On Compulsory Civil Liability Insurance of Private Notaries

The Law of the Republic of Kazakhstan dated 11 June, 2003 No. 435

Unofficial translation

      This Law regulates public relations arising due to compulsory civil liability insurance of private notaries and establishes legal, economic and organizational grounds for its performance.

Chapter 1. General provisions

Article 1. Basic definitions used in this Law

      The following basic definitions are used in this Law:
      1) a beneficiary party – a person that is a recipient of insurance payment in accordance with this Law;
      2) civil liability of private notary –obligation of a private notary to compensate harm inflicted as a result of commitment of notarial actions established by the civil legislation of the Republic of Kazakhstan;
      3) an insurant – the private notary that concluded the contract of compulsory civil liability insurance of the private notary with an insurer;
      4) insurance payment – a sum of money paid by the insurer to the insurant (beneficiary party) within the insured amount upon occurrence of an insured event;
      5) insurance premium – a sum of money which the insurant shall pay to the insurer for acceptance of obligation to make insurance payment to the beneficiary party by the latest in amount determined by the contract of compulsory civil liability insurance of the private notary;
      6) insured amount – a sum of money on which the object of insurance is insured and which represents the limiting volume of responsibility of the insurer upon occurrence of insured event;
      7) insured event – event in occurrence of which the contract of insurance shall provide making of insurance payment;
      8) an insurer – a legal entity registered as insurance organization and having the license on a right of carrying out insurance activity, obliged to make insurance payment to the insurant or the other person in behalf of which the contract is concluded (beneficiary party) upon occurrence of an insured event, within the insured amount determined by the contract;
      9) third party – a person that is not the party of the contract of compulsory civil liability insurance of the private notary, the property interests of which are inflicted by harm upon performance of professional obligations by the private notary linked with commitment of notarial actions, for carrying out of which the private notary shall conclude the contract of compulsory civil liability insurance of the private notary in accordance with the legislation of the Republic of Kazakhstan;
      10) private notary – a citizen of the Republic of Kazakhstan carrying out the notarial activity without formation of legal entity on the basis of the license for the right of carrying out the notarial activity and that passed record registration in the territorial body of justice:
      11) franchise – release of the insurer from compensation of loss not exceeding the particular size.

Article 1. Legislation of the Republic of Kazakhstan on compulsory civil liability insurance of private notaries

      1. Legislation of the Republic of Kazakhstan on compulsory civil liability insurance of private notaries shall be based on the Constitution of the Republic of Kazakhstan and consist of the Civil Code of the Republic of Kazakhstan, this Law and the other regulatory legal acts of the Republic of Kazakhstan.
      2. If international treaty, ratified by the Republic of Kazakhstan establishes other rules than those contained in this Law, the rules of international treaty shall be applied.

Article 3. Object of compulsory civil liability insurance of private notaries

      Object of compulsory civil liability insurance of private notaries (hereinafter – compulsory liability insurance of private notaries) are the private interests of the private notary linked with its obligation to compensate the harm inflicted to the third parties as a result of its commitment of notarial actions for carrying out of which the private notary shall conclude the contract of compulsory liability insurance of the private notary (hereinafter – notarial actions) in accordance with the legislation of the Republic of Kazakhstan.

Article 4. Purpose and basic principles of compulsory liability insurance of private notaries

      1. The purpose of compulsory liability insurance of private notaries is provision of protection of the property interests of the third parties to which the harm is inflicted as a result of commitment of notarial actions by the private notary by making insurance payments.
      2. Basic principles of compulsory liability insurance of private notaries are:
      carrying out the activity of the private notary upon condition of existence of the contract of compulsory liability insurance of the private notary;
      performance of the obligations by parties under the contract of compulsory liability insurance of private notaries.

Article 4-1. Special aspects of carrying out compulsory liability insurance of private notaries

      1. Legal entity registered as insurance organization shall have the branches and (or) insurance agents in the capital, cities of the republican, oblast and district significance before receipt of the license for the right of carrying out compulsory liability insurance of private notaries.
      2. Activity that is directed to the limitation or elimination of business competition, provision or receipt of the unfounded advantages on conclusion of contracts of compulsory liability insurance of private notaries by the one insurer owed to the others, the impairment of rights and legal interests of the insurants shall not be admitted.
      Footnote. The Law is supplemented by Article 4-1 in accordance with the Law of the Republic of Kazakhstan dated 30.12.2009 No. 234-IV.

