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. Last Updated: 07/27/2016

Revised Procedure Code Fosters the Rule of Law

One of the greatest fears of foreign organizations operating in Russia is local courts. Underdeveloped substantive law, a court system historically discredited for being subject to interference by the ruling Communist Party and today's corruption increase the uncertainty connected with any lawsuit.

The first major amendments to the Civil Procedure Code (CPC) since 1988 went into effect at the beginning of this month. The amendments are an important step toward rationalizing litigation in Russian courts and establishing rule of law.

The civil courts primarily decide cases involving an individual on at least one side of the dispute. Thus, a company is most likely to be summoned to civil court as a defendant against a disgruntled employee or a person injured in an accident or by the company's products.

The amendments discard much of the CPC's paternalism and proclaim the adversarial contest, rather than "socialist legal consciousness," as the basic guide to civil court proceedings. Thus, each party bears primary responsibility for prosecuting its own case. The court has now been mostly relieved of its pre-amendment duty to actively defend the parties' rights, for example by requiring presentation of evidence even without it being requested.

Now the court decides the dispute as presented by the parties. Similarly, if the plaintiff drops the case, the court is no longer required to inquire into whether he is needlessly relinquishing his rights, absent signs of coercion or fraud.

This shift in the court's role suggested by the amendments may be mitigated by lingering traditions and provisions that cannot be fully understood before application. For example, the court is required, "when necessary," to "propose" to the parties to present specific evidence.

The revised CPC provides that the losing party must pay the winning party's "reasonable" attorney's fees. This rule increases the risk for both sides and encourages settlement of disputes rather than initiating or prolonging litigation.

Expedited procedures are introduced for recovering certain fixed monetary obligations, such as wages, or an amount due under a written contract, promissory note, or check.

Under these procedures, if the defendant does not contest the claim within 20 days, the court will decide the case without conducting usual preliminary procedures or holding a trial. These procedures could have a significant positive impact on respect for contracts at grassroot level.

The amendments reaffirm the court's ability to meet with each party without the opposing party's knowledge. Most legal systems forbid this practice for the sake of impartiality, except in emergencies.

Daniel Rothstein, a partner in the firm Rothstein & Shaw, has practiced law in Moscow since 1990.