The actio pauliana (also known as the “Pavloff claim”) could be filed by the creditor not only against the main debtor but also against the guarantor according to Interpretative Ruling No. 2/2017 by the Supreme Court of Cassation (“SCC”).
What is new?
The majority within the SCC held that with respect to the guarantor, all procedural means shall be deemed admissible, which guarantee the precise execution of the obligation, including the actio pauliana, whereas, previously the court’s case law indicated that a creditor cannot file an actio pauliana against a guarantor due to the accessory nature and securitizing function of the guarantee.
What is the Actio pauliana?
It is a procedural means for the purpose of protecting a creditor in case its debtor undertakes harmful actions, which may diminish its property or impede the satisfaction thereof - i.e. it damages the “general security of the creditor”. The SCC went on describing the main characteristics of the claim by stating that through the submission of the actio pauliana the creditor exercises its discretionary rights of satisfying itself with the sum received by the enforced execution of the property subject to the contract between the debtor and its contracting party. Also, the latter shall comply with the claim in case of other contracting party’s debt if it has acted in bad faith in the course of paid acquisition of the property – i.e. it has acted with the knowledge that the agreement was damaging, or if it has acquired the property without any payment. If the contracting party wants to discharge itself from the execution, it can pay the creditor, satisfying the obligation of the debtor and then seek recourse from the latter.
Furthermore, the SCC states that the nature of guarantee is accessory, i.e. it depends on the main debt, as well as relatively independent since the guarantee could be granted under less stringent conditions. Nonetheless, the debtor and the guarantor act in a solidary manner, whereas the creditor may seek a standalone execution vis-à-vis each one of them in a non-subsidiary fashion.
Other considerations by the SCC
By virtue of the same interpretative ruling, the SCC held that there is a preliminary procedure nexus under art. 229 para. 1 item 4 of the Civil Procedure Code, between the proceedings filed under a claim by the creditor for its receivable and the filed proceeding under art. 135 of the Law on Obligations and Contracts (“LOC”) for declaration of relative invalidity of actions against the creditor and executed by the debtor. What this means in practice is that the proceedings under the actio pauliana shall be suspended on the grounds of art. 229, para. 1 item 4 Civil Procedure Code, for the purpose of entering into force of a claim by the creditor concerning its receivable.
Finally, The Civil and Commercial Chambers of the SCC also ruled upon the question of what is the procedure for the protection of the creditor in the subsequent disposal transaction made by the third party in whose benefit the debtor disposed of his property. The SCC held that in a subsequent number of agreements damaging the creditor, art. 135, para. 1. section 3 of the LOC provides protection to subsequent acquirers who have acquired rights to the property from the person with whom the debtor has contracted if they act in bad faith or have benefited gratuitously from an assignor in respect of whom the claim can be upheld. Moreover, if the acquirer, with whom the debtor has bargained, disposed of the property prior to the filing of the actio pauliana, the decision given thereon will be unenforceable upon the subsequent acquirer whose act was registered before the filing of the claim.