Even if U.S.Steel Košice (USSK) lost the court dispute with US shell company Adams & Co., it would probably not lose the land under its premises in Košice’s Šaca district, say lawyers addressed by the Sme daily.
The Košice Regional Court issued a right of lien in relation to two thirds of the land owned by USSK, in favour of an American shell company, Adams & Co. The court’s spokesperson, Marcela Gálová, confirmed the information for Sme. The right of lien has also been published as part of the on-line cadastre.
Adams & Co., whose ownership is unclear, is demanding €16 million from U.S. Steel but the value of the lands in question significantly exceeds the total amount claimed.
“Adams & Co. cannot become owner of the plots by the ‘passing’ or transfer of ownership from U.S. Steel into its hands,” said Tomáš Kamenec of the Paul Q law firm, as quoted by Sme.
The right of lien issued by the Košice Regional Court does not mean that Adams & Co. would automatically become the owner of the plots in the event of a ruling in their favour.
“The right of lien is not used to make the creditor the owner of the debtor’s property,” Viktor Eweling from the Ikrényi & Rehák law firm told Sme. It should only prevent the debtor from getting rid of his or her property during the court proceeding, in case they do not have enough money to pay off their debts at the end, he added.
The whole court dispute may last for several years, even if the regional court decides the participants can appeal to the Supreme Court and then the Constitutional Court. If Adams & Co. wins in the end, U.S. Steel will have to pay the full amount, in which case, the plots will automatically be released, according to Michaela Machová of Maple & Fish law firm.
The court will not even have to issue a special decision, adds Veronika Vlčková of HMG Legal law firm.
Adams & Co. would be able to handle the plots only if U.S. Steel refused to pay the money after a valid loss in the dispute. In such a case they would be put up for auction or undergo distrainment proceedings. The shell company would then receive the money from the auction’s revenue, Sme reported.
Adams & Co. could only become the owner if it directly obtained the plots in such an auction or the distrainment proceeding, on its own behalf or via its affiliated firm, Andrej Leontiev of the TaylorWessing law firm told Sme.
USSK in its accounting statement however does not anticipate a loss in the court dispute. It does not have a reserve which the company would have to create if its management considered the loss probable.
Meanwhile, Adams & Co. looks like a typical shell company, according to Sme.
Even the Slovak Finance Ministry doubts the transparency of the company. When it threatened the government with international arbitration due to its dispute with U.S. Steel back in 2014, the ministry said it would not accept it. It explained at the time that Adams & Co. does not carry out any extensive business activity in the USA and that it is controlled by a third-country citizen, not an American, as reported by the daily.
18. Apr 2017 at 23:22 | Compiled by Spectator staff