Disputes between legal entities and citizens engaged in business activities with the participation of government agencies

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Disputes between legal entities and citizens engaged in business activities with the participation of government agencies

8 January 2024

Disputes between legal entities and citizens engaged in business activities with the participation of government agencies

The legal basis for dispute resolution in this category of civil cases is the general norms of civil legislation that define the concept and terms of a contract, the procedure for its conclusion, amendment and termination, contained in chapters 22-24 of the Civil Code of the Republic of Kazakhstan, as well as special norms governing the legal relations of the parties to certain types of contracts and included in the chapters of the Civil Code on certain types of obligations. When resolving disputes involving government agencies, relations between the parties are also regulated by the Law of the Republic of Kazakhstan "On Public Procurement".

According to Part 1 of Article 48 of the Civil Procedure Code of the Republic of Kazakhstan, the plaintiff and the defendant are the parties to the civil procedure. Plaintiffs are citizens and legal entities who have filed a claim in their own interests or in whose interests the claim is filed. The defendants are citizens and legal entities against whom the claim is filed.

By virtue of Part 3 of Article 43 of the Civil Code of the Republic of Kazakhstan, branches and representative offices are not legal entities. RSU "State Revenue Department for the Raiymbek district of the Department of State Revenue for the Almaty region of the State Duma of the Ministry of Finance of the Republic of Kazakhstan" filed a lawsuit against the Moynak branch of the state enterprise "China International Corporation of Water Management and Energy in Almaty in the Republic of Kazakhstan", MOL DEMEU LLP on the recognition of transactions as invalid and the obligation of the Moynak branch of the state Enterprise China International Corporation of Water Management and Energy in Almaty in the Republic of Kazakhstan to exclude from deductions the costs of transactions declared invalid when calculating the amounts of CPN, by submitting an additional declaration, by a court ruling dated June 5, 2015, the specified statement of claim was reasonably left No movement, Since the plaintiff has indicated as a defendant the Moinak branch of the State Enterprise China International Corporation for Water Management and Energy in Almaty in the Republic of Kazakhstan, which, in accordance with the norms of civil law (art.43 of the Civil Code), is not a legal entity, therefore, the branch cannot act as a party to the case.

147 of the Civil Code of the Republic of Kazakhstan, transactions are recognized as actions of citizens and legal entities aimed at establishing, changing or terminating civil rights and obligations.

An invoice is not a transaction and, according to Article 7 of the Law of the Republic of Kazakhstan "On Accounting and Financial Reporting", refers to accounting documentation, which includes primary documents, accounting registers, financial statements and accounting policies.

The plaintiff requested to invalidate the transactions between the branch of Moynak State Enterprise "China International Corporation of Water Management and Energy" in Almaty in the Republic of Kazakhstan and "MOL DEMEU" LLP, namely: invoices. In this regard, the court correctly indicated in the ruling on leaving the statement of claim without motion that the plaintiff also needs to specify the claims, since invoices are only primary accounting documents, and provide evidence in support of the claims (contracts concluded by MOL DEMEU, procedural documents of the criminal prosecution authorities).

Coercion to conclude a contract is not allowed, except in cases where the obligation to conclude a contract is provided for by the code, the law or a voluntarily accepted obligation. The parties may conclude an agreement, both provided for and not provided for by law.

The parties, at their discretion, determine the terms of the contract, except in cases where the content of the relevant condition is prescribed by law (Article 382 of the Civil Code).

In accordance with Article 378 of the Civil Code of the Republic of Kazakhstan, an agreement between two or more persons on the establishment, modification or termination of civil rights and obligations is recognized as a contract.

One of the basic principles of civil law is the principle of freedom of contract, enshrined in Article 2 of the Civil Code, by virtue of which civil law is based on the recognition of equality of participants in regulated relationships, inviolability of property, freedom of contract, the inadmissibility of arbitrary interference in private affairs, the need for the unhindered exercise of civil rights, ensuring the restoration of violated rights, their judicial protection. According to Article 380 of the Civil Code, citizens and legal entities are free to conclude a contract. The plaintiff, SMP-610 LLP, filed a lawsuit with the State Institution "Committee on Public Procurement of the Ministry of Finance of the Republic of Kazakhstan", State Institution "Committee on 5 Water Resources of the Ministry of Agriculture of the Republic of Kazakhstan", Kimaki LLP for invalidation of the contract and the obligation to conclude a public procurement contract, The claims are motivated by disagreement with the decision under the protocol of August 8, 2014 on the rejection by the organizer of the State Institution "Committee on Water Resources of the Ministry of Agriculture of the Republic of Kazakhstan" by the decision of September 17, 2014 of the tender application of SMP-610 LLP from participation in the tender for the lot "Construction and reconstruction of the water supply system, hydraulic structures" for the Committee on water resources of the Ministry of Agriculture of the Republic of Kazakhstan.

