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Procedural Passivity in Insolvency Proceedings: A Judicial Assessment Model under Regulatory Uncertainty

Slovo of the National School of Judges of Ukraine. №1(54) 2026. P.106-115

ISSN: 2707-6849   

UDC347.736:347.91/.95

DOI https://doi.org/10.37566/2707-6849-2026-1(54)-10

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Artem DANILOV,
Attorney, Insolvency Practitioner, Doctor of Philosophy in Law

ORCID ID: https://orcid.org/0009-0003-0355-4973

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Procedural Passivity in Insolvency Proceedings: A Judicial Assessment Model under Regulatory Uncertainty


Abstract 

This article conceptualizes procedural passivity in insolvency proceedings as an autonomous and legally significant form of conduct manifested through the non-exercise of procedural powers granted by law. It argues that reducing passivity either to party autonomy (dispositiveness) or to abuse of procedural rights is methodologically inadequate and obscures the multi-subject nature of insolvency proceedings. In a collective process structured around several procedural centers — insolvency practitioner, creditors, and the court — inactivity is rarely neutral and directly affects the formation of procedural strategy and the final outcome of the case.

The study focuses on the difficulties courts encounter at the final judicial stage of insolvency proceedings when assessing the conduct of participants in the absence of clear statutory benchmarks. Particular attention is paid to the asymmetry of judicial practice, where the “indubitable completeness of actions” standard is applied to insolvency practitioners, while creditors’ passivity remains largely unstructured doctrinally.

The article proposes a structured judicial assessment model based on the criteria of real procedural possibility and duty to act, as well as on the concept of “forced passivity,” referring to inactivity objectively обусловлена procedural dynamics, stage-related constraints, lack of funding, or absence of coordinated creditor support. Such passivity cannot automatically be equated with negligence or bad faith.

The proposed approach shifts the focus from individualized attribution of blame toward a comprehensive evaluation of collective procedural interaction. It aims to ensure balanced judicial reasoning, reduce the risk of regulatory misinterpretation, and contribute to a more coherent model of collective responsibility in insolvency adjudication under conditions of regulatory uncertainty.

Keywords: procedural passivity; insolvency proceedings; insolvency practitioner; creditors; judicial assessment; party autonomy; forced passivity; collective responsibility; regulatory uncertainty.

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Suggested Citation: Danilov, A. (2026) Procedural Passivity in Insolvency Proceedings: A Judicial Assessment Model under Regulatory Uncertainty. Slovo National School of Judges of Ukraine, 1 (54), 106–115. https://doi.org/10.37566/2707-6849-2026-1(54)-10

Date of first submission of the article to the publication: 31.03.2026

Date of acceptance of the article for publication after review: 13.04.2026

Date of publication (publication): 22.04.2026