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Legal Studies
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Criteria of Integrity of the Sole Executive Body: Problem Statement

Vronskaya Mariya Vladimirovna

PhD in Law

Associate Professor at the Department of Private Law of Vladivostok State University of Economics and Service 

690014, Russia, Vladivostok, Primorsky Krai, 42 Balyaeva str., sq. 119

m.vronskaya@mail.ru
Other publications by this author
 

 
Pavlova Anna Dmitrievna

Master, Department of Civil Law Disciplines, VVGU

690014, Russia, Vladivostok krai, Vladivostok, Gogol str., 41

Pavlova.AD@vvsu.ru

DOI:

10.25136/2409-7136.2022.12.39370

EDN:

WGIGAX

Received:

11-12-2022


Published:

24-12-2022


Abstract: The subject of the study is the legal relations related to the implementation of the principle of good faith by the participants of corporate law. The author examines the acts of interpretation that reveal the essence of good faith behavior in corporate legal relations. Sets itself the following questions based on the analysis of legislation, scientific materials and law enforcement practice, related to the definition of legal problems related to the implementation of the principle of good faith. Particular attention is paid to the integrity of the sole body of a legal entity, the current state of legislation and law enforcement practice is investigated, in terms of specifying the integrity of behavior. The authors establish their insufficiency, the need for additional doctrinal research in the context of an innovative revision taking into account modern civilizational (political) risks and threats. Based on the study of Russian legislation and the practice of implementing the principle of good faith in corporate legal relations, the authors conclude that their doctrinal rethinking is necessary, only judicial clarification of the criteria of good faith of the executive body of a legal entity is established, their insufficiency is determined in the context of the actual civilizational and political-legal situation in the country. The results of the scientific research are the establishment of the insufficiency of the application of the criteria for determining the integrity of the executive bodies of a legal entity, defined by the Resolution of the Plenum of the Supreme Arbitration Court of the Russian Federation dated 30.07.2013 No. 62 "On certain issues of compensation for damages by persons who are part of the bodies of a legal entity". The authors raise the question of the need to rethink the criteria of good faith, taking into account civilizational (political) risks and threats.


Keywords:

conscientiousness, director, abuse of right, criteria, law enforcement practice, corporate relations, civil legislation, legal problems, prospects for improvement, civilizational risks

This article is automatically translated.

 "Conscientiousness" is located at the junction of two areas and acts not only as a legal category, but also as a moral one, therefore – purely subjective. In view of this, a number of authors, addressing the issue of integrity of the sole executive body and integrity in general, adhere to different interpretations of this term. I.G. Fedin notes the multidimensional nature of integrity, which can be used by researchers as a measure, idea, beginning, presumption, evaluative concept. Due to its multidimensional nature, this category as a tool of legal technology is in demand in all branches of domestic law [1, p. 7]. According to E.N. Bychkova and K.S. Kalinichenko, good faith implies compliance with legal regulations, as well as making objective decisions [2].  Kuligina M.A. notes the evaluativeness of the category "good faith", even despite the attempt made by the legislator to disclose the content of this concept in the Resolution of the Plenum of the Arbitration Court of the Russian Federation dated July 30, 2013 No. 62 "On certain issues of compensation for damages by persons who are part of the bodies of a legal entity" [3]. On the one hand, the act of interpretation is an opportunity to highlight the main characteristics of good faith, to reduce judicial practice to uniformity, on the other hand, it is the basis for many discussions and entails a number of contradictions, especially from a theoretical point of view.

Taking into account the absence of legislative formulations that allow determining and specifying the good faith of the participants' behavior in the event of disputes, the question of the qualification of the participants' actions is established within the framework of legal proceedings. Having familiarized with the practice of applying and interpreting the bona fide behavior of participants in civil turnover by Russian courts, it becomes clear that the courts see a manifestation of good faith in the behavior of persons expected from any participant in civil turnover, taking into account the rights and legitimate interests of the other party, assisting her, including in obtaining the necessary information [4].

