The topic of the speech was legal literacy as an integral part of a modern successful woman. In her speech, Olena Sibirtseva also spoke about the importance of contacting a family lawyer before getting married or starting to live with a partner without going to the registry office. Why do business competitors "wait" for divorce and division of marital property? Should we allow "registering an apartment in one's mother's name" and why is it dangerous for the family? Is inheritance planning about everyone's responsibility or unnecessary precautions? Why should you divorce your previous spouse if a new relationship is on the horizon?

The dispute arose out of a DAP contract under which our client had to deliver the goods to a Polish border station using railway transport. Our client submitted the applications to the electronic railway system to book the railcars for delivery. The said applications had to be approved by a Polish railway with the assistance of a buyer and its consignee. Some of the applications were approved, allowing our client to successfully deliver part of the goods. However, some of the submitted applications were rejected by the Polish side. As a result, the client could not deliver the remaining contract quantity of the goods within the delivery period.

The client insisted that the performance of the contract was prevented by the buyer’s omission, i.e., failing to facilitate the approval of shipment applications by a Polish railway. As a result of this omission, the client incurred substantial default damages, as the non-delivered goods were re-sold at a much lower price. Because the buyer refused to compensate for these damages, the client decided to initiate the FOSFA arbitration proceedings.

During the arbitration, the buyer insisted on the absence of his fault. The buyer stated that under a classic DAP contract, it is a seller who is responsible for the delivery of the goods until the place of destination, bearing all the risks. Our legal team, in turn, referred the Tribunal to numerous contractual provisions which expressly mentioned the buyer’s obligation to facilitate the delivery of the goods and acceptance of the shipment applications. In addition, numerous pieces of evidence were submitted (witness statements, excerpts of Ukrainian legislation, etc) proving that a buyer is playing an important role in the delivery process from Ukraine to Poland.

After a long-lasting exchange of written submissions between the parties, the tribunal fully satisfied the client’s claim awarding the damages in the amount of about USD 2 mln together with interest. The Tribunal in its award admitted that while under a common DAP contract, a seller indeed bears all the risks related to the delivery of the goods to the destination, in the present case the parties in the contract expressly placed additional obligations on the buyer. This decision reminds us once again to carefully study the contractual provisions before signing agreements with counterparties.

The AGA Partners’ team was represented by partners Ivan Kasynyuk and Iryna Moroz, as well as senior associates Ievgen Boiarskyi and Dmytro Izotov.

The list includes 115 arbitrators from 39 countries who are the leading practitioners and most respected academicians recommended in arbitration by reputable international legal rankings, including Chambers and Partners, The Legal 500 and Who's Who Legal.

The Claimant filed a lawsuit against a Chinese corporation, claiming that the agreement for a bank guarantee was invalid and any disputes arising out of the guarantee are to be settled under Ukrainian law at Ukrainian courts. However, such a position was contradicted by the fact that the bank had signed an arbitration agreement, which provided that English law applies and disputes should be resolved under ICC Arbitration Rules.

As a result, the first instant court remained the claim without consideration, because the parties had agreed to settle any disputes through arbitration instead of going to court.

Nevertheless, the appeal court overturned the previous court's decision, stating that one of the defendants was in bankruptcy proceedings, therefore the dispute is non-arbitrable and shall be considered by the Ukrainian court.

Disagreeing with this outcome, AGA Partners filed a cassation to the Supreme Court, drawing attention to the fact that the appeal court wrongly ignored the binding arbitration clause, under which arbitration proceedings had already been initiated. This violated the Law of Ukraine "On International Commercial Arbitration" and the Commercial Procedure Code of Ukraine (hereinafter referred to as the "CPCU"). The appeal court also made a mistake in concluding that the dispute under the guarantee in non-arbitrable.

