Facts: Marshell Oil LLP applied to the Commercial Court of St. Petersburg and Leningrad Region to the Federal Bailiff Service (FSSP) to recover damages in the amount of USD 274,785. The dispute arose due to the fact that the bailiffs, in the opinion of the Claimant, unlawfully seized movable property belonging to the Claimant, while the Claimant not only was not a debtor in the enforcement proceedings, within which the arrest was imposed, but in general in no way was not associated with such.

In particular, bitumen and bitumen containers were seized. When imposing an arrest, the FSSP proceeded from the fact that the arrested bitumen was marked – “BITUMINA”. Since the debtor in the enforcement proceedings was Bitumina General Trading LLC, the bailiffs concluded that this property belonged to the debtor in the enforcement proceedings.

The plaintiff claimed losses in the form of lost profits – the sale of bitumen due to the arrest did not take place, and the plaintiff was forced to conclude a replacement transaction at a lower price. The loss of profits was US $ 100,620. The Claimant also claimed losses for excess storage of cargo (USD 162,762) and loss of part of the property (in the amount of USD 10,881). Among other things, The plaintiff also claimed as losses the amount of VAT that the seller, from whom the plaintiff acquired the property, had to pay, since due to the arrest the goods were lost and were never exported outside the Russian Federation (the tax amount was $ 2,106).

Ruling of the court: St. Petersburg Commercial Court satisfied the claim of Marchell Oil LLP in full and analyzed in detail all the claims of the Claimant for losses, indicating the reasons why, in the court’s opinion, the losses were caused by the actions of the bailiffs.

The court examined the issue of the Claimant’s ownership of bitumen, proceeding from the FCA delivery basis used by the Claimant and the seller, analyzed in detail the Claimant’s argument about the decrease in the market price of the goods during the period of illegal arrest and the need to conclude a replacement transaction. The court concluded that the fact of a decrease in the price of bitumen and the occurrence of a loss of profits for the Claimant were proved and occurred due to the illegal seizure of the goods. The court also concluded that despite the fact that the custody was carried out not by the FSSP, but by a third party, the FSSP, nevertheless, is responsible for the lost goods, which were seized. Moreover, the court also upheld the Claimant’s argument that the actions of the bailiffs – executors led to the impossibility of applying a zero VAT rate to the goods, therefore the amount of tax paid is also a loss.

Commentary: the decision on the case can be safely called a rare and valuable example of the recovery from the state (represented by the FSSP) of all the losses claimed by the Claimant in full in the court of first instance.It should be noted that disputes over the recovery of damages from the state are traditionally complicated by the public status of the defendant and Russian courts very rarely satisfy such claims, especially in such a large amount, without any deductions.

It should be noted that the Claimant is scrupulous in proving each circumstance to which he refers. It is especially worth noting what evidence was accepted in support of the Claimant’s arguments. Thus, in confirmation that the replacement transaction of the Claimant at a reduced price was the only possible one, the Claimant brought a letter from the seller-manufacturer, who refused to terminate the contract and accept the goods back “due to the absence of another buyer”. The court found this sufficient confirmation of the difficulty of finding a buyer of the illegally seized property.

At the time of publication of the issue, the FSSP has already filed an appeal, the hearing is appointed for 2nd March 2021. ■