Setting aside of the declaration of bankruptcy due to failure to pay or deposit the debt within the appeal period

Facts

Parties and procedural history:

The appellant, [A. AG] in liquidation, was declared bankrupt by the President of the District Court of Baden on 24 October 2022 at the request of the respondent [B.] pursuant to Art. 190 para. 1 no. 2 DEBA (cessation of payments) without prior debt enforcement proceedings. The appellant appealed this decision to the Higher Court of the Canton of Aargau on 11 November 2022 and requested that the declaration of bankruptcy be set aside. At the same time, it filed a motion for suspensive effect, which was dismissed on 18 November 2022. A motion for reconsideration was filed on 21 November 2022. The Higher Court dismissed the appeal in its decision of 30 November 2022, as the motion for reconsideration had become moot due to the appeal decision. On 19 December 2022, the appellant filed an appeal with the Federal Supreme Court and requested that the Higher Court’s decision be set aside and the matter referred back to the lower court. In the alternative, it requested that the declaration of bankruptcy be set aside.

Submissions of the appellant:

The appellant submitted that it had a bank balance of CHF 167,255.--, which covered the debts claimed in the amount of CHF 166,801.30 (including the respondent’s claim). It stated its willingness to pay the respondent’s claim from this balance, but was unable to do so due to the immediate attachment of assets upon the declaration of bankruptcy. The appellant argued that the debt should be paid by assignment of the bank balance or by deposit with the court cashier, but that this was not possible within the appeal period.

Considerations

Admissibility of the appeal:

The Federal Supreme Court first examined the admissibility of the appeal. The appellant, as the debtor, was entitled to appeal pursuant to Art. 76 para. 1 lit. b FSCA, as it was particularly affected by the contested decision. The appeal could in particular allege a violation of federal law (Art. 95 lit. a FSCA). The Federal Supreme Court based its judgment on the facts established by the lower court (Art. 105 FSCA). New facts and evidence were admissible only insofar as the lower court’s decision gave rise to them (Art. 99 para. 1 FSCA).

New facts in bankruptcy proceedings:

The decision concerned the declaration of bankruptcy without prior debt enforcement proceedings due to cessation of payments (Art. 190 para. 1 no. 2 DEBA). The admissibility of new facts in the cantonal appeal proceedings was in dispute. The Federal Supreme Court recalled that the admissibility of new facts in second-instance bankruptcy proceedings is governed by federal law under Art. 174 DEBA. False new facts (new facts prior to the first-instance decision) are admissible without restriction, whereas true new facts (payment of the debt, deposit or waiver by the creditor) are exhaustively regulated under Art. 174 para. 2 DEBA. Case law emphasises that both false and true new facts must be raised within the appeal period (FSCA 139 III 491 para. 4.4).

Examination of payment or deposit:

The appellant submitted that it had paid the debt by assigning a bank balance. The lower court rejected this, as payment under Art. 174 para. 2 DEBA must be proven by documents and the assignment of a bank balance is insufficient.…