Fixing in Article 1 of the Civil Code of the Russian Federation the obligation of civil participants to act in good faith in establishing, exercising and protecting civil rights and in the performance of civil duties, the legislator points out the value and integrity of this institution in all civil relations arising between subjects [4].

Despite the fact that the principle of good faith is normatively fixed as a general principle of civil law in Russian legislation, in 2012 by Federal Law No. 302-FZ of December 30, 2012, its observance by participants in legal relations is not fully ensured by the requirements of the law. For almost 10 years now, there has been an urgent problem in the legal environment of the lack of criteria for conscientious behavior by participants in various civil legal relations. Judicial practice shows that the dishonesty of participants in civil legal relations is found everywhere, and corporate law is no exception. Depending on the direction of the legal entity's activity, options for possible behavior within this legal entity with its counterparties and government agencies will depend, which often manifests itself in the abuse of owned rights and violation of the rights of other persons, causing them losses.

That is why the purpose of this study is to identify criteria for conscientious behavior of the sole executive body of a legal entity, to propose ways to solve the problem of the lack of their legislative definition and consolidation.

From the point of view of the legislator, corporate law is not an independent branch, it is assigned the role of only a component of civil law [5, p. 11]. At the same time, it is subject to the norms enshrined in civil legislation, its main principles, which include conscientiousness.

Speaking about legal entities and their conscientious behavior, it is necessary to proceed from the fact that the nature of the legal relations into which this legal entity enters depends, first of all, on the decisions of the sole executive body of the company – the director or the general director. Therefore, the initiative of unscrupulous behavior, the legality of certain actions, their compliance with the fundamentals of civil legislation is the result of the strong–willed behavior of a single person, because the dishonesty of the subject is possible only if this person has the appropriate fixed right.

Paragraph 3 of Article 53 of the Civil Code of the Russian Federation stipulates that a person who, by virtue of a law, other legal act or constituent document of a legal entity is authorized to act on its behalf must act in the interests of the legal entity represented by it in good faith and reasonably [4]. In case of violation of this obligation, the director, at the request of the legal entity and (or) its founders (participants), who are granted the right by law to make a corresponding claim, must compensate the losses caused to the legal entity by such violation.

There are several reasons that give rise to unscrupulous behavior. The most significant of them are:

 – a low level of legal awareness of persons who have the authority to exercise the management of a legal entity, which entails the use of the rights granted to them for purposes contrary to the law;

 – the absence of formally defined and legally fixed criteria for such behavior. This is where the biggest problem manifests itself, because if the level of legal awareness is something that the person himself is able to influence, then the criteria that he would have to follow when managing a legal entity are not specified.

The improvement of the Russian legal system determines the same rapid development of corporate legal relations. There are more opportunities to cause damage to counterparties or third parties and, of course, more opportunities to avoid liability, and it is increasingly difficult for the latter to protect their rights.

This problem is aggravated, first of all, because the state, although it establishes the presumption of good faith of the behavior to be followed, the legal norms do not formalize the possible behaviors of the subjects, but only define the limits of the exercise of civil rights, assuming their non-infringement by the participants. By conscientious behavior, the legislator means compliance with the norms of law and, at the same time, awareness that their implementation will not lead to violation of the private or public interests of other participants in civil turnover. In the presence of proven guilt of a participant in legal relations, it is not possible to talk about good faith. That is, the edge when the realization of a participant's subjective rights becomes an abuse is causing harm to third parties to such an extent that dishonesty acquires a level of public danger.

