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What for can a judicial fine be imposed in the arbitration court?

April 4, 2019

The arbitration court in accordance with Paragraph 1 of Article 119 of the Arbitration Procedural Code of the Russian Federation (APC RF) is authorized to impose judicial fines on the basis of the specific circumstances of a particular case and the current legislation in the cases stipulated by the legislation.

The judicial fine is a measure of the legal responsibility, which is a sanction that is applied by the arbitration court on the grounds and in the manner established by the APC RF with respect to the persons who do not fulfill the obligations imposed on them by the law and (or) the legal claims of the arbitration court.

As explained in Decision of the Constitutional Court of the Russian Federation No. 2093-O of September 25, 2014, the arbitration court, when considering the issue of imposing a judicial fine for the non-execution of the judicial act, must determine whether there are the grounds for applying to the debtor the public-law measures of impact aimed at forcing him to the proper execution of the obligations imposed on him by the judicial act.

The judicial fine may be imposed both on citizens and officials, and on organizations.

However, Article 256.11 of the APC RF stipulates privileges and immunities for the foreign states participating in the legal proceedings. In particular, when the arbitration court considers the case with the participation of a foreign state, the judicial fine can not be imposed on this foreign state.

The judicial fines imposed by the arbitration court on the officials of the state authorities, the local self-government authorities and other authorities and organizations, shall be recovered from their personal funds.

The judicial fines shall be recovered to the federal budget.

The amounts of the judicial fines vary depending on the status of the person whom it is imposed on.

The APC RF establishes a general rule, according to which the amount of the judicial fine can not exceed:

–          imposed on citizens – ‑two thousand five hundred roubles,

–          on officials – ‑five thousand roubles,

–          on organizations – ‑one hundred thousand roubles.

 

However, there are exceptions stipulated for this rule.

–          the amount of the judicial fine imposed by the arbitration court in the case stipulated by Paragraph 4 of Article 225.4 of the APC RF shall be five thousand roubles.

–          the amount of the judicial fine imposed by the arbitration court in the case stipulated by Part 10 of Article 225.6 of the APC RF on the citizens shall be two thousand five hundred roubles, on the persons performing the functions of a sole executive authority or heading the collegial executive authority of a legal entity – five thousand roubles.

–          the amount of the judicial fine imposed by the arbitration court in the case stipulated by Paragraphs 2 and 3 of Article 225.12 of the APC RF on the citizens shall be two thousand five hundred roubles, on the persons performing the functions of a sole executive authority or heading the collegial executive authority of a legal entity shall be five thousand roubles, on the organizations – ten thousand roubles.

 

The grounds for imposing the judicial fine shall be:

–          non-execution of the arbitration court’s claims to submit an expert conclusion to the arbitration court within the prescribed period (Part 6 of Article 55 of the APC RF);

–          non-execution of the obligation to submit the evidence demanded by the court due to the disrespectful reasons (Part 9 of Article 66 of the APC RF);

–          failure to notify the court on the impossibility of submitting the evidence at all or within the prescribed period (Part 9 of Article 66 of the APC RF);

–          repeated non-execution of the arbitration court’s claims to submit the evidence (Part 10 of Article 66 of the APC RF)

–          non-execution of the decision on securing the statement of claim by the person on whom the court has imposed an obligation to execute interim measures (Part 2 of Article 96 of the APC RF);

–          disrespect to the arbitration court (Part 5 of Article 119 of the APC RF);

–          disorderly conduct at the judicial session or disobedience to the legal orders of the presiding judge (Part 5 of Article 154 of the APC RF);

–          failure to appear in the judicial session of the person participating in the case, whose appearing in accordance with the APC RF has been recognized as mandatory by the arbitration court (Part 4 of Article 156, Part 3 of Article 194, Part 3 of Article 200, Part 4 of Article 205, Part 3 of Article 210, Part 3 of Article 215 of the APC RF);

–          failure to appear in the court due to the disrespectful reasons to the judicial session of an expert, a witness or a translator (Part 2 of Article 157 of the APC RF);

–          failure to submit or a late submission of explanations, objections and (or) arguments within the prescribed period by the authority, organization, official, who have failed to execute the judicial act within a reasonable period (Part 3 of Article 222.8 of the APC RF);

–          non-execution by the person of the obligation to notify on the initiation of the proceedings in the case, the subject and the grounds for the claims filed to the arbitration court and other circumstances of the dispute of other participants (Part 4 of Article 225.4 of the APC RF);

–          non-execution by the person, who has applied to the arbitration court with a petition to secure the statement of claim, of the obligation to notify the persons participating in the case about the time and place of the consideration of the petition for securing the statement of claim (Part 10 of Article 225.6 of the APC RF);

–          an abuse by the person, who has applied to the arbitration court in the case concerning protection of the rights and legitimate interests of a group of persons, of his procedural rights (Part 3 of Article 225.12 of the APC RF);

–          the loss by the guilty person of the writ obligatory passed to him for execution, which has been issued by the arbitration court (Article 331 of the APC RF);

–          non-execution of the judicial act of the arbitration court by the state authorities, other organizations, officials and citizens (Part 1 of Article 332 of the APC RF);

–          non-execution of the actions specified in the writ obligatory by the person, on whom committing these actions has been imposed (Part 2 of Article 332 of the APC RF).

