Home > Regions > Europe > Changes in the way of challenging decisions of arbitrazh court in connection with adoption of Federal law dd. 27th of July, 2010 No. 228-FZ “On introducing changes into the Arbitrazh-procedural code of the Russian Federation”

Changes in the way of challenging decisions of arbitrazh court in connection with adoption of Federal law dd. 27th of July, 2010 No. 228-FZ “On introducing changes into the Arbitrazh-procedural code of the Russian Federation”

In connection with adoption of Federal law dd. 27th of July, 2010 No. 228-FZ “On introducing changes into the Arbitrazh-procedural code of the Russian Federation” significant changes were applied, in particular, to regulation of the way of challenging decision of arbitrazh court. So, since the 1st of November 2010 the challenging of the judicial act to the appellate instance before resorting to cassation instance will become obligatory.

The previous version of Article 181 of the Arbitrazh-procedural code, regulating the order of challenging arbitrazh court decisions, established a two-tier system of challenging the judicial acts, adopted by arbitrazh courts, no limitations were set in relation to this procedure by the law maker. In accordance with the new version of part 2 of Article 181 of Arbitrazh-procedural code, unless otherwise established by this code, а decision of anarbitrazh court of the first instance may be challenged in the arbitrazh court of the cassation instance upon condition, that it has already been subject of review by an arbitrazh court of appellate instance, or the appellate court has declined a restitution of the missed term for lodging an appeal. That is, one can apply to cassation instance only after the case has been tried in the appellate court instance. As result, in case the decision of the arbitrazh court of the first instance has already entered into legal force and had not been challenged in the appellate instance, the way to the cassation instance, accordingly, will be closed. The filed claim will not be considered at all.

Still there is a way out of this situation. The only exclusion applies to the situation, in which the term for appeal was missed, and the appellate court has declined to restore the term (part 2 of Article 181 of Arbitrazh-procedural code). So, if the monthly term, established by law, was missed, one will still have to lodge the appeal, attaching the application for restoration of the missed term (part 2 of Article 115 of Arbitrazh-procedural code). Furthermore, the following variants of the case outcome are possible. In the first case – the term will be restored, accordingly, one will have the possibility to challenge the case firstly in the appellation instance, and then, if necessary, in the cassation. In the second case – the restoration will be declined, but this decline will constitute the standing for subsequent appeal to the cassation instance.

The second variant is not applicable for the decisions of the arbitrazh courts of the first instance on calling to and challenging the decisions on calling to administrative account, if the amount of the fine imposed does not exceed: 100 000 – for organizations, 5 000 – for entrepreneurs. The aforementioned decisions are conceded to the cassation after their review in the appellation in accordance with part 4.1 of Article 206 of Arbitrazh-procedural code, brought into effect by 228-FZ law. The omission of the 10-day term, established by law, will seize your right for challenging.

The court practice, yet scarce, witnesses the mass return of cassation claims from the 1st of November 2010 based upon clause 5 of part 2 Article 281 of Arbitrazh-procedural code. So, by decision of Federal Arbitrazh Court for Volgo-Vyatskiy region dd. 27.11.2010 in the case No. А43-8222/2010, decision of Federal Arbitrazh Court for Volgo-Vyatskiy dd. 30.11.2010 in the case No. А65-13165/2006, decisionof Federal Arbitrazh Court for Volgo-Vyatskiy region dd.30.11.2010 in the case No. А79-8151/2010, decisionof Federal Arbitrazh Court for Volgo-Vyatskiy region dd.06.12.2010 on the case No. А43-2146/2010,  decision of Federal Arbitrazh Court for Volgo-Vyatskiy region dd. 06.12.2010 in the case No. А68-6139/2009, decision of Federal Arbitrazh Court for Volgo-Vyatskiy region dd. 07.12.2010 in the case No. А39-3272/2010, decision of Federal Arbitrazh Court for Volgo-Vyatskiy region dd. 20.12.2010 in the case No. А17-4068/2010, decision of Federal Arbitrazh Court for Volgo-Vyatskiy region dd.23.12.2010 in the case No. А82-6895/2010.

The courts hold a view, that the way of cassation challenge of decisions, set forth in part 2 of Article 181 of Arbitrazh-procedural code as amended by Law No. 228-FZ, must be applied also to the decisions, adopted before the Law No. 228-FZ entered into force, if the cassation claim was lodged after the Law No. 228-FZ entered into force. Lodging the cassation appeal is a distinct procedural action, and, in accordance with part 4 of Article 3 of Arbitrazh-procedural code, the proceedings in arbitrzh courts are performed in accordance with federal laws in force at the moment of distinct procedural action is committed. Consequently, the return of cassation claims, lodged against judicial acts, that were not challenged in arbitrazh court, on the basis of the common rule, established by clause 5 of part 2 Article 281 of Arbitrazh-procedural code as amended by Federal law No. 228-FZ, are returned to the applicants.

Undoubtedly, the introduced amendments, touching upon the regulation of the order of challenging arbitrazh courts decisions, will cause a significant increase of load upon arbitrazh courts. It is clear, that in the nearest future, in relation to the introduction of amendments negative consequences will follow – the increase of the average term for considering claims, lowering of quality of judicial acts reasoning, more formal attitude towards motions on restitution of the missed terms for challenge and on postponement of court hearing. The courts will tend to limit the increased flood of claims by lawful measures.

Still there are positive aspects of the introduced amendments. The consistent transition of the case from one instance to another is a logical and reasonable decision. Earlier a lot of problems arose in reality. That is, the court of cassation instance, if the claim was filed directly, omitting the appellate court, had to stand-in for the appellate court: it had to consider additional evidence, re-evaluate the circumstances, established by the court of the first instance.

The introduced changes, touching upon obligatory reference to the appellation before cassation, are an additional warranty of the quality of case proceedings, because they foresee reconsideration of the additionally furnished on file evidence. And the court of the cassation instance is entitled to check the application of law provisions only. The process of introducing changes, novation always causes problems, the main point here is to foresee in advance and minimize them.