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Private Enforcement: Novelties in the Sphere of Execution of Court Judgements


Maryna Sergeeva, attorney at Ilyashev & Partners Law Firm

Shall the body of the private enforcement officers become a necessary and sufficient prerequisite of effective and objective work of the court system?

On March 01, 2017 the Institute of the law and postgraduate education of the Ministry of Justice of Ukraine will give diplomas to the private enforcement officers for the first time in the Ukrainian history. The educational courses related to studying the sphere of the enforcement of court decisions and decisions of other bodies commenced on 27-th of January. The courses were attended by 210 students – first group of future enforcement officers.

Especially for Forbes magazine the Attorney of “Ilyashev & Partners” Law Firm, Maryna Sergeeva, shares her views on the categories of cases related to enforcement of court judgments which will be handled by the private enforcement officers, as well as on the range and nature of their services which the entrepreneurs will be able to take advantage of.

Only those private enforcement officers will be able to commence their work in this capacity who will pass qualification exams. Real introduction of the reform is near at hand, this is why it will be helpful to underline the differences between the state and private enforcement officers.

Under what conditions will the work of the private enforcement officers, whose activities are remunerated by monetary payments and whose activities are controlled only by professional association, be effective? Is there a danger of an increase of the facts of abuse on the part of the state and private enforcement officers? What measures are necessary to be applied to minimize such risks to the maximum extent?

Firstly, a large category of cases will not be subject to jurisdiction of private enforcement officers, but to the jurisdiction of the state enforcement officers. These, of course, are the judgments upheld against the state and the state authorities, the National Bank of Ukraine, communal enterprises, the state-owned companies and enterprises the state’s participation in the charter capital of which exceeds 25%, as well as legal entities which get the financing from the state or local budget. Out of the jurisdiction of the private enforcement officers are also the judgements under which the state or state bodies act as the recoveror, as well as all the judgments stipulating performance of any measures regarding state and communal property.

Private enforcement officer may not enforce:

• judgments on confiscation of property;
• judgments on eviction and occupancy of individual persons;
• judgments upheld by administrative courts and European Court of Human Rights;
• judgments on retrieval or recovery of a child, establishment of meetings with him/her or elimination of obstacles to visiting the child;
• judgments according to which the debtors include children or individual persons acknowledged as legally incompetent or whose legal capacity has been limited;
• judgments according to which the debtor is represented by a legal entity compulsory sale of property of which is forbidden by the law;
• judgments execution of which is legislatively related to the competence of other bodies which are not considered to be enforcement bodies (for example, judgments on recovery of monetary assets from the state authorities, state and local budgets or budgetary institutions are executed by the bodies performing treasury support of budgetary funds).

Secondly, (and this must be taken into the particular consideration!), on December 21, 2016 Ukrainian Parliament introduced additional limitations related to the private enforcement officers to the Law of Ukraine “On enforcement proceedings”. The limitations are as follows:

In particular: during his first year of work no enforcement officer has the right to enforce decisions under which the sum of recovery constitutes 20 and more million hryvnias or equivalent of this sum in another currency. In addition, up until January 01, 2018 no private enforcement officer may perform enforcement of the judgments under which the sum of recovery constitutes six or more million hryvnias or an equivalent sum in the foreign currency.

The mentioned details must be considered for in the process of upholding a decision on serving a writ of enforcement. The mistake in establishment of jurisdiction of enforcement, as well as poor awareness of the effective limitations may lead to dismissal of the applications for opening the enforcement proceedings and, as a result, to loss of time or, which is more critical in certain situations, alienation by the debtor of its property. In a number of cases enforcement required urgency and immediacy as soon as even small loss of time at the stage of opening of enforcement proceedings enables the debtor to withdraw (transfer) money from bank accounts and carry out alienation of its property.

Thus, will the body of the private enforcement officers be a necessary and sufficient guarantee of effective and objective work of the court system in general?

From the moment when the private enforcement officers will enter upon their duties the recoverors will have the right to independently chose whom to trust enforcement of their judgment. It cannot be ruled out that many of those who had a negative experience of enforcement their decisions by the state enforcement service will make their choice in favor of private enforcement officers – in the hope of having more expedient enforcement of the judgment, as well as more effective and accessible cooperation with the private enforcement officer.

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