Questions and Answers

Answer:

In the case where the proposer withdraws the proposal to initiate bankruptcy proceedings during the preliminary bankruptcy process and the court issues a decision to suspend the bankruptcy proceedings, the provision of Article 58, paragraph 2, of the Bankruptcy Law applies in relation to the costs incurred.

However, the Bankruptcy Law does not regulate the situation where the withdrawal of the proposal occurred due to the fulfillment of the obligation after the proposal to initiate bankruptcy proceedings was submitted.

In such a situation, based on Article 7, paragraph 1, of the Bankruptcy Law, the provision of Article 157 of the Civil Procedure Law is applied accordingly.

(Bulletin of the Court Practice of Commercial Courts No. 3/2023, Commercial Appellate Court, Belgrade, 2023, p. 137 – answer to question no. 3)

Answer:

The response to the question posed is given in the Bulletin of the Commercial Appellate Court No. 4/2018, as well as in the Bulletin of the Commercial Appellate Court No. 4/2016.

The response from Bulletin No. 4/2018 states:

“According to Article 117a, paragraph 1 of the Bankruptcy Law, determined and disputed claims in bankruptcy proceedings can be transferred.

This provision should not be interpreted restrictively to mean that only claims that have been examined can be transferred, with or without compensation. Instead, it should be understood that claims can be transferred regardless of whether they are determined or disputed, provided they must certainly be timely reported according to the provisions of the Bankruptcy Law.

(See also the Answers to questions of commercial courts established at the session of the Department for Commercial Disputes of the Commercial Appellate Court held on November 7, 2016, and November 8, 2016, and at the session of the Department for Commercial Offenses held on November 10, 2016 – Court Practice of Commercial Courts – Bulletin No. 4/2016, question no. 29)”

The response from Bulletin No. 4/2016 reads:

“According to Article 117a, paragraph 1 of the Bankruptcy Law, a claim in bankruptcy proceedings can be transferred regardless of whether it is determined or disputed. From this provision, it follows: The law allows the transfer of claims from creditors to the bankrupt debtor to third parties with or without compensation, regardless of whether the claim is determined or disputed, which implies that the claim must be reported in accordance with the provisions of the Bankruptcy Law, the transfer is carried out by contract between the creditor and the third party (recipient), the claim can be assigned during the bankruptcy proceedings, provided that if the proceeding is conducted as a bankruptcy settlement procedure it can be done until the decision on the main division is made, and after the adoption of the reorganization plan and the suspension of bankruptcy for the mentioned reason, the claim determined by the plan is transferred.

If the claimant is a bank, it is necessary to consider the provision of Article 42a of the NBS Decision on Risk Management during the conclusion of the claim assignment contract, which prescribes a certain procedure before the NBS, related to the assignment of claims which includes appropriate notifications and submission of documentation prescribed by these provisions.

From the stated, it follows that the Law does not limit the possibility of transferring claims more than once, nor does it condition the transfer by the existence of a certain time distance from the first to the subsequent assignment of the same claim.”

(Bulletin of the Court Practice of Commercial Courts No. 3/2023, Commercial Appellate Court, Belgrade, 2023, pp. 139-140 – answer to question no. 5)

Answer:

According to Article 113, paragraphs 2 and 4 of the Bankruptcy Law, the bankruptcy administrator determines the validity, scope, and order of payment of each claim and prepares a list of recognized and disputed claims, which he is obligated to submit to the bankruptcy judge within the prescribed period. The bankruptcy judge is then required to publish the bankruptcy administrator’s list of claims on the court’s notice board or, if the list is disproportionately large, to post a notice on the court’s notice board indicating where the list is located.

Based on the list of claims submitted by the bankruptcy administrator for the examination hearing and the amendments entered during the examination hearing, the bankruptcy judge adopts a final list of claims by conclusion. The final list of claims contains information on all reported claims, who disputed them, and in what amounts they are established or disputed. Based on the final list, the bankruptcy judge issues a conclusion on the list of established and disputed claims. The final list that determines the claim and its order of payment is binding for the bankrupt debtor and all bankruptcy creditors as per Article 116, paragraph 5 of the Bankruptcy Law.

The final list of established claims is subject to amendments in cases of: 1) a bankruptcy creditor proving their claim in a lawsuit, in which case they request a correction of the final list, 2) the recipient of a claim in case of a transfer, 3) the heir (legal successor) of a creditor based on a probate decision (executed status change), 4) based on the satisfaction of the creditor outside the bankruptcy procedure from a joint debtor (from a guarantor, the pledging debtor of the bankruptcy creditor, or the principal debtor) or by someone who has a legal interest, 5) in case of statutory subrogation.

