Case for cancellation of savings

Individuals have the freedom to dispose of the goods they own. In cases such as foreclosure and bankruptcy, the debtor's freedom of savings is restricted. Some bad-intentioned debtors, knowing that the restriction will be imposed, may make fraudulent dispositions in order to evade the assets in their possession from creditors before foreclosure or bankruptcy; in practice, this rate is quite high. Debtors who transfer their assets think that by doing so, they will prevent creditors from collecting their receivables. At this point, the legislature has granted creditors the right to file a lawsuit for cancellation of the disposition.

Case for cancellation of savings Articles 277-284 of the Execution and Bankruptcy Law. It is arranged among the articles. In Article 277, "The purpose of the annulment action is to declare the acts written in Articles 278, 279 and 280 null and void." It is stated as follows. However, the nullity in this provision should not be confused with the concept of nullity defined in Article 27 of the TCO. The purpose of the action for annulment of disposition is to ensure that the property in question is seized and sold by the creditor as if it were in the creditor's assets. Otherwise, the savings transaction will not become invalid with the action for cancellation of the savings. As a matter of fact, this situation is stated in Article 283 of the Bankruptcy Code: "If the annulment case is established, the plaintiff obtains the authority to take his right to the property that is the subject of this lawsuit, through compulsory enforcement, and if the subject of the lawsuit is not immovable, the defendant may request the seizure and sale of that immovable property without requiring the correction of the record on the third party." It is stated as follows.

The case for cancellation of savings is not a case in rem. As we mentioned above, with the annulment action, the ownership of the goods is taken from the third party and not delivered to the debtor, and the plaintiff is given the opportunity to collect his receivables from the price of the goods. In this form, the annulment case is a personal case. In a decision dated 2020, the 17th Civil Chamber of the Supreme Court of Appeals said, "The purpose of the actions for cancellation of the disposition regulated in Articles 277 and the following of the EBL is to ensure that some of the dispositions made by the debtor before the seizure or bankruptcy, which are actually valid, are invalid or inconclusive against the creditor due to "contrary to the rules of good faith", and therefore to collect the receivable by continuing the compulsory enforcement on that property. If the annulment case is proven, the plaintiff obtains the authority to obtain the right to the property subject to the disposition through compulsory enforcement and the disposition." If the subject is immovable property, the defendant may request the seizure and sale of that immovable property without the need for correction of the record on the third party (EBL.Art.283/1). For this legal reason, the annulment case is a legal action of a relative nature that allows the creditor to collect his receivables; it is not related to the same property subject to disposal. He stated as follows.

SUBJECT OF THE CANCELLATION OF THE SAVINGS CASE

Dispositions subject to cancellation are listed under three headings in Articles 278-279 and 280 of the EBL. However, the law does not limit the acts subject to annulment by limiting them. The titles listed in the law constitute the savings groups subject to cancellation. According to a decision of the General Assembly of the Supreme Court of Appeals dated 2019; "The debtor's actions subject to cancellation are regulated in three groups in Articles 278, 279 and 280 of the EBL. All actions that can be canceled in these articles are not limited. It is not mandatory to specify which of the mentioned articles is based on in the petition. Even if one or more of these articles are shown in the petition, the judge is not bound by this and may decide to cancel the disposition based on one of the provisions of the other article."

As we stated above, these dispositions are legally valid dispositions. The word savings should not be interpreted narrowly. Here, the word disposition should be considered broadly to include legal transactions and legal acts. As a matter of fact, in cases where the debtor terminates his receivables from a third party with a contract, waives his receivables, accepts the lawsuit, or makes a settlement agreement, a lawsuit for cancellation of disposition may be filed. It is possible to multiply these examples. Transactions that reduce the debtor's assets may be subject to cancellation if they are among the groups listed in the law.

On the other hand, debit transactions cannot be subject to cancellation of savings. Again, invalid dispositions in the sense of substantive law do not need to be subject to an annulment lawsuit.

