Supreme Court of Lithuania Spoke on the Provisions of the Enterprise Bankruptcy Law Related to Making of Creditors Claims, the Sequence of their Approval, Terms and Procedure of their Satisfaction
On 17 October 2007, the Supreme Court of Lithuania passed a judgement in the case according to a cassation appeal of the third person UAB Vevira against the judgement of the Vilnius County Court of 10 October 2006 and for reversal of the judgement of the panel of judges of the Civil Cases Division of the Court of Appeal of Lithuania, dated 7 December 2006, which satisfied the requests of the applicants Lithuanian National Road Carriers Association Linava, UAB Linavos Servisas and the receiver UAB Būrai of UAB Revi under liquidation to correct the list of creditors in UAB Revi bankruptcy proceedings (case No. B2-356-45/2006).
The Vilnius County Court by its judgement of 17 March 2005 initiated UAB Revi bankruptcy proceedings and established a term of 30 days for creditors for making of financial claims. The applicants Association Linava and UAB Linavos Servisas addressed the court with a request to renew the term for making of financial claims in bankruptcy proceedings of UAB Revi under liquidation and to approve their financial claims. It was indicated in the requests that the applicants had learnt about the initiation of the bankruptcy proceedings too late when they received a notification of the receiver in bankruptcy regarding payment of debt, therefore they missed the term for making of creditors financial claims due to important reasons.
In this case the Supreme Court of Lithuania examined whether there were legal grounds to accept the creditors requests regarding admission of claims that had arisen before the initiation of the bankruptcy proceedings, when such claims were made upon missing the term established in paragraph 4(5) of Article 10 of the Enterprise Bankruptcy Law due to important reasons and after the date of the court judgement to liquidate the enterprise by reason of bankruptcy. The Supreme Court of Lithuania noted that the enforcement of the rights of creditors of enterprises under bankruptcy to make claims depended of the legal rules given in the Enterprise Bankruptcy Law which establish consistent performance of the enterprise bankruptcy procedures in certain stages. The panel of judges of the Supreme Court of Lithuania stated that the fulfilment of the duty to notify creditors about initiation of the bankruptcy proceedings depended on the accuracy of information about creditors of the enterprise, therefore in case when there is no information about creditors and the notification, therefore, is not given, also when the creditor does not learn about this fact otherwise, the creditor being unable to exercise its statutory right due to reasons beyond its control would be deprived of the protection of its rights protected by the law and would find itself in a legally unjustifiably worse situation in comparison with other creditors. The Supreme Court of Lithuania emphasized that such legal situations were intolerable and were against the principles of justice, reason and fairness. Referring to the above-indicated arguments, the Supreme Court of Lithuania stated that creditors claims that arose before the initiation of the bankruptcy proceedings could be made until the court passed a judgement to dismiss the bankruptcy proceedings or a decision regarding the dissolution of the enterprise. There are legal grounds to accept the creditors requests regarding admission of the claims that arose before the initiation of the bankruptcy proceedings, when it is admitted that they were made upon missing the term established in paragraph 4(5) of Article 10 of the Enterprise Bankruptcy Law due to important reasons and the court has not passed a judgement to dismiss the bankruptcy proceedings or has not taken a decision regarding the dissolution of the enterprise.