Article 5. Persons the civil liability of which shall be subject to compulsory insurance

      1. Civil liability of private notaries carrying out the activity in the manner established by the legislation of the Republic of Kazakhstan shall be subject to compulsory insurance.
      2. Conclusion of the contract of voluntary civil liability insurance linked with carrying out the notarial activity by the private notary shall release it from the obligation on conclusion of the contract of compulsory liability insurance of private notaries.

Article 6. Inadmissibility of carrying out the activity of the private notary without conclusion of the contract of compulsory liability insurance of private notaries

      1. The private notary shall not have the right to commit notarial actions without conclusion of the contract of compulsory liability insurance of private notaries.
      2. The private notary carrying out the activity without conclusion of the contract of compulsory liability insurance of private notaries shall bear the responsibility established by the Laws of the Republic of Kazakhstan.

Article 7. State supervision and control in the field of compulsory liability insurance of private notaries

      1. The state supervision of carrying out the activity of insurance organizations shall be carried out by the National Bank of the Republic of Kazakhstan in accordance with the legislation of the Republic of Kazakhstan.
      2. The state control of performing the requirements of this Law by the private notary in part concerning the obligation of concluding the contract of compulsory liability insurance of private notaries and appliance of the measures to private notaries that breached such requirement shall be imposed on the bodies of justice in accordance with this Law within their competence established by the legislative acts of the Republic of Kazakhstan.
      Footnote. Article 7 as amended by the Law of the Republic of Kazakhstan dated 05.07.2012 No. 30-V (shall be enforced upon expiry of ten calendar days after its first official publication).

Chapter 2. Contract of compulsory liability insurance of private notaries

Article 8. Contract of compulsory liability insurance of private notaries and order of its conclusion

      1. Compulsory liability insurance of private notaries shall be carried out on the basis of the contract concluded in accordance with this Law and the Civil Code of the Republic of Kazakhstan between the insurer and insurant in behalf of the third party, the property interests of which may be inflicted by harm upon carrying of notarial actions by the private notary.
      The private notary shall conclude the contract of compulsory insurance of its civil liability before commitment of the notarial actions by it.
      2. Making of insurance payment on the obligation arisen due to infliction of harm to the third parties upon commitment of the notarial actions by the insurant with the exception of compensation of moral harm, denied profit and payment of the forfeit shall be provided by the contract of compulsory liability insurance of private notaries.
      3. The contract of compulsory liability insurance of private notaries may be concluded only with the insurer having the license for the right of carrying out the activity on such type of compulsory insurance. Conclusion of such contract for the mentioned insurer shall be obligated.
      4. Contract of compulsory liability insurance of private notaries shall be concluded in written form by issuance of the insurance police for the insurant by the insurer.
      Requirements on content and execution of the insurance police on compulsory liability insurance of private notaries shall be established by the legislation of the Republic of Kazakhstan on insurance and insurance activity.
      Non-observance of the written form of the contract of compulsory liability insurance of private notaries shall entail its invalidity.
      Responsibility for incompleteness of conditions being subject to the statement in the contract of compulsory liability insurance of private notaries shall be borne by the insurer. In case of occurrence of a dispute on the contract of compulsory liability insurance of private notaries due to incompleteness of its particular conditions, the dispute shall be resolved in behalf of the insurant.
      5. If the contract of compulsory liability insurance of private notaries is concluded on conditions degrading the situation of the insurant or third parties in comparison with that is provided by this Law, the insurer shall incur obligations owed to the insurant and third parties upon occurrence of the insured event on conditions established by this Law.

Article 9. Validity of the contract of compulsory liability insurance of private notaries

      1. If the contract of compulsory liability insurance of private notaries does not provide otherwise, it shall be enforced and be compulsory for the parties from the date of paying insurance premium by the insurant and upon its payment by installment – of the first insurance contribution.
      2. The contract of compulsory liability insurance of private notaries shall be concluded for the term of twelve months from the date of its entering into force.
      Period of validity of insurance protection shall coincide with the term of the validity of the contract of compulsory liability insurance of private notaries.
      3. Validity of the contract of compulsory liability insurance of private notaries shall be limited by the territory of the Republic of Kazakhstan, unless otherwise is provided by the contract of compulsory liability insurance of private notaries.

