Real estate disputes
Set aside a bailiff auction and restored the client’s ownership of a half share in an apartment
Bailiffs put our client Nikolay Shchechkin’s one-half share in an apartment up for auction. Key documents concerning valuation and sale were sent to addresses where the owner did not actually live, although the bailiff had information that he was incarcerated. The court found the transfer of the share for sale unlawful, invalidated the auction and the subsequent sale agreement, and restored the client’s ownership of the one-half share.
Situation
Nikolay Shchechkin (Щечкин Николай Васильевич) owned a one-half share in an apartment. The share was seized in enforcement proceedings and was later selected for sale.
The enforcement process used a valuation of RUB 296,000. The valuation report was dated July 20, 2022, and the bailiff accepted the valuation results on September 15, 2022.
The bailiff had information that Shchechkin did not live at the addresses to which correspondence was being sent and, on April 15, 2022, obtained information that he was incarcerated. Nevertheless, key documents concerning valuation and the subsequent sale continued to be sent to an address where the client did not actually live.
The auction of the one-half share took place on February 14, 2023. A sale agreement dated March 14, 2023 was subsequently executed, meaning that the client’s ownership interest had already been affected by a completed sale to a third party.
Legal Task
Challenge the violations surrounding the transfer of the one-half apartment share for sale, obtain invalidation of the auction and the subsequent sale agreement, and apply the consequences of invalidity to restore the client’s ownership.
How the Work Proceeded
What We Did
- 01
Reviewed the enforcement file, including information on the client’s addresses, notices, seizure of the property, valuation and transfer of the share for sale.
- 02
Established that the bailiff had information that the client was incarcerated, while key documents continued to be sent to an address where he did not actually live.
- 03
Challenged the use of the RUB 296,000 valuation and starting price, including the fact that the valuation report was dated July 20, 2022 while the auction took place on February 14, 2023, beyond the six-month period considered by the court when assessing the legality of the sale process.
- 04
Sought a declaration that the transfer of the share for auction was unlawful, that the auction and sale agreement were invalid, and that Nikolay Shchechkin’s ownership of the one-half apartment share be restored.
Result
The court restored the client’s ownership of the one-half apartment share
On February 28, 2024, the Leninsky District Court of Krasnoyarsk in case No. 2-267/2024 found the bailiff department’s actions in transferring Nikolay Shchechkin’s one-half apartment share for sale to be unlawful.
The court invalidated the auction of February 14, 2023 and sale agreement No. 24 АА 4735514 dated March 14, 2023, concluded with Vyacheslav Krotov following the auction.
The court applied the consequences of the invalid transaction and restored Nikolay Shchechkin’s ownership of the one-half share in the apartment.
The claim was granted in part. The court did not find unlawful conduct by the Interregional Territorial Administration of the Federal Agency for State Property Management and rejected that part of the claim. The available case materials do not confirm that the restored ownership has already been registered in the real estate register or that the judgment has entered into legal force. Viktor Erofeev of Konsultant Law Firm represented the client.
RUB 296,000 and RUB 986,000 were not monetary awards to the client
RUB 296,000 was the value used in the enforcement process for the one-half share when it was transferred for sale. The court did not award this amount to the client and did not establish it as a new compensation amount.
RUB 986,000 represented proceeds from the sale of the share that were transferred to the bailiff department’s account for settlement within the enforcement proceedings. The RUB 986,000 was not an amount awarded or paid to Nikolay Shchechkin.
The principal result of the case was not a monetary recovery. It was the invalidation of the auction and sale agreement and the judicial restoration of the client’s ownership of the one-half apartment share.
Judicial restoration of ownership and registration in the property register are separate stages
The judgment restored Nikolay Shchechkin’s ownership of the one-half apartment share as a consequence of the invalid transaction.
The case materials do not confirm that the corresponding entry has already been made in the real estate register after the judgment. The result therefore must not be described as completed registration of the restored ownership.
Why This Case Matters
A completed enforcement auction can still be challenged where procedural violations materially affected the owner’s rights. Here, the central issue was that the client was deprived of a real opportunity to challenge the bailiff’s actions, the valuation and the starting price before the property was sold.
Once the auction was declared invalid, the sale agreement concluded as a result of that auction was also invalidated. This allowed the court to apply the consequences of invalidity and restore the client’s ownership of a one-half apartment share that had already been sold.
Our role
Konsultant Law Firm represented the plaintiff, Nikolay Shchechkin (Щечкин Николай Васильевич), who owned a half share in the apartment.
The case was handled by lawyer Viktor Erofeev.
The court declared the bailiffs’ actions in transferring the 1/2 share to auction unlawful, invalidated the auction and the purchase and sale agreement concluded on its results, and restored the client’s ownership.
Client
Nikolay Shchechkin (Щечкин Николай Васильевич)
Client role
claimant, owner of a one-half apartment share
Subject
challenge to the transfer for auction, the auction and sale agreement; restoration of ownership
Property
one-half share in the common ownership of an apartment
Property status
seized in enforcement proceedings and transferred for sale
Valuation report
July 20, 2022
Valuation accepted
September 15, 2022
Value used in enforcement
RUB 296,000
Bailiff information on client’s incarceration
available to the bailiff
Auction
February 14, 2023
Sale agreement
No. 24 АА 4735514 dated March 14, 2023
Purchaser under sale agreement
Vyacheslav Krotov (Кротов Вячеслав Георгиевич)
Sale proceeds
RUB 986,000 — transferred to the bailiff department’s account within the enforcement proceedings
RUB 986,000 awarded to client
no
Court
Leninsky District Court of Krasnoyarsk
Case
No. 2-267/2024
Case UID
24RS0032-01-2023-001779-47
Decision date
February 28, 2024
Bailiff result
transfer of the one-half share for auction declared unlawful
Auction result
auction declared invalid
Sale agreement result
sale agreement declared invalid
Ownership result
client’s ownership of the one-half share restored by the court
State Property Agency
no unlawful conduct established by the court
Claim
granted in part
Actual registration in real estate register
not confirmed
Appeal
not confirmed
Legal finality
not confirmed
Lawyer
Viktor Erofeev
Practice Areas
Practices Related to This Case
Managing Partner, Konsultant Law Firm
Nikolay Nemkov
Has your real estate been transferred for auction in enforcement proceedings?
We will review the enforcement file, notices, property valuation, starting price, transfer for sale and auction documents to determine whether there are grounds to challenge the enforcement actions, the auction and the subsequent transaction.