AN INDIRECT ACTION

  • 2011-03-02
  • By Laima Platūkytė, Associate Lawyer

ECOVIS Miškinis, Kvainauskas ir partneriai advokatų kontora

The Civil Code of the Republic of Lithuania establishes a special method for implementation of rights – so-called indirect action. The main purpose of this legal institution is to protect creditor rights from unfair actions of debtors in these cases, when a debtor is uninterested to his rights’ performance (for example re-gaining the debts from third parties), because the creditor would direct his claim to it. In such cases the creditor gets the right on his/her debtor’s behalf to bring an action against the debtor’s debtor, but only when certain conditions exist.

First of all, a creditor’s claim against a debtor must be certain and exigible. In other words - the contract or statutory obligation term must be expired. The second condition is a debtor’s inaction. This can result as a delay, avoidance or lack of initiative from the debtor’s side in performing his/her rights and may occur in many different forms. Finally, an indirect action may only be brought up as a necessity for the creditor to protect his rights (in case of a debtor’s insolvency, bankruptcy proceedings instituted against him/her or in any other special matters, etc.).

However, it should be noted that the indirect action is an exception in the disposition principle and a creditor has no right to demand exercising such debtor’s rights, which are related exceptionally with the person of the debtor (eg. compensation for the breach of non-material rights, the right to maintenance, etc.). It is also worth mentioning that upon the satisfaction of an indirect action, the property recovered goes to the debtor and, together with his property in general, is used to benefit all his/her creditors including the creditor bringing the case up.