Supreme Court of Russia has issued a decision on status of a person’s property as a result of its spouse’s insolvency proceedings

December 22, 2022, the Supreme Court of Russian has resolved an issue of whether spouses should be deemed as joint debtors if their obligation is also deemed as a joint one.

A Debtor has taken a loan of 10+ mln Rubles from the Creditor in 2013-2015. As the Debtor was unable to return the loan, the Creditor has initiated the Debtor’s bankruptcy proceedings (as per Chapter X of Russian Law on Insolvency). When it was found that the Debtor has no property, the question has arisen before the court whether Debtor’s wife, Respondent, to whom the Creditor has, too, submitted a claim, should be considered as co-debtor, considering that Debtor and Plaintiff have been divorced since 2018.

The Supreme Court has concluded that the debt should not be considered an obligation of both spouses, since a “presumption of a person’s agreement with its spouse’s actions” does not mean that this person automatically accrues a debt, on which her or his spouse has agreed with the third parties, but the person itself did not.

The Supreme Court Decision prevents the creditor to turn one person’s claim into a joint claim towards the debtor’s and her or his spouse joint property accrued during throughout their marriage[1].

[1] Ruling of the Supreme Court of Russia No. 309-ЭС22-16470 on the case No. А71-2503/2021 can be found at: https://ras.arbitr.ru/Document/Pdf/2482bc6e-ac0a-45f8-a640-eb28376ae3d7/c3dbe0cb-9137-4d47-9e5c-38bacb350eb8/%D0%9071-2503-2021__20221219.pdf?isAddStamp=True.