The Supreme Court upheld our client's position and completely overturned the appeal court's decision, leaving the first-instance court's ruling in force. The Supreme Court noted that:

"...the appeal court erroneously prioritized individual provisions of national law over the provisions of valid international treaties of Ukraine in the disputed legal relations, and unjustifiably interpreted the absence of special provisions regarding the implementation of an arbitration agreement by the debtor in a bankruptcy case as a basis for applying analogies of law instead of applying the mandatory provision of Article 226, Part 1, Section 7 of the CPCU".

It is an important decision, demonstrating the court’s support for arbitration dispute resolution in Ukraine. The decision of the Supreme Court can be found at the following link.

The AGA Partners team was represented by partner Iryna Moroz and senior associate Olena Sibirtseva.

To start the new year with good news - our colleagues have been elected to the councils of the Ukrainian Bar Association's committees:
 
Olena Sibirtseva - Head of the UBA Committee on Civil, Family and Inheritance Law
Oleksandr Gubin - Member of the UBA Committee on Civil, Family and Inheritance Law
Iryna Moroz - Member of the UBA Committee on Alternative Dispute Resolution
Ivan Kasynyuk - Member of the UBA Committee on International Trade Law
Pavlo Lebedev - Member of the UBA Committee on Agrarian Law
Viktor Pasichnyk  - Member of the UBA Committee on Agrarian Law
Anastasia Shevchuk - Member of the UBA Committee on Agrarian Law
 
Thank you for your support!

Aminat Suleimanova, Managing Partner of AGA Partners, was recognized among the TOP-100 best lawyers in Ukraine.

AGA Partners lawyers were also recognized in four practices:

• International Arbitration - Managing Partner Aminat Suleimanova and Partner Iryna Moroz;
• International trade - Partner Ivan Kasynyuk;
• Family law - Managing Partner Aminat Suleimanova and senior associate Olena Sibirtseva;
• Sportsl Law - Senior Associate Dmytro Koval.

We are grateful to Yurydychna Hazeta for the research and our colleagues for the recognition!
➡ More information about the ranking

Based on the research conducted by Yurydychna Hazeta, Ukrainian Women in Law 2023, Managing Partner Aminat Suleymanova has been recognized as one of the top 5 women leaders who have significantly influenced the development of the legal community. Additionally, Partner Iryna Moroz has been included in the list of women leaders in the legal market.

AGA Partners and Managing Partner Aminat Suleymanova are recognized among the leaders in International Arbitration and International Trade Law according to the results of the research conducted by the Ukrainian Advocates' Association (UAA)

AGA Partners' Partner Iryna Moroz has been included in the list of TOP-10 Ukrainian lawyers in Dispute Resolution in 2023 according to the online business news platform Business Today

The platform provides its readers with the latest updates and information on a wide range of topics related to the business world.

In this case, the seller undertook to supply 25,000 mt of Ukrainian corn and wheat in October 2022 under two CIF contracts.

From 29 October to 2 November 2022, russia suspended its participation in the Grain Deal. Because of this situation, the seller referred to the blockade of the grain corridor and requested a free extension for the later performance of the contract. The buyer did not accept that request and the goods were not eventually shipped within the agreed period.

In these circumstances, the buyer declared the seller in default for the failure to perform the contract and initiated arbitration to recover damages. 

The seller’s main defence was that force majeure excused it from liability for the breach. The arbitral tribunal held that there was no force majeure for the following reasons:

• The contracts were concluded more than six montns after the russian invasion. The seller assumed the possibility of delays and should have planned for this in advance of the shipment period.
• To take advantage of a force majeure clause, the seller had to make a clear reference to the force majeure event. Instead, it merely requested a free extension in its letter.
• The seller did not prove that there were issues with the cargo and difficulties with vessels.

On this basis, the arbitrators awarded our Turkish client ~USD 1,300,000 in damages.

This case vividly illustrates that obstacles to contract performance might be treated as force majeure only if they directly prevent the shipment of the goods. Mere difficulties (even grave ones) will not suffice. 

