Article 80. Mutual Settlement of Claims

Termination of the debtor's financial obligations by mutual settlement of an alternative counterclaim, except for the case provided for by part eight of this article, shall be allowed only in cases where:

debtor's and the creditor's claims for monetary obligations arose before the initiation of insolvency proceedings;

monetary obligations of the debtor and the creditor arose as a result of transactions made before the commencement of the insolvency proceedings, and the period for claiming these obligations began after the commencement of the insolvency proceedings, or the date and time of the claim is not specified.

The provisions of Articles 150 and 185 of this Law shall not be taken into account when considering mutual claims. Obligations shall be considered terminated when one of the parties has declared this, starting from the entry into force of the counterclaims of the parties on the date of their compliance, that is, from the moment of expiration of the period for fulfilling the obligation, regardless of whether an application for payment has been received or accepted.

Termination of the debtor's financial obligations by mutual settlement of an alternative counterclaim shall not be allowed in cases where:

claims of the debtor (or against the debtor) for monetary obligations arose after the initiation of an insolvency case, if this would lead to a violation of the rights of creditors;

claims of the debtor (or against the debtor) for monetary obligations were acquired in bad faith before the initiation of insolvency proceedings. If the acquirer of the right to claim knew or should have known that the debtor had signs of insolvency, but acquired this right, it shall be assumed that it was acquired in bad faith. Otherwise, the proof of the fact rests with the acquirer of the right to claim.

If claims become counterclaims as a result of a change in the person in the obligation, then the time of their occurrence cannot be earlier than the date of such change.

An application for an alternative counterclaim by mutual settlement may be filed by the creditor, debtor or liquidation manager.

Disputes on the termination of monetary obligations by mutual settlement of the debtor's alternative counter claim shall be considered by the court in the manner prescribed by Article 60 of this Law.

If the terms of mutual settlements have come within six months before the initiation of insolvency proceedings, mutual settlements can be challenged only in case of bad faith of the actions of the creditor.