I. What is Ownership?
To gain knowledge about the dissolution of partnership lawsuits, it is first necessary to learn some legal concepts.
Ownership grants the right holder the authority to use, benefit from, and dispose of property. It is an unlimited real right that can be asserted against everyone and pertains to an object. The right to ownership is regulated as one of the fundamental rights in the Constitution of the Republic of Turkey.
If the ownership of an object belongs to a single person, it is called sole ownership; if it belongs to more than one person, it is called joint ownership. Joint ownership is regulated in two ways in the Civil Code. If the right of ownership over an object is divided into shares and belongs to more than one person, it is called co-ownership. If the right of ownership over an object belongs to more than one person without being divided into shares due to an existing partnership relationship, it is called collective ownership.
II. What is Joint Ownership?
In Article 688 of the Turkish Civil Code, joint ownership/co-ownership is defined as follows: “In co-ownership, more than one person owns the entire thing with specific shares, even though it is not physically divided.”
In joint ownership, multiple people own an object together with specific shares, even though it is not physically divided. These shares can be freely determined. If not specified, they are considered equal. All co-owners have all the rights and obligations granted by the right of ownership concerning their shares. They can sell and transfer their shares. Additionally, creditors can seize their shares.
Joint ownership can be terminated in several ways: if a co-owner is removed from co-ownership or transfers their share, if the property is sold or transferred, if the co-owners agree to partition it, or if it transitions to collective ownership. It can also end as a result of a partition or dissolution of partnership lawsuit filed at the request of one or more of the co-owners.
III. What is Collective Ownership?
Collective ownership, as defined by Article 701 of the Turkish Civil Code, is the ownership held jointly by individuals due to a community formed by law or contracts stipulated in the law.
In collective ownership, there are no specified shares for the partners. Each partner’s right encompasses the entire ownership of the property within the partnership.
In collective ownership, the partners must act together in every transaction related to the property they own. They do not have direct rights over the property. This type of ownership arises from a legal event or relationship regulated by law. While there is no specific share in collective ownership, there is a participation share (liquidation share). The liquidation share refers to the rights and claims concerning the assets formed as a result of the dissolution and partitioning of the partnership.
Communities in which collective ownership is present are limitedly enumerated by law. These include inheritance communities, property communities, family property partnerships, and simple partnerships.
According to Article 703 of the Turkish Civil Code, collective ownership ends with the transfer of the property, the dissolution of the community, or the transition to co-ownership. Beyond those listed in the law, collective ownership also ends if the property is completely destroyed or in cases of expropriation.
IV. How is Partnership Dissolved?
1. Request for Partition
If there is no obligation to maintain co-ownership due to a legal transaction among the partners or because the property is allocated for a continuous purpose, any partner may request the partition of the property. (Article 698 of the Turkish Civil Code.
2. Methods of Partition
The dissolution of a partnership can occur through the physical division of the property, sale by negotiation, or auction, with the proceeds being distributed. If an agreement on the method of partition cannot be reached, upon the request of one of the partners, the court may decide on the division of the property in kind. lf the values of the divided portions do not match, the court may order compensation by adding cash to the portion of lesser value to equalize the shares.
lf the request for division is deemed unsuitable due to the circumstances, especially if the co-owned property cannot be divided without significant loss of value, the court will decide on its sale by public auction.
If all partners agree, the sale can also be conducted among the partners themselves.
V. Elimination of Joint Ownership Case – Dissolution of Partnership
1. Partition in Kind
In the dissolution of a partnership, the primary method is partition in kind. Partition in kind should be carried out if it does not significantly reduce the value of the property and if the property is suitable for physical division. If, after investigations, it is determined that partition in kind is possible, the court will decide to dissolve the partnership through partition in kind. The boundaries and areas of the sections allocated to each partner will be shown with reference to a subdivision sketch and included in the decision. Upon the finalization of the decision, joint and collective ownership terminates, transitioning to individual ownership.
In cases of collective ownership, the provisions relating to co-ownership apply. However, the collective partnership must first be dissolved. Dissolution of the partnership can be requested by converting collective ownership into co-ownership. This situation is applicable only in inheritance partnerships, as in other types of collective ownership, a partner does not have the right to request conversion to co-ownership.
Disputes may arise regarding which divided portions will be allocated to which partner in partition in kind. The Supreme Court has resolved such disputes through a draw method. (Supreme Court 14th Civil Chamber, 2016/141 Basis, 2017/9043 Decision, 31.08.2018).
2. Partition Through Sale
If the dissolution of the partnership through partition in kind is not possible or if the judge deems it inappropriate—especially if the property cannot be divided without significant loss of value—an order for the sale of the property by public auction will be made (Article 699 of the Turkish Civil Code). Simply put, if partition in kind is not feasible, the property will be sold via public auction. If all partners consent, the sale can be conducted solely among the partners.
