We are pleased to announce a significant success of the litigation practice of KKLW in a criminal case initiated against the partners and management board members of two limited liability companies in connection with transactions of transferring a package of receivables between the companies in question, in time correlation with a court ruling that could be perceived as leading to the insolvency of one of the companies.
A bill of indictment was brought by the public prosecutor against the Clients, based on the charge of depleting creditors’ assets (Article 300 § 2 of the Criminal Code), indicating that as a result of the defendants’ actions, in particular as a result of the conclusion of agreements on the sale of receivables due from one of the abovementioned companies for deliveries of goods to its contracting parties, to the other of the abovementioned companies, which took over the contracts of its predecessor in this way, there was a sale of assets at risk of seizure, and as a consequence, there was a depletion of a creditor who did not receive satisfaction in the framework of subsequently opened bankruptcy proceedings.
The prosecutor’s allegations also included the issue of the very establishment of a limited liability company, to which the receivables were transferred because this initiative was seen as the implementation of a broader plan consisting of escaping with the assets from the creditors. In the verdict of the District Court for Warszawa Praga-South in Warsaw, all defendants were acquitted of the charges, despite the appeal filed by the public prosecutor, the verdict in question was upheld by the County Court for Warszawa Praga.
The accusation brought against the Client in the described case, in particular the way it was justified, was confirmed by the prosecution, which does not always correctly interpret the actions of business entities, having difficulties with interpreting commercial relations between entrepreneurs and market transaction realities, which in consequence often results in unjustified accusations.
The key to success in the proceedings in question – given the intransigent position of the public prosecutor – was a comprehensive presentation by the defence counsels of the full argumentation already at the stage of preparatory proceedings, a strategy built not only based on experience in representing principals in substantive criminal law cases, but also based on specialist legal knowledge in the area of business trading, accounting and bookkeeping.
The position was already presented at the preliminary stage of the proceedings, and the defendants’ comprehensive position, contained in the pre-trial file, reached the desk of the referring judge together with the indictment. Subsequently, a reply to the indictment was filed, elaborating on the earlier arguments and accompanied by relevant procedural and evidentiary motions.
It is a basic principle of criminal procedure that the prosecution is obliged to prove the guilt of the accused. However, experience shows that in the case of a passive attitude of defendants, the courts often accept, without further reflection, the theses contained in the indictment, even if – objectively speaking – they might seem doubtful, because legal protection bodies often act on the principle of consistency, confirming each other’s repeated positions.
Therefore, already at the initial stage of any such case, preferably before the first direct contact with the law enforcement authorities, it is important to develop a proper rebuttal argumentation and strategy based on a multidisciplinary range of knowledge and experience. In the case of significant commercial transactions undertaken by business entities in crises, already at the stage of their planning and design, it is worth remembering that they may become an object of interest for the prosecution and creditors, so as part of their legal preparation, it is necessary to consider all possible implications on the grounds of substantive criminal law. The project was supervised by partner Przemysław Wierzbicki and senior associate Stanisław Wiśniewski.
KKLW Legal Kurzyński Wierzbicki sp. k.
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