Article 10. Termination of the contract of compulsory liability insurance of private notaries

      Contract of compulsory liability insurance of private notaries shall be terminated in the following cases:
      1) the expiration of the contract;
      2) early termination of the contract;
      3) making of insurance payment (insurance payments) by the insurer in amount of the insured amount determined by conditions of the contract of compulsory liability insurance of private notaries.

Article 11. Early termination of the contract of compulsory liability insurance of private notaries

      Order, conditions and consequences of early termination of the contract of compulsory liability insurance of private notaries shall be determined in accordance with the civil legislation of the Republic of Kazakhstan.

Article 12. Invalidity of the contract of compulsory liability insurance of private notaries

      Conditions, grounds and consequences of recognizing the contract of compulsory liability insurance of private notaries invalid shall be determined in accordance with the civil legislation of the Republic of Kazakhstan.

Article 13. Rights and obligations of the insurant

      1. The insurant shall have the right to:
      1) require explanations of conditions of compulsory liability insurance of private notaries, own rights and obligations under the contract of compulsory liability insurance of private notaries from the insurer;
      2) familiarize with financial report of the insurer;
      3) receive insurance payment in the manner and on conditions provided by this Law;
      4) controvert decision of the insurer on refusal in making of the insurance payment or unfounded decrease of its amount in the manner provided by the legislation of the Republic of Kazakhstan.
      2. The insurant shall be obliged to:
      1) pay insurance premium in amount, manner and terms established by the contract of compulsory liability insurance of private notaries;
      2) represent details to the insurer upon conclusion of the contract of compulsory liability insurance of private notaries in accordance with the requirements of this Law;
      3) inform the insurer by accessible way (orally, in writing) immediately but no later than five business days, as he (she) became known about specifying the requirement or statement of claim of the third party on compensation of harm inflicted as a result of commitment of the notarial actions by him (her);
      4) provide all information and documentation available to him (her) to the insurer allowing to judge on the reasons, course and consequences of the event with occurrence of which there is the obligation of the insurant to compensate inflicted harm, as well as on nature and extents of the inflicted harm;
      5) provide a possibility to the insurer for participation in regulation of questions linked with requirement of the third parties on compensation of harm;
      6) apply measures for prevention or decrease of losses from the insured event;
      7) ensure transfer of right of contribution to the insurer, to a person being responsible for occurrence of the insured event;
      3. Contract of compulsory liability insurance of private notaries may provide the other rights and obligations of the insurant not inconsistent with the legislative acts of the Republic of Kazakhstan.

Article 14. Rights and obligations of the insurer

      1. The insurer shall have the right to:
      1) require provision of information on previous contracts of compulsory liability insurance of private notaries, insured events, insurance payments and other details being necessary for entering into the contract of compulsory liability insurance of private notaries provided by the Civil Code of the Republic of Kazakhstan upon conclusion of the contract of compulsory liability insurance of private notaries;
      2) participate in the regulation of questions linked with the requirements of the third parties on compensation of harm inflicted by the insurant;
      3) bring a right of contribution to a person being responsible for inflicting harm in cases provided by Article 20 of this Law;
      4) refuse in making of insurance payment in whole or in part on the grounds provided by Article 21 of this Law.
      2. The insurer shall:
      1) introduce the insurant with conditions of compulsory liability insurance of private notaries, explain his (her) rights and obligations arisen from the contract of compulsory liability insurance of private notaries;
      2) return the insurance premium in whole or in part to insurant upon early termination of the contract of compulsory liability insurance of private notaries in cases and in the manner established by the civil legislation of the Republic of Kazakhstan;
      3) make insurance payment upon occurrence of the insured event in the manner and in conditions provided by this Law;
      4) compensate expenses to the insurant incurred by him (her) for the purposes of prevention or decrease of losses upon the insured event;
      5) provide insurance secrecy;
      6) pay the forfeit to the beneficiary party upon untimely making of insurance payment in the manner and in amount established by the Civil Code of the Republic of Kazakhstan.
      3. The other rights and obligations may be provided by the treaty of the compulsory liability insurance of private notaries are not contradict to the legislative acts of the Republic of Kazakhstan.

Chapter 3. Insured amount and insurance premium

Article 15. Size of insured amount

      Size of insured amount under the contract of compulsory liability insurance of private notaries shall be determined by its conditions and shall be no less than 1000 for the notaries carrying out the activity in the territory of the city of republican significance, the capital, no less than 500-fold monthly calculation index for the other notaries established by the Law on republican budget for the relevant financial year on the date of concluding the contract of compulsory liability insurance of private notaries.

