The Commercial Court of the Odesa Region satisfied the claim of the Kherson District Prosecutor’s Office in the interests of the state and terminated the contract for works dated June 10, 2021, concluded between the Department of Territorial Development of the Kherson Regional State Administration and LLC «Odesmiskbud». The subject of the contract was the restoration of the Kherson Regional Art Museum named after O.O. Shovkunenko.
This is stated in the court judgment.
The total value of the contract amounted to UAH 94.6 million. The client managed to transfer UAH 32.5 million to the contractor.
The court took into account the decision of the Commercial Court of the Odesa Region dated January 26, 2026, which has come into legal force. By this decision, UAH 28.4 million in damages has already been recovered from LLC «Odesmiskbud» in favor of the Department. Forensic examinations by the Ministry of Internal Affairs proved that the contractor actually performed work worth only UAH 4.1 million (4.3% of the total scope), limited to demolition and partial installation of floor slabs, after which it completely stopped construction.
During 2025 the prosecutor’s office repeatedly appealed to the Kherson OVA (KhODA) and the Department of Territorial Development regarding the existence of grounds for terminating the contract and recovering penalties in connection with the criminal proceeding opened under Part 5 of Article 191 of the Criminal Code of Ukraine.
In June 2025 the Department informed that it had not filed a lawsuit because it considered the payments confirmed by certificates of completed works, and that amounts of unused advances were absent. At the same time, the agency asked the prosecutor’s office to file the claim on its behalf.
In November 2025 KhOVA in its response stated that termination of contractual relations during martial law was not initiated with the aim of “saving budgetary funds”, and that penalty sanctions were not imposed on the contractor due to lack of access to procurement documents. The authorities planned to consider the issue of resuming work after the end of martial law.
Given the absence of independent actions by the authorized bodies, in December 2025 the prosecutor’s office informed KhOVA, KhODA and the Department about independently filing a claim in the interests of the state.
The court rejected arguments regarding the impact of force majeure circumstances (martial law) on the performance of obligations, on the grounds that significant violations of deadlines and volumes of work by LLC «Odesmiskbud» were committed in 2021 — before the start of the full-scale invasion.
In addition, the contractor did not send the client any documented notices of the impossibility of performing the work due to force majeure circumstances.
The court qualified the defendant’s actions as a material breach of the contract (Article 651 of the Civil Code of Ukraine), since the client was largely deprived of what it had relied on when entering into the transaction.
The claims of the Kherson District Prosecutor’s Office were satisfied in full — the contract for works was terminated.
Recall, in July last year the Kherson City Court issued a verdict against the former technical supervision engineer Mykhailo Loktiev — he was found guilty of official negligence during the restoration of the Kherson Regional Art Museum named after Shovkunenko.
Loktiev was sentenced to 4 years in prison and a fine of UAH 4.1 thousand. However, because the man sincerely repented and actively assisted in solving the crime, the court released him from imprisonment with a one-year probationary period.
The head of «Odesmiskbud», Volodymyr Malyarov, was notified of suspicion of embezzling budget funds in the restoration of the Kherson Art Museum in August 2025.