According to the Supreme Court, if the sale of the property is decided, the distribution of the sale proceeds and costs should be according to the shares registered in the land registry if it concerns co-ownership, according to the shares in the certificate of inheritance if it concerns collective ownership, and considering both the shares in the land registry and the inheritance certificate if both co-ownership and collective ownership coexist (Supreme Court 7th Civil Chamber, 2021/3227 Basis, 2021/2606 Decision, 02.11.2021).
3. Dissolution of Partnership Through Establishment of Condominium Ownership
Article 1 of the Condominium Ownership Law states: “Independent ownership rights can be established on sections of a completed building such as apartments, offices, shops, basements, and warehouses, which are suitable for independent and separate use, by the owner or co-owners of the real estate according to the provisions of this Law.” Condominium ownership is the independent ownership right established over parts of a building suitable for individual use. Co-owners of a building may want to convert their shares into condominium ownership.
There are certain conditions for converting co-ownership into condominium ownership for partition. The property must be suitable for condominium ownership. Additionally, one of the co-owners must request the partition through conversion into condominium ownership. For partition, the property must have multiple independent sections. Each co-owner should receive at least one independent section. If this is not possible, partition through this method cannot be carried out (EDALI, Gözde, Partition Lawsuit, 2018, Antalya, p.40). Partition through condominium ownership can be executed by official contract or court decision.
4. Partition of Inheritance
Heirs jointly own the inheritance. Inheritance partnership can be dissolved either by agreement among the heirs or by filing a partition lawsuit.
5. Conversion of Collective Ownership to Joint Ownership
If an heir requests the conversion of collective ownership over all or part of the estate assets into co-ownership, the probate judge will notify the other heirs and invite them to present any objections within a specified period.
If no valid objection justifying the continuation of collective ownership is raised or if none of the heirs files a partition lawsuit within the specified period, the judge will order the conversion of collective ownership into co-ownership for the requested asset. The same rules apply to the division of other rights and receivables included in the estate according to the heirs’ shares.
Article 644 of the Turkish Civil Code allows for the conversion of collective ownership into co-ownership without the need for additional partition procedures, enabling each owner to dispose of their share independently once co-ownership is established.
6. Who Are the Parties in an Elimination of Joint Ownership Case?
The plaintiff(s) are the co-owner(s) seeking the termination of joint ownership and the partition of the property through the court. Thé defendant(s) are the co-owner(s) who cannot reach an agreement on the partition. The lawsuit must be directed against all co-owners because there is mandatory joinder of defendants in such cases.
7. Mandatory Mediation in Elimination of Joint Ownership Lawsuits
On March 28, 2023, Article 18/B was added to the Law on Mediation in Civil Disputes, stipulating that applying to a mediator before filing a elimination of joint ownership lawsuit is a procedural requirement.
According to Article 18/B of the Law on Mediation in Civil Disputes, mediation must be sought before filing a lawsuit in the following disputes:
a) Disputes arising from lease agreements, except for provisions related to the eviction of leased properties through non-judicial proceedings as per Law No. 2004. b) Disputes related to the partitioning and dissolution of co-owned movable and immovable properties. c) Disputes arising from the Condominium Ownership Law dated June 23, 1965, No. 634. d) Disputes arising from neighbor rights.
With the enactment of Article 18/B, as of September 1, 2023, it has become mandatory to apply to a mediator before filing a partition lawsuit. If you file a lawsuit without first applying to a mediator, your case will be dismissed.
The mediation process begins with an application to the mediation office in the jurisdiction of the competent court. The mediator will initially contact the parties and their legal representatives or attorneys if any. Tle mediator will invite the parties to the first meeting as soon as possible. On the meeting day, the parties and the mediator will come together. The parties will convey their demands to each other and negotiate to resolve the dispute.
The mediation process can end with or without an agreement. If the parties reach an agreement, or if they fail to do so, the mediation process concludes. If the parties do not reach an agreement and wish to file a lawsuit, they must attach the final mediation report to their petition.
The limitation and prescription periods will be suspended from the date of the application to the mediator until the end of the mediation process. In a partition lawsuit, all co-owners of the property must be included in the mediation process. If any co-owner is not included in the mediation process, this cannot be corrected during the litigation, and your case will be dismissed due to the lack of procedural requirements.
8. Competent Court in Elimination of Joint Ownership Lawsuits
According to Article 4 of the Law on Civil Procedure, the peace court has jurisdiction over lawsuits concerning the partitioning of movable and immovable property or rights and the dissolution of co-ownership. Cases involving the partitioning of co-owned property and the partitioning of inheritance fall within the scope of this article. In cases involving the dissolution of co-ownership due to the partitioning of inheritance and the establishment of condominium ownership, the competent court is also the peace court.
9. Authorized Court in Elimination of Joint Ownership Lawsuits
In lawsuits concerning a real right over immovable property or which may result in a change of ownership of such a right, the court where the immovable property is located has exclusive jurisdiction. Therefore, in a partition lawsuit filed concerning immovable property, the court where the immovable property is located has exclusive jurisdiction.
