Case No. 428/6579/17

Case category No.

428/6579/17
: Administrative cases; Cases on disputes over the implementation of public policies in the
areas of labour, employment and social protection of citizens and disputes in the area of
public housing policy, namely, disputes regarding: management, supervision and other
administrative functions (assignment, recalculation and implementation of insurance
benefits) in the area of the corresponding types of obligatory state social insurance,
including: obligatory state pension insurance, including pension insurance for persons
dismissed from the public service (military service).
Sent by the Court: 31.01.2018. Registered: 31.01.2018. Published: 01.02.2018.
Date of entry into force: 30.01.2018

THE SUPREME COURT
JUDGMENT
IN THE NAME OF UKRAINE

30.01.2018, Kyiv

Case No. 428/6579/17

Proceedings No. K/9901/3099/17

The Supreme Court consisting of the chamber of the Cassation Administrative Court:

Chief Judge – A.Yu.Buchyk (judge-rapporteur),

judges: M.M. Gimon, L.L. Moroz,

participants in the case:

Claimant – PERSON_1,
Defendant – Directorate of Pension Fund of Ukraine in Sievierodonetsk, Luhansk Oblast,
Third Party – Directorate for Labour and Social Protection at Sievierodonetsk City Council in
Luhansk Oblast.

Having considered the cassation appeal of the Directorate of the Pension Fund of Ukraine in
Sievierodonetsk, Luhansk Oblast against the Judgment of August 4, 2017 of Sievierodonetsk City
Court in Luhansk Oblast consisting of Judge D.B. Baronin, and the Judgment of October 10, 2017
of Donetsk Administrative Court of Appeal in the Judicial Panel: A.A. Shyshova, I.V. Sivachenko,
A.A. Chebanova,
the Court found that:

PERSON_1 appealed to the court with an administrative claim to recognize the unlawful inactivity
of the Directorate of the Pension Fund of Ukraine in Sievierodonetsk, Luhansk Oblast, regarding
the suspension of pension, the obligation to renew the payment of pension effective April 1, 2017,
and pay the backlog.

By Judgment of August 4, 2017 of Sievierodonetsk City Court in Luhansk Oblast, which was left
unchanged by Judgment of October 10, 2017 of Donetsk Administrative Court of Appeal, the
actions and inaction of the Directorate of the Pension Fund of Ukraine in Sievierodonetsk, Luhansk
Oblast, were recognized as unlawful. The Directorate of the Pension Fund of Ukraine in
Sievierodonetsk, Luhansk Oblast, was bound to resume the payment of pension to PERSON_1
effective April 1, 2017 and pay the backlog in the payment of the pension.

In its cassation appeal, the Directorate of the Pension Fund of Ukraine in Sievierodonetsk, Luhansk
Oblast, requests that the appealed court judgments be cancelled and a new one that completely
refuses PERSON _1 in satisfying the claims be accepted. The Directorate of the Pension Fund
points out that since the Claimant did not apply to the Directorate of the Pension Fund of Ukraine
in Sievierodonetsk, Luhansk Oblast, for renewal of the pension payment according to the
Procedure for Assignment (Renewal) of Social Payments to Internally Displaced Persons and
Order 22-1, the respondent had no legal grounds to decide whether to resume or refuse to renew
the payment of the Claimant's pension, and the defendant did not take any decision on this matter.

The Claimant did not file a response to the cassation appeal within the time period established by
the Court.

The cassation appeal is not subject to satisfaction.

The courts of previous instances established that since March 1, 2016, PERSON _1 has been
registered with the Directorate of the Pension Fund of Ukraine in Sievierodonetsk, Luhansk Oblast
and receives the retirement pension.

According to the copy of Certificate on Registration of an Internally Displaced Person No.
919054024 of May 05, 2016, issued by the Directorate for Labour and Social Protection at
Sievierodonetsk City Council, PERSON _1 who had been permanently residing at ADDRESS_1,
on February 25, 2016 moved from temporarily occupied territory to ADDRESS_2 in
Sievierodonetsk. The term of validity of the certificate is unlimited.

According to written explanations of the representative of the Directorate of the Pension Fund of
Ukraine in Sievierodonetsk, Luhansk Oblast, PERSON _1 the payment of pension to PERSON_1
was suspended effective April 1, 2017, since PERSON_1 was reported absent at the place of
residence.