In order to ensure compliance with the lawful conduct of the director (or CEO) of a legal entity, the most accurate criteria for good conduct should be determined. On July 30, 2013, the legislator made an attempt to establish the criteria of good faith of the sole executive body of a legal entity, based on the court decisions made. By Resolution of the Plenum of the Supreme Arbitration Court of the Russian Federation No. 62 dated 30.07.2013 "On certain issues of compensation for losses by persons who are part of the bodies of a Legal entity", the legislator determined that this is evidence of unfair behavior of the sole executive body of a legal entity [6]:

1) acts exclusively in the interests of a legal entity, without involving in its activities and without taking into account its personal interests, except in cases when information about the conflict of interests was disclosed in advance and the director's actions were approved in accordance with the procedure established by law;

2) provides reliable information for the participants of the legal entity information about the transactions of the legal entity (in particular, if the information about such a transaction in violation of the law, the charter or internal documents of the legal entity were not included in the reporting of the legal entity);

 3) does not make transactions (other legally significant actions) without the approval of the relevant bodies of the legal entity required by law or the charter;

4) after the termination of his powers, voluntarily submits to the legal entity documents relating to the circumstances that entailed adverse consequences for the legal entity;

5) in the case of a transaction on conditions that are obviously unfavorable for a legal entity or with a person who is obviously unable to fulfill an obligation (a "one-day company", etc.) did not know or should not have known that his actions (inaction) at the time of their commission did not meet the interests of the legal entity [6].

The said Resolution examines examples of dishonesty of the sole executive body and by the method of the reverse, it is possible to come to a conclusion in what conscientiousness is manifested in the management of the company's current activities. But how are the limits of the participation of the sole executive body of a legal entity in the implementation of management determined, and the boundary between the fair use of the rights granted and the abuse of them? How conscientious will it be considered to issue a power of attorney by the director (CEO) to a person temporarily replacing him during a period of unstable economic situation in the company, is this an attempt to evade responsibility by involving third parties? What is the degree of his conscientiousness when signing an order to issue a bonus to the director (general director), whether there is a conflict of interest in these situations – neither the law nor the acts of interpretation regulate these circumstances. These rights of the sole executive body of a legal entity are not a novelty for civil law, while to this day they are not without problems associated with their implementation. How then to regulate the new legal relations arising in modern conditions?

A.V. Neznamov and M.A. Mikheenkova touched upon the problem of criteria of integrity of the sole executive body of a legal entity in their research. They noted that the existence of such an act, the clarification of some provisions related to the implementation of the principle of good faith does not indicate uniformity in the application of existing norms. In this regard, they identified a fairly wide list of criteria by which it is possible to determine the good faith or bad faith of a legal entity and, accordingly, the sole executive body of a legal entity. Among these, the authors include the commission of transactions not for the intended purposes, the debtor's repeated appeal to the creditor with a request to defer the debt due to the inability to repay it within the originally established period; the presence of information from an unscrupulous creditor that at the time of the disputed transaction, the debtor stopped fulfilling its obligations to other creditors and other signs that may to testify about the possible dishonesty of the legal entity and, accordingly, its sole executive body.

But even these criteria cannot unambiguously characterize a person as conscientious or unscrupulous. Moreover, it is quite difficult to identify such circumstances, especially at the stage of concluding a transaction, when no contractual legal relations have yet developed. And compliance with some of the criteria named by Neznamov A.V. and Mikheenkova M.A. is almost impossible (for example, the presence of information from an unscrupulous creditor that at the time of the disputed transaction, the debtor stopped fulfilling its obligations to creditors (both unscrupulous and others), the presence of an unscrupulous creditor of the debtor's accounting data and/or the right to require the provision of such reporting, despite the fact that at the time of the disputed transaction, the insolvency or insufficiency of the debtor's property, or the existence of another possibility of access to such information, was seen from the accounting statements) [7]. Such information can only be obtained in court.

In other words, a person, having information about compliance with the counterparty's good faith or bad faith, can only see actions in the behavior of his sole executive body that indicate possible bad faith.