The client was represented by partners Ivan Kasynyuk and Iryna Moroz as well as by senior associate Pavlo Lebediev.

And the waiting is over! But… whether the government’s decision resolves the existing issues? 

On 31 October 2023, the Cabinet of Ministers of Ukraine issued Resolution No. 1132 "On the Implementation of an Experimental Project on the Verification of Subjects of the Agro-Industrial Complex under Martial Law" (“Resolution”). This act fundamentally changed the procedure for the export of agricultural goods from Ukraine.  

In plain words, the Resolution provides that only legal entities that are included in the verification list of Ukrainian exporters and meet the established criteria are entitled to export agricultural products. All procedure of verification is carried out by Ukrainian authorities. 

But, delving deeper, the established rules apply to the export of agricultural products under UKTZED codes 1001, 1002, 1003, 1004, 1005, 1201, 1205, 1206 00, 1507, 1512, 1514, and 2306. 

Thus, an exporter of the goods under the said codes must meet the following requirements: 

1. an exporter must be a VAT payer at the time of submitting an export application and as of 23 February 2022; 

2. an exporter has no tax debt for the payment “Penalty for Violation of Settlement Deadlines in Foreign Economic Activity, Non-Performance of Obligations, and Penalties for Violating Currency Legislation” (payment code - 21081000); 

3. an exporter has documentary confirmation from the bank that from 23 February 2022 to 27 October 2023, an exporter conducted at least one successful export operation with a return of foreign currency revenue; 

4. an exporter has not been subjected to a tax authority decision regarding the absence of a registered location; 

5. an exporter is not subject to the bankruptcy proceedings and is not in the liquidation. 

As an alternative to the verification procedure, the Ukrainian Government provides a licensing procedure for the export of agricultural products. 

So now, a new bureaucratic stage has been added to the export process (which is unlikely to please any of the traders) – the formation of a list of verified agricultural entities. Each of the entities that now wish to export Ukrainian agricultural products without hindrance must undergo this verification procedure. 

But whether existing restrictions and established rules can be treated as a prohibition of export or other event that exempt sellers from liability for non-delivery of agricultural products. The question is still open. 

It is not yet entirely clear how this innovation will work in practice and how realistic the requirements of Ukrainian legislation are. Hopefully, the market will return to normal, traders will adapt, and the goods will be delivered to buyers! 

For additional information, please contact Mr. Ivan Kasynyuk, Partner at AGA Partners, kasynyuk@agalawyers.org; Mr. Oleksandr Zub, Associate at AGA Partners, zub@agalawyers.org; or Mr. Viktor Romaniv, Associate at AGA Partners, romaniv@agalawyers.org.  

AGA Partners team constituted of the partners Iryna Moroz and Ivan Kasynyuk, senior associates Yurii Bedenko and Pavlo Lebediev, associates Anastasiia Shevchuk and Vasyl Radetskyi have successfully cancelled the arrest nine days after the interim measures were imposed. Eventually, AGA Partners law firm have returned the amounts paid on the deposit account of the court to the shipowners.

Senior associate Yurii Bedenko comments: “Imposing an arrest on the sea vessel considered in ex parte court proceedings may cause huge damages for the shipowners. The courts of Ukraine may impose an arrest even in the situations where the maritime claim is not clearly visible. That is why is important to act fast to reduce shipowner’s losses caused by arrest”.

Senior Associate Ievgen Boiarskyi will be a guest lecturer on "Drafting Arbitration Agreements and Arbitration Clauses" within the course "International Law and Arbitration" organized by the Business Consulting Academy (BCA).

AGA Partners' Partner Ivan Kasynyuk, Senior Associate Pavlo Lebediev and Associate Anastasiia Shevchuk delivered a seminar on the latest challenges in commodity trade in the Black Sea region. Active interaction with the audience resulted in a great discussion. Pavlo Lebediev also spoke at the panel "Price Assessment, Contracts and Insurance in International Trade" together with other speakers of the conference.