Disagreeing with the termination of payment of pension, PERSON _1 submitted this
administrative claim.

While satisfying the claims, the court of first instance, the conclusions of which were
accepted by the court of appeal, referred to the groundlessness of the respondent's reference to the
receipt of information on the absence of the Claimant at the place of residence as the ground for
suspending the payment of pension, since the law in force does not envisage such basis for the
suspension of pension.

The Panel of Judges agrees with such arguments of the courts of previous instances, based on the
following.

On 22.11.2014, the Law of Ukraine No. 1706-VII of October 20, 2014 "On Ensuring the Rights
and Freedoms of Internally Displaced Persons", providing guarantees according to the
Constitution and laws of Ukraine, international treaties of Ukraine, the consent to be bound by the
Verkhovna Rada of Ukraine, confirms guarantees for internally displaced persons.

Particularly, in accordance with Article 7 of the said law, for a registered internally displaced
person, the realization of the right for pension and social services is carried out in accordance with
the legislation of Ukraine. Ukraine undertakes all possible actions aimed at solving issues related
to social protection, including the renewal of all social payments to internally displaced persons.
Citizens of retirement age, persons with disabilities, disabled children and any other persons in
difficult life circumstances who are registered as internally displaced persons, have the right to
receive social services in accordance with the legislation of Ukraine at their registered actual place
of residence.

Clause 1 of the Resolution No. 637 of the Cabinet of Ministers of Ukraine of 05.11.2014 "On the
Exercise of Social Payments to Internally Displaced Persons" specifies that internally displaced
persons are assigned and continue to receive their pensions (lifelong monthly allowance), lifelong
state scholarships, and all types of social assistance and compensation, material support, provision
of social services at the expense of the state budget and funds of obligatory state social insurance
at the place where such persons are registered, as evidenced by a certificate issued in accordance
with the Procedure for Issuance of Certificate of Registration to Internally Displaced Persons
approved by Resolution No. 509 of the Cabinet of Ministers of 01.10.2014. Payment (continuation
of payment) of pensions (lifelong monthly allowance), lifelong state grants, all types of social
assistance and compensation, material support (hereinafter - social payments) intended for these
persons, shall be carried out exceptionally to the accounts and via the network of offices and
devices of the Public Joint-Stock Company "Derzhavnyi Oshchadnyi Bank Ukrainy".

That is, according to the requirements of the abovementioned provision, the following conditions
for assignment and continuation of payment of pensions to internally displaced persons shall be
observed: presence of internally displaced persons at their place of stay, as evidenced by the
certificate; presence of an account at an office of PJSC "Derzhavnyi Oschadny Bank".

According to Paragraph 6 of the Procedure for Issuance of Certificate of Registration to Internally
Displaced Persons approved by Resolution No. 509 of the Cabinet of Ministers of 01.10.2014
(amended by Resolution of the Cabinet of Ministers No. 352 of 08.06.2016) (hereinafter referred
to as Procedure No. 509), the Certificate of Registration of an Internally Displaced Person shall
be valid for an indefinite period, except in cases stipulated by Article 12 of the Law and the sixth
section of this paragraph. A certificate issued before June 20, 2016, which has not been cancelled
or expired, is valid or an indefinite period, except as stipulated in Article 12 of the Law.

The courts found that the Certificate No. 919054024 of 05.05.2016 that confirms the
registration of the Claimant as a person who was displaced from the temporarily occupied territory
of Ukraine or the area of the antiterrorist operation, is valid.

According to Article 12 of the Law of Ukraine "On Ensuring of Rights and Freedoms of Internally
Displaced Persons", the grounds for cancelling the certificate of registration of an internally
displaced person and making entries on this into the Unified Information Database on Internally
Displaced Persons are the circumstances where an internally displaced person has: 1) submitted
an application to renounce the certificate; 2) committed a crime: actions aimed at violent change
or overthrow of the constitutional order or seizure of state power; encroachment on the territorial
integrity and inviolability of Ukraine; terrorist acts; involvement in the commission of a terrorist
act; public call for terrorist acts; creation of a terrorist group or terrorist organization; assistance in
the commission of a terrorist act; financing of terrorism; genocide, crimes against humanity or war
crimes; 3) returned to the place of permanent residence; 4) moved to a permanent place of
residence abroad; 5) submitted knowingly false information.