Despite the fact that the interpretation, the practice of applying the norms and, as a result, the conclusions concerning the principle of good faith are very subjective and can be criticized by various theorists, there is a statement that is quite difficult to challenge. This statement is stated in the scientific works of D.I. Stepanov and Y.S. Mikhalchuk, who believe that the integrity of the sole executive body of a legal entity is manifested, first of all, in compliance with the prohibition to the director to identify the interest of the legal entity managed by him with personal interest [8, p. 33]. Yu.G. Leskova also addresses the issue of the contradiction of personal interests and the interests of the company in her scientific works. She notes that the fact of the director's participation in a conflict of interest is a rather controversial issue, given the uncertainty of both legislation and judicial clarifications in this area. But even here a logical question arises: can actions committed by a sole executive body not in the interests of society be in good faith [9]

The authors of this article believe that the criteria set out in the Resolution are not sufficient for the most complete and lawful application of the existing norms by the courts. At the same time, it is impossible not to agree with Neznamov A.V. and Mikheenkova M.A. and their proposed criteria that can be accurately applied in the work of a particular company at the stage of concluding contracts. These criteria (together with the criteria from the Resolution) should be recognized as relatively sufficient to rely on the integrity of the sole executive body and the legal entity when planning contractual obligations, or the exercise of control and supervisory functions by state bodies.

Further along the text of this article, I would like to place additional aspects justifying the need to raise the issue of doctrinal and legislative establishment of criteria for the integrity of the behavior of economic entities.

The pandemic of coronavirus infection, other civilizational and political threats gave a new powerful impetus to the development of digital technologies in corporate law, which was supposed to provide maximum technological capabilities for the remote exercise of corporate rights and corporate governance. There was not only an opportunity for all participants in corporate relations to interact with each other in a "remote" mode, but also the possibility of abuse of the right of the sole executive body of a legal entity. Thus, in the conditions of partial mobilization carried out within the framework of the Decree of the President of the Russian Federation dated 09/21/2022 No. 647 "On the announcement of partial mobilization in the Russian Federation" [10], a number of employers introduced a "remote work mode" in the organization with the aim of not providing the opportunity to serve summons to citizens subject to conscription and hiding the location of these employees. At the same time, the Director (General Director) legally complied with the Recommendations for employers on the prevention of coronavirus infection in the workplace [11] and took the necessary and sufficient measures to achieve the goals of the activity for which the legal entity was created [6].

Legislation and legal relations are constantly evolving, digitalization of all spheres of public life, including the legal one, is a catalyst not only for improving corporate legal relations, but also for new opportunities for abuse of the existing rights of their participants, including the sole executive body of a legal entity, and the 2013 Resolution is only the first step towards regulating the institute of integrity.

Obviously, the above list of criteria is not exhaustive at the moment. This is due not only to the breadth of the powers of the director of a legal entity, but also to constantly evolving legislation, political and foreign economic circumstances. Trends in identifying criteria for unfair behavior in the current legal space can be predicted. Digitalization has not bypassed corporate legal relations. That is why unscrupulous persons have more and more opportunities for appropriate behavior within the legal framework. This means that the criteria of good faith cannot be clearly defined. The legislator and the participants in such legal relations can only have an approximate understanding of what constitutes unfair behavior, how to avoid the consequences and damage caused by such behavior. It is also possible for bona fide participants in legal relations, within the framework of the same digitalization, to promptly study judicial practice, pay attention to news sources in which evidence of unfair behavior of participants in legal relations is fixed in order to avoid and prevent a collision with such within the framework of their activities.

Failure to comply with the principle of good faith by a legal entity entails not only a violation of the interests of participants in corporate relations (within the legal entity, counterparties, public authorities) [6], but also the occurrence of reputational losses in the further activities of the legal entity.

The solution to the problem of the lack of criteria for the integrity of the sole executive body of a legal entity can be a systematic review of judicial practice, the publication by the higher courts of acts of interpretation summarizing the already existing precedents of such unfair behavior, highlighting their most common features. Such measures will allow to increase the legal establishment of participants in corporate relations – legal entities, in particular the sole executive body exercising direct management, and significantly reduce the number of disputes arising due to unfair behavior of participants in corporate legal relations.