 

I would like to dwell upon separately on such grounds of imposing the judicial fine as disrespect to the court.

The APC RF empowers the arbitration court with the right to impose at its discretion the judicial fine on the persons participating in the case and other persons, who are present in the room for judicial sessions for their disrespect to the arbitration court.

As explained in Paragraph 19 of Resolution of the Plenum of the Supreme Court of the Russian Federation No. 21 of June 13, 2017 “On the Application by the Courts of the Measures of Procedural Compulsion at Considering Administrative Cases,” disrespect to the court shall be meant committing the actions (inaction) that demonstrate clear disregard to the established rules of conduct in the court (for example, the use of obscene expressions in the text of the procedural document filed to the court; multiple filing, not due to the change of the circumstances of the case or other objective reasons, the same petition, with respect of which the court decision has already been made and announced).

At the same time, such actions (inaction), the responsibility for committing which is stipulated by other norms of the procedural legislation (for example, failure to submit the evidence demanded by the court, failure to appear of the duly notified person, whose appearance in the judicial session has been recognized by the court as mandatory) shall not be qualified as disrespect to the court, as well as such actions (inaction), which entail the criminal responsibility.

The judicial fine for disrespect to the court shall be imposed, if the committed actions do not entail the criminal responsibility.

So, in particular, the legislator has established the criminal responsibility for the following actions:

– disrespect to the court, expressed in insulting the participants in the judicial proceedings (Part 1 of Article 297 of the Criminal Code of the Russian Federation);

– disrespect to the court, expressed in insulting the judge or other person participating in the administration of justice (Part 2 of Article 297 of the Criminal Code of the Russian Federation).

As indicated in Decision of the Constitutional Court of the Russian Federation No. 1170-O of May 29, 2014, the court’s authority to impose a judicial fine for disrespect to the court shall not subject to be implemented arbitrarily and it can not be exercised in order to limit the procedural rights of the persons participating in the case, and it contributes to the implementation of such the tasks of the legal proceedings in the arbitration courts as the formation of a respectful attitude to the law and the court. In the event that the person participating in the case, on whom the judicial fine has been imposed, considers the court's decision on imposing the judicial fine to be illegal and unreasonable, he shall be entitled to appeal against it in the prescribed manner (Part 6 of Article 120 of the APC RF). Thus, the determination of the degree of respectfulness to the court of the participant of the legal proceedings is in the court’s jurisdiction and it is established, if there are the legal grounds for that (this legal position was reflected in Resolution of the Arbitration Court of the Far Eastern District of August 18, 2017 in case No. А24-1918/2010, Resolution of the Arbitration Court of the Moscow District of February 16, 2017 in case No. A40-44820/2012).

In accordance with Article 2 of the APC RF, the tasks of the judicial proceedings in the arbitration courts shall be, including: the formation of a respectful attitude to the law and the court; promoting the establishment and development of the partnership business relations, the formation of the customs and ethics of the business turnover.

According to the legal position set forth in decisions of the Constitutional Court of the Russian Federation No. 559-O-O of March 22, 2012, No. 1170-O of May 29, 2014, the determination of the degree of respectfulness to the court of the participant of the legal proceedings shall be in the court’s jurisdiction and shall be established, if there are the legal grounds. The imposition of the judicial fine for disrespect to the court also contributes to the implementation of such task of the judicial proceedings in the arbitration courts as the formation of a respectful attitude to the law and the court. At the same time, the authority granted to the arbitration court to evaluate these persons’ actions entailing the imposition of the judicial fine for the demonstrated disrespect to the court, follows from the principle of the judge administering the legal proceedings (Part 3 of Article 9 of the APC RF).

Thus, for example, according to decision of the Intellectual Property Court of September 13, 2017 in case No. A82-7654/2016, the judicial fine in the amount of 1,500 roubles was imposed on the representative of defendant Sh.

The plaintiff in case No. A82-7654/2016 filed a statement to the Intellectual Property Court on the imposition of the judicial fine on the representative of the defendant for the demonstrated disrespect to the court expressed in the disparaging and disrespectful wordings presented in the appeal and cassation petitions.

