Greetings. As a lawyer with many years of experience, I have analyzed the court decision you provided. Here is a detailed breakdown of the case:
1. **Subject matter of the dispute:** The Plaintiff (JSC “Ukrnaftnafta”) filed a lawsuit with the court requesting to invalidate a petroleum products supply agreement concluded with the Defendant (PJSC “Synthesis Oil”) due to the Plaintiff’s representative exceeding their authority and the fictitious nature of the transaction.
2. **Court’s arguments:**
– The court established that the Plaintiff’s representative signed the agreement for an amount that significantly exceeded the limits established by the company’s Charter for such transactions.
– The Supreme Court emphasized that although there is a presumption of the validity of a director’s actions, it is not absolute if the counterparty acted in bad faith or unreasonably.
– The court noted that the Defendant, as a professional market participant, when concluding an agreement for a large amount, was obliged to exercise reasonable diligence and verify the authority of the signatory, in particular by analyzing the Charter, which was referenced in the power of attorney.
– Since the Defendant did not verify the existence of corporate approvals (decisions of the Management Board or the Supervisory Board), its conduct was deemed to be in bad faith.
– The court, in its decision, clearly relied on the legal position of the Grand Chamber of the Supreme Court dated 03.12.2025 in case No. 914/768/22, which details the criteria for a counterparty’s good faith when assessing the authority of a legal entity’s representative.
– The court also rejected the Defendant’s arguments regarding the prejudicial nature of other court decisions, as the issue of the signatory’s authority to conclude this specific agreement was not examined on its merits in those cases.
– The absence of a claim for restitution (returning the parties to their original position) does not render the lawsuit ineffective, as the Plaintiff has the right to protect its interests by having the transaction declared invalid.
3. **Court decision:** The Supreme Court upheld the appellate court’s ruling, which granted the lawsuit and declared the agreement invalid.