By the decision of the specialized interdistrict Economic Court of Astana dated November 5, 2014, the claim of the State Institution "Committee on Water Resources of the Ministry of Agriculture of the Republic of Kazakhstan" on recognition of SMP610 LLP as an unscrupulous participant in public procurement was denied, that is, the refusal of the organizer was declared illegal by the court. Then, in accordance with the protocol of the organizer's commission, an agreement was concluded for this lot between the State Institution "Committee on Water Resources of the Ministry of Agriculture of the Republic of Kazakhstan" and "Kimaki" LLP, which violated the legitimate rights and interests of the plaintiff to participate in the tender, since the State Institution "Committee on Public Procurement of the Ministry of Finance of the Republic of Kazakhstan" needed to win the competition The "necessary" supplier, the violations committed are of a corrupt nature, since when making a decision, preference was given in favor of a legal entity in violation of the Law on Public Procurement.

The claim for invalidation of the contract is not justified by the norms of substantive law provided for in Chapter 4 of the Civil Code of the Republic of Kazakhstan, which may serve as the basis for invalidating the transaction. According to Part 1 of Article 158 of the Civil Code of the Republic of Kazakhstan, a transaction is invalid, the content of which does not comply with the requirements of the law, as well as committed with a purpose deliberately contrary to the principles of law and order or morality.

In accordance with clause 1 of Article 616 of the Civil Code, under a work contract, one party (contractor) undertakes to perform certain work on behalf of the other party (customer) and deliver its result to the customer within the prescribed period, and the customer undertakes to accept the result of the work and pay for it (pay the price of the work). The work is performed at the contractor's risk, unless otherwise provided by legislation or contract. The contested public procurement contract No. 126 for the Reconstruction of the Presnovsky Group water pipeline of the North Kazakhstan region (Stage II) on November 4, 2014 was concluded with Kimaki LLP of the Russian State Institution Committee on Water Resources of the Ministry of Agriculture of the Republic of Kazakhstan using a single-source method, but not based on the results of an electronic tender for the lot "Construction and reconstruction of the water supply system, hydraulic structures", declared invalid.

According to clauses 19-1) of Article 1 of the Law "On Public Procurement", the State Institution "Committee on Public Procurement of the Ministry of Finance of the Republic of Kazakhstan" is a single organizer of public procurement that performs procedures for organizing and conducting public procurement for budgetary programs or goods, works, services determined by the authorized body, and the conclusion of public procurement contracts in accordance with the competence of the organizer is not included.

The contract was signed by both parties: the customer of the State Institution "Committee on Water Resources of the Ministry of Agriculture of the Republic of Kazakhstan" and the contractor "Kimaki" LLP represented by authorized officials, whose signatures are sealed by the organizations. The contract is concluded between the parties in writing, contains all the essential conditions imposed by the requirements of the Civil Code for contract contracts, that is, the requirements of the law on the form of the transaction are met. The regulatory resolution of the Supreme Court of the Republic of Kazakhstan "On the application of legislation on public procurement by courts" clarified that when filing a claim for invalidation of an effective contract on grounds of violation of legislation on public procurement in the process of selecting a supplier and concluding a contract, the authorized body, in accordance with articles 65, 66 of the CPC, must provide the relevant evidence to the court (act control materials).

When declaring a contract invalid on the grounds of non-compliance with the requirements of the law, the courts must indicate in the reasoning part of the decision the conclusions about the illegality of the decision on the results of public procurement. The plaintiff is not a party to the transaction, and does not belong to the authorized bodies authorized to file a claim for invalidation of the transaction on grounds of non-compliance with legal requirements, as well as as committed with a purpose deliberately contrary to the principles of law and order or morality. The plaintiff has not provided any evidence to support the argument of illegal refusal of admission to participate in the competition.