 Over the past few years, Russian courts have increasingly taken into account the fact that participants in civil turnover observe the principle of good faith, which is sometimes crucial for the outcome of a case. For this reason, according to the authors, many problems related to the interpretation and implementation of the principle of good faith in corporate law have worsened, including the problem of determining the criteria of good faith of the sole executive body of a legal entity. The authors see the reason for the existence of many problems and contradictions due to the abundance of evaluative concepts in the legislation, such as morality, responsibility, and, of course, conscientiousness [12]. Due to the ambiguity and lack of specificity of such concepts, many problems manifest themselves.  It is almost impossible to bring about uniformity and the same understanding of such ambiguous and subjective categories for the reason that they, one way or another, relate to philosophy and understanding of their nature, influence on public relations, role in corporate law, etc. it depends on the mentality, upbringing, level of education, literacy of the individual, her standard of living and other circumstances that are constantly changing.

References
1. Fedin I.G. The multifaceted nature of the category “good faith” in Russian law // I.G., Fedin // Legal sciences: problems and prospects: materials of the III Intern. scientific conf. (Kazan, May 2015). Kazan, 2015. [Electronic resource]. – Access mode: https://moluch.ru/conf/law/archive/141/8028/
2. Bychkova E.N., Kalinichenko K.S. Judicial practice on disputes related to the prosecution of the sole executive body of a legal entity // Arbitration disputes. No. 3. 2015. [Electronic resource]. – Access mode: http://areopag2002.ru/sudebnaya-praktika-po-sporam-svyazannym-s-privlecheniyem-kotvetstvennosti-yedinolichnogo-ispolnitelnogo-organa-yuridicheskogo-litsa
3. Kuligina, M. A. Non-compliance with the requirements of reasonableness and good faith as a basis for bringing the sole executive body of a corporation to civil liability / M. A. Kuligina // Social and labor relations: problems of theory and practice: collection of scientific articles / executive editor L. V. Zaitseva.-Tyumen: Tyumen State University Publishing House, 2018.-P. 104-115.
4. Civil Code of the Russian Federation (Civil Code of the Russian Federation) // ATP "Consultant Plus" [Electronic resource]. – Access mode: https://www.consultant.ru/document/cons_doc_LAW_5142/?ysclid=la7h8aqn4v75702132
5. Zhevnyak O.V., Shablova E.G., Ryzhkovskaya E.A., Tikhovskaya P.G. Corporate law: textbook. allowance / O. V. Zhevnyak, E. G. Shablova, E. A. Ryzhkovskaya, P. G. Tikhovskaya; under total ed. E. G. Shablovoy // Ministry of Science and Higher. education Ros. Federation, Ural. feder. un-t.-Yekaterinburg: Ural Publishing House. un-ta, 2019.-183 p.
6. On some issues of compensation for losses by persons who are part of the bodies of a legal entity: Resolution of the Plenum of the Supreme Arbitration Court of the Russian Federation dated July 30, 2013 No. 62 // ATP "Consultant Plus" [Electronic resource]. – Access mode: https://www.consultant.ru/document/cons_doc_LAW_150888/?ysclid=la7h9gvbga614218419
7. Mikheenkova M.A., Neznamov A.V. The use of the concept of good faith by the courts on the example of contesting transactions within the framework of bankruptcy / M.A. Mikheenkova, A.V. Neznamov // Journal "Vestnik AS of the Moscow District" No. 1. 2016.-P.63-72. [Electronic resource]. – Access mode: https://wiselawyer.ru/poleznoe/90800-primenenie-sudami-koncepcii-dobrosovestnosti-primere-osparivaniya-sdelok?ysclid=lbwwr2z8av783084171
8. Stepanov D.I., Mikhalchuk Yu.S. Responsibility of a director to a corporation for losses caused to it in judicial practice // Statute, 2018.-136 p.
9. Leskova Yu.G., Zhukova Yu.D., Pavlova K.P. Civil liability of members of management bodies of business entities: trends in the development of Russian legislation and the experience of foreign countries // Bulletin of the Perm University. Legal Sciences. No. 40. 2018. 264-289 p. [Electronic resource]. – Access mode: https://cyberleninka.ru/article/n/grazhdansko-pravovaya-otvetstvennost-chlenov-organov-upravleniya-hozyaystvennyh-obschestv-tendentsii-razvitiya-rossiyskogo/viewer
10. On the announcement of partial mobilization in the Russian Federation: Decree of the President of the Russian Federation of September 21, 2022 No. 647 // ATP "Consultant Plus" [Electronic resource]. – Access mode: https://www.consultant.ru/document/cons_doc_LAW_426999/?ysclid=la7hd9vqh0634737279
11. On measures to prevent a new coronavirus infection (COVID-19) (together with the “Recommendations for the prevention of a new coronavirus infection (COVID-19) among workers”): Letter from Rospotrebnadzor dated 10.03.2020 No. 02/3853-2020-27 // SPS "Consultant Plus" [Electronic resource]. – Access mode: https://www.consultant.ru/document/cons_doc_LAW_347459/?ysclid=la7hf9yvep469896046
12. Bogdanova E.E. The principle of conscientiousness: correlation of legal and moral aspects / E.E. Bogdanova // Lex Russica.-2016.-182 p. [Electronic resource]. – Access mode: https://cyberleninka.ru/article/n/printsip-dobrosovestnosti-sootnoshenie-pravovyh-i-nravstvennyh-aspektov?ysclid=lbwwmr35vt840445549