Cancellation and Mutualization of Savings

There are differences of opinion in the doctrine regarding the ability to file an annulment lawsuit against fictitious dispositions. However, the dominant view is that an annulment lawsuit cannot be filed in case of an allegation of collusion. In collusive dispositions, there is no need to file an annulment lawsuit since the ownership has not legally changed hands. The Supreme Court has given contradictory decisions on whether a lawsuit for annulment of the disposition can be filed based on collusion. However, especially in recent years, it has been accepted that a lawsuit for the annulment of the disposition can be filed, mostly based on collusion. In fact, it has been ruled that proof of insolvency will not be required in annulment cases based on collusion. As a matter of fact, according to a decision of the 17th Civil Chamber of the Supreme Court of Appeals dated 2019, "In order for it to be accepted that the third party's rights have been damaged by collusion, he must have a receivable from the one who made the collusive transaction and a collusive transaction must be carried out in order to prevent the payment of this receivable. The plaintiff's aim in this case is to ensure the invalidity of the transaction, which is essentially invalid due to collusion, in order to collect his receivable. In cases based on collusion, the plaintiff does not need to initiate enforcement proceedings and obtain an insolvency certificate. Because As explained above, although the acts subject to an annulment lawsuit in EBL Article 277 and the following articles are essentially valid, in an annulment case based on collusion, the plaintiff claims that he has been harmed by a collusive transaction. The plaintiff's right to file an annulment lawsuit regulated in EBL Article 277 and the following articles does not prevent the plaintiff from filing a lawsuit based on collusion. Considering that the claim is not related to the immovable property but is for the collection of the receivable. "Article 283/1,2 will need to be applied by analogy and a provision will need to be made for the plaintiff to be able to request the seizure and sale of the immovable properties without the need for cancellation and registration. This article only applies to the plaintiff by analogy the authority to request seizure and sale, and it should not mean that the third party will be liable for compensation."

Requisition cases and cancellation of savings cases are also different from each other. In the claim lawsuit, there is a claim of collusion and it is claimed that the ownership of the property has not changed hands. However, in an annulment case, the dispositions are considered valid.

Below, explanations will be given under separate headings about the savings groups that can be subject to the cancellation of the savings listed in the relevant articles of the law.

CANCELLATION OF FREE SAVINGS

Article 278 of the EBL has undergone some changes with the law no. 7571, which came into force on 25.12.2025. According to Article 278 of the EBL;

"Except for ordinary gifts, all donations and gratuitous savings made within one year before the date on which the temporary or final insolvency document or the lien report in the form of an insolvency certificate was issued or the bankruptcy was filed are subject to cancellation."

The article aims to protect creditors against those who have unrequited gains. The law annuls all gratuitous savings and donations, keeping customary gifts separate. Gifts given on occasions such as marriage, birthday, holiday etc. are considered ordinary gifts and cannot be cancelled.

It has been observed that debtors often make unrequited savings in order to smuggle goods from creditors. With this awareness, the legislator has deemed some savings to be forgiving. Again, with the amendment of the law, changes have been made within the scope of this paragraph. According to the final version of Article 278 of the EBL, the dispositions that have the force of forgiveness are as follows;

a) Unless it is proven to be gratuitous in accordance with its real value, savings made between descendants and descendants, blood relatives, including the third degree, spouses and in-laws, including the third degree, even if the marriage union has ended within the last year, savings made between the adopter and the adopted child, and people living in common residence.

b) Unless the contrary is proven, contracts in which the debtor accepts a price much lower than the actual value of what he gave at the time the contract was made.

c) Contracts in which the debtor establishes a lifetime income contract or usufruct right for himself or a third party, or care contracts until death, unless it is proven that an appropriate provision is provided.

CANCELLATION OF SAVINGS MADE IN CASE OF INJURY

According to Article 279 of the EBL;

The following savings are also void if they are made by a debtor who has not paid his debt within a year before the seizure or insolvency due to lack of property or the filing of bankruptcy:

1- Pledges made by the debtor to secure an existing debt, except in cases where the debtor has previously committed to provide collateral;

2- Payments made in any way other than money or ordinary means of payment;

3- Payments made for undue debts,

4- Annotations placed on title deeds to strengthen personal rights.

If the person who benefits from these savings proves that he does not know the debtor's situation and situation, the annulment case will not be heard.

Examples of payments made other than money include paying by check or giving a property instead of a loan. Payment of overdue debts is also among the savings subject to cancellation. In addition, the legislator has regulated that the disposition transaction can be canceled in cases where the person in whose favor the disposition is made knows the situation of the debtor. Here, the burden of proof belongs to the third party in whose favor the disposition was made. If the debtor proves that he does not know his situation, the action for cancellation of the disposition will be rejected.

