Case No. SPC-20
On issue of a writ of execution for enforcement of the arbitration court judgment.
Riga, 23 May 2001
The Senate of the Supreme Court of the Republic of Latvia in the following composition – chairman of the hearing, senator M.Dudelis, senators O.Druks-Jaunzemis and R.Zake -, with participation of prosecutor of Prosecutor General Office of the Republic of Latvia A.Koskina, in an open court hearing tried the case regarding the protest of the Prosecutor General of the Republic of Latvia on decision of 18 May 1999 by Riga Vidzeme Regional Court, by which it was ruled to issue a writ of execution for enforcement of the arbitration court judgment.
Having heard the report by a senator M. Dudelis, explanations of the company`s «Trio Bella LLC» representative V. Tihonovs, the opinion of the prosecutor that the protest shall be sustained, the Senate of the Supreme Court of the Republic of Latvia
According to judgment of Regional Arbitration Court , located at Kr. Valdemara Str. 149-504, Riga, made on 23 February 1999, the sum in the amount of 3 771 600,20 US dollars was collected from a USA company «Trio-Bella LLC» in favor of an Ukrainian private company «Ugleavtomatika».
According to decision of 18 March 1999 by Riga Vidzeme Regional Court a writ of execution was issued for the enforcement of the mentioned arbitration court judgment.
The Prosecutor General of the Republic of Latvia has submitted to the Senate a protest, in which he asks to cancel the decision on the issue of a writ of execution and forward the case for a new trial.
The protest specifies that in the process of Regional Arbitration Court, when considering the current dispute, there have been substantial violation of provisions set forth in part «D» of Civil Procedure Law. The references to material legal rules, on the bases of which the claim is sustained, cannot be found in the arbitration court judgment. The company «Ugleavtomatika» was represented by E. Bog danova, who did not submit the duly made authorization. When performing the investigation in the criminal case pursuant to indications stated in Article 177, part three and Article 15, part four of the Criminal Law regarding the attempt of fraud in large amounts from Insurance Joint Stock Company «Austrumu Aliance» in favor of the company «Trio Bella LLC», the expert has acknowledged that the signature of the company`s «Ugleavtomatika» director A. Meteļcenko on several documents (also on the power of attorney and contract) has not been made by himself, but by another person. The term of the power of attorney for the company`s «Trio Bella LLC» representative P.Kaidaks has exoired on 5 January 1999. Besides, the provisions set forth in Article 534, part three of the Civil Procedure Law has been violated, as the translations of the documents in English and Russian into the state language were not submitted to the court.
The Senate of the Supreme Court admits that the court decision shall be cancelled and application on the issue of a writ of execution shall be forwarded for a new trail due to substantial violation of procedural rules.
Article 533, part two of the Civil Procedure Law provides that if an arbitration court judgment shall be enforced in Latvia and it is not voluntary executed, the party concerned may turn to the respective regional (city) court, according to the location place of the arbitration court, with an application on the issue of a writ of execution for the enforcement of the arbitration court judgment.
Thereby the rights to turn to the Latvian court with application on the issue of a writ of execution depends on the fact whether the arbitration court judgment is to be enforced in Latvia. From the application, submitted materials, minutes of the court hearing, court decision and facts established in the hearing of Senate it cannot be concluded that enforcement of the mentioned arbitration court judgment would be possible in Latvia.
If the provision of law stating that enforcement of a judgment shall take place in Latvia is not complied with, then there is no ground for issue of a writ of execution irrespective of all other (mentioned also in the protest) conditions.
From the mentioned Article 533, part two it shall also be concluded that the party concerned may request to issue of a writ of execution . By the party concerned shall be understood a party in the current arbitration procedure. In this case E.Bogdanova, naming herself as the company`s «Ugleavtomatika» representative submitted to the court the application on the issue of a writ of execution . E.Bogdanova cannot be acknowledged as an authorized person (Articles 83, 84 of Civil Procedure Law) on the bases of the power of attorney of undetermined origin enclosed to the application.
Article 536, part one of Civil Procedure Law states the grounds for refusal to issue a writ of execution, if the party, against which the enforcement of arbitration court judgment is claimed, declares and proves such grounds. Such grounds cannot be found in the protest and, in accordance with the law, only the party concerned has rights to declare and prove such grounds.
Despite the above mentioned, a writ of execution cannot be issued, as provisions set forth in Article 533, part two of the Civil Procedure Law, i.e. enforcement of judgment shall take place in Latvia, the party concerned of the arbitration procedure shall submit the application, are not complied with.
The court, when repeatedly considering the application, shall comply with Article 534 of Civil Procedure Law, as it is noted in the protest.
Pursuant to Articles 485. and 474. of Civil Procedure Law, the Senate of the Supreme Court of the Republic of Latvia
To cancel decision of 18 March 1999 by Riga Vidzeme Regional Court and to forward the application to the same court for a new trial.
Chairman of hearing, senator M.Dudelis
senators O.Druks-Jaunzemis R.Zake