Dispute with the insolvency administrator

Our dispute resolution team has successfully represented one of the largest poultry company in Lithuania in a dispute regarding the award of an alleged debt with the insolvency administrator of a construction company before the Kaunas Regional Court.

More precisely, the insolvency administrator of a bankrupt construction company had brought a claim in relation to our client and demanded the award of an alleged debt for construction work. The claimant required to award the amount withheld under the construction contract – risk reserve (10% deduction), which purpose was to ensure the fulfillment of the contractor’s contractual obligations.

However, our team successfully provided a wide range of arguments and convinced the court, which demonstrated that the risk reserve must not be repaid after the opening of bankruptcy proceedings. Moreover, our team persuaded that the risk reserve may be used in accordance with the terms of the contract, including to remedy defects, which were made by the contractor.

In accordance with this, the Kaunas Regional Court dismissed the action.