First Peer Review

Peer reviewers' evaluations remain confidential and are not disclosed to the public. Only external reviews, authorized for publication by the article's author(s), are made public. Typically, these final reviews are conducted after the manuscript's revision. Adhering to our double-blind review policy, the reviewer's identity is kept confidential.
The list of publisher reviewers can be found here.

The subject of the research in the article submitted for review is, as follows from its name, the criteria of integrity of the sole executive body. The stated boundaries of the study are fully respected by the authors. The methodology of the research is not defined in the text of the article, however, it is obvious that scientists used universal dialectical, descriptive, formal and legal research methods. The relevance of the research topic chosen by the authors is justified as follows: "For almost 10 years now, there has been an urgent problem in the legal environment of the lack of criteria for conscientious behavior by participants in various civil legal relations. Judicial practice shows that the dishonesty of participants in civil relations is found everywhere, and corporate law is no exception. Depending on the direction of the legal entity's activity, options for possible behavior within this legal entity with its counterparties and government agencies will depend, which often manifests itself in the abuse of owned rights and violation of the rights of other persons, causing them losses." Scientists also need to disclose the degree of study of the problems raised in the article and indicate the names of the most prominent specialists who have been and are studying them. The authors do not say what the scientific novelty of the study is, but indicate that "... the purpose of this study is to identify criteria for conscientious behavior of the sole executive body of a legal entity, to propose ways to solve the problem of the lack of their legislative definition and consolidation." In general, the work is descriptive, abstract in nature. The criteria for the conscientious conduct of the sole executive body of a legal entity are defined in the resolution of the Plenum of the Supreme Arbitration Court of the Russian Federation, although not exhaustively. The authors themselves do not express original scientific proposals, limiting themselves, in fact, to describing the existing problem. The scientific style of the article is fully maintained by the authors. The structure of the work is quite logical. The introductory part of the article substantiates the relevance of the chosen research topic. In the main part of the article, the authors analyze the criteria of integrity of the sole executive body identified by judicial practice and indicate the disadvantages of such activities. The final part of the article contains a general recommendation based on the results of the study. The content of the work corresponds to its name, but is not without a number of disadvantages. First of all, the authors need to finalize the introductory part of the study. Scientists write that conscientiousness "... is at the junction of two areas and acts not only as a legal category, but also as a moral one, therefore – purely subjective." One can argue with the fact that morality is subjective, since society (for example, a single Russian one) still develops common criteria known to the entire population of what is considered moral and what is not. If good faith were a purely subjective phenomenon, it would be unclear how the legislator and the court can assess the behavior of participants in civil turnover from the point of view of their good faith. The authors write: "the legislator has determined what is evidence of unfair behavior of the sole executive body of a legal entity [4]: 1) acts solely in the interests of the legal entity, without involving it in its activities and without taking into account its personal interests, except in cases where information about a conflict of interest was disclosed in advance and the actions of the director were approved in accordance with the procedure established by law; 2) provides reliable information to the participants of the legal entity about the transactions of the legal entity (in particular, if information about such a transaction in violation of the law, the charter or internal documents of the legal entity was not included in the reporting of the legal entity)..." and so on. On the contrary, what is listed in the article testifies to the conscientious behavior of the sole executive body of a legal entity. The readership will be interested to know what the authors of the article understand by the abuse of civil rights (this concept is still debatable). The authors note that "... the above list of criteria is not exhaustive at present." Should it be exhaustive at all, what are the boundaries of the dispositive principle in civil law, is it necessary to increase the presence of an imperative component in it? The scientists write: "The solution to the problem of the lack of criteria for the integrity of the sole executive body of a legal entity can be a systematic review of judicial practice, the publication by higher courts of acts of interpretation summarizing the already existing precedents of such unscrupulous behavior, highlighting their most common features." I would like the authors to propose their own model of such an interpretation (of course, which can be developed for the current day). The bibliography of the study is presented by 6 sources (normative legal acts, a textbook, a scientific article, explanatory instructions of the Supreme Arbitration Court of the Russian Federation). From a formal and factual point of view, this is not enough. The theoretical basis of the work should be expanded due to the works of A. V. Bogdanov, M. A. Kuligina, Yu. G. Leskova, M. F. Lukyanenko, A. Makovskaya, I. A. Neznamova, A. A. Sekanova, etc. This will help clarify some of the provisions of the work and deepen its content. There is an appeal to opponents, but of a general nature, the authors do not enter into a scientific discussion with specific scientists. The conclusions based on the results of the study are available and deserve the attention of the readership, but can and should be supplemented ("The solution to the problem of the lack of criteria for the integrity of the sole executive body of a legal entity can be a systematic review of judicial practice, the publication by higher courts of acts of interpretation summarizing the already existing precedents of such unfair behavior, highlighting their most common features"). The article needs additional proofreading by the authors. It contains typos, logical contradictions, punctuation and stylistic errors. The interest of the readership in the presented article can be shown, first of all, by specialists in the field of civil law, provided that it is finalized: disclosure of the research methodology, clarification of certain provisions of the article, introduction of additional elements of scientific novelty and discussion, concretization of conclusions based on the results of the study, elimination of shortcomings in the design of the work.