CANCELLATION OF SAVINGS DUE TO INTENTION TO CAUSE HARM

Cancellation due to intent to cause harm is regulated in Article 280 of the EBL. According to the article; All transactions made by a debtor whose assets are not sufficient to pay his debts with the intention of harming his creditors may be annulled in cases where the financial situation of the debtor and his intention to cause harm are known to the other party of the transaction or there are clear signs that require knowledge.

The legislator required the creditor to prove the intent to cause harm in order to annul the dispositions within the scope of Article 280. However, considering that the requirement of proof cannot be easily exceeded, presumptions have also been drawn up in favor of the creditor. It is assumed that the persons listed below knew that the debtor was insolvent and no other proof is required. For people other than these, it must be proven that these people knew about the debtor's insolvency situation. Accordingly:

"If the third party is the debtor's wife or husband, or his or her descendants, and blood and affinity relatives up to the third degree (including this degree), the adopter or adopted child, it is assumed that the debtor knows the situation declared in the first paragraph. The third party can only prove the contrary in accordance with the last paragraph of Article 279."

In a decision of the 17th Civil Chamber of the Supreme Court of Appeals dated 2020 on the subject;

"The defendant sold his share in the relevant independent section to his brother. Since it is established that the debtor-defendant third party is a brother, the savings between them must be annulled in accordance with Article 278/3-1 of the EBL. The same immovable property was later sold by the defendant to the other defendant. Since the defendant is registered to the same population as the debtor and operates in the same industrial zone in the same field of activity, he intends to expose the financial situation of the debtor and his creditors. This disposition must be annulled in accordance with Article 280/1 of the EBL. Although the defendant sold the immovable property to the other defendant, there is no error in rejecting the case as the plaintiff could not prove that the defendant knew the debtor's financial situation.

The other parcel in question was sold to the defendant by the debtor. From the file of the Enforcement Civil Court, it is clear that the person claiming compensation is an insured worker at the debtor's workplace, and it is understood that the defendant is the brother of this person. With the acceptance that the person, who has been the sister of the debtor's insured worker for many years, knew about the financial situation of the debtor and his intention to harm his creditors, this disposition is also in accordance with Article 280/1 of the EBL. It must be canceled in accordance with the article. The provision was made as follows.

280. In the last paragraph of the article, a presumption is included due to commercial transactions. This paragraph of the article generally comes to the fore in annulment lawsuits to be filed regarding the transfer of the commercial enterprise. According to the article;

"It is accepted that the person who transfers or purchases all or a significant part of the commercial enterprise or the existing commercial goods in the workplace, or who acquires a part of it and subsequently occupies the workplace, knows that the debtor intends to harm his creditors, and that the debtor acts with the intention of harming his creditors in these cases."

Again, according to the regulation in the article;

"This presumption can only be refuted by proving that the situation was notified in writing to the creditor who filed the annulment lawsuit at least three months before the date of transfer, sale or abandonment, or that it was announced by the Trade Registry Gazette by hanging visible signs at the location of the commercial enterprise, or, if this is not possible, by appropriate means to ensure the understanding of all creditors."

CONDITIONS OF THE CANCELLATION OF SAVINGS CASE

Some conditions must be met in order to file a lawsuit for cancellation of the savings. Established Supreme Court jurisprudence is in this direction. Again, in a decision of the 17th Civil Chamber of the Supreme Court dated 2020, "The purpose of the actions for cancellation of the disposition regulated in Article 277 and the following articles of the Execution and Bankruptcy Law is to ensure that some of the dispositions made by the debtor before the seizure or bankruptcy and which are actually valid are invalid or inconclusive against the creditor due to "contrary to the rules of good faith", and therefore to collect the receivable by continuing the compulsory enforcement over that property. In order for such cases to be heard, the plaintiff's receivables in the debtor must be real, the enforcement against the debtor must be ineffective." The provision has been established as follows: "The proceeding must be finalized, the disposition requested to be canceled must have been made after the debt subject to follow-up, and there must be a final or temporary insolvency certificate issued for the debtor (Article 277 of the EBL).

Based on this, it is possible to list the conditions of the annulment of disposition case as follows:

1- The creditor must have a real receivable.

The receivable requested by the creditor from the debtor must be based on a real legal relationship. Otherwise, the case will be rejected.

2-Enforcement proceedings must have been carried out against the debtor and this proceedings must have been finalized.