Article 16. Size of insurance premium

      Size of insurance premium shall be established under agreement of the parties but no more than 4,5 percent from the insured amount determined by conditions of the contract of compulsory liability insurance of private notaries.

Article 17. Order and terms of paying insurance premium

      1. The order and terms of paying insurance premium under the contract of compulsory liability insurance of private notaries shall be established by agreements of the parties.
      2. If otherwise is not provided by the contract of compulsory liability insurance of private notaries, the insurant shall pay the forfeit for untimely payment of regular insurance contribution to the insurer as for the wrongful use by the other people’s money in the manner and amount established by the Civil Code of the Republic of Kazakhstan,

Chapter 4. Insured event and insurance payment

Article 18. Determination of the insured event and amount of insurance payment

      1. The insured event under the contract of compulsory liability insurance of private notaries shall be recognized as the fact of occurrence of the civil liability of the insurant on compensation of harm inflicted to the property interests of third parties as a result of commission of notarial actions by the private notary.
      2. The insured event shall be considered as occurred from the date of entering of the court decision into legal force on compensation of the harm inflicted by the insurant or recognition of requirements of third parties by the insurant on compensation of harm as valid and consent of the insurer with recognition of the requirements of the insurant.
      3. Amount of insurance payment shall be determined by the insurer proceeding from the sum of requirements of third parties or court decision that came into legal force on compensation of inflicted harm in recognition of provisions of paragraph 2 of Article 8 of this Law.
      4. Expenses incurred by the insurant for the purpose of prevention or decrease of losses shall be subject to compensation by the insurer if such expenses were necessary and were incurred for performance of orders of the insurer even though the relevant measures were unsuccessful.
      Such expenses shall be compensated in actual amounts however in order that the total sum of insurance payment and compensation of expenses does not exceed insured amount provided by the contract of compulsory liability insurance of private notaries, if the expenses are occurred as a result of performance of orders by the insurant, they shall be compensated in full amount without reference to the insured amount.
      5. The size of franchise on each insured event shall be established under agreement of parties, but by this shall not increase five percent from insured amount established in the contract of compulsory liability insurance of private notaries.
      In cases when the extent of inflicted harm increases established size of the franchise, the insurance payment shall be made in full size.

Article 19. Conditions and procedure for making insurance payment

      1. The requirement on insurance payment to the insurer shall be submitted by the insurer or by the third party in a written form accompanied by the documents being necessary for making insurance payment.
      2. The application on insurance payment shall be accompanied by:
      1) the contract of compulsory liability insurance of private notaries;
      2) requirement of third parties on compensation of harm accompanied by the documents confirming the inflicted harm and its size, or court decision that came into legal force on compensation of harm inflicted by the insurant as a result of commission of notarial actions by him (her);
      3) copy of certificate of identity of the beneficiary party (for an individual) or the letter of attorney issued to the representative of legal entity;
      4) the documents confirming the expenses linked with appliance of the measures on the prevention or decrease of the extent of harm.
      3. The insurer that accepted the documents shall be obliged to issue a certificate with specification of the full list of represented documents and the date of their acceptance to the applicant.
      4. Upon making of insurance payment the insurer shall not have the right to require acceptance of conditions from the beneficiary party restricting his (her) right of claim against the insurer.
      5. Beneficiary party is a third party to which the harm is inflicted by the private notary as a result of commission of notarial actions by it and in case of death (reorganization) of the third party – his (her) successors (legal successors).
      Beneficiary party may be also the insurant or other person that compensated inflicted harm to the third party (successors (legal successors) within the volume of responsibility of the insurer established by this Law and that gained the right to compensation of own expenses from the insurer.
      6. Insurance payment shall be made by the insurer no later than seven business days from the date of receiving the documents by him (her) provided by paragraph 2 of this Article.
      7. In cases when amount of insurance payment is contested by parties of the contract of compulsory liability insurance of private notaries or by third parties, the insurer shall be obliged to make insurance payment in the part which is not contested by any of mentioned persons within the term established by paragraph 6 of this Article.
      The contested part of insurance payment shall be paid by the insurer within three business days from the date of concluding the amicable agreement and its approval by the court or from the date of entering of the court decision into legal force on such dispute, if the decision is not exposed to immediate performance by the court.
      8. Requirement on insurance payment for the harm inflicted to the property interests of third persons in the period of validity of the contract of compulsory liability insurance of private notaries may be submitted to the insurer within three years from the date of occurrence of the insured event.

