Diversity of procedures for the enforcement of judicial acts covered by budgetary immunity

Savenkov Aleksei Vladimirovich Lecturer, Administrative and Public Finance Law Department, St Petersburg State University 199106, Russia, Saint Petersburg, 22nd line V.O., 7 alexeysavenkov94@gmail.com

The history of the development of the provisions of budget legislation regulating the execution of judicial acts demonstrates that in a little more than twenty years, the immunity of budgets from the regime providing the legal basis for the execution of two types of court-confirmed claims against a public entity has transformed into a regime claiming to increasingly cover relations on the execution of judicial acts at the expense of funds having, first of all, the budget origin.

The current rules of Article 239 and Chapter 24.1 of the Budget Code of the Russian Federation (hereinafter referred to as the BC of the Russian Federation) begin to be formalized in 2006 after the appeal of the Constitutional Court of the Russian Federation to the designated procedures for the execution of judicial acts on foreclosure on budget funds. In its decision, the Constitutional Court of the Russian Federation, analyzing the special procedure for the execution of judicial acts on foreclosure on budget funds as a result of compensation for losses caused by illegal actions (inaction) of state bodies, local self-government bodies or their officials, indicated that the introduction of such an order, different from the general procedure for the execution of judicial acts, pursues a constitutionally significant the goal. This procedure guarantees the continuous realization of human and civil rights and freedoms, ensured by the stable and continuous performance by the state of its functions as a result of enabling a public legal entity to take organizational and technical measures to redistribute budgetary funds in order to form budget expenditures for the execution of a judicial act (paragraph 3.2 of the Resolution of the Constitutional Court of the Russian Federation No. 8 of July 14, 2005-P).

In the future, the Constitutional Court of the Russian Federation, in its decisions, has not once addressed the issue of the execution of judicial acts in the conditions of budgets, in particular, pointed out that the introduction of special procedures for foreclosure on budget funds also pursues another goal, namely, prevents uncontrolled foreclosure on budget funds, ensuring the safety of funds (paragraph 3 of the Resolution of the Constitutional Court RF dated March 2, 2010 No. 5-P). However, it is important that in its rulings the court confirmed the questioned position that both of these goals are inherent in the introduction of both special procedures for foreclosing on budget funds, including on monetary obligations of a budget institution (old type), and then a state-owned debtor institution (paragraph 3 of the Resolution of the Constitutional Court of the Russian Federation from July 15, 2021, No. 37-P).

Thus, initially, the legislator, in Article 239 of the BC of the Russian Federation, covered the budget immunity regime only directly funds of the budgets of the budgetary system of the Russian Federation, regulating the procedures for the execution of judicial acts on foreclosure on the treasury of public legal entities and on funds allocated at the initial stage to budgetary institutions (old type), and then to state institutions.

However, since January 1, 2022, this list of Article 239 of the BC has been supplemented by the procedure for the execution of judicial acts in respect of funds subject to treasury support of participants in treasury support. Literally, Article 239 of the BC of the Russian Federation says that both budget funds and funds subject to treasury support are protected by the immunity of the budgets of the budgetary system of the Russian Federation. From this it can be assumed that since the legislator, speaking about the immunity of funds subject to treasury support, formally includes it in the concept of immunity of budgets, then these funds themselves are perceived by him as budgetary or, at least, maintaining a close connection with the budget system.

The current budget legislation does not allow us to say that the funds subject to treasury support after their transfer to the participant of treasury support are still funds of the budgets of the budgetary system. Budget funds (their balances) are locked in a single treasury account – a bank account (their totality) opened to the Federal Treasury in the Central Bank of the Russian Federation for making money transfers in order to ensure the implementation and reflection of operations on treasury accounts (paragraph thirty-second of Article 6, paragraph 1 of Article 242.12 of the BC of the Russian Federation, paragraphs 2, 3 Articles 242.8 of the BC of the Russian Federation). However, the balances of funds of autonomous and budgetary institutions and participants of treasury support are also accumulated on the same account (paragraph 1 of Article 242.12 of the BC of the Russian Federation). At the same time, transactions with the funds of the budgets of the budgetary system of the Russian Federation and with the funds of participants in treasury support are carried out on separate treasury accounts opened in the Federal Treasury (paragraph 1 of Article 242.14 of the BC of the Russian Federation). Consequently, the funds subject to treasury support are not funds of a specific budget and are located not on single budget accounts, but on special treasury accounts intended for the implementation and reflection of transactions with the funds of participants in treasury support. Therefore, they are not budgetary in the sense that they are located outside the unified accounts of budgets and, accordingly, the budget system.

