Real Estate

Protection against “consumer extremism” by equity holders

By 19.11.2018 No Comments

Lawyers of the Law Firm “Legal Studio” managed to fend off “consumer extremism” on the part of equity holders in relation to the Developer, who was a client of the company.

In the spring of 2016, an equity Holder filed a lawsuit against the Developer claiming  an apartment was to be handed over according to the equity agreement, a penalty, moral damage compensation, fine, and reimbursement of costs associated with installing an electric stove and a sink in the bathroom due to the incompleteness of the apartment, basing its requirements on the provisions of the Federal Law of the Russian Federation “On Participation in Equitable Construction” No. 214-FZ.

As per the Court’s decision that entered into legal force the claim for the recovery of the cost of completing the apartment was denied.

In March 2017, an equity Holder once again filed a lawsuit against the Developer, but that time with the objective to reduce the purchase price of the object of equitable construction,  to claim penalties, moral damage and fines, basing his demands on the provisions of the Federal Law of the Russian Federation “On Participation in Equitable Construction “No. 214-FZ and the provisions of the Law of the Russian Federation” On Protection of Consumer Rights “. At the same time, the equity Holder once again pointed out that the apartment was incomplete.

During the consideration of the dispute, it became possible to get the termination of the proceedings in regard to the stated demands for a commensurate reduction of the purchase price on the grounds that the equity Holder had already exercised his right to defense by initially choosing a different method of protecting his rights, and the consideration of the new claim violates the principle of stability of a judicial instrument as well as  proves that the claims made by the plaintiff were identical to the claims already considered by the court earlier in a different civil case, since in both cases it was a question of reimbursement  for losses incurred while bringing the apartment to the state corresponding to the terms of the contract.

Regarding the remaining claims, at the request of the lawyers of Legal Studio, who indicated that the court would be violating the rules of lineal jurisdiction of the dispute in case of its further consideration, the case was transferred to the magistrate’s judicial division.