A man surrendered his apartment to settle a loan, yet PrivatBank demands an additional 1,005,935 hryvnias. What was the court's ruling on this matter?

A man is required to pay an outstanding debt of 1,005,935 hryvnias to PrivatBank. However, he requests the cancellation of the notary's enforcement note, as he has already sold and transferred his apartment to the bank. This is stated in the decision of the Ordzhonikidze District Court of Zaporizhzhia, published on December 11, 2024.

The man states that at the time of the contested enforcement note (July 25, 2017), the loan agreements that led to his payment delays were not included in list No. 1172. The Cabinet of Ministers' resolution to add this section to the list was deemed illegal and invalid by a court ruling that became final. The plaintiff also claims that the enforcement note does not specify which document establishing the debt was provided to the notary. The copy of the loan agreement dated August 16, 2005, between him and JSC KB "PrivatBank" was not notarized. Additionally, he disputes the amount of debt stated in the enforcement note. Given these circumstances, he believes that the issuance of the notary's enforcement note No. 9902 on July 25, 2017, regarding the collection of the debt totaling 1,005,935 hryvnias is unlawful.

"JSC KB 'PrivatBank' provided all necessary documents in accordance with the list, namely: the loan agreement, a bank-certified calculation of the debt, which fully reflects all the plaintiff's transactions regarding debt repayment. There are no grounds to consider the notary's actions illegal, especially since the absence of documents does not confirm the indisputability of the claims against the plaintiff. Regarding the timeframe for enforcement based on the enforcement note, the defendant's representative noted that considering the interruption of the term due to partial payment of the debt by the plaintiff, the defendant rightfully claimed the amount of debt for the specified period (from August 16, 2005, to June 27, 2017), and the notary lawfully completed the enforcement note within the deadlines. Moreover, the plaintiff has not proven the fact of repaying the loan amount," stated PrivatBank.

According to the man, he properly fulfilled the terms of the agreement until February 26, 2016, but due to difficult life circumstances, he was unable to meet his obligations to the bank in full after that date. He also noted that global events, such as the pandemic caused by the coronavirus disease of 2019 and the full-scale invasion of Ukraine on February 24, 2022, significantly affected his ability to fulfill his obligations. Furthermore, he pointed out that PrivatBank has not provided explanations regarding the debt amount specified in the enforcement note. The lawsuit stated that the amount of accrued penalties of 2,054 dollars, equivalent to 53,484 hryvnias, was unclear, while penalties of 3,877 dollars, equivalent to 100,936 hryvnias, had been paid. In the opinion of his representative, the principal amount of the loan should have been paid off first, and penalties should have been calculated from the remaining loan balance. Additionally, the payment of the insurance fee of 12,600 dollars was not taken into account.

During the court session on December 2, 2024, the man and his representative supported the claims and requested their satisfaction. They were also informed that the apartment, which was the subject of the mortgage to secure the borrower's obligations under the loan agreement dated August 16, 2005, had been transferred to the bank and sold by it.

What did the court decide?

The man's claim was granted. The court recognized the enforcement note issued on July 25, 2017, by a private notary to collect from the citizen in favor of the joint-stock commercial bank "PrivatBank" the debt under the loan agreement dated August 16, 2005, as unenforceable.

"In violation of legislative requirements, the enforcement note issued to collect the debt from the plaintiff for almost 12 years is invalid. The defendant has not proven that the contested enforcement note was issued in compliance with the requirements of the legislation governing the disputed legal relations at the time of its issuance. Considering the above, the court concluded that the disputed enforcement note was issued by the notary in violation of current legislation; therefore, the claims to recognize the enforcement note as unenforceable should be satisfied," emphasized the court.