BGP Litigation represented the bankruptcy trustee of a developer of a premium residential complex in the heart of Moscow. In the bankruptcy proceedings, the trustee challenged an agreement on shared participation in the construction of 450 parking lots, made with a debtor’s affiliate in 2013.
The task of challenging the agreement was aggravated by the fact that the parking lots were pledged as security to the bank that issued a loan to fund their acquisition.
Owing to the legal arguments developed by the lawyers of BGP Litigation’s Bankruptcy and Dispute Resolution practices, the court of first instance has established that the transaction at issue was not an arm’s length one, invalidated the agreement on the shared participation in construction, and ruled that there was no pledge over the parking lots. Thanks to that, 142 parking lots remained in the bankruptcy estate and the affiliate had to pay the market price of the parking lots sold to third parties, for the total of more than RUB 427 million.