Amendments to the final list are made by a decision of the bankruptcy judge, against which an appeal is allowed.

The bankruptcy creditor is obliged to inform the court about any collection of their claim under Article 111, paragraph 7, and Article 204a of the Bankruptcy Law. Afterward, the bankruptcy judge will issue a decision to amend the final list by stating the remaining amount of the creditor’s claim that remains unpaid, or the amount in which the creditor has been satisfied.

(Bulletin of Court Practice of Commercial Courts No. 3/2023, Commercial Appellate Court, Belgrade, 2023, pp. 139-140 – answer to question no. 11).

Answer

Regarding the change of status from a secured creditor to a bankruptcy creditor, Article 49, paragraph 2, of the Bankruptcy Law states that secured creditors are not bankruptcy creditors. If the amount of their claim exceeds the amount of funds realized from the sale of the property on which they have a separation right, they are entitled to satisfaction for the difference as bankruptcy creditors.

Thus, in a situation where a secured creditor is not fully satisfied from the amount obtained from the sale of the collateral, they will be satisfied for the remaining amount as an unsecured, bankruptcy creditor. The bankruptcy judge must issue a decision to amend the final list to avoid confusion about the total liabilities of the bankrupt debtor, as the amount for which the secured creditor is not satisfied directly affects the percentage of satisfaction of other bankruptcy creditors.

(Bulletin of Court Practice of Commercial Courts No. 3/2023, Commercial Appellate Court, Belgrade, 2023, p. 149 – answer to question no. 13).

Одговор

Према члану 3. став 1. Закона о промету непокретности преносом права својне на згради, односно другом грађевинском објекту, истовремено се преноси и право својине за земљишту које служи за редовну употребу зграде.

Ако стечајни дужник није власник парцеле на којој се налазе објекти у његовом власништву, онда она не улази у његову имовину, односно не представља стечајну масу. Стога се након продаје објеката на купца преноси право својине на објектима и на земљишту које је потребно за њихову редовну употребу, а не на целој парцели, осим ако цела површина парцеле није потребна за редовну употребу објекта. У том случају се продају и право својине на објекту и право коришћења на целој парцели на којој се та непокретност налази, с тим да би приликом процене вредности ове имовине требало узети у обзир како вредност објекта, тако и вредност права коришћења парцеле.

Пре него што започне са поступком продаје имовине стечајни управник треба да провери да ли постоје докази, односно исправе по ком основу је стечајни дужник користио парцелу на којој су изграђени објекти у његовом власништву. Уколико постоје писани докази да је стечајни дужник имао право коришћења на целој парцели, али да оно није било уписано у катастар или у земљишне књиге, стечајни управник треба да упише то право у катастар непокретности. Само у таквој ситуацији би се могла извршити процена и продаја права својине на објектима са правом коришћења на целој парцели. У случају потребе може се водити и парнични или управни поступак ради утврђења права коришћења целе парцеле, како би се оно могло укњижити на основу правоснажне пресуде или друге одлуке надлежног органа.

У сваком случају би приликом процене и продаје имовине требало јасно разграничити шта је предмет продаје, тако да потенцијални купци ни у једном тренутку не буду доведени у заблуду о томе шта купују и по којој цени.

(Билтен судске праксе привредних судова бр. 3/2023, Привредни апелациони суд, Београд, 2023, стр. 149-150 – одговор на питање бр. 14).

Answer:

Article 136v of the Bankruptcy Law stipulates that in the case of the sale of a bankrupt debtor as a legal entity, the entire property of the bankrupt debtor, or a property unit:

• If the offered price is less than 50% of the estimated value of the item for sale, the bankruptcy administrator is required to immediately submit such an offer to the creditors’ committee, and the sale can be carried out if it is approved by the creditors’ committee;
• If, according to the estimate under Article 132, paragraph 2, of this Law, the part of the funds realized from the sale related to the property under separation or pledge right would be less than 50% of the estimated value of that property, the bankruptcy administrator is required to immediately submit such an offer to each secured and pledge creditor who has a separation or pledge right on that property, and the sale can be carried out if it is approved by the secured or pledge creditor who, by applying Article 35, paragraph 3, of this Law, makes it probable that their secured claim can be satisfied in part or in full from the property under the separation or pledge right if it were sold individually.

The National Standard on the Method and Procedure of Monetizing the Assets of a Bankrupt Debtor (National Standard No. 5) in point II prescribes four methods of monetization, in accordance with the law: 1) sale of the entire property of the bankrupt debtor, 2) sale of a property unit, 3) sale of individual property of the bankrupt debtor, and 4) sale of the bankrupt debtor as a legal entity. The methods of sale are: 1) public auction, 2) public collection of offers, and 3) direct negotiation.