10. Process of Elimination of Joint Ownership Lawsuit
Since the competent court is the peace court, the lawsuit is subject to simplified proceedings.
The right to request the dissolution of co-ownership is not subject to any statute of limitations or prescription, so there is no time limit for filing the lawsuit.
Disputes concerning ownership, disputes over possession, preemptive right lawsuits, will nullification lawsuits, equalization lawsuits in inheritance, lawsuits for cancellation and registration of title deeds, cancellation of inheritance certificates, cancellation of administrative acts forming the basis of cadastral parcels, lawsuits for correction of property boundaries and areas, lifetime maintenance contracts, lawsuits for cancellation of cadastral determinations, and lawsuits for removal from co-ownership can be considered as potential issues in partition lawsuits.
11. Fees and Expenses in Elimination of Joint Ownership Lawsuits
In a partition lawsuit, the fees include application fee, fixed-rate advance fee, expert examination fee, attorney fee if the case is represented by a lawyer. Additionally, there will be expenses for postage for delivering petitions to the parties, fees for the expert appraiser who will appraise the value of the property, electronic notification expenses for notifications to the Land Registry Directorate or directorates, road expenses for conducting examinations, and others. The fees and expenses of the lawsuit vary depending on the number of parties, the number of properties, the location and nature of the properties (for example, for agricultural properties, an agricultural expert witness may be added to the committee).
After the conclusion of the lawsuit, during the sale phase, a new examination will be conducted to determine the value of the property or properties. In case of disposal through sale, additional expenses such as sale fees, fees for notices to the press, etc., may arise.
In a partition lawsuit, all parties are responsible for the litigation costs and attorney fees according to their shares. Therefore, if the co-ownership is dissolved through the sale of the property, the plaintiff will recover the expenses incurred from the other co-owners in proportion to their shares.
12. Termination and Verdict of Elimination of Joint Ownership Lawsuits
The court’s decision is based on procedures such as examination and valuation of the property during the trial phase of the lawsuit. During the examination, it is determined whether the property can be partitioned. lf the property is divisible based on the outcome of the examination, the court must decide to partition the property as requested in the lawsuit. If division is not feasible, the court decides to partition through sale. f there is imbalance in distribution during the partition, an equalization decision is made. If the plaintiff requests partition through sale despite the possibility of partitioning, the court dismisses the case. Additionally, in a partition lawsuit, even if the plaintiff withdraws the case, the defendants can continue with the lawsuit.
According to the Supreme Court’s opinion, if only partitioning is requested in the lawsuit and the conditions for partitioning are not met, a decision cannot be made to partition through sale, and the lawsuit will be dismissed.
If the partition is ordered through sale, it becomes time-barred ten years after the date of the decision. The sale must be requested within 10 years of the decision through enforcement. If partition is ordered through division, the co-ownership ends as soon as the verdict becomes final, and individual ownership is established. Therefore, there is no statute of limitations.
According to the Supreme Court, after the finalization of the judgment in a case filed by a creditor, another co-owner who was not a party to the original case can file a partition lawsuit for the same property. This is because the parties of the two cases are different.
13. Remedies Against the Decision of Elimination of Joint Ownership Lawsuits
Appeal
There is no specific provision regarding the appeal period for partition lawsuits in the Law on Civil Procedure. Article 345 of the Law on Civil Procedure states, “The period for appeal is two weeks.” Since the general rule is two weeks, an appeal can be lodged within two weeks against the decision of this lawsuit.
As a rule, only the parties to the case can appeal. However, there is an exception in partition lawsuits. If the co-plaintiffs or co-owners who are not parties to the case but have suffered a violation of rights due to the lack of party status, they can appeal the court decision.
Cassation
According to Article 362 of the Law on Civil Procedure, the appeals route is closed against the decisions of regional appellate courts regarding cases falling within the jurisdiction of the peace civil court, except for certain cases. Since partition lawsuits are not included among the excluded cases, appeals cannot be made against the decision of the regional appellate court.
14. How Long Does an Elimination of Joint Ownership Lawsuit Take?
It wouldn’t be accurate to provide a specific timeframe for how long lawsuits will last. The duration of lawsuits varies depending on factors such as the number of parties, the number of properties, the time it takes to prepare expert reports, and the workload of the court. However, according to the target timeframe set by the Ministry of Justice in the performance criteria, the expected duration for partition lawsuits is 365 days, or approximately 1 year.
Given that there are no appeals or appeals routes available within the specified timeframe, and considering that the case is subject to simple litigation procedures, a one-year period is considered a reasonable timeframe.
Ece Deniz Vardar
Attorney at Law | Lawyer in Turkey
Call us : +90 212 909 86 34
Send mail : info@ballawfirm.com
