On June 8, the Riga City Court of Pardaugava made a decision to reject the application of SIA AVN Group to initiate bankruptcy proceedings against the construction company MONUM. The insolvency petition was unfounded and, as the court points out, the insolvency petition cannot be used as a solution to resolve civil disputes.

“MONUM’s filing for bankruptcy is evidence that some companies are abusing law enforcement and exploiting loopholes in the law to resolve civil disputes. MONUM has no overdue obligations to SIA AVN Group or any other company with which all contractual obligations have been fulfilled. The court also indicates in its decision that the bankruptcy petition against us is completely unreasonable, and we consider this to be libel against our company, ”notes Maris Ozoliš, Chairman of the Board of MONUM.

On May 3, 2018, SIA AVN Group filed a petition in court for recognizing the insolvency proceedings of SIA MONUM, which on June 8 was declared unfounded and terminated the proceedings on the grounds that the sign of insolvency indicated in the petition was absent and SIA AVN Group filed an application for insolvency, recognizing that there is a dispute between the parties regarding the performance of obligations.

Maris Ozolins notes that “at present, construction volumes are growing, there is a shortage of employees, and as a result of demand, many new companies are created, which often do not comply with the terms of the contract, both delay work and perform poor-quality work. Consequently, situations where subcontractors use all methods to tarnish and damage the reputation of general contractors, since civil disputes cannot be resolved, can only increase. For example, the construction company Latvijas Energoceltnieks, now MONUM, recently faced an unfounded bankruptcy filing. “