INFORMATION LETTER OF THE SUPREME ECONOMIC COURT OF UKRAINE

of November 21, 2011 No. 01-06/1623/2011

About practice of application by the Supreme Economic Court of Ukraine in hearing of cases of separate regulations of procedural law

For the purpose of ensuring the correct and identical court practice we consider necessary to draw the attention of economic courts to practice of application by court of cassation instance in hearing of cases of separate regulations of procedural law, namely:

1) Item 3 of Article 83 of the Economic Procedure Code of Ukraine.

According to Item 3 of Article 83 of the Economic Procedure Code of Ukraine (further - HPK of Ukraine) economic court, making the decision, has the right to reduce in exceptional cases the penalty size (penalty, penalty fee) which is subject to collection from the party which violated obligations.

In the given regulation there is a speech about possibility of reduction of the size of penalty (penalty, penalty fee), and therefore it cannot be applied in resolution of disputes, the amounts of losses and damage connected with compensation (Article 22, Chapter 82 of the Civil code of Ukraine).

Besides, the specified regulation of HPK of Ukraine can be applied only in interrelation (set) with regulation of the substantive right which provides possibility of reduction of the size of penalty (penalty, penalty fee), namely part three of Article 551 of the Civil code of Ukraine and article 233 of the Economic code of Ukraine. If the corresponding sanctions are applied not in connection with violation of the obligation, and on other bases provided by the law, their size cannot be reduced by court (see resolutions of the Supreme Economic Court of Ukraine of 16.03.2011 No. 22/274, of 20.04.2011 No. 4/110-38);

2) Item of 1 part one of article 81 HPK of Ukraine.

According to part two of article 99 HPK of Ukraine Economic Court of Appeal, reviewing the decision in appeal procedure, has the rights granted to Trial Court.

According to part two of article 101 HPK of Ukraine the Economic Court of Appeal is not connected by arguments of the petition for appeal and checks legality and justification of the decision of local economic court in full.

Therefore, Economic Court of Appeal, leaving the claim without consideration based on Item of 1 part one of article 81 HPK of Ukraine in connection with signing of the action for declaration by person who has no right to sign it, or is effective with person whose official capacity is not specified within the powers conferred to it by HPK of Ukraine (see resolutions of the Supreme Economic Court of Ukraine of 19.01.2011 No. 1/80-10, of 08.02.2011 No. 18/75-10);

3) article 12 HPK of Ukraine concerning determination of jurisdiction of contentious case about the obligation of the company of bureau of technical inventory count to perform registration of the property right or to oblige her to cancel.

Cases on disputes over claims of subjects of managing to bureau of technical inventory count about the obligation of the last to perform registration of the property right to real estate or about the obligation to cancel it are not connected with protection of the rights, freedoms or interests in the field of the public relations from violations from public authorities that excludes consideration of the corresponding cases according to the procedure of administrative legal proceedings (see the resolution of the Supreme Economic Court of Ukraine of 11.02.2010 No. 02-03/587).

The corresponding legal line items were stated also by the Supreme Court of Ukraine (see resolutions of the Supreme Court of Ukraine of 27.11.2007 No. 45/24pn, of 13.05.2008 No. 1/23).

At the same time it must be kept in mind that the bureau of technical inventory count performs only state registration of the property right to real estate and consequently cannot be party litigant which is considered by economic court concerning recognition of such right as is not person from whom the appropriate right passed, or person who can apply for such right (see resolutions of the Supreme Economic Court of Ukraine of 20.01.2010 No. 2/237, of 28.01.2010 No. 9/396-PN-06, of 25.03.2010 No. 10/77/07 and the resolution of the Supreme Court of Ukraine of 04.07.2006 No. 2-20/11842-2005, of 02.04.2010 No. 2-12/6245.2-2009 (2-5/5129.1-2008 (2-13/694-2007));

4) parts four of article 35 HPK of Ukraine.

According to part four of article 35 HPK of Ukraine the judgment on civil case which took legal effect is obligatory for economic court concerning the facts which are determined by court and matter for dispute decision.

In application of this instruction for economic court the facts determined by general court in the decision on any civil case irrespective of subject structure of party litigants which is considered by economic court (see the resolution of the Supreme Economic Court of Ukraine of 22.12.2009 No. 9/346-08) have collateral estoppel.

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