The Intellectual Property Court found that the cassation petition contained the disparaging and disrespectful dicta with respect to the judges of the arbitration courts of the court of first appearance and the Court of Appeal, namely: “...there is just a masterpiece of the court's cunning on the 4th page of the Decision” (the first unnumbered paragraph of page 8); “The logic of the court is... Rubbish! ”(the second unnumbered paragraph of page 8); “The conclusions of the Arbitration Court of the Court of Appeal of the Yaroslavl Region and the 2nd Arbitration Court of Appeal, contained in the decision and the resolution, are so ridiculous and illogical ...” (the seventh unnumbered paragraph of page 11); “... The courts transfer what has not been proved by the plaintiff to what has not been proved by the defendant... Just a kindergarten.” (the first unnumbered paragraph of page 12); “We read the resolution of the 2nd Arbitration Court of Appeal... Further, the lie is growing increasingly” (the fifth unnumbered paragraph of page 12 – the first unnumbered paragraph of page 13); “The judges of the 2nd Arbitration Court of Appeal did not even know what to invent, if only to distort the Law of Russia” (the first unnumbered paragraph of page14); “... And the 2nd Arbitration Court of Appeal does not care. The 2nd Arbitration Court of Appeal has neither knowledge of the law, nor any arguments, except for referring to the letters of the Supreme Arbitration Court that have been forbidden by V.V. Putin by the amendments to the APC...” (the fourth unnumbered paragraph of page 14); “In general, all conclusions and arguments of the 2nd Arbitration Court of Appeal are deceitful, not based on the circumstances of the Cause, the meaning of the norms of the law is distorted, and they contain the inventions of the judges of the 2nd Arbitration Court of Appeal” (the first unnumbered paragraph of page 15); “Eventually, the 2nd Arbitration Court of Appeal has dropped to outright lies in the Resolution... There is nothing, but lies ... ”(the second – the third unnumbered paragraphs of page 15); “And a masterpiece of ignorance of the Law of Russia and a complete lack of logic at the end of the Resolution of the 2nd Arbitration Court of Appeal” (the first unnumbered paragraph of page 16).”

The Court in the analysis of this issue has been guided by the following provisions.

The disrespect to the court in the written appeals to the court can be expressed in the use of obscene expressions, provocative expressions. Such actions of the person may be considered as an abuse of the right to court (the Resolution of the European Court of Human Rights of April 6, 2006 in case “Chernitsyn v. the Russian Federation” (petition No. 5964/02).

The Court found that “the representative of Sh., who is the applicant of the cassation petition, has outlined the arguments of the cassation petition, using the wordings of a pejorative character with respect to the court of first appearance and the Court of Appeal without demonstrating the appropriate dignity, civility and tolerance, which should be inherent to the representative of the person participating in the case, thus creating a potential conflict situation, which is able to damage the reputation of the judges or the credibility of the judicial authorities of the Russian Federation. Not merely an impolite or without the appropriate tolerance, but a disparaging and a disrespectful style of presenting the arguments in the cassation petition chosen by the representative of Sh. discourages the formation of a respectful attitude to the law and the court; it does not allow implementing adequately the tasks of the legal proceedings in the arbitration courts, in particular, on promoting the establishment and development of the partnership business relations, the formation of the customs and ethics of the business turnover. Such style of formalizing the documents is essentially aimed at impairing the honor and the dignity of both the persons participating in the case, other participants of the legal proceedings and the judges exercising justice.”

As it is explained in decision of the Constitutional Court of the Russian Federation No. 698-О of April 4, 2017, all participants of the legal proceedings, including the representatives of the parties, shall be obliged to demonstrate a respectful attitude to the court as to the judicial authority exercising justice on behalf of the state, to respond adequately to the comments of the presiding judge, thus excluding the situations that destabilize the legal proceedings, creating obstacles to the proper and timely resolution of the case.

The generally accepted standards of conduct of a legal representative in the court imply that the representative must comply with the norms of the relevant procedural legislation, demonstrate respect to the court and to the persons participating in the case (Paragraphs 2 and 6 of the International Code of Ethics of Lawyers (adopted in 1956); Paragraphs 4.3 and 5.1.2 The Charter of Core Principles of European Lawyers (adopted on November 25, 2006 in Brussels) and the Code of Conduct for Lawyers in the European Community (adopted on October 28, 1988 by the Council of the Bars and Law Societies of the European Union); Article 12 of the Code of Professional Ethics of a Lawyer (adopted by the First All-Russian Congress of Lawyers on January 31, 2003), etc.).

The Court concluded that the representative of defendant Sh. had violated those standards in that case, what was the basis for imposing the judicial fine on that person.

Thus, regarding the norms of conduct in the legal proceedings, the legislator has established universally binding norms, for the violation of which the responsibility in the form of the judicial fine is stipulated.

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Author of article

Olga Zhurid

Olga Zhurid

Lawyer