The Supreme Court of Estonia has upheld the decision of Tallinn District Court, which previously ruled that claims made against Saaremaa Shipping Company (Saaremaa Laevakompanii) amounting to nearly €60 million were unfounded.
According to the Supreme Court judgement, which entered into force on Monday, the claims made against Saaremaa Shipping Company (Saaremaa Laevakompanii) are unfounded. The dispute over the claims has now been heard at all three levels of the Estonian court system.
In the dispute, which begin 2018, claims were filed against Saaremaa Shipping Company for withdrawing individual clauses of a compromise agreement, arguing that they were detrimental to the interests of the company's creditors.
According to lawyers of the Sorainen legal firm, who represented Saaremaa Shipping Company in court, the court found that individual clauses of the compromise agreement could not be withdrawn in isolation from the other clauses. Therefore, the claims were unfounded.
This means that Saaremaa Shipping Company has more assets than liabilities and therefore the company is not bankrupt.
The termination of the bankruptcy proceedings gives Saaremaa Shipping Company the opportunity to continue its business activities and participate in the public tender for the organization of inter-island passenger transport services.
According to lawyer Mari Agarmaa, who represented Saaremaa Shipping Company in court, in addition to the large economic impact of the judgment (approximately €60 million), the case sets an important judicial precedent, as Estonia's current bankruptcy law does not account for cases involving the partial reversal of a transaction.
In 2019, ERR reported, that the bankrupt Saaremaa Shipping Company had received claims of around €90 million. €18 million of that came from real estate management company Holostovi Kinnisvarahaldus, which is owned by Vjatšeslav Leedo, and more than €60 million from Leedo's former business partners Richard Tomingas and Olavi Miil.
According to Agarmaa, Monday's court ruling will also have an impact on pending criminal proceedings related to the causing of insolvency. It is not possible to uphold criminal charges against someone for causing insolvency in a situation where the insolvency has been dropped and bankruptcy proceedings have been closed, Agarmaa said.
The case concerns the trial, which began last November at Pärnu County Court, of Vjatšeslav Leedo, chair of Saaremaa Shipping Company's supervisory board, along with the company's executives. Six individuals and one legal entity stand accused of knowingly making decisions, which were detrimental to the company since 2016.
The charges alleged, that the defendants made unreasonable transactions using the assets of Saaremaa Shipping Company and harmed the interests of creditors in the company's bankruptcy proceedings.
Saaremaa Shipping Company served routes connecting the major Western Estonian islands of Saaremaa and Hiiumaa with the Estonian mainland between 1994 and 2016, until state-owned Port of Tallinn won the tender to take over these routes.
Editor: Michael Cole