Point V of National Standard No. 5 regulates the sale by public auction and, among other things, provides that in the case of the sale of a bankrupt debtor as a legal entity, the entire property of the bankrupt debtor or a property unit, the bankruptcy administrator acts in accordance with Article 136v of the Law. If the creditors’ committee, secured, or pledge creditor does not provide approval in accordance with Article 136v of the Law within 15 days from the date of receipt of the request, the bankruptcy administrator will declare the public auction unsuccessful.

From the cited provisions, it follows that both the Bankruptcy Law and National Standard No. 5 provide that in cases under Article 136v of the Bankruptcy Law, it is necessary to obtain the consent of the creditors’ committee, or the secured and pledge creditors, for the sale at a price less than 50% of the estimated value of the property. This consent is needed in the case of the sale of the entire property of the bankrupt debtor, in the case of the sale of a property unit, and in the case of the sale of the bankrupt debtor as a legal entity. Only in the case of the sale of individual property of the bankrupt debtor is the mentioned consent not required.

The rule about progressively reducing the initial price at the first, second, and third public auctions is formulated to apply to all four methods of monetization, but if a price offered at a public auction is less than 50% of the estimated value of the item for sale, it is necessary to seek approval under Article 136v of the Bankruptcy Law. Thus, even in the case of the sale of a bankrupt debtor as a legal entity at public auctions, the initial price is reduced from 50% to 20% and finally to 5% of the estimated value of the item for sale.

The confusion likely arose because a distinction is made between “property” (either entire or a property unit) and a “legal entity,” which owns that property. However, the Bankruptcy Law and National Standard No. 5 do not make this distinction, i.e., they prescribe the same procedure for obtaining consent provided under Article 136v) also in the case of the sale of the bankrupt debtor as a legal entity.

(Bulletin of Court Practice of Commercial Courts No. 3/2023, Commercial Appellate Court, Belgrade, 2023, pp. 154-156 – answer to question no. 19).

Answer:

Under Article 5 of the Mortgage Law, which governs the extent of a mortgage, it is stipulated that a mortgage covers the immovable property including: 1) all constituent parts of the property, natural fruits not separated from the property, unless otherwise specified by the mortgage contract; 2) appurtenances of the property specified in the mortgage contract, but not the property owned by third parties; and 3) all improvements and increases in the value of the property that occurred after the establishment of the mortgage.

According to Article 106, paragraph 1 of the Law on Planning and Construction, upon completion of the process of converting the right of use into the right of ownership on construction land, in accordance with this law, the cadastral parcel of developed construction land together with the buildings constructed on it becomes a single subject of property rights (unity of property). Therefore, all existing rights and encumbrances that existed on the building or specific part of the building, from the moment of registration of ownership, transfer to this cadastral parcel or part of the cadastral parcel owned by the owner of that specific part, unless a long-term lease is established on that land in accordance with this law.

The Law on the Conversion of the Right of Use into the Right of Ownership on Construction Land with Compensation in Article 17 prescribes that upon the legal enforceability of the decision establishing the right to convert the right of use into the right of ownership on the cadastral parcel subject to the request, conditions for the registration of ownership rights on the cadastral parcel of construction land are met. The authority responsible for state survey and cadastre performs the registration of ownership within 7 days from the date of application submission. If it involves the registration of ownership rights on developed land, this authority will ex officio perform the registration of encumbrances that exist on the building and on the construction land that is the subject of the conversion, according to the order of registration of those rights.

According to Article 3, paragraph 1 of the Law on Real Estate Trading, the transfer of ownership rights on a building or other construction object simultaneously transfers the ownership rights on the land on which the building is located, as well as on the land used for the regular use of the building.

These legal provisions stipulate that the right of ownership on the building and the right of ownership on the land beneath the building and for the regular use of the building represent a single subject of property rights. In the case where the property register initially registered ownership rights on the building and later the ownership rights on the land are registered, all existing rights and encumbrances transfer to the construction land that was the subject of the conversion, regardless of whether the conversion was with or without compensation. Both the Law on Planning and Construction and the Law on the Conversion of the Right of Use into the Right of Ownership on Construction Land with Compensation regulate this issue in the same way.

Therefore, in the case of subsequent registration of ownership rights on the land on which there is a building with a separation right, such separation right would extend to the land on which the building is constructed.

(Bulletin of Court Practice of Commercial Courts No. 3/2023, Commercial Appellate Court, Belgrade, 2023, pp. 157-158 – answer to question no. 20).