Recovery of dividends under a securities deposit agreement: which court?
The question of the jurisdiction of the dispute is one of the initial issues that should be resolved when the injured party initiates a legal dispute. Often, not only participants in civil legal relations, but also professional lawyers incorrectly determine the jurisdiction and jurisdiction of the dispute. The reason for this is rather vague wording of the legislation: how is the economic nature of the requirement determined, what is considered a corporate dispute, etc.
The plot of the case:
The plaintiff - an individual applied to the Arbitration Court of the city of Moscow with a statement of claim to the Company to recover a sum of money in the amount of 67,448 rubles. as dividends on the concluded between the parties to the agreement of deposit of securities (shares) and interest for the use of foreign funds.
The arbitration court terminated the proceedings because of the lack of jurisdiction of the dispute to the arbitration courts because there is no dispute between the parties on the right to shares, and the only substantive interest of the claimant is to receive funds due to it under the contract.
Judicial act: Determination of the Arbitration Court of Moscow of 03.10.2018 in case number A40-152872 / 2018.
The findings of the court:
1. Based on the totality of procedural norms, the issue of jurisdiction of a dispute to an arbitration court should be decided taking into account the presence of two reasons: a special subject of the dispute and the nature of the dispute (in this case it is an economic (property) character).
2. As for the subject composition of the disputed material and legal relations, arbitration courts consider disputes involving legal entities and individual entrepreneurs. The law also establishes an exception to the general rule, according to which the jurisdiction of arbitration courts includes disputes involving persons who do not have the status of an individual entrepreneur, such cases should be directly established by law. In this case, the relevant evidence was missing.
3. Due to the fact that the claimant is not an individual entrepreneur, the dispute is subject to consideration in the arbitration court only in cases expressly established by law. In particular, if the dispute falls into the category of corporate disputes.
The court concluded that this dispute is not a corporate one, since there was no dispute between the parties about the right to shares, their encumbrance or the exercise of the rights arising from them. The dispute arose from a contract for managing shares, and the plaintiff demanded only the amount of cash constituting dividends on shares, in no way disputing their affiliation.
4. The court also noted that the plaintiff did not submit evidence of the loss of the right to defense in a court of general jurisdiction: the court of general jurisdiction did not decide to refuse to accept the application or to terminate the proceedings. In other words, if the arbitration court decides to discontinue the proceedings, the claimant will not lose the right to defense of his violated rights and will be able to apply for their protection to a court of general jurisdiction.
5. The reservation established by the parties to the agreement on the consideration of disputes in the Moscow Arbitration Court has no legal significance in this case. The court stressed that procedural legislation defines the right of the parties to change the jurisdiction of the dispute, but not jurisdiction.
Comments:
1) One of the most important issues in the implementation of methods for the protection of violated rights is the determination of the jurisdiction and jurisdiction of the dispute. To establish the jurisdiction of the dispute, it is necessary to take into account two reasons in its totality: the subject composition of the participants in the controversial relationship and the nature of the dispute.
2) The law may establish exceptions to the rules regarding the subject composition of participants (for example, arbitration courts may adjudicate disputes, whose parties are persons who do not have the status of an individual entrepreneur, but because of the nature of the dispute that has arisen (corporate) belong to the jurisdiction of arbitration courts).
3) When considering the issue of jurisdiction, it is also important to establish whether the decision made will not violate the right to protection of the injured party. For example, if a party appeals to an arbitration court after the court of general jurisdiction decides to refuse to accept the application or to discontinue the proceedings, the arbitration court’s decision to discontinue the proceedings is impossible due to the fact that the injured party simply has nowhere to turn for judicial protection of violated rights.
In the event that your litigation or other dispute, contractual work or any other form of activity concerns the issues discussed in this or other of our material, we recommend checking and making sure that your legal position corresponds to the latest changes in practice and legislation.
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