Lawin has represented AB bankas SNORAS in a dispute with Corvus Holding OU in Estonia in a dispute involving application of the Estonian Bankruptcy Act.
SNORAS had filed a petition in Parnu County Court seeking to have Corvus Holding declared bankrupt. The court found the petition meritorious, and declared Corvus Holding bankrupt. Corvus Holding then appealed the ruling to the Tallinn Circuit Court, which overturned the Parnu County Court's ruling, finding that Corvus Holding should not have been declared bankrupt as the claim of SNORAS was unclear. SNORAS in turn appealed to Supreme Court, arguing that the Tallinn Circuit Court incorrectly applied Bankruptcy Act subsection 31 (1) in conjunction with subsection 31 (2). Specifically, SNORAS argued that pursuant to subsections 31 (1) and (2) of the Bankruptcy Act -- which entered into force on January 1, 2010 -- it is not possible to refuse to declare a legal entity obligor bankrupt when the interim trustee has determined that the obligor is permanently insolvent even without taking into account the claim of the obligee who filed the bankruptcy petition.
On June 10, 2014, the Estonian Supreme Court ruled that the Tallinn Circuit Court had indeed misinterpreted subsections 31 (1) and (2) of the Bankruptcy Act. The Supreme Court agreed with the position advocated by SNORAS, that upon determining that a legal entity obligor is permanently insolvent, it must be declared bankrupt even if the claim of the obligee who filed the bankruptcy petition is unclear. This decision carries significant meaning in terms of bankruptcy law, as it reverses the previous understanding: that a legal entity obligor is not to be declared bankrupt if the claim of the obligee who filed the bankruptcy petition is unclear.
Lawin represented AB bankas SNORAS in all court instances. The litigation team consisted of Partner Liina Linsi, Senior Associate Kadri Michelson, and Associate Lembit Tedder.