Second Peer Review

Peer reviewers' evaluations remain confidential and are not disclosed to the public. Only external reviews, authorized for publication by the article's author(s), are made public. Typically, these final reviews are conducted after the manuscript's revision. Adhering to our double-blind review policy, the reviewer's identity is kept confidential.
The list of publisher reviewers can be found here.

A REVIEW of an article on the topic "Criteria of integrity of a sole executive body: problem statement". The subject of the study. The article proposed for review is devoted to the formulation of the problem "... Criteria of integrity of the sole executive body ...". The author has chosen a special subject of research: the proposed issues are investigated from the point of view of civil, corporate and procedural law, while the author notes that "Given the lack of legislative formulations that allow to determine and specify the integrity of the behavior of participants in disputes, the question of qualification of the actions of participants is established within the framework of legal proceedings." The NPA and judicial practice of Russia relevant to the purpose of the study are being studied. A certain amount of scientific literature on the stated issues is also studied and summarized, analysis and discussion with these opposing authors are present. However, there are other authors who also study this problem and write about it. But for some reason, not a word about them. At the same time, the author notes: "... the act of interpretation is an opportunity to highlight the main characteristics of good faith, reduce judicial practice to uniformity, on the other hand, it is the basis for many discussions and entails a number of contradictions, especially from a theoretical point of view." Research methodology. The purpose of the study is determined by the title and content of the work: ""Conscientiousness" is at the junction of two areas and acts not only as a legal category, but also as a moral, therefore purely subjective", "... the purpose of this study is to identify criteria for conscientious behavior of the sole executive body of a legal entity, to propose ways to solve the problem of the lack of their legislative definitions and fixations". They can be designated as the consideration and resolution of certain problematic aspects related to the above-mentioned issues and the use of certain experience. Based on the set goals and objectives, the author has chosen a certain methodological basis for the study. The author uses a set of general scientific, special legal methods of cognition. In particular, the methods of analysis and synthesis made it possible to generalize some approaches to the proposed topic and partially influenced the author's conclusions. The most important role was played by special legal methods. In particular, the author used a formal legal method, which allowed for the analysis and interpretation of the norms of current legislation and judicial practice. In particular, the following conclusions are drawn: "Depending on the direction of activity of a legal entity, options for possible behavior within this legal entity with its counterparties and government agencies will depend, which often manifests itself in abuse of owned rights and violation of the rights of other persons, causing them losses," etc. Thus, the methodology chosen by the author is fully adequate to the purpose of the article, allows you to study many aspects of the topic. The relevance of the stated issues is beyond doubt. This topic is one of the most important in Russia, from a legal point of view, the work proposed by the author can be considered relevant, namely, he notes: "For almost 10 years now, there has been an urgent problem in the legal environment of the lack of criteria for conscientious behavior by participants in various civil relations," "... a number of authors, addressing the issue of integrity of the sole executive body and integrity in general, adhere to different interpretations of this term." And in fact, an analysis