By the decision of the specialized Interdistrict Economic Court of Astana dated November 5, 2014, the claim of the State Institution "Committee on Water Resources of the Ministry of Agriculture of the Republic of Kazakhstan" on recognition of SMP-610 LLP as an unscrupulous participant in public procurement was denied due to the fact that no violations of the requirements of art.6 of the Law of the Republic of Kazakhstan "On Public Procurement" were found.

The agreement was signed by both parties: the customer of the State Institution "Committee on Water Resources of the Ministry of Agriculture of the Republic of Kazakhstan" and the contractor "Kimaki" LLP represented by authorized officials, whose signatures are sealed by the organizations. The contract is concluded between the parties in writing, contains all the essential conditions imposed by the requirements of the Civil Code for contract contracts, that is, the requirements of the law on the form of the transaction are met. The regulatory resolution of the Supreme Court of the Republic of Kazakhstan "On the application of legislation on public procurement by courts" clarified that when filing a claim for invalidation of an effective contract on grounds of violation of legislation on public procurement in the process of selecting a supplier and concluding a contract, the authorized body, in accordance with articles 65, 66 of the CPC, must provide the relevant evidence to the court (act control materials).

As follows from the tender documentation, according to the claimant's tender application, the names of the equipment (mechanisms, machines) in the above list A number of mechanisms and machines are indicated by the plaintiff as possible for use in competitive contract work based on contracts of intent concluded by the plaintiff as a potential supplier with their owners. Moreover, according to the Rules of electronic Public Procurement, equipment (mechanisms, machines) must belong to the applicant by right of ownership or other legal possession, in particular, by property lease (lease).

The court also took into account the circumstances confirmed by both defendants that currently the Kimaki LLP contract works, funded for 2014, have been fully completed, and the work has been performed without quality claims. That is, budget money is used optimally and efficiently, and no one's legally protected rights and interests are violated.

The factual circumstances of the case, consistent with the requirements of the above-mentioned rules of substantive and procedural law, were the basis for rejecting the claims. By the decision of the specialized Interdistrict Economic Court of Astana dated June 4, 2015, the claims of SMP-610 LLP against the State Institution "Committee on Public Procurement of the Ministry of Finance of the Republic of Kazakhstan", the State Institution "Committee on Water Resources of the Ministry of Agriculture of the Republic of Kazakhstan", Kimaki LLP regarding the invalidation of the contract and the obligation to conclude a public procurement contract were reasonably abandoned without satisfaction.

For non-fulfillment of the terms of the contract, the defendant is liable in the form of payment of a penalty, loss of the right to refund the performance of the contract and termination of the contract due to violation of the essential terms of the contract. The legislation does not provide for forcing the contractor to comply with the terms of the contract in court.

KSU "Department of Energy and Communal Services of Almaty" filed a lawsuit against Sunkar LLP to enforce the terms of the contract and recover the amount of the penalty.

It can be seen from the case file that the parties concluded a public procurement agreement dated December 14, 2012 in the amount of 26,929,000 tenge for the development of design estimates for the reconstruction of the main and distribution heating networks of Almaty in lots: "Reconstruction of the heating main from CTC-4 to CTC-11", "The section of the highway from TK-9 to TK-2-1", "The section of the highway from TK-1 to CTC-03", "The heating main from TP Kometa to TK-15", "The section of the highway from TK-26 to TK-29", "The branch to the houses of the KECH boiler room zone". The term of the contract is until December 15, 2013. The contract is valid until December 31, 2013.

From the certificate No. 1 on the cost of work performed and expenses for December 24, 2013, it follows that the development of the PSA by the contractor was completed on December 24, 2013, which is confirmed by the invoice issued on December 24, 2013.

It was established that on December 24, 2013, the defendant transferred the PSA for all six lots to the customer in accordance with the act. The amount of work performed under the act dated December 24, 2013 is 26,929,000 tenge.

On December 4, 2013, the customer sent letters to Gosexpertiza with a request to conduct a state examination of the PSA for all facilities. From the response of Gosexpertiza dated January 14, 2014, it follows that Filal RSE Gosexpertiza refused to accept the documentation provided by Sunkar LLP for examination, due to the fact that Sunkar LLP, having a license of the III category of license, is not entitled to operate at facilities of the first and second levels of responsibility.

Thus, the positive conclusion of the state expert examination has not yet been received, which confirms the validity of the plaintiff's arguments about the contractor's failure to fulfill its obligations to the customer.

However, the plaintiff's claims to compel the contractor to carry out work on the development of the PSA and to provide a positive opinion on the projects and a set of PSA for all six facilities are not subject to satisfaction on the following grounds.

