2011/5/31 - 29 NSČR 13/2010 (summary)

Czech Republic – Supreme Court – Decision No. 29 NSČR 13/2010 – May 31, 2012

(insolvency – known creditor domiciled in a Member state of the European Union)

A Regional Court (CZ) rejected a creditor’s application for the registration of his claim in an insolvency proceeding, and determined that after the resolution became final and conclusive, its role in the insolvency proceeding would end. The first-instance court (the Regional Court) started from the fact that the creditors were invited to apply for the registration of their claims by a specific date. However, the application of creditor no. 48 was delivered to the insolvency court almost one year later. The creditor claimed that he was a known creditor of the debtor, as defined in Section 430 of Act No. 182/2006 Coll. on bankruptcy and methods of bankruptcy resolution, and he should have therefore been immediately notified of the initiation of the insolvency proceeding. The first-instance court admitted that the creditor should have been notified of the initiation of the insolvency proceeding, but only provided that the court knew, at the time of the initiation of the insolvency proceeding, that the creditor indeed was a known creditor. A High Court, as the appellate court, upheld the resolution of the first-instance court. As regards the appellant’s request for suspension of the proceeding and referring the case to the Court of Justice of the European Union for a preliminary ruling concerning the interpretation of the term “known creditor domiciled in a Member State of the European Union”, the court did not grant that request, stating that the court’s interpretation was not contrary to the Regulation and that the appellant still had the chance to lodge an extraordinary appeal with the Supreme Court.

The Supreme Court of the Czech Republic pointed out that it had dealt with the interpretation of Section 430 of the Insolvency Act before in its decision-making practice and that, in the case of a known creditor, the period for the filing of an application commences as late as the date on which the invitation to file an application is specifically delivered to that creditor. The Supreme Court mentioned, in respect of the request for the reference for a preliminary ruling, that the interpretation and correct application of European Union law were absolutely clear in those matters and that the provided interpretation of European Union law was identically clear to the courts of other Member States and to the Court of Justice of the European Union as well. The Supreme Court vacated the resolutions of the courts of both instances and remanded the case to them for further proceedings.