Order proceedings on the application of procedural novelty by commercial courts
Order production is an institution that appeared in the economic process after the entry into force of the new edition of the Economic Procedural Code of Ukraine on December 15, 2017.
Even at the stage of discussion of the draft Code of Civil Procedure of Ukraine among lawyers held a lot of discussions around whether it is generally advisable to introduce the appropriate institution in the business process. Active critics insisted that the innovation did not comply with the principles of publicity and adversarial proceedings, there were concerns that order-based proceedings could become an instrument of abuse and even raider seizures. The reason for such fears was the features of the recovery procedure on the basis of a court order, since:
consideration of the relevant application is carried out within 5 days from the date of its receipt without notice to the applicant and the debtor and without a court hearing (Article 154 of the Civil Procedure Code of Ukraine);
it is not determined what evidence can be considered proper evidence of the existence of monetary debt, so that the demand for its recovery could be stated in a writ of order;
when considering claims in the order of writ proceedings, the court does not consider the substantiation of the claims claimed by the claimant on the merits (paragraph 7 of clause 1 of article 155 of the Code of Civil Procedure of Ukraine);
a court order is not subject to appeal on appeal (part 3 of article 154 of the Civil Procedure Code of Ukraine).
Proponents of the relevant novelty referred to the positive experience of the existence of similar procedures in European jurisdictions and noted that the new institution is unlikely to become an instrument of abuse, because the court order:
can be canceled at the request of the debtor, filed within 15 days from the date of delivery of the court order, which must be considered by the court no later than 2 days after its submission (part 1 of article 157 of the Civil Procedure Code of Ukraine);
it may seem solely based on the results of consideration of requirements that meet the following criteria (Article 148 of the Civil Procedure Code of Ukraine) the requirement to collect monetary debt arose under an agreement concluded in writing (including electronic); the amount of the claim does not exceed 100 living wages for able-bodied persons.
At the same time, the most debatable question was what kind of evidence in this case could be considered as proper proof of the existence of monetary debt, because the court has the right to refuse to issue a court order if the application does not discern the occurrence or violation of the monetary claim (Article 152 of the Civil Procedure Code Ukraine). The answer to this question should be given precisely by judicial practice.
After more than 9 months after the entry into force of the new revision of the Code of Civil Procedure of Ukraine, one can talk about certain trends based on the consideration of the relevant applications of the exactors. In particular, we can call an already established approach, according to which the requirements for recovering 3% per annum, penalties, losses, and inflation losses are not subject to consideration in the order of writ. Judicial orders are issued based on the results of consideration of requirements for the recovery of principal debt.
At the same time, the courts do not satisfy the requirements for the recovery of 3% per annum, penalties, losses, inflation losses within the framework of writ proceedings. Refusing to issue orders on this category of claims, the courts note that they do not comply with the requirements of Art. 148 Code of Civil Procedure of Ukraine (it is not a requirement to collect monetary debt under a contract concluded in writing), noting that the applicants can apply with the relevant requirements in the proceedings. An example is the decision of the Kiev Economic Court of Appeal dated 03/27/2018 in the case No. 910 / 1002/18 and the decision of the Commercial Court. Kiev from 03.30.2018. In the case No. 910 / 3640/18.
According to the evidence, which can be considered as a proper confirmation of debt in writ proceedings, it is now premature to assert the existence of a certain established approach. Satisfying applications for the issuance of court orders, in most cases the courts in the reasoning part of the order do not indicate at all what evidence was provided in support of the existence of the debt, limiting itself only to the fact that the person who has the right to claim under the contract applied with the corresponding statement, as well as that the amount of the monetary claim declared to be collected does not exceed the amount determined by Part 1 of Art. 148 Code of Civil Procedure of Ukraine. For example, the court limited itself to just such arguments, satisfying the application for the issuance of a court order in case No. 904 / 2553/18, which was examined by the Economic Court of the Dnipropetrovsk Region.