At the same time, these funds, due to their placement on treasury accounts due to the need for their treasury support as targeted funds of budgetary origin, cannot be fully called private funds, since the rights of their recipients in relation to them are limited. Therefore, we can say that these funds have a close connection with the budget system.

The funds subject to treasury support allocated on the basis of state contracts for the supply of goods (performance of works, provision of services); contracts and agreements on the provision of subsidies, budget investments and contributions to the authorized (stock) capital (contributions to property) of legal entities (their subsidiaries) are mainly designed to ensure the rights and freedoms individuals through the fulfillment by the participants of the treasury support of their obligations under these contracts, contracts and agreements, which is directly emphasized by representatives of the Federal Treasury ^{[3, p. 39]}.

Therefore, despite the fact that these funds formally already belong to a private person, since they are transferred to him from unified budget accounts, the public entity continues to maintain control over these funds by placing them on special treasury accounts and authorizing expenditures ^{[7, p. 14]}. In this regard, it can be said that before fulfilling their obligations under contracts, contracts and agreements, the funds subject to treasury support belong to legal entities only within their intended use.

This probably explains the extension of the budget immunity regime to these funds. However, there are doubts that the legislator, formally extending the budget immunity regime to the funds subject to treasury support and fixing in the budget legislation a special procedure for the execution of judicial acts on foreclosure on them, pursued the achievement of the same goals for which the immunity of budgets was initially introduced, assuming special procedures for the execution of judicial acts provided for in Chapter 24.1 of the BC of the Russian Federation.

The appearance of treasury support, as noted in the explanatory note to the draft Federal Law fixing the provisions on it in the Budget Code, is due to "the need to balance the interests of the state as the owner of funds and executors of state (municipal) contracts" (Explanatory Note to the draft Federal Law No. 1100181-7). Therefore, this mechanism pursues the goal of ensuring the safety of funds provided by a public entity to achieve the result for which they were allocated from the budget ^{[4, p. 12]}. Probably, in view of this, these funds were initially reserved from any collection (Letter of the Ministry of Finance of the Russian Federation dated November 19, 2018 No. 09-02-07/84638), which excluded the possibility of their diversion to purposes other than the intended purpose ^{[8, p. 44]}. Otherwise, foreclosing on them before a private person fulfills his obligations would mean using them not in accordance with their purpose and could lead to the impossibility of achieving the material result for which they were allocated, and, as a consequence, the realization by citizens of their rights and freedoms.

At the same time, such a restriction did not seem to meet the balance of private and public interests developed by the legislator and judicial practice. Therefore, it can be assumed that the legislator in the future, focusing on the fact that the said ban in certain cases leads to a violation of the rights of citizens, for example, in case of the need for compensation for damage caused to life and health and the absence of another source of satisfaction, allowed the principal possibility of using funds subject to treasury support for the execution of judicial acts.

At the same time, realizing the importance of these funds, which have a strictly targeted orientation and are spent on "state and public needs in the interests of all citizens," the legislator considered it necessary to establish such regulations, which, as well as in the case of budgetary funds, would exclude uncontrolled foreclosure on them (paragraph 3 of the Resolution of the Constitutional Court of the Russian Federation dated March 2, 2010 No. 5-P). Therefore, the public entity has extended to them the already existing regime of immunity of budgets.

Nevertheless, it is fundamentally important to note that when creating special regulation, including in terms of foreclosure on funds subject to treasury support, the legislator takes into account not only the special purpose nature of these funds, but also their significant size exceeding 100 million rubles ^{[2, p. 25]}. At the same time, the absence of special rules regarding funds with the same purpose allocated under contracts, contracts and agreements with a price lower is based solely on a risk-oriented approach and is not due to the lack of need to ensure control and targeted use of funds, but an attempt to achieve a balance of private and public interests when spending funds ^{[1, p. 89]}.

