Allocation of shares in monetary terms and invalidation of certificates of ownership and certificates of inheritance by law

On March 30, 2022, the Judicial Board for Civil Cases of the Supreme Court of the Republic of Kazakhstan consisted of: the chairman, Judge K., judges K., J., with the participation of plaintiff (defendant in the second claim) L.S. and her representative N.A., defendant (plaintiff in the second claim) E.I. and her representative N.S.. having considered in open court via mobile videoconference, the civil case on the claim of L.S. to E.I. for the allocation of a share in monetary terms, on the claim of E.I. to L.S., a private notary of the notary circle (hereinafter – notary) T.Yu. on invalidation of the certificate of ownership and certificates of inheritance under the law, received at the request of E.I. for a review of the decision of the judicial board for civil cases of the regional court dated October 12, 2021,

L.S. filed a claim to E.I. for the allocation of a half share in the apartment at the address: Sh city, T street, house 1/2, apartment No. 1 (hereinafter referred to as the disputed apartment) in monetary terms in the amount of 5,112,500 tenge. The plaintiff motivated her claim by the fact that, on the basis of the issued certificate of inheritance, she legally owns a half share in the disputed apartment. Currently, L.S. lives in the Russian Federation, is not interested in disputed real estate, as there is no opportunity to live together with the defendant in an apartment, and needs money.

E.I. filed a lawsuit against L.S., notary T.Y. for invalidation of the certificate of ownership and certificates of inheritance under the law, arguing that she was married to S.V. During the marriage, the disputed apartment was purchased with her own money, S.V. did not make any investments in the purchase of the apartment..  During his lifetime, no agreement was reached on the division of common property and the determination of his share, no marriage contract was concluded, and no court decision was issued on the matter. Moreover, by the ruling of the city court of December 25, 2008, the claim of S.V. The division of property was left without consideration, after which he left for the Russian Federation, where he later died. The plaintiff believes that S.V.'s statute of limitations has expired during his lifetime on the claim for the division of the common acquired property and the allocation of a share. Accordingly, L.S.'s demands for the allocation of a share are unreasonable.

By the decision of the city court of July 3, 2021, L.S.'s claim was denied.

E.I.'s claim was partially satisfied.

The certificate of ownership No. 568 dated January 14, 202, certificates of inheritance under Law No. 569 dated January 14, 2021, No. 1091 dated February 3, 2020 were declared invalid.

The issue of court costs has been resolved.

By the decision of the judicial board for civil cases of the regional court dated October 12, 2021, the court's decision was overturned and a new decision was issued.

The claim of E.I. was denied.

The claim of L.S. is fully satisfied.

Monetary compensation for the cost of a half share in the disputed apartment in the amount of 5,112,500 tenge, court costs 66,125 tenge, a total of 5,178,625 tenge were recovered from E.I. in favor of L.S.

In the petition, the applicant, disagreeing with the decision of the court of appeal, asks him to cancel and uphold the decision of the court of first instance, pointing out the inconsistency of the court's conclusions with the factual circumstances of the case, significant violations of substantive and procedural law.

Having listened to the explanations of the applicant E.I. and her representative N.S., who supported the arguments of the petition, the objections of L.S. and her representative N.A., having examined the case materials, having discussed the arguments of the petition, the judicial board considers the petition to be satisfied on the following grounds.

In accordance with part 5 of Article 438 of the Civil Procedure Code of the Republic of Kazakhstan (hereinafter referred to as the CPC), the grounds for cassation review of judicial acts that have entered into force are significant violations of substantive and procedural law provided for in Article 427 CPC, which led to the issuance of an illegal judicial act.

Such violations were committed in this case by the court of appeal.

The case file reliably established that from July 7, 2000 to October 21, 2008, S.V. and E.I. were in a registered marriage.

On April 25, 2003, E.I. (during the period of E.I.'s marriage), with the consent of S.V.'s spouse, a disputed apartment was acquired, the ownership of which was registered on November 22, 2003 with the registration authority for E.I. as a common shared ownership.

On October 21, 2008, the marriage between the spouses was dissolved, after which S.V. filed a lawsuit against E.I. for the division of the disputed apartment in kind between the owners.  

However, S.V. subsequently withdrew his claim.

By the ruling of the city court of December 25, 2008, the claim was dismissed, after which S.V. left for the Russian Federation and no longer applied with similar demands to the defendant.

Thus, during S.V.'s lifetime, the ownership shares in the disputed apartment were not determined, and no prenuptial agreement or other agreement was drawn up between the spouses when purchasing the disputed apartment.  

On March 13, 2012, S.V. died in the Russian Federation.

L.S., born on October 23, 1986, is the daughter of the late S.V.

After her father's death, L.S. applied to the notary, T.Y., to accept the inheritance, and the certificates were issued.:

- on the right to inheritance under Law No. 439 of September 19, 2012 for pension savings with all investment income of S.V.;

- on the ownership right No. 16568 dated January 14, 2021 for a half share of the father's property in the disputed apartment;

- on the right to inheritance under Law No. 16569 of January 14, 2021 on the non-property rights and obligations of the deceased father to register ownership of a half share of ownership in the disputed apartment;

- on the right to inheritance under Law No. 16691 of February 3, 2021 additionally, similar to the second one and additionally reflecting the ownership share in the disputed apartment.

Resolving the dispute and satisfying the claim of E.I. and rejecting the claim of L.V., the court of first instance applied a three-year limitation period, referring to the provisions of Articles 177, 180 of the Civil Code of the Republic of Kazakhstan (hereinafter referred to as the Civil Code), paragraphs 3 and 6 of Article 36 of the Law of the Republic of Kazakhstan "On Marriage and Family" (hereinafter referred to as the Law), which was in force at the time of the dissolution of the marriage.

