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RESOLUTION OF THE PLENUM OF THE SUPREME ECONOMIC COURT OF THE REPUBLIC OF UZBEKISTAN

of November 27, 2015 No. 289

About some questions of application by economic courts of the regulations of the legislation governing the leasing relations

For the purpose of ensuring the correct and uniform application by economic courts of the regulations of the legislation governing the leasing relations, being guided by article 47 of the Law of the Republic of Uzbekistan "About courts", the Plenum of the Supreme Economic Court of the Republic of Uzbekistan decides:

1. Draw the attention of courts that the relations following from leasing agreements are regulated by the Civil code of the Republic of Uzbekistan (further - group of companies), the Law of the Republic of Uzbekistan "About leasing" (further - the Law) and other acts of the legislation.

2. According to part one of Article of 2 Zakona leasing - special type of finance lease in case of which one party (lessor) at the request of other party (leasing recipient) acquires at the third party (seller) in property the property (object of leasing) caused by the agreement of leasing and presents him to the leasing recipient for a fee on the conditions defined by such agreement in ownership and use for the term exceeding twelve months.

In case of calculation of terms courts shall consider that the duration of the agreement is considered to equal 12 months if validity begins from the corresponding day of certain month of the current year and comes to an end in the prior afternoon of this month of the next year (for example, from February 5, 2017 to February 4, 2018).

In case of the dispute resolution, following from the agreement of leasing, courts should pay attention that the essential conditions listed in part three of article 9 of the Law shall be provided in this agreement.

Courts should mean that according to the Law the parcels of land and other natural objects cannot be objects of leasing, and also other property withdrawn from circulation or is limited transferable. If such property is specified in the agreement as object of leasing, the agreement is considered insignificant. That application of effects of invalidity of the agreement of the leasing signed on such by property is the right of court, the matter can be discussed by court.

It is necessary to consider that in case of transfer of the company, property complex, the building, construction as object of leasing also right to use with that part of the parcel of land on which this real estate, and necessary for its use is located passes to the leasing recipient for the term of leasing.

5. In case of the dispute resolution, connected with non-execution or improper execution of obligations by subjects of leasing, courts should study carefully regulations of the legislation on the rights and obligations of subjects of leasing and the term of the contract.

Courts should mean that fundamental breach of the agreement of leasing by the leasing recipient is understood as causing to the lessor of damage which substantially deprives of what he had the right to expect in case of the conclusion of the agreement. Also, fundamental breach of the agreement of leasing is understood as content by the leasing recipient of object of leasing in breach of agreement, non-realization by the leasing recipient of insurance of object of leasing, untimely introduction of leasing payments, non-realization at own expense of running repair of object of leasing if other is not established by the agreement of leasing. At the same time the obligation of proof of the fact of fundamental breach of the agreement of leasing by the leasing recipient is assigned to the lessor.

Explain to courts that in case of fundamental breach by the leasing recipient of the agreement of leasing the lessor has no right to require at the same time both early collection of all leasing payments, and agreement cancelation with the address of collection on object of leasing according to the procedure, provided for collection regarding pledge and claiming damages.

If in the action for declaration of the lessor along with requirements about the agreement cancelation with indemnification and addresses of collection on object of leasing according to the procedure provided for collection regarding pledge the requirement about early collection of all leasing payments is also declared and the court will come to conclusion about fundamental breach by the leasing recipient of the agreement of leasing, one of these requirements - or the requirement about early collection of all leasing payments, or the requirement about the agreement cancelation with indemnification and addresses of collection on object of leasing according to the procedure provided for collection regarding pledge is subject to satisfaction. This rule is applied and if in the action for declaration of the lessor along with the requirement about collection of the formed debt on leasing payments and penalties the requirement about the agreement cancelation and addresses of collection on object of leasing according to the procedure provided for collection regarding pledge is also declared.

Losses of the lessor are determined by general rules of the civil legislation.

In particular, as the actual damage of the lessor it is necessary to understand the expenses connected with delivery, return, transportation, storage, repair and other expenses, and as lost profit - the uncollected income which the lessor would gain in case of usual conditions of civil circulation if its right was not violated.

If the bases given in the action for declaration about return of object of leasing are not stipulated by the legislation or the agreement of leasing, such claim is subject to refusal in satisfaction.

6.1. Courts should mean that systematic violation of payment due dates of the leasing payments established in the agreement is fundamental breach of the agreement of leasing.

In this regard courts need to determine the reasons of delay of payment by studying and the analysis of the payment schedule provided by the agreement.

6.4. According to the paragraph to the fifth part one of article 12 of the Law in case of failure to deliver, underdelivery, delay of delivery or delivery of object of leasing of inadequate quality the leasing recipient has the right to detain payment of leasing payments, to refuse the delivered object of leasing and to require leasing agreement cancelation if other is not provided by the agreement.

In case of establishment during use of object of leasing of availability of defects which do unsuitable its for use or significantly complicate such use about which the leasing recipient did not know and could not know in case of acceptance of object of leasing, this circumstance is fundamental breach of the agreement of leasing from the lessor if the choice of the seller is performed by it.