by the crime. In a criminal case, it was impossible to restore the violated right, the damage was not compensated

The client specified the task: it is necessary to return the building.

The new task was further complicated by the fact that the courts rejected a claim for the recovery of stolen property if a civil action was satisfied in a criminal case. In the course of the dispute, the shareholder deposited money on a notary's deposit and indicated that the satisfaction of the claim for the recovery of property would lead to double damages, which is unacceptable.

Before defining a further defense strategy, we analyzed the prospects for reviewing a case for recovering property due to newly discovered circumstances and found that courts in similar circumstances refuse to review.

We prepared a new statement of claim

We indicated that the Arbitration Court had previously refused to reclaim the building, but the verdict in the criminal case is a new ground that provides the right to file an independent claim with the court. Our position was based on the position of the Supreme Arbitration Court of the Russian Federation.

The arbitral tribunal accepted the proceedings. The defendant filed a motion to terminate the proceedings in connection with the fact that it is identical to the previously considered case for the recovery of property. The court refused to terminate the proceedings.

A few months later, the Defendants filed a second application to terminate the proceedings on the same basis, which this time was satisfied by the court. By this time, we had expired a preventive six-month period for filing an application for review of an old case due to newly discovered circumstances

We appealed to the court to restore the time limit for reviewing the case due to newly discovered circumstances

The punitive period by virtue of the law is not subject to restoration, regardless of the reasons for such a pass. There was no good practice in arbitration courts on such issues.

In order to convince the court that the situation is extraordinary, and in this case, the term must be restored, we:

pointed out that the procedural period was missed due to the fault of the court, which accepted the new case for production and initially refused to terminate it, thereby confirming that we initially chose the right way to protect the right.
pointed to the position of the Supreme Court of the Russian Federation, when the court restored the deadlines for committing procedural actions that were missed through the fault of the court. However, this practice did not apply to preventive periods.
pointed to the position of the Constitutional Court of the Russian Federation, which delimits liability for missing deadlines due to the fault of the party and fault.

The court restored the time limit for reviewing the case due to newly discovered circumstances and accepted the application for proceedings

The Supreme Court of the Russian Federation confirmed the legality of the restoration of the term.

In the application for review of the case due to newly discovered circumstances, we drew attention to the following:

The party itself chooses a way to protect its rights. If the joint-stock company wants to return the building, and not monetary compensation, then the joint-stock company cannot be forced to receive money by a court sentence;
A denial of a claim will result in the legalization of property obtained by criminal means, which the convicted person could not receive under normal civil circulation.

We prepared a draft court ruling, which the court laid the foundation of its decision.