According to the court of first instance, after the dissolution of the marriage, S.V. filed a lawsuit for the division of property, and subsequently, according to his statement, the claim was dismissed. He did not take any further actions to determine his share in the joint property, including the division of property. During his lifetime, S.V. did not dispose of his share in the joint property (the disputed apartment). At the same time, the court proceeded from the fact that for a long time E.I. herself owns the disputed apartment, bears the burden of its maintenance.

Disagreeing with such conclusions, rejecting the claim of E.I. and satisfying the claim of L.S., the court of appeal pointed to the perpetuity of ownership rights due to the requirements of paragraph 5 of Article 188 of the Civil Code and considered that the division of the disputed apartment was not carried out, the share of the deceased was not recognized as personal property of E.I. Consequently, the disputed apartment remained in the joint joint ownership of the spouses and S.V.'s share was subject to the rules of inheritance law.

In the opinion of the judicial board, the decision of the court of appeal is subject to cancellation, while the decision of the court of first instance remains in force, due to a misinterpretation of the substantive law and inconsistency of the conclusions with the circumstances established in the case in accordance with paragraphs 3), 4) of part 1, subparagraph 3) of part 2 of Article 427 of the CPC.

In accordance with paragraphs 3 and 6 of Article 36 of the Law in force at the time of the dissolution of the marriage and before the adoption of  The Code of the Republic of Kazakhstan "On Marriage (Matrimony) and Family" dated December 26, 2011 No. 518-IV (hereinafter referred to as the Code), in the event of a dispute, the division of the common property of the spouses, as well as the determination of the spouses' shares in this property, are carried out in court.

When dividing the common property of the spouses, the court, at the request of the spouses, determines which property is to be transferred to each of the spouses. If property is transferred to one of the spouses, the value of which exceeds the share due to him, the other spouse may be awarded appropriate monetary or other compensation.

A three-year limitation period applies to the claims of the spouses regarding the division of the common property of the spouses whose marriage has been dissolved.

According to paragraphs 1 - 3, 6 of Article 37 of the Code, the division of the spouses' common property can be carried out both during the marriage (matrimony) and after its dissolution at the request of either spouse, as well as in the case of a creditor's claim for the division of the spouses' common property in order to foreclose on the share of one of the spouses in the spouses' common property..

The common property of the spouses may be divided between the spouses by their agreement. The agreement on the division of the spouses' common property must be notarized.

In the event of a dispute, the division of the spouses' common property, as well as the determination of the spouses' shares in this property, are carried out through mediation or judicial proceedings.

A three-year limitation period from the date of the dissolution of the marriage applies to the claims of the spouses regarding the division of the common property of the spouses whose marriage (matrimony) has been dissolved.

By virtue of paragraph 20 of the Normative Resolution of the Supreme Court of the Republic of Kazakhstan "On the application of legislation by courts when considering cases of divorce" No. 5 dated April 28, 2000, the three-year limitation period for claims on the division of property that is common joint property, the marriage (matrimony) of which is dissolved (paragraph 6 of Article 37 of the Code), should be calculated at the dissolution of marriage (matrimony) in court – from the date of entry into force of the decision, at the dissolution of marriage (matrimony) in the registration authorities – from the date of registration of the dissolution of marriage (matrimony) in the book of registration of acts of civil status.

When making a decision on the dissolution of a marriage (matrimony), the court is obliged to explain to the parties about the application of the three-year limitation period and the procedure for calculating it to disputes on the division of jointly acquired property.

The marriage between the spouses was dissolved by their joint application, which was recorded in the register of acts of divorce No. 60-249-08-1000914 dated October 21, 2008.

Consequently, from that time on, the limitation period for S.V.'s claim for the division of property began to flow.

Meanwhile, the late S.V., during his lifetime, missed the three-year statute of limitations for applying to the court to determine and allocate a share in the common property (disputed apartment). The claim filed by S.V. during his lifetime was left without consideration by the court at his will, which indicates his waiver of the relevant right provided for in Articles 219, 221, 223 of the Civil Code, Articles 37, 38 of the Code.  

In such circumstances, the court of first instance reasonably applied the statute of limitations at the request of the defendant E.I. The disputed apartment or its share was not included in the estate of the deceased S.V., accordingly, there was no right of inheritance from L.S.'s heir.

By issuing disputed certificates of ownership and inheritance to the heir by notary, the rights and legitimate interests of E.I. were unreasonably violated.  

In accordance with paragraph 4 of Article 8 of the Civil Code, citizens and legal entities must act in good faith, reasonably and fairly in exercising their rights, observing the requirements contained in the legislation, the moral principles of society, and entrepreneurs, as well as the rules of business ethics.

This obligation cannot be excluded or limited by the contract. Good faith, reasonableness and fairness of the actions of participants in civil law relations are assumed.

The actions of L.S. and the notary do not comply with these principles of civil legislation.

Thus, the decision of the court of appeal is subject to cancellation, while the decision of the court of first instance remains in force.

In accordance with parts 1 and 3 of Article 109 of the CPC, in favor of the applicant, the defendant's petitions are subject to recovery from the plaintiff's court costs for the payment of the state fee when filing the petition in cassation in the amount of 25,562 tenge.

Guided by subparagraph 2) of Part 2 of Article 451 of THE CPC, the judicial board DECIDED:

The decision of the judicial board for civil cases of the regional court of October 12, 2021 in this case should be canceled, while the decision of the city court of July 3, 2021 remained in force.

To collect from L.S. in favor of E.I. the court costs of paying the state fee in the amount of 25,562 (twenty-five thousand five hundred and sixty-two) tenge.

To satisfy the petition of E.I..  

 

 

 

 

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