Top 5 family disputes: how to divide shares and real estate properly

Head of family and inheritance law, Managing Partner of Pavlova & Partners Law Firm Galina Pavlova commented on key family disputes.
According to the statistics of the Supreme Сourt, one of the most common categories of cases following the results of the last year is related to family relations (1+ million disputes), half of them is about divorce. Based on the opinions of experts, we have chosen five important cases on this topic for you, which have reached the sun. What problems do the participants of "celebrities’ divorces" face? How to divide "marital" shares properly? What will help to divide multiple real estate in the divorce properly? 

Dividing assets with the bankrupt

Andrey Ratnov* owed money to Rosselkhozbank JSC, therefore, the court declared him a bankrupt and has initiated the procedure of sales of assets of insolvent individual. Later, Nina Ratnova*, his wife, decided to divide marital assets, but it was not possible to do it amicably. And the wife filed a respective lawsuit. The couple had no common minor children, as well as common debts. The Mikhaylovsky District Court of the Ryazan Oblastarrested judgment on her petition, and the appeal left such a decision without any changes. Two instances indicated that the law did not allow the court of General jurisdiction to hear a case on the division of property between spouses after the recognition of an individual as bankrupt. At the same time, the second spouse is able to receive his/her share of the common property only in the form of money received from the sale of marital property, the courts added. They were basing on the fact that satisfaction of claims of Ratnova is possible only through her participation in the bankruptcy case as a creditor. 

Then the wife addressed with similar requirements to the Arbitration Court of Ryazan Oblast. But the Arbitration Court denied her petition, having specified the absence of the right to participate in case of bankruptcy of the spouse. The applicant was offered to resolve the dispute in the Court of General Jurisdiction. The 20th Arbitration Court of Appeal agreed with this and explained: during the bankruptcy procedure, the debtor's spouse has the right to apply to the court of General jurisdiction according to the standard procedure with a claim for the division of marital property of the spouses or to demand the recognition of the right of common ownership of these assets (No. A54-1301/2016). 

After these conclusions Ratnova appealed the acts of the Court of General Jurisdiction in the Supreme Court. The Supreme Court pointed out that the jurisdiction of cases between courts of General jurisdiction and arbitration courts is determined considering the nature of the disputed legal relations and their subject matter. Taking into account that special norms of the bankruptcy law do not expressly provide for the consideration of disputes related to the division of the common property of the spouses in the Arbitration Court, it should be guided by the rules of civil procedural law. According to paragraph 1 part 1 article 22 code of Civil Procedure Code, the competence of the Court of General Jurisdiction also includes ordinary proceedings on trials arising from family relations, such as those of Ratnov's family. The Supreme Court has noted: initiation of bankruptcy proceedings of an individual does not mean that all disputes related to the formation of the bankruptcy estate are subject to consideration in Arbitration courts. Since in a disputable situation, the claim is not filed within the framework of creditor claims on issues related to the sale of common property, but is based on the provisions of civil and family legislation, - the Supreme court noted. In such circumstances, the lower courts had no legal grounds for the termination of the proceedings in connection with its wrong jurisdiction, judicial panel in civil cases of the Supreme Court underlined (case No. 6-KG 8-1).

Galina Pavlova, Managing Partner of Pavlova & Partners Law Firm:
"In this trial, the main subject is of a procedural nature, but it is very important for judicial practice. The Court of General Jurisdiction in such cases often terminates proceedings on the division of property of spouses, believing that such a conflict is subject to consideration in a bankruptcy dispute in the Arbitration Court (AC). But the Supreme Court explained: initiation of insolvency proceedings of an individual does not mean that all disputes related to the formation of the bankruptcy estate should be considered in Arbitration courts. Participation of the debtor's spouse in the insolvency proceedings is possible in the case provided for in the bankruptcy law." 

Divide the property successfully
Spouses Anna and Boris Solyuskin* had joined shared ownership of two cottages and a land plot of 8002 sq. m. The wife was entitled to 24/100 and the husband to 76/100 shares. They had no agreement on how to use the premises. When the couple started the divorce procedure, they could not divide the assets amicably. And Anna Solyuskina filed a claim for division of property. In this case, the court appointed an expert examination in order to establish the most optimal scheme how to divide the property. The specialist offered several options at once, but the court has chosen the one according to which the husband received the ownership of all residential buildings and a land plot of 5541 sq. m. And the applicant got just a shed and a land of 2461 sq. m. 

The first instance decided that this scheme is in the interests of the parties and is convenient for using the property, as it does not provide for the reconversion of real estate and takes into account all necessary compensations. This position was also supported by the representative of Boris Solyuskin. The defendant was absent at the session, and after the judgment was awarded he said that he did not like this option since he has not asked for both cottages at the expense of reducing the share of the land lot. And the husband obtained a review of the decision in the appeal, which agreed that another version of the division will be correct: according to it, each of the owners receives a share of the building or a land lot proportional to his/her share. But in this case significant financial investments and reconstruction of residential houses were needed – construction of dividing partitions, gas supply, installation of heating system, electric wiring etc. In this case, the claimant received a plot of 1920 sq. m, and her husband – 6082 sq. m. "with a configuration that provides each party with a possibility to reach the allocated shares of both houses." 

This time such a division of property was not satisfactory for the applicant. She challenged the appeal in the Supreme Court. The Supreme Court pointed out that in a disputable situation it is not necessary to provide both the claimant and the defendant with an appropriate share in each of the objects. Since the goal of the division is to terminate the mode of common property and to give the opportunity as much as possible freely to dispose of the property, - the Supreme Court emphasized. Judicial panel on civil cases of the Supreme Court has noted: when the share of the owner is insignificant and it cannot be allocated actually, the court is entitled, even in the absence of this owner's consent, to oblige the other participants of the share property to pay him/her a compensation (case No. 4-KG17-66). In this case, the courts should take into account several factors at once: does the chosen option of division of property require additional costs, construction works, formation of complex configuration areas and the establishment of easement on part of the premises in residential buildings, - the Supreme Court underlined. In addition, in a disputable situation the lower courts failed to take into account that the parties developed a conflictual relationship, and thus it would be difficult to use one and the same house, the "three" judges of the Supreme Court chaired by Sergei Astashov summed up. 

Galina Pavlova, Managing Partner of Pavlova & Partners Law Firm:
"The Supreme Court paid attention that when the court is able even in the absence of the consent of the owner to oblige the remaining participants of shared property to pay a compensation to him/her: the share of the owner should be insignificant, it can not actually be allocated, and the owner does not have a significant interest in the use of common property (paragraph 4 of article 252 of the Civil Code). In most cases, lower courts avoid the application of this norm and follow the same way as in this case: they determine the share on the basis of expert opinion". 

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Ирина Кошечкина