Gentleman’s loan. ILF protects client from con men

Our client, agribusiness executive, loaned UAH 1 million to his long-time business partner for a year. Partnership notwithstanding, the parties still registered their gentleman’s agreement with a notary. When the year almost passed, the debtor, instead of returning the money, demanded to pay him UAH 1 million instead. This is despite the fact that our client was the one who had loaned the money.

Investigation showed that the notary changed the agreement's subject matter by adjusting it: he made the creditor and debtor swap places. Our client fell victim to a con that not only cost him UAH 1 million but also left him with a million more as the main debt and another one as penalty. In order to protect the client and get his money back, ILF petitioned the Ministry of Justice to inspect the notary's activities. In addition, the lawyers had to invalidate the notary's signature put on the “adjusted” contract in court. What's interesting, the signature belonged to the notary’s own daughter who verified the loan agreement. Existence of opposite agreements also served as grounds for initiating another action to collect UAH 1 million, since each party considered the other a debtor.

Obviously, it was up to the court to put an end to the dispute, but our adversaries tried intimidating our client by opening criminal proceedings against him on suspicion of fraud. In the course of the criminal investigation, the police conducted a search and interrogations and informed our client about the fraud charges. According to law enforcement officers, our client was already guilty for going to the court to retrieve his money and simply tried to avoid paying back the debt under the “adjusted” agreement. The investigator and prosecutor didn’t stop there: the court was petitioned to have our client put under guard for the duration of the pre-trial investigation. Unfortunately, the local prosecutor's office was ignoring the situation.

ILF lawyer Boris Zamikula adjusted his strategy accordingly: he suspended the proceedings on mutual debt collection and focused on appealing against the notary’s actions and representing our client in the criminal case. As a result of the investigation, ILF had a number of investigative actions recognized as unlawful. We also invited the media to make the proceedings public, including that which concerned placing our client under arrest. This helped us prevent a purely bureaucratic approach of the court and allowed the defense also voice its arguments instead of just the prosecution. As a result, the court examined the charges objectively and ruled against our client’s arrest. After a long procedural battle, a new prosecutor was appointed to the case, who declared the charges groundless and closed the criminal case. Moreover, when the case was reopened through court, the prosecutor made the same decision once again.

By that time, the Ministry of Justice finished inspecting the notary’s activities and discovered that he had indeed violated the law. In the end, the appellate court affirmed the unlawfulness of the notary’s actions, which helped our client avoid a UAH 1 million debt based on the notary's signature.

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