Law enforcement 'lost' 1.2 million hryvnias from evidence: The Supreme Court determined who will return the money

During investigative actions, law enforcement officers are obliged not only to lawfully seize property but also to ensure its preservation until it is returned to the owner. If evidence disappears or is lost after the seizure, the responsibility lies with the state.

This conclusion was reached by the Supreme Court when considering case No. 752/29491/21 regarding compensation for funds that were never returned to the owner after the seizure was lifted. The amount in question is nearly 1.2 million hryvnias.

Essence of the dispute

In August 2019, within the framework of a criminal proceeding, investigators conducted a search at a woman’s residence. During the investigative actions, a significant amount of cash was seized from the owner – 20,240 US dollars, 2,120 euros, and 211,600 hryvnias, along with documents. Subsequently, the seized funds were frozen.

Two years later, the court concluded that there were no grounds for further restriction of property rights and partially lifted the seizure. After the ruling became legally binding, the owner, through a lawyer, requested the investigator to comply with the court decision and return the seized property. However, this did not happen.

As it turned out during an internal investigation, the money was actually lost during the pre-trial investigation. It was revealed that the investigator handling the case did not transfer the seized funds to an authorized banking institution for safekeeping, as required by the rules for handling evidence. Due to improper performance of official duties, the whereabouts of the seized funds could not be established. This circumstance became the basis for a claim for compensation for property damage.

In October 2024, the Main Department of the National Police of Kyiv region filed a cassation appeal with the Supreme Court against the decision of the first instance court and the appellate court ruling, citing incorrect application of substantive law and violations of procedural law, requesting to cancel the contested decisions regarding the satisfied claims and issue a new decision denying the claim.

Position of the Supreme Court

In considering the dispute, the Supreme Court noted that the seizure of property itself was lawful, as it was carried out based on a court order. However, the legality of the seizure does not mean that the law enforcement agency is exempt from the obligation to ensure its proper storage. The pre-trial investigation body was obliged to return the property to the owner after the court lifted the seizure.

An internal investigation was conducted, which revealed that the investigator violated the procedure for handling evidence and did not transfer the seized funds to an authorized banking institution for safekeeping. According to the court, these actions were the direct cause of the loss of the property.

The Supreme Court emphasized that in such a situation, the provisions of part six of Article 1176 of the Civil Code of Ukraine apply, according to which damage caused by unlawful decisions, actions, or inaction of pre-trial investigation bodies is compensated under the general rules of civil law. The court also applied Articles 1173 and 1174 of the Civil Code of Ukraine, which provide for state liability for damage caused by unlawful decisions, actions, or inaction of state authorities or their officials while exercising their powers.

At the same time, the Supreme Court specifically stressed that to hold the state liable, it is not necessary to prove the fault of a specific investigator. It is sufficient to establish three mandatory circumstances: the illegality of the actions or inaction of the state body, the existence of property damage, and a causal link between the actions of officials and the damage caused. This combination of circumstances was proven in this case.

After the seizure was lifted, the money effectively ceased to exist as evidence since it was lost while in the possession of the pre-trial investigation body. Therefore, the owner reasonably demanded compensation for their value, not the return of the actual funds.

The Supreme Court also rejected the police’s argument that a separate court decision recognizing the investigator’s actions as illegal was initially required. The panel of judges noted that the fact of improper storage of the seized property was already confirmed by the internal investigation materials, and the funds were never returned to the owner after the seizure was lifted. Under these circumstances, this is sufficient to establish the right to compensation under civil law.

Furthermore, the Supreme Court emphasized that compensation for damages in no way prevents the conduct of a criminal investigation into the circumstances of the disappearance of evidence or the bringing of responsible officials to justice. For this reason, the cassation appeal of the Main Department of the National Police of Kyiv region was dismissed, and the decisions of the courts of first and appellate instances remained unchanged.

This case serves as a reminder that the obligation of law enforcement officers does not end at the moment of seizure. While evidence is in the possession of the pre-trial investigation body, it is responsible for its safekeeping. If the property is lost, the owner should not bear these losses alone – they must be compensated by the state in accordance with the law.

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