Slabko Andrei, US Invest lawyer
Writ proceeding is a very effective way to collect debts due to the low cost and shortened time for consideration of documents.
Do I have to go to court if I filed an application to institute writ proceedings?
The court considers only documents, without calling the parties for clarification.
What can be required of a debtor in court in writ proceedings if the debt is monetary?
- Principal debt under the contract;
- Forfeits (penalty, fine);
- Interest on borrowed money.
The claimant also has the right to reimbursement of expenses on payment of state duty and legal services (legal assistance).
In which cases is it possible to apply to the court?
There are two groups of conditions when a person can apply to the court.
The first one is criteria for appliance to the court:
- indisputability of claims (debt confirmed by documents);
- the debtor does not pay the debt, although he confirms it or does not dispute it (for example, does not answer the claim).
The second group is about the subject of requirements:
- reimbursement of money;
- reclamation of property;
- repayment of existing debt at the expense of the debtor's property.
In what situations writ proceedings is inapplicable?
- return of real estate by the owner or other legal owner;
- if fulfillment of a guarantee obligation is required (in the case of a bank guarantee, this restriction does not apply);
- the debt arose in connection with change of persons in the obligation (assignment of a claim or transfer of a debt). In the case of written recognition of debt by the debtor, this restriction does not apply;
- if debt collection is possible only by execution of an executive inscription.
What court should consider documents?
According to the general rule, the court at the place of debtor’s registration. However, the contract jurisdiction (reference to a specific court), as well as the applicability of Articles 49-51 of the Economic Procedure Code, should also be checked.
What is the rate for state fee?
There could be 3 different rates: 2, 5 or 7 basic units. The determination of the basic unit depends on the amount of debt: up to 100 basic units, from 100 to 300 basic units, more than 300 basic units.
Details for payment of state duty can be found on the website of the relevant economic court.
How to prepare an application for the initiation of writ proceedings?
An application for initiation of a writ proceedings shall indicate:
- name of the court;
- data on the collector and debtor: full name, registration address, servicing bank and account number, contact details (if any);
- requirements of the claimant indicating the applicable laws;
- circumstances of the occurrence of the debt and evidence of it;
- calculation of the amount;
- list of attachments;
- signature of the claimant or his representative.
The application should also note compliance with the pre-trial procedure for resolving the dispute (date of sending and receiving the claim, note the absence of an answer, etc.).
At the end of the application, it is advisable to state your requirements in a list, for example, we ask you to collect principal debt at the sum of _ rubles, forfeit (penalty), etc.
What documents need to be attached to the application for initiation of writ proceedings?
- A copy of the receipt (payment order) on payment of the state fee (certified by the bank);
- A copy of the collector’s registration certificate;
- A copy of the order to the director or a copy of the power of attorney for the representative;
- A copy of the main contract;
- Copies of delivery note, consignment note, invoices, waybills, etc.;
- Copies of payment orders for partial payment (by bank);
- A copy of the claim (with a postal receipt of the direction to the debtor);
- A copy of the reconciliation report (if any);
- Calculation of the amount of debt;
- A postal receipt confirming the sending to the debtor of a copy of the application and copies of the attachments to the application.
Sanctions for breach of contract may be collected from the debtor, if the collector previously included them in the claim against the debtor.
How long the documents will be considered?
Documents are considered by the court no more than 20 days (excluding non-working days) from the day the application is submitted to the court.
What can be expected from the debtor during the period of consideration of documents?
After receiving a decision from the court to initiate writ proceedings, the debtor is entitled to send a letter of revocation to the court within 7 days. The response should contain reasonable objections to the stated requirements, confirmed by documents and references to the legislation. If there is no such a letter, the court will make a determination on the court order.
What are the next steps after obtaining a determination on a court order?
It is necessary to send a payment requirement to the bank, so the collector's bank can request the debtor's bank to write off money from the debtor's account.
In the following situations it is unnecessary to send payment requirement:
- If both parties don’t have bank accounts;
- the object of collection is not money;
- collection is applied to the property of the debtor;
- if the debtor is a citizen, including individual entrepreneur.
If you have any questions please contact us!