Article 20. Right of contribution to a person that inflicted the harm

      1. The insurer that made insurance payment shall have the right of contribution to the insurant within the paid sum in case of:
      1) intended actions of the insurant oriented to occurrence of the insured event or promoting its occurrence;
      Note RCLI!
      Subparagraph 2) is provided to be in the wording of the Law of the Republic of Kazakhstan dated 03.07.2014 No. 227-V (shall be enforced from 01.01.2015).
      2) commission of actions by the insurant recognized as intentional crimes or administrative infractions being in the causal connection with the insured event in the manner established by the legislative acts of the Republic of Kazakhstan;
      3) increase of the extent of harm in the result of intentional non-acceptance of the rational and accessible measures on its decrease by the insurant;
      4) informing of knowingly false details by the insurant to the insurer on the object of insurance, insured risk, insured event and its consequences;
      5) refusal of the insurant from the own right of claim to a person being responsible for occurrence of the insured event as well as refusal to send the documents to the insurer being necessary for a transfer of the right of claim.
      2. Right of contribution which the insurant has to a person being responsible for the losses compensated as a result of the insurance shall be transferred to the insurer that made insurance payment within the paid sum.

Article 21. Grounds for release of the insurer from making of insurance payment

      1. The insurer shall have the right to refuse in insurance payment in whole or in part if the insured event is occurred due to:
      1) intended actions of third parties oriented to occurrence of the insured event or promoting of its occurrence;
      NOTE RCLI!
      Subparagraph 2) is provided to be in the wording of the Law of the Republic of Kazakhstan dated 03.07.2014 No. 227-V (shall be enforced from 01.01.2015).
      2) actions of third parties recognized as intentional crimes or the administrative infractions being in the causal connection with the insured event in the manner established by the legislative acts of the Republic of Kazakhstan;
      3) carrying out the activity by the insurant that does not correspond to the functions and obligations of the notary determined by the legislation of the Republic of Kazakhstan on the notary office;
      4) notarial actions committed by the insurant with infraction of the requirements of the legislation of the Republic of Kazakhstan on notary office concerning the territory of the activity of the notary.
      2. Ground for refusal of the insurer in making of insurance payment may be also as follows:
      1) receiving of the relevant compensation of the loss by the insurant from the person that is guilty in inflicting the loss;
      2) non-notification or untimely notification of the insurer on occurrence of the insured event with the exception of cases established by this Law;
      3) impeding of the insurer by the insurant in investigation of the circumstances of occurrence of the insured event and in establishing the extent of inflicted harm.
      3. Non-notification or untimely notification of the insurer on occurrence of the insured event shall give him (her) the right to refuse in insurance payment, unless it is proved that the insurer became known on occurrence of the insured event without undue delay or the absence of details on this at the insurer might not have an impact on his (her) obligation to make an insurance payment.
      4. The insurer shall be released from making of insurance payment, if the insured event is occurred due to:
      1) the influence of the atomic explosion, radiation or the radioactive contamination;
      2) military activities;
      3) civil war, civil disturbance of all kind, mass disorders or strikes.
      5. In existence of the grounds for refusal in insurance payment, the insurer shall be obliged to send the relevant decision on full or partial refusal in insurance payment in written form with the reasonable substantiation of the reasons for refusal to the person that submitted the application on insurance payment within seven business days from the date of receiving the documents provided by Article 19 of this Law.
      6. The insurer shall not have the right to refuse in insurance payment on the grounds not provided by this Article.

Chapter 5. Final provisions

Article 22. Procedure for consideration of disputes

      The disputes resulting from the contract of compulsory liability insurance of private notaries shall be considered in the manner established by the legislation of the Republic of Kazakhstan.

Article 23. Responsibility for the breach of the legislation of the Republic of Kazakhstan on compulsory civil liability insurance of private notaries

      Persons that are guilty in the breach of the legislation of the Republic of Kazakhstan on compulsory civil liability insurance of private notaries shall entail the responsibility in accordance with the Laws of the Republic of Kazakhstan.

      The President
      of the Republic of Kazakhstan