More than three years after the initiation of civil proceedings, the appellate court’s judgement, favorable to the client, has come into force. This resolved a dispute regarding the ownership rights of a former farmer’s estate owner over real estate exceeding 232 hectares, which had been transferred together with the farmer’s estate for a price of 1 euro.
The court examined whether the purchase agreement for the farmer’s estate concluded in 2017 complied with the legal and substantive requirements of a purchase agreement. In this regard, the decisive factor was the contribution of the sworn attorneys-at-law from ZAB Skrastiņš un Dzenis, who demonstrated that the parties’ intentions were actually directed towards the conclusion of a different agreement, namely, a concealed authorization contract, rather than the sale and transfer of ownership of all assets to the buyer.
The appellate court, aligning with the arguments presented by the sworn attorneys-at-law of ZAB Skrastiņš un Dzenis, found that:
• The agreement cannot be classified as a purchase, as the price specified therein does not correspond to a reasonable price that could be set for a farmer’s estate with all its properties and assets, even considering the estate’s indebtedness;
• The terms of the agreement and the subsequent actions of the parties concerning the farmer’s estate do not indicate a purchase. The parties had no intention of transferring all the farmer’s estate’s assets, including real estate, to the buyer, and, in fact, the assets were not transferred;
• Although formally titled and introduced as a purchase agreement, the transaction is, in substance, a fiduciary arrangement concealing an authorization contract. The true purpose of the transaction was to secure financing from a third party.
As a result, the appellate court concluded that the claimant is entitled to recover what she had transferred to the buyer under the concluded transaction as part of the authorization contract.
The complexity of the case was further compounded by the fact that enforcement measures had been imposed on the farmer’s real estate, considered as property belonging to the buyer, amounting to over 1.8 million euros due to the enforcement of a judgment in another case. The appellate court also granted the claimant’s request for the removal of enforcement notations on the respective real estate.
The ZAB Skrastiņš and Dzenis team is pleased with the favorable outcome achieved for the client through the provision of professional legal assistance, characterized by a meticulous and thorough approach to evidence collection, analysis, and presentation. Additionally, there is satisfaction that the court, when interpreting legal norms in the judgement, also considered the principle of fairness.