According to the requirements of Section 71 of the Procedure No. 509, if there are grounds
stipulated by Article 12 of the Law, the Ministry of Internal Affairs, the National Police, GTN, the
Security Service of Ukraine, the State Border Guard Service and the Ministry of Finance shall
submit the appropriate information to the authorized body to decide on deregistration of an
internally displaced person.

The decision on cancellation of the certificate in accordance with Article 12 of the Law shall be
made by the head of the authorized body at the place of residence of the person and shall be given
to him within three days from the date of adoption of such decision or sent to the address of
residence indicated in the IDP certificate.

There is no evidence in the case materials regarding the cancellation of the Claimant's Certificate
No. 9190054024 of an Internally Displaced Person issued 05.05.2016 by the body that issued it -
the Directorate for Labour and Social Protection.

Considering the above, the Panel of Judges considers the reference of the defendant to a letter No.
3147/02 of 27.03.2017 from the General Directorate of the Pension Fund of Ukraine in Lugansk
Oblast reporting absence of pension recipients from among internally displaced persons at their
place of residence and announcing suspension of the pension effective April 1, 2017 to the
indicated persons including the Claimant.

Section 2 of the Procedure for Monitoring the Realization of Social Payments to Internally
Displaced Persons at Their Actual Place of Residence / Stay, approved by Decree No. 365 of the
Cabinet of Ministers of Ukraine of June 8, 2016, stipulates that the realization of social payments
to internally displaced persons shall be monitored by structural units on social protection at district
administrations, district administrations in Kyiv, executive bodies in cities, district councils in
cities (in case of formation) (hereinafter - structural units on social protection of the population)
by visiting the actual place of residence / stay of an internally displaced person at least once every
six months, which shall be recorded in the Housing Inspection Report in accordance with the form
established by the Ministry of Social Policy.

According to Subsection 2 of Section 12 of the said Procedure, social payments are suspended in
case of establishing the fact of absence of an internally displaced person at the actual place of
residence / stay in accordance with the Housing Inspection Report.

The respondent did not provide any Housing Inspection Report for this internally displaced person
at the actual place of residence / stay.

Article 49 of the Law of Ukraine "On Compulsory State Pension Insurance" specifies the grounds
for suspension and renewal of pension payments. Paragraph 1 of this article determines that the
payment of pension by decision of the territorial bodies of the Pension Fund or by a court decision
shall be suspended: 1) if the pension is assigned on the basis of documents containing inaccurate
information; 2) for the whole period of pensioner's stay abroad, unless otherwise envisaged by
Ukraine's international treaty accepted by the Verkhovna Rada of Ukraine; 3) in case of
pensioner's death; 4) in case of non-receipt of the assigned pension for 6 consecutive months; 5)
in other cases stipulated by law.

The defendant has not submitted any evidence of existence of grounds for termination of the
pension payment to the Claimant.

The courts have correctly noted the priority of application of the requirement of Article 49 of the
Law of Ukraine "On Compulsory State Pension Insurance", and therefore the defendant's
arguments about the need to apply the standards of the Decrees of the Cabinet of Ministers
decisions are groundless.

Considering the above, the Panel of Judges considers that the courts of the first and appeals
instances established the circumstances of the case correctly and fully, and took judicial decisions
in compliance with the rules of substantive and procedural law, and therefore there are no grounds
for its cancellation.

According to Part 1 of Article 350 of the Administrative Procedure Code of Ukraine, the court of
cassation leaves the cassation appeal without satisfaction, and the judicial decisions shall remain
unchanged, if it recognizes that while taking judicial decisions or exercising procedural actions,
the courts of the first and appellate instances did not commit an improper application of substantive
law or violations of procedural law rules.

Guided by Articles 349, 350, 355, 356 and 359 of the Administrative Procedure Code of Ukraine,
–
the Court decided:

The cassation appeal of the Directorate of the Pension Fund of Ukraine in Sievierodonetsk,
Luhansk Oblast, is left without satisfaction, and Judgment of August 4, 2017 of Sievierodonetsk
City Court in Luhansk Oblast, as well as Judgment of October 10, 2017 of Donetsk Administrative
Court of Appeal, remain unchanged.

This judgment is final and is not subject to appeal.

Chief Judge A.Yu. Buchyk
judges M.M. Gimon
L.L. Moroz