Wife will not pay debts on a loan that her husband took out without her knowledge

Publication date: November 5, 2023

A resident of the city of Chervonohrad, Lviv Oblast, asked the lawyers of the Youth Initiative Center to help her solve her credit problem. Although her ex-husband was the “culprit” of both the loan and the debt, the ex-wife was obliged to repay the debt.

During the consultation provided to Tamara* by the lawyer of the Youth Initiative Center, Andrii Mytsak, the woman said that her ex-husband entered into a loan agreement in 2021. The couple was still married at the time. The husband took out a loan from a microfinance organization online, and most importantly, without her knowledge. 

The woman found out that such a loan existed after the divorce when the financial institution began calling her and telling her about the loan that had not been paid on time. As it turned out, the loan amount was UAH 2,000, but the financial institution charged interest on the loan, and the total amount increased to more than UAH 13,000.

The financial institution then passed the loan agreement to collectors, who continued to “assault” Tamara and her relatives with calls. The woman’s arguments that she had not taken out such a loan, had already divorced her husband and was not in contact with him did not work.

Ultimately, the financial institution turned to a private notary to seize Tamara’s accounts because her ex-husband used her passport details to sign the loan.

In December 2021, a private notary of the Kyiv City Notarial District issued a writ of execution to recover funds from Tamara under the loan agreement.

In April 2022, the state enforcement officer of the Chervonohrad Department of the State Enforcement Service in the Chervonohrad District of the Lviv Oblast of the Interregional Department of the Ministry of Justice (Lviv) issued a resolution to open enforcement proceedings, and the woman’s bank accounts were seized – under the notary’s writ of execution.

After assessing the situation, Andrii Mytsak suggested that the client contact the organization’s partners, the Chervonohrad Local Center for Free Secondary Legal Aid, to obtain secondary legal aid, as her issue could only be resolved in court.

– A private notary arrested without a court decision. We went to court to lift the arrest, as such actions were illegal. When making the executive inscription, the notary did not take into account that the legal provision that allowed notaries to make executive inscriptions under loan agreements that were not notarized had expired. By doing so, the notary violated the requirements of the Law of Ukraine “On Notaries” and the List of Documents for which debt collection is carried out indisputably based on executive inscriptions of notaries, approved by the Resolution of the Cabinet of Ministers of Ukraine No. 1172 of June 29, 1999, explains Andrii Mytsak.

As a result, at the end of September, the Chervonohrad City Court of Lviv Oblast ruled that the writ of execution by the private notary was unenforceable.

As a result, Tamara will not have to pay the illegal debts.

The legal framework that guided the lawyer

Under Article 87 of the Law of Ukraine “On Notaries”, to collect monetary amounts or reclaim property from the debtor, notaries make executive inscriptions on documents establishing the debt. The list of records subject to indisputable debt collection based on administrative memos is set by the Cabinet of Ministers of Ukraine.

Article 88 of the Law of Ukraine “On Notaries” sets forth the conditions for executing the writ of execution. Under the provisions of this Article of the Law, a notary shall complete executive inscriptions if the submitted documents confirm the indisputability of the debtor’s debt or other liability to the creditor and provided that no more than three years have passed since the date of the right of claim, and no more than one year in relations between enterprises, institutions and organizations.

Under subparagraphs 3.2 and 3.5 of paragraph 3 of Chapter 16 of Section II of the Procedure for Performing Notarial Actions, the indisputability of the debt is confirmed by the documents provided in the List of Documents for which Debt Recovery is Undisputed based on Executive Inscriptions of Notaries, approved by Resolution of the Cabinet of Ministers of Ukraine No. 1172 dated 29.06.1999.

Under clause 2 of the List (as amended by the Resolution of the Cabinet of Ministers of Ukraine No. 662 dated 26.11.2014 “On Amendments to the List of Documents for Debt Collection in an Undisputed Procedure based on Executive Inscriptions of Notaries”), to obtain an executive inscription under loan agreements under which debtors have committed late payments on their obligations, the following shall be submitted

a) the original loan agreement;

b) a statement of the debtor’s account certified by the creditor, indicating the amount of the debt and the terms of its repayment, with a note of the creditor on the non-repayment of the debt.

According to Article 124 of the Constitution of Ukraine and Article 13 of the Law of Ukraine “On the Judicial System and Status of Judges”, court decisions that have entered into force are binding on all state authorities, local governments, their officials and employees, individuals and legal entities and their associations throughout Ukraine.

By the decision of the Kyiv Administrative Court of Appeal dated February 22, 2017, in case No. 826/20084/14, upheld by the decision of the High Administrative Court of Ukraine dated November 1, 2017, the conclusion of the District Administrative Court of Kyiv dated November 07, 2016, was cancelled. Resolution of the Cabinet of Ministers of Ukraine No. 662 dated November 26, 2014 “On Amendments to the List of Documents for Debt Collection based on Indisputable Procedure Based on Executive Inscriptions of Notaries” was declared illegal and invalid, including in part of supplementing the list after the section “Debt Collection under Notarized Agreements” with a new area of the following content: “Debt collection on the grounds arising from credit relations”. Loan agreements under which debtors are in default of their obligations.

To obtain the writ of execution, the following shall be attached:

a) the original loan agreement;

b) a statement from the debtor’s account certified by the creditor indicating the amount of debt and its maturity with the creditor’s note on non-repayment of the debt.”

The Resolution entered into force upon its promulgation.

In other words, at the time of the disputed writ of execution, the provision allowing notaries to execute the writ of execution under loan agreements that are not notarized was abolished, which violated the requirements of the Law of Ukraine “On Notaries” and the List of Documents for which Debt Recovery is Undisputed based on Notarial Writ of Execution, approved by Resolution of the Cabinet of Ministers of Ukraine No. 1172 of June 29, 1999.

* Name has been changed for ethical reasons.

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