Regardless of the court
"Attorneys received a wide range of procedural tools to represent interests in courts, but we advise our clients, as early as at the agreement conclusion stage, to take care of a strong position".ALEXEY KOT, ATTORNEY, MEMBER OF JUDICIAL REFORM COUNCIL, MANAGING PARTNER AT ANTIKA LAW FIRM, SHARES PERSONAL EXPERIENCE
— Has it become easier for a business to sue under the new Commercial Procedure Code of Ukraine?
— It all depends on whom the business is going into this process. If a company has a good attorney and a well-prepared position, it will be easy to sue under any rules. It’s a matter of choosing a legal advisor.
— Then, let's change the question: has it become easier for you to render legal assistance to clients in the form of legal representation in commercial cases?
— It really has become easier for us, attorneys, because now the process is more structured. Innovations gradually become the norm and give a positive result when applied in the process.
For example, if a court considers that the parties had sufficient time to prepare, the evidence was submitted, the arguments were stated, then it is entitled to close the preparatory meeting and proceed to review the merits of the case. After that, none of the parties is allowed to submit new evidence. And if it turns out that one or another argument is not supported by the evidence submitted by the parties, it means that the court will not be able to take it into account when reviewing the merits of the case. It imposes some discipline when preparing a case. Moreover, this structuring is rather mild: there are no deadlines: evidence shall be submitted within a month or within several days at the discretion of the judge. .
— Has it become easier for judges to consider cases in such a process?
— Perhaps at this stage there are still some inconveniences for those judges who still remain in the system and got used to the old process, but they just need to get used to the new rules. The new regulation enables the judge not only to participate in the process, but also to govern it, to coordinate the actions of the participants in the process, to ensure discipline during the proceedings and so on. In other words, it provides attorneys with the opportunity to efficiently and conscientiously ensure the protection of the interests of their clients.
— What kind of disputes are the most interesting today for clients in terms of their resolution?
— In terms of our company’s judicial practice, the structure of disputes has remained virtually the same. Frankly speaking, it should not change in connection with changes in the procedural rules.
Today, as a rule, disputes arise in connection with the non-fulfillment of obligations, their restructuring, enforcement, primarily regarding items transferred as collateral, mortgage, and under surety. Property disputes remain completely relevant. Traditionally, there are a number of disputes on international contracts related to our legislative regulation governing the return of foreign exchange earnings. It is necessary to check why the obligations are not being fulfilled in each individual case: this is a principled ground, an objective impossibility, a response to certain violations on the part of a counterparty (according to deadlines or quality) or poor-quality legal execution of the relations.
Based on our own experience in such processes, we try to orient our client towards the situation where if he/she is right in substance, the form of consolidating his position is also of a great importance, sometimes even crucial. And we can change nothing at the litigation stage. However, we can do everything to ensure that the client’s position is as strong as possible in the court even at the stage of conclusion of the agreement: when the client has good relations with partners, when everyone has big plans for collaborative work and high expectations for cooperation. At this point, it is important that all the arrangements are properly drawn up and executed in a legally relevant form, i.e., in the form of an agreement.
— In the process of preparing the new Commercial Procedure of Ukraine, the idea was to popularize arbitration as an alternative way to resolve disputes. Do your clients have recourse to arbitration more often now?
— I would not say that the development of arbitration was the primary task of judicial reform, because it focuses primarily on restoring confidence in the judicial system as a whole. Nevertheless, the popularization of arbitration was an essential change. If the parties have agreed to go to arbitration, then it is the very contractual intention that should prevail, since the parties in so doing expressed their intention to exclude the jurisdiction of state courts. The new approaches to the enforcement of arbitration awards, as well as to the procedure for appealing against them, will certainly have a positive impact on the image of our state as an arbitration-friendly jurisdiction. Moreover, changes were also made to the rules and regulations of ICAC at the Ukrainian Chamber of Commerce and Industry in order to update the process and make arbitration as comfortable as possible for its participants.
However, such changes alone cannot change the preferences of business. The choice of an authority to resolve a dispute (jurisdictional court or arbitration) can be called a matter of taste. However, when it comes to the choice, if a dispute has already arisen, we direct our client to follow the path agreed in the contract. We welcome when the courts and arbitrations also try to determine the true will of the parties on this issue and go beyond formalities. For example, when the name of arbitration is specified incorrectly in the clause, they, in the old fashion way, consider it possible to refer the matter under the jurisdiction, for example, of the commercial court.
— What innovations of the Commercial Procedure Code of Ukraine have you already managed to practice? Have you already invited witnesses?
— A witness in the economic process is, perhaps, one of the most controversial innovations, which we, at least for the time being, have not yet used. I have not even heard from my colleagues that the commercial courts are overloaded with receiving evidence from witnesses.
The opinion of legal experts is what really works today and is actively used by attorneys. As a scientist, I was lucky to prepare more than one such opinion in cases that I do not support as an attorney.
If we talk about procedural reform in general, then attorneys have significantly expanded the arsenal of procedural tools to protect the rights and interests of a client. And even if not all of them are involved in a particular case, then the very freedom of choice and the possibility of their application inspires and enables a more creative and fine approach to each case.
— What changes do you expect in connection with the introduction of changes to the relevant law on the Bar?
— In my subjective opinion, substantive changes in the law on the Bar and practice of law should be slightly different, rather than those recorded in the final text of the draft bill. Without disputing the importance of an attorney's autonomy, I would like to note that behind the discussions on self-government, powers, the number and duration of the Bar leadership cadence, which we had to support during preparation of the draft bill, we were unable to pay due attention to extremely important practical issues: organization of activities, taxation, relationship of attorneys in the bar association, distribution of profits in the Bar association and many others.
In terms of the rights and guarantees of professional activities, the proposed rules are generally acceptable. Therefore, summing up my position on Bar reform, I can say that it is necessary to find an opportunity to arrive at constructive proposals, the formula of which is quite simple: draft bill No. 9055, prepared by the Judicial Reform Council should be taken as a basis and should be completed by the second reading in terms of resolving urgent issues on the organization and conduct of law practice.