Article 221. Procedure for Satisfaction of Claims of Creditors of Natural Person

Claims of creditors on current payments shall have priority over claims that arose before the adoption of an application for declaring a natural person insolvent, and these claims shall be settled out of turn.

Claims of creditors for current payments shall be satisfied in the following priority:

in the first place — current payments related to the payment of alimony, judicial costs in the case of insolvency of a natural person, payment of remuneration to the financial manager, persons involved by the financial manager to ensure the duties assigned to them in the case of insolvency of a natural person;

in the second place — current payments related to labor relations;

in the third place — utility payments, as well as mandatory payments to homeowners associations for the management of apartment buildings;

in the fourth place — claims for other current payments.

Claims of creditors for current payments related to the same priority shall be satisfied in the order of calendar priority.

Claims included in the register of creditors' claims shall be satisfied in the following priority:

in the first place — claims for obligations for causing harm to the life or health of citizens, as well as claims for the recovery of alimony;

in the second place — the requirements arising from labor relations;

thirdly, the claims of other creditors.

Settlements with creditors shall be made in accordance with the procedure established by Articles 150 and 154 of this Law.

The funds received from the sale of the object of pledge shall be used to satisfy the claims of creditors secured by the pledge. After the sale of the pledged property, the remaining part, after the full satisfaction of the claims of creditors secured by the pledge, shall be included in the liquidation estate.

Obligations unsatisfied at the expense of the value of the object of pledge, secured by the pledge of property of a natural person, shall be satisfied as part of the claims of third-priority creditors.

If all the debtor's property is a pledge and (or) the debtor's property is not enough to satisfy creditors' claims in full, the funds received from the sale of the object of pledge shall be distributed in the following order:

to satisfy the claims of creditors of the first and second priority, but within a part of the funds not exceeding ten percent;