Meanwhile, the introduced regime of immunity of funds subject to treasury support cannot be fully identified with the immunity of budgets, because in the case under consideration, the introduction of a special procedure for foreclosure and execution of a judicial act is not conditioned by the second purpose of immunity of budgets. It is about giving the debtor the opportunity to redistribute funds to ensure the continuity of the performance of other obligations. However, the absence of this goal can be explained by a disadvantage inherent in the Constitutional Court of the Russian Federation in the system of relations for the execution of judicial acts in the conditions of immunity of budgets. In a dissenting opinion to the Resolution of 14.07.2005 No. 8-P, the judge of the Constitutional Court of the Russian Federation, N.S. Bondar, noted that the constitutional and legal justification proposed by the court for the existence of a special procedure for the execution of judicial acts against a public entity through the need to redistribute budgetary funds is valid in relation to the execution of judicial acts issued against public legal entities, however it cannot be automatically extended to judicial acts against budget recipients (Opinion of the judge of the Constitutional Court of the Russian Federation N.S. Bondar to the Resolution of the Constitutional Court of the Russian Federation dated July 14, 2005 No. 8-P). It seems that this is explained by the fact that at the disposal of budgetary institutions (of the old type), acting at that time as recipients of budget funds, there were funds both received from the budget and from income-generating activities. The established features of foreclosure on each of the types of funds led to the fact that, in particular, for debts incurred in the framework of income-generating activities, a judicial act could be executed only at the expense of funds received from such activities, or the founder's funds in the order of subsidiary liability.

Consequently, the need to redistribute budgetary funds for the execution of a judicial act could arise only in the situation of foreclosure on funds allocated to the institution from the budget. In this part, the financial support of the institution's activities was carried out through the granting of powers to dispose of budgetary funds within the limits of budgetary obligations brought to them. At the same time, a situation could arise in which an institution was forced to accept budgetary obligations in an amount exceeding the limits allocated to it. In this case, during the execution of the judicial act, indeed, there could be a need to find budgetary funds.

Consequently, it can be assumed that within the framework of the immunity of budgets in relation to certain types of execution procedures, the purpose designated by the Constitutional Court of the Russian Federation in the Resolution of 14.07.2005 No. 8-P may be absent, which, however, does not deny the applicability of the regime itself due to the need to provide additional control over the expenditure of funds. Thus, it is possible to talk about the immunity of budgets in relation to the funds subject to treasury support only with a high degree of conditionality, realizing that these are no longer budget funds, but still maintaining a close connection with it. In this regard, the extension of the budget immunity regime to these funds is its adaptation to protect other economic entities from penalties, although in connection with ensuring access of such entities to public financial resources.

In addition to the above-mentioned procedures for the execution of judicial acts, Russian legislation contains two more procedures that are technologically similar to the execution procedures provided for in Chapter 24.1 of the BC of the Russian Federation. We are talking about the provisions of Part 20 of Article 30 of Federal Law No. 83-FZ of May 8, 2010 "On Amendments to Certain Legislative Acts of the Russian Federation in Connection with the Improvement of the Legal Status of State (Municipal) Institutions" and Part 3.19 of Article 2 of Federal Law No. 174-FZ of November 3, 2006 "On Autonomous institutions" procedures for the execution of judicial acts on foreclosure on funds held in the personal accounts of autonomous and budgetary institutions.

It is noted in the literature that these procedures tend to the regime of immunity of budgets, since foreclosure on funds reflected in the personal accounts of autonomous and budgetary institutions is possible only on the basis of a judicial act (Selionov I. V. Execution of executive documents in relation to state (municipal) institutions in the Russian Federation: financial and legal aspect: dis. ... cand. jurid. M., 2018., p. 135). At the same time, even with regard to the previous system of regulation of public finance (before the advent of treasury services), it was concluded that budget funds allocated to autonomous and budgetary institutions are not budget funds ^{[6, pp. 117-118]}. Today, these funds are also separated from budget funds in separate treasury accounts, as well as it is done with the funds of participants in treasury support. Therefore, the use of the concept of budget immunity in relation to funds allocated as budget allocations to autonomous and budgetary institutions is also conditional.

However, if before the appearance of a special procedure for foreclosing on funds subject to treasury support, it was problematic to talk about adapting the immunity regime of budgets to other funds of budgetary origin, then after that there are sufficient grounds to assert that the legislator followed this path. Thus, having identified a constitutionally significant purpose for which the foreclosure of funds of autonomous and budgetary institutions located on personal accounts was placed under the condition of obtaining a judicial act, the execution of which was transferred to special participants in the budget process, the public entity actually extended the immunity regime of budgets to these relations.

