Is it possible to cede the right to demand payment of a fine by a public organization in Russia

Situation: a court decision in favor of the consumer collected funds, and in favor of a public organization, 50% of the amount that was satisfied by the consumer was recovered as a fine for violating the rights of the consumer (pursuant to paragraph 2 of clause 6 of Article 13 of the Consumer Protection Law).

The question is: can a public organization cede the fine that was collected in its favor to another person?

In other words: is it possible to assign the right to demand payment of a fine for violation of consumer rights under Russian law?

Answer:an unequivocal conclusion can not be made, since such an opportunity is dependent on judicial discretion.

Rationale:: In the sense of art. 4 of the Civil Procedure Code of the Russian Federation in cases of retirement of one of the parties in a legal relationship established by a court decision, including due to the assignment of a claim, the court allows the replacement of this party by its legal successor. Succession is possible at any stage of civil proceedings.

By virtue of Article 383 of the Civil Code of the Russian Federation, the transfer to another person of rights inseparably linked with the creditor’s identity is not allowed.

Thus, if the claim is not inextricably linked with the person and a cession agreement is made with respect to this requirement, the court shall replace the party with its successor.

The main issue in the case under consideration is whether the requirement of a public organization to recover 50% of the fine awarded by the court, inextricably linked with the person or not?

Courts to this question give an answer on the internal conviction, with the established practice is not due to its scarcity.

Thus, in the appeal judgment of the Kemerovo Regional Court of 24.03.2015 in case No. 33-3511/2015 the court replaced the public organization by its successor, who did not have such status, and dismissed the respondent’s argument that the fine was a special liability measure and was charged in favor of a special entity – public organizations that protect the rights and legitimate interests of consumers, and that the identity of the creditor (public organization) is of significant importance.

In another case № 11-54/2012 the Orlov District Court in its appeal dated May 23, 2012 refused to replace the public organization with a successor, stating that: “in this case, the rights to receive a fine by a court decision are inextricably linked with the person Creditor, since the penalty is a measure of the legal liability of the seller to a public organization, and is not an ordinary monetary obligation. Encumbrance of ZAO Svyaznoy Logistika with an obligation to a natural person B. to pay a fine contradicts the above law and the Orel Regional Society for the Protection of Consumer Rights did not have the right to concede it at the stage of execution of the court decision”.

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