DGKV successfully defended Electrohold Sales EAD (former CEZ Electro Bulgaria) in a complex energy dispute

DGKV successfully defended Electrohold Sales EAD (former CEZ Electro Bulgaria) in a complex energy dispute involving claw back and insolvency recovery claims brought by an insolvency creditor in the insolvency proceedings of Future Energy EOOD (insolvent), an electricity trader whose license was revoked in December 2017. The total value in dispute was approximately EUR 2 million. The target of the claw back and recovery claims was the setoff of accounts receivable against Future Energy and the drawing of a bank guarantee both initiated by CEZ Electro Bulgaria (now Electrohold Sales) as creditor of Future Energy in December 2017 in the aftermath of the withdrawal of Future Energy’s electricity trading license.

The positive outcome came after the appellate decision was admitted to cassation by the Supreme Court of Cassation (the “Supreme Court”) which addressed in its final decision certain legal issues of interpretative significance. The Supreme Court drew upon the earlier Interpretative Decision No. 2 /2020 of the Supreme Court of 18.03.2022, which is the first to conclusively accept that it is sufficient that a claim be undisputed to qualify as “liquid” and thus eligible for setoff by unilateral act of the holder of the claim against its own liability meaning the claim does not need to be established by a final and binding court decision to be eligible for setoff. The Supreme Court now accepted that a third party, such as another creditor of the same debtor, may not affect the validity of the setoff by disputing the claim, as it is only privy to the debtor to dispute the claim to prevent its setoff.

The Supreme Court further reaffirmed the legal position that creditors of the insolvency estate have no legal standing to bring derivative action on behalf of the insolvent debtor against another creditor of the same debtor for unjustified enrichment resulting from drawing on a bank guarantee.

Electrohold Sales EAD was represented by Partners Gergana Monovska, Angel Ganev and Anton Krustev and Senior Associate Galin Atanasoff.