Nevertheless, it is worth noting that in itself the subordination of foreclosure on funds of autonomous and budgetary institutions with budgetary origin to a special regime can be justified by the peculiarities of the status of the institution itself. As the Constitutional Court of the Russian Federation noted in one of its decisions, "budgetary institutions, having special legal capacity, have property rights to solve the tasks set for them by the founder – public owner" (paragraph 3 of the Resolution of the Constitutional Court of the Russian Federation No. 23-P of 12.05.2020). This confirms that, despite the independence of autonomous and budgetary institutions proclaimed as a result of the 2010 reform, expressed in particular in the ability to participate in civil turnover on their own behalf and bear, as a general rule, property responsibility for their obligations, institutions retain a dual status.

On the one hand, the legislator recognizes institutions as independent and equal to other participants in civil turnover, on the other hand, perceives them as one of the forms of implementation by a public entity of its functions and powers ^[5]. In this regard, it becomes fundamentally important to ensure the efficiency of institutions, for example, if it is necessary to attract them to provide socially significant services, the provision of which was not handled by private individuals who were allocated budget funds for the same purpose.

In addition, it seems that, in addition to the indicated importance of autonomous and budgetary institutions, it is also necessary to take into account the nature of the funds themselves, which consists in their belonging to a private person already described above within the framework of the purpose for which they were allocated. At the same time, the absence of similar Part 20 of Article 30 of Federal Law No. 83-FZ of May 8, 2010 "On Amendments to Certain Legislative Acts of the Russian Federation in Connection with the Improvement of the Legal Status of State (Municipal) Institutions" restrictions when foreclosing on the funds of the same subsidies, but allocated to commercial organizations, may probably be it is explained by the use of a risk-based approach to subsidizing in order to increase the attractiveness of budget funds for individuals.

Thus, the analysis of the adaptation of the budget immunity regime to the relations developing with the participants of treasury support, as well as autonomous and budgetary institutions, suggests that there are grounds to talk about the need to abandon the concept of budget immunity and introduce new terminology in the conditions of the updated regime, indicating the coverage of all those subject to special rules of treatment by such a regime relationship penalties.

However, it cannot also be excluded that the introduction of an indication in the text of Article 239 of the BC of the Russian Federation to extend the immunity regime of budgets to funds subject to treasury support in the absence of changes in the norm regarding the indication of immunity of budgets of the budgetary system of the Russian Federation expands the very concept of budget immunity. In this case, the immunity of the budgets of the budgetary system of the Russian Federation — contrary to the literal meaning of the fourth paragraph of Article 6 of the BC of the Russian Federation — covers not only budget funds as funds held in single budget accounts, as well as other specially specified funds of budgetary origin.

Then immunity, assuming the admissibility of foreclosure only on the basis of a judicial act subject to execution under a special budgetary procedure, covers not only budget funds, but also funds subject to treasury support, as well as funds reflected in the personal accounts of autonomous and budgetary institutions. This broad understanding of the immunity of budgets is also confirmed by the position of the Ministry of Finance of the Russian Federation, which, in the process of drafting a new budget code, combined the execution of judicial acts against budgets, autonomous and budgetary institutions within the same rules (Explanatory Note to the draft Budget Code of the Russian Federation). This draft provided for subordination to the general principles (articles 249 and 250 of the draft) of the procedures for the execution of judicial acts on foreclosure on funds of public legal entities (article 251 of the draft), state-owned, autonomous and budgetary institutions (articles 252 and 254 of the draft).

At the same time, such an updated regime in the current state in practice does not take into account the peculiarities of the legal status of participants in treasury support, autonomous and budgetary institutions, as well as the funds allocated to them. Therefore, the preservation of a single immunity regime is possible only with the appearance of a more fine-tuning of the application of the rules of Chapter 24.1 of the BC and Part 20 of Article 30 of Federal Law No. 83-FZ of May 8, 2010 On Amendments to Certain Legislative Acts of the Russian Federation in Connection with the Improvement of the Legal Status of state (Municipal) Institutions." Otherwise, it seems justified to introduce an independent regime for cases of execution of judicial acts against participants of treasury support and autonomous and budgetary institutions, reflecting their inherent characteristics.