During the Division of Property, the Spouses "Abused the Rights" and Used This Mechanism to Avoid the Execution of the Judgment to Recover the Debt - the Civil Cassation Court within the Supreme Court

The court of first instance, whose decision was upheld by the appellate court, satisfied the claim for the recognition of ownership of 1/2 of the property and the removal of the arrest from it. The judgments were substantiated by the fact that the land plots had been acquired, and the entertainment complex had been built for the common funds of the spouses during the period of their cohabitation.

The Supreme Court composed of a panel of judges of the Second Judicial Chamber of the Civil Cassation Court overturned the judgments and dismissed the claim, taking into account the following.

In May 2011, the marriage between the spouses was dissolved by a court decision in absentia, and in November 2019, at the request of the wife, the court canceled this decision, accepted the husband's refusal from the claim for divorce, and closed the proceedings. 

In 2007, the husband bought two plots of land for personal farming. In 2010, the village council transferred a land plot into his ownership. The husband built a mall on it, and in August 2011 he received a certificate of ownership of the building.

Pursuant to the court’s judgment to recover the money debt from the husband, in 2017 and 2018 all immovable property belonging to him was seized.

The Supreme Court concluded that the courts of previous instances had failed to pay attention to the following:

• participants in civil relations (spouses who were divorced by a decision in absentia in 2011) "abused the rights" because civil law tools (a claim for recognition of the right to a share and release of property from arrest subject to cancellation of 2011 decision in absentia, closing the divorce proceedings after filing a lawsuit in this case) were used by the parties to prevent foreclosure on the property of the debtor;
• the plaintiff’s application for a review of the decision in absentia to dissolve the marriage and her husband’s application for abandoning the claim for divorce were filed eight years after the lawsuit had been filed and the decision had been made and only after the creditor had filed a lawsuit to recover the debt from the defendant. The defendant and the other creditor recognized the claims;
• the division of the spouses' common property cannot be used to evade payment of the debt by the debtor or execution of a court decision to recover the debt. The debtor, against whom the court has decided to recover the debt and seized his property, and his wife, who are engaged in the division of property, were obviously acting in bad faith and abused the rights against the creditor, since the division of property violated the property interests of the creditor and was aimed at preventing the foreclosure on the debtor's property. Therefore, the rule of law cannot leave without reaction such actions which, while not in violation of specific peremptory norms, are obviously unfair and amount to abuse of law.

At the same time, the Supreme Court stressed that the actions of participants in civil relations must be bona fide, i.e. meet a certain standard of conduct, characterized by honesty, openness and respect for the interests of the other party to the contract or the relevant legal relationship. Actions of a person committed with intent to cause harm to another person, as well as abuse of rights in other forms (part 3, Article 13 of the Civil Code of Ukraine) are also not allowed.

Resolution of the Supreme Court of August 11, 2021, in case No. 723/826/19 (proceedings No. 61-8810св20) – https://reyestr.court.gov.ua/Review/99037704.