It was established that the defendant carried out work on the development of the PSA, and the State Expertise refused to accept the PSA, which precludes the impossibility of passing controversial projects of state expertise in the future. In this regard, the requirement to compel the defendant to provide a positive expert opinion is unreasonable, since the expert examination is not conducted by the contractor.

The contractor, under the terms of clause 1.3. of the agreement, has undertaken to coordinate the PSA with the relevant government agencies and submit an expert opinion on the project to the customer. In accordance with clause 4.4. of the contract, this period includes the time required to review the work and obtain the conclusion of the State Expert Examination. However, the contractor has not fulfilled the obligations stipulated in clause 4.1. of the contract, according to which the completion date is December 15, 2013. By December 15, 2013, Sunkar LLP was obliged to complete the development of the PSA and provide the customer with PSA for all facilities with positive state expert opinions.

RDS Provisions 1.02-04-2013 The assignment of construction and urban planning facilities to the levels of responsibility was put into effect by the Order of the Minister of Regional Development of the Committee for Construction and Housing and Communal Services No. 2-nu from January 6, 2014.

The defendant's arguments that the contractor has completed the work completely and that the contractor is not guilty of failing to review the projects due to changes in legislation are not unfounded. At the time of the development of the PSA and before the deadline for their delivery before December 15, 2013, the provisions of the RDS 1.02-04-2013 they did not extend to the design that had begun.

In such circumstances, the court reasonably concluded that there was no reason to release the contractor from liability from paying the penalty.

In accordance with clause 4.2. of the contract, for late completion of work, the defendant has undertaken to pay a fine in the amount of 0.1% of the total amount of the contract for each day of delay, but not more than 5% of the amount of the contract. The amount of the penalty calculated by the plaintiff for 316 days is KZT 8,509,564. The calculation was verified by the court and found incorrect. Taking into account the terms of the agreement on the accrual of a penalty of no more than 5% of the total amount of the agreement, a penalty in the amount of 1,346,450 tenge is subject to collection.

By the decision of the Council of Economic and Social Council of Almaty, the claim of the KSU "Department of Energy and Communal Services of Almaty" to Sunkar LLP for forcing the fulfillment of the terms of the contract and for collecting the amount of the penalty was partially satisfied. The amount of the penalty in the amount of 1,346,450 and the state duty of 40,393 tenge was collected from Sunkar LLP to the state revenue. The claim for forcing the defendant to comply with the terms of the contract was denied.

The general provisions of the Civil Code on the freedom to conclude a contract fully apply to legal relations on the amendment and termination of the contract.

Unilateral renunciation of a contract or unilateral modification of a contract are allowed even when such a right of the parties is provided for by the contract, unless, of course, something else follows from the law or the nature of the obligation itself.

If the parties cannot come to an agreement on the need to amend or terminate the contract, when unilateral withdrawal from the contract is not provided for, the occurrence of such consequences is possible by court decision, subject to mandatory compliance by the parties with the procedure provided for in Article 402 of the Civil Code.

In accordance with this rule, an agreement to amend or terminate a contract is made in the same form as the contract, unless otherwise provided by law, contract, or business practices.

Based on the above legal norms, amendments to the contract after its conclusion are possible if this is provided for in the contract or by law.

Only after receiving the refusal of the other party to the proposal to amend or terminate the contract, or failure to receive a response within the time period specified in the proposal or established by law or contract, and in its absence - within thirty days, the claim for amendment or termination of the contract may be filed by the party in court.

Thus, when considering disputes on the amendment (termination) of contracts, it is necessary to verify that the parties comply with the mandatory pre-trial procedure outlined above.

The plaintiff's claims are not based on the law, since in accordance with art. 401 of the Civil Code of the Republic of Kazakhstan, at the request of one of the parties, the contract may be amended or terminated by a court decision only in case of a significant violation of the contract by the other party.

The plaintiff of Inder Cement LLP filed a lawsuit against the State Institution "Department of Natural Resources and Environmental Management of Atyrau region" with a demand for invalidation:

- Agreement dated February 10, 2014 on amendments to the Contract dated July 20, 2006 for the extraction of marl-chalk and clay rocks at the Belaya Rostosh deposit in the Indersky district of Atyrau region;

- Agreement dated February 10, 2014 on amendments to the Contract dated August 28, 2006 for chalk extraction at the Belaya Rostosh deposit in the Indersky district of Atyrau region;

- on the termination of Contracts dated July 20, 2006 for the extraction of marl-chalk and clay rocks at the Belaya Rostosh deposit in the Indersky district of the Atyrau region and the Contract dated August 28, 2006 for the extraction of chalk at the Belaya Rostosh deposit in the Indersky district of the Atyrau region.

