Recognition of illegal termination of the subsoil use contract

No. 6001-23-00-6ap/153 dated 06/13/2023

Plaintiff: LLP "G"

Defendants: Akim of the region, State Institution "Department of Natural Resources and Environmental Management of the Akimat of the region"

The subject of the dispute: on the recognition of illegal actions of the Akim on the transfer of Management rights to presentation, the delivery of a notice with the issuance of an order to terminate the contract for subsurface use, on the recognition of illegal actions of the Department on the issuance of a notice and order dated 05.01.2022 on the termination of contract No. 9 dated 12.05.2000,

Review of the plaintiff's cassation appeal

PLOT:

.On 05.2000, a contract No. 9 was signed between the State Institution "Department of Infrastructure and Construction" and LLP "K" for mining construction sands. In 2003, the regional territorial administration for the protection and use of mineral resources granted LLP "K" a mining allotment with an area of 42.4 hectares for the development and generation of construction sand.

By an additional agreement to contract No. 9, the right of subsurface use for mining was transferred from LLP "K" to LLP "G".

By the decree of the Akimat of the region dated 28.08.2019, the akimat endowed the GU with functions to ensure the execution and termination of contracts for the exploration and production of common minerals.

On 03.12.2021, LLP "G" received a notification from the Management of a one-term termination of the contract.By the Management Order dated 05.01.2022, the contract was terminated.

The plaintiff, filing a claim, motivated by the fact that only the local executive body, represented by the akim of the region, has the right to send a notification on the elimination of deficiencies and the provision of time limits for their removal within two months, as well as the termination of the contract, if more than two violations are not eliminated, respectively, the documents issued by the Department are illegal.

Judicial acts:

1st instance: the claim was denied.

Appeal: the decision remains unchanged.

Cassation: judicial acts are upheld.

Conclusions:

Courts of previous instances, refusal to satisfy the claim

motivated by the fact that:

in accordance with the competence established by subparagraph 5) of Article 1, Article 27, paragraph 2 of Article 39 of the Law of the Republic of Kazakhstan "On Local Government and Self-Government in the Republic of Kazakhstan", Article 40 of the APPC, the Akimat of the region authorized the state institution to perform certain functions of local government in the field of subsoil use;

The procedure for monitoring the fulfillment by subsurface users of obligations under a subsurface use contract (license) is determined by the competent authority in accordance with the Code of the Republic of Kazakhstan "On Subsurface and Subsurface Use" (hereinafter referred to as the Code) and subordinate regulatory legal acts. The Management has not violated this procedure.;

In fact, the Management is a party to OPI contracts (since August 5, 2020) and has the right to control the execution of contracts by subsurface users.

The board recognizes these conclusions of the courts as correct.

According to the first part of Article 5 of the CPC, the objectives of administrative procedures are the full realization of public rights, freedoms and interests of physical and legal persons. Consequently, disputes arising from public rights are considered in administrative court proceedings.

The contested claims to recognize as illegal the actions of the akim of the region on the transfer of management rights for the presentation, delivery of a notification with the issuance of an order to terminate a contract for subsurface use are not administrative acts, and are not subject to independent negotiation in administrative proceedings, since they themselves do not give rise to any rights, do not impose an obligation and do not create an obstacle to the exercise of rights, duties and legitimate the interests of the plaintiff.

Along with the established and investigated circumstances of the case, the board took into account that some of the requirements do not apply to administrative jurisdiction, however, local courts simultaneously with those requirements for recognition of illegal actions investigated the arguments of the administrative claim, the appeal and the courts gave them a specific assessment.

 

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