of the opponents' work should follow here, and it follows and the author shows the ability to master the material. Thus, scientific research in the proposed field is only to be welcomed. Scientific novelty. The scientific novelty of the proposed article is beyond doubt. It is expressed in the specific scientific conclusions of the author. Among them, for example, the following: "... the line when the realization of a participant's subjective rights becomes an abuse is causing harm to third parties to such an extent that dishonesty acquires a level of public danger." As can be seen, these and other "theoretical" conclusions can be used in further research. Thus, the materials of the article as presented may be of interest to the scientific community. Style, structure, content. The subject of the article corresponds to the specialization of the journal "Legal Research", as it is devoted to the formulation of the problem "... Criteria of integrity of the sole executive body ...". The article contains an analysis of the opponents' scientific works, so the author notes that a question close to this topic has already been raised and the author uses their materials, discusses with opponents. The content of the article corresponds to the title, since the author considered the stated problems and achieved the goal of his research. The quality of the presentation of the study and its results should be recognized as improved. The subject, objectives, methodology, research results, and scientific novelty directly follow from the text of the article. The design of the work meets the requirements for this kind of work. No significant violations of these requirements were found, except for some descriptions (or errors!): "... on the attempt made by the legislator to disclose the content of this concept in the Resolution of the Plenum of the Arbitration Court of the Russian Federation." The author's words with reference to the opponent and the Supreme Court of the Russian Federation do not correspond to reality: "... the legislator has determined that this is evidence of unfair behavior of the sole executive body of a legal entity ...", and then we are talking about good faith, for example, "acts exclusively in the interests of a legal entity, without involving it in its activities and without taking into account its personal interests, except in cases where information about a conflict of interest was disclosed in advance and the director's actions were approved in accordance with the procedure established by law"! You cannot be called a legislator of the Russian Federation, because it is a judicial body. Bibliography. The quality of the literature presented and used should be highly appreciated. However, the presence of additional modern scientific literature would show even greater validity of the author's conclusions. The works of these authors correspond to the research topic, have a sign of sufficiency, and contribute to the disclosure of many aspects of the topic. Appeal to opponents. The author has analyzed the current state of the problem under study. The author describes the opponents' different points of view on the problem, argues for a more correct position in his opinion, based on the work of individual opponents, and offers solutions to individual problems. Conclusions, the interest of the readership. The conclusions are logical, specific "... the Russian courts ... take into account the fact that participants in civil turnover observe the principle of good faith.... For this reason, according to the authors, many problems related to the interpretation and implementation of the principle of good faith in corporate law have worsened, including the problem of determining the criteria of good faith of the sole executive body of a legal entity." The article in this form may be of interest to the readership in terms of the systematic positions of the author in relation to the issues stated in the article. Based on the above, summing up all the positive and negative sides of the article, I recommend "publishing" taking into account the comments.