Declaring Unlawful the Actions of a Bailiff Imposing Registration Restrictions on a Vehicle

Case Profile

The Background

In January 2023, our Client (the Company) acquired a Volkswagen Polo vehicle under a sales agreement, paid its price in full, and registered title with the State Traffic Inspectorate (STSI/GIBDD). Despite this, in April 2023, a court bailiff-executor from the Perovsky Department of Bailiffs imposed a ban on registration actions regarding the vehicle as part of enforcement proceedings initiated against its former owner.

The Company petitioned the bailiff to lift the restrictions, demonstrating that the vehicle had left the debtor's ownership long before the proceedings were initiated and measures were applied. However, the petition was refused. This effectively deprived our Client of the ability to dispose of its property, violated the lawful owner's rights, and hindered the Company's normal business operations.

Client Risks

Imposing a ban on registration actions deprived our Client of the right to sell, transfer, or utilize the vehicle as a full-fledged corporate asset.

This created direct financial risks, threatened commercial operations, and risked establishing a negative precedent where a good-faith purchaser of property remains restricted in rights due to debts and liabilities of a former owner.

Furthermore, the bailiff's formal refusal to grant the petition heightened legal uncertainty and created artificial obstacles to defending the Company's legitimate interests.

Legal Defense & Strategy

KDpartners lawyers prepared and filed an application with the Arbitration Court of Moscow to declare the actions of the court bailiff and the issued refusal order unlawful.

The claims were substantiated with the following evidence:

• the vehicle sales agreement;
• a payment order confirming full settlement of the vehicle's purchase price;
• the vehicle registration document (PTS) marked with the title transfer;
• the vehicle registration certificate issued in our Client's name.

The legal position was grounded in the Federal Law "On Enforcement Proceedings" and clarifications of the Plenum of the Supreme Court of the Russian Federation, which stipulate that compulsory execution measures may only be applied to property owned directly by the debtor. The lawyers emphasized that when the restrictions were imposed, the vehicle had already ceased to be the former owner's property and was officially registered to our Client.

The court fully agreed with the defense's arguments, finding that the bailiff's actions infringed upon the rights of a good-faith purchaser and created unlawful impediments to property usage.

The Outcome

The Arbitration Court of Moscow satisfied our claims in full:

• the actions of the court bailiff-executor imposing a ban on registration actions with the Volkswagen Polo were declared unlawful;
• the bailiff's order refusing to lift the restrictions was set aside as invalid;
• the court bailiff-executor was ordered to remedy the violations and lift all restrictions on the vehicle within five days of the judgment entering into legal force.

For our Client, this meant the complete restoration of its right to freely dispose of the vehicle, the elimination of legal risks, and the protection of commercial assets from third-party liabilities.