The claims are motivated by the fact that due to the non-granting of land use rights, with the failure of the defendant to comply with clause 7.3.2. of the contracts, the plaintiff cannot start mining.

The defendant fraudulently discharged his obligations under the contracts and is currently in a preferential position over the plaintiff.

The Court of first instance, resolving the case, satisfied the plaintiff's claim in full.

The court of appeal overturned the decision of the court of first instance due to the court's incorrect application of substantive law.

In accordance with Part 9 of Article 159 of the Civil Code, a transaction made under the influence of deception, violence, or threat may be declared invalid by a court at the victim's claim.

When making a transaction under the influence of deception, the victim's will is formed not freely, but forcibly, under the influence of unfair actions of the counterparty, which consist in intentionally creating a false impression on the victim about the circumstances relevant to the conclusion of the transaction.

The plaintiff claimed in his claim that they were signed by him in a state of deception and asked to be declared invalid on the grounds of paragraph 9 of art. 159 of the Civil Code of the Republic of Kazakhstan.

Meanwhile, in violation of the requirements of Article 65 of the Civil Code, the plaintiff did not provide the court with evidence that the contested agreements were concluded under the influence of deception on the part of the defendant, the Department of Natural Resources and Environmental Management of Atyrau Region.

In such circumstances, there was no basis for satisfying the claim for invalidation of the agreements of February 10, 2014.

Regarding the plaintiff's claim to terminate contracts No. 149/2006 dated July 20, 2006 for the extraction of marl-chalk and clay rocks and No. 152/2006 dated August 28, 2006 for the extraction of chalk, the court, having satisfied them, indicated in the reasoning part of the decision that the obligations assumed by the defendant had not been fulfilled, that is, the defendant had the terms of the contract and the requirements of the Law have been violated.

Therefore, based on this, the court of first instance terminated the disputed contracts on the basis of part 2 of Article 401 of the Civil Code.

The appellate instance did not agree with the arguments of the court of first instance, since the plaintiff did not provide reliable evidence indicating that the defendant had not fulfilled the terms of the contract, that is, a significant violation of the terms of the contract was committed.

The appellate instance concluded that the plaintiff's claims are not based on the law, since in accordance with Article 401 of the Civil Code, at the request of one of the parties, the contract can be amended or terminated by a court decision only if the other party significantly violates the contract.

It was also noted that the court of first instance pointed to the conclusion of the contract by deception and unfair actions of the defendant as the basis for termination of the contract. Meanwhile, neither the court of first instance nor the appeals board has been provided with evidence that it was the defendant who was guided by deception when concluding the contract.

According to Article 393 of the Civil Code, a contract is considered concluded when an agreement has been reached between the parties, in the form required in the appropriate cases, on all its essential terms. Essential are the terms of the subject of the contract, the terms that are recognized as essential by law or are necessary for contracts of this type, as well as all those conditions regarding which, at the request of one of the parties, an agreement must be reached. As can be seen from the case file, the plaintiff signed the agreements voluntarily without coercion, therefore, there are no legal grounds for termination of the contract due to fraud by the defendant during the transaction.

Thus, the decision of the court of first instance to satisfy the claims cannot be recognized as lawful and justified, it is canceled with the issuance of a new decision on the refusal to satisfy the claim.

It should be noted that the conclusions of the Atyrau Regional Court of Appeal on the annulment of the decision of the court of first instance are indicated only in the reasoning part of the appeal decision, that is, the appeal decision overturns the decision of the court of first instance and a new decision is made, which does not contradict paragraph 1) of Part 2 of art.359 CPC, which states that the court of appeal makes a decision in the case provided for in paragraph 3) of art.358 of the CPC.

And according to paragraph 3) of Article 358 of the CPC, the court of appeal has the right to reverse the decision of the court of first instance and make a new decision.

At the same time, there is judicial practice when the appellate instance issues a separate ruling on the annulment of the decision of the court of first instance and on the satisfaction of the appeal or appeal protest, the appeal decision on the satisfaction of the claim or the rejection of the claim is also made separately.

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