On the acceptance of property in lieu of debt

Both individuals and legal entities may encounter non-performance of obligations and other disputes that entail the obligation to pay them monetary funds. If a competent authority (court, notary) resolves the situation in their favor, it issues an enforcement document to the claimant (the court, upon a separate application).

Obtaining it makes sense only if there is an intention to further recover sums from the debtor with its help. As a rule, the enforcement document is presented by the claimant to the enforcement authority (it is also possible to send it independently to the place of work of the debtor-individual, but then enforcement will not be levied on their other property). It is not uncommon for a bailiff, in the course of enforcement proceedings, to find that the debtor does not fulfill their obligations due to insufficient or lack of funds for this. The situation is even worse if they have practically no property that can be sold to cover debts. When such property does exist, the bailiff seizes it, takes measures for its appraisal, and transfers it for sale. The latter is not always successful: sometimes buyers either do not want to acquire such goods, or, having initially agreed, change their minds later.

The bailiff offers the claimants to take over the unrealized property, which they often refuse, citing the desire to receive compensation in money. At the same time, other claimants agree to such an offer – those with enforcement documents of a lower priority or who presented them for enforcement later than the refusing persons, i.e., occupying lower positions in the queue for satisfaction of claims. As a result, they take all or a significant part of the debtor's liquid property in lieu of debt, due to which they may not have any items subject to further seizure and sale. In the first case, the enforcement document may be returned to the refusing claimants by the bailiff without further execution, in the second case, the enforcement may be delayed.

Thus,

the prompt execution of requirements contained in enforcement documents depends not only on the debtor's conduct and the work of bailiffs, but also on the approach of creditors to enforcement proceedings. Therefore, it is necessary to once again emphasize such an important way of satisfying creditors' claims as accepting the debtor's property in lieu of debt repayment. Such an opportunity should not be neglected, especially if the acquired property can be used by citizens in everyday life, and by legal entities in production activities.

Prosecutor of the regional prosecutor's office department
for supervision of compliance
with legislation by bodies
of the penal system
and enforcement
Denis Ploskunov