Litigation | Interim proceedings as “leverage” in negotiations

In an action involving the financial collapse of a family and joint business, it was learned that the client did not have any genuine pleas to cope with the arguments of the bank – with the aim of transferring the proceeding to an ordinary proceeding and form a situation in which the bank, as a creditor, would consent to negotiating a compromise.

However, the bank, per its standard operating procedure, had a staying order issued preventing the debtor from leaving the country. The order was issued ex-parte with an affidavit from the bank branch manager. The said order allowed the objector to hold a hearing with both parties present and examine the affiant before the defendant (the debtor) argued his position on the matter of the claim.

Therefore, to build up the pleas that would allow a motion to be filed to transfer the proceeding to the ordinary track, the branch manager who had given the affidavit was examined. During the examination, the subject was led by his tongue and provided the pleas that were necessary for objecting to the statement of claim. The judge, who understood the moved, stopped the examination after some time, explaining that the hidden goal of the examination had been achieved.

Later, the same judge in the same file, after having transferred it to the ordinary track, allowed the document discovery process to be used, which pushed the bank into a position that led the file to end in a compromise and settlement before its adjudication begun.