The enforcement proceedings against the debtor must be finalized. A lawsuit for cancellation of disposition cannot be filed based on objectionable proceedings. "When the file is examined, it is understood that the plaintiff has pursued the creditor's receivables arising from the checks worth 40,000 TL and the receivables arising from the checks worth 50,000 TL, but the payment orders could not be notified to the debtor and the follow-up was not finalized. A seizure that could be considered as an insolvency certificate could not be made from the file in which the receivables arising from the check worth 50,000 TL was pursued. Therefore, the prerequisite for the lawsuit is in the concrete case. It appears that it did not happen." Supreme Court of Appeals 17th HD 2019/7087 K.

3- The savings requested to be canceled must have been made after the debt was born.

However, savings made after the debt arises are subject to cancellation. Cancellation of savings made before the debt arises cannot be requested. In terms of checks, the date of birth of the debt is considered the date on which the basic relationship was established. In terms of post-dated checks, the date of birth of the debt will be determined by examining the basic relationship between the parties.

4- The creditor must have received a certificate of final or temporary insolvency about the debtor.

It is a condition for the lawsuit that the creditor obtains an insolvency certificate. In case of absence, the case is rejected. The certificate of insolvency is a condition of a consummable lawsuit and can be presented at any stage of the trial. Seizure minutes replace the certificate of insolvency if the conditions are met. The insolvency certificate for the file in which the annulment case was filed must be submitted. An insolvency document belonging to someone else cannot be used. In cases of annulment based on collusion, a certificate of insolvency is not required.

WHO CAN FILE A CASE FOR CANCELLATION OF THE SAVINGS?

A lawsuit for annulment of disposition is a lawsuit filed by a creditor who has not received his receivable partially or completely.

In case of bankruptcy, the right to file a lawsuit belongs to the bankruptcy administration. If the bankruptcy administration does not want to open the case, this right can be transferred to the creditor who wants to open the case.

AGAINST WHOM CAN A CANCELLATION CASE BE FILED AGAINST WHOM?

The lawsuit is filed jointly against the debtor and the person in whose favor the savings are made. Here, there is compulsory litigation between the debtor and the third party. If the person in whose favor the savings were made is dead, the lawsuit is filed against his or her heirs. In addition, an annulment lawsuit may be filed against third parties with bad faith.

One of the issues that should be emphasized here is that the transfers subject to the annulment of disposition case have occurred more than once. In chain transfers, a lawsuit can be filed against all malicious transferees. If there is a bona fide transferee, no lawsuit can be filed against him or those who transfer the property from him. In this case, the lawsuit is filed as a compensation lawsuit against the third party in whose favor the disposition was made and other malicious persons after him.

THIRD GOOD FAITH PERSON IN THE CANCELLATION OF THE SAVINGS CASE

According to Article 282 of the Execution and Bankruptcy Law; The annulment action does not violate the rights of bona fide third parties. If the person in whose favor the disposition was made transferred the acquired property to a fourth person, the intention of the fourth person is investigated. If the 4th person is in good faith, an annulment lawsuit cannot be filed against him. As we mentioned above, if the fourth person has bad intentions, a lawsuit can be filed against him/her.

THE COURT WITH RESPONSIBILITY AND AUTHORITY IN THE CASE FOR CANCELLATION OF THE SAVINGS

The action for cancellation of the disposition is filed in the civil courts of first instance, regardless of the amount of the receivable.

The competent court is determined according to the general jurisdiction rules. Since the annulment case is not a case concerning the same immovable property, it is not subject to the absolute jurisdiction rule. Therefore, if the debtor and the third party reside in the same place, the lawsuit can be filed in the court of their joint residence, and if they reside in different places, the case can be filed in the court of both of them.

REDUCTION PERIOD IN THE CANCELLATION OF SAVINGS CASE

The action for cancellation of the savings must be filed within the 5-year limitation period. After this period has passed, a lawsuit cannot be filed anymore. The 5-year period starts from the date of the revocable savings.

Article 278 of the Law stipulates that in terms of cancellation of gratuitous dispositions, dispositions 2 years before the seizure or bankruptcy may be subject to cancellation.

279. In the article, it is stated that in case of nullity due to insolvency, savings made within 1 year before the insolvency are subject to cancellation.

The periods specified in Articles 278 and 279 are not periods for filing a lawsuit. These periods regulate which savings can be subject to cancellation. Therefore, the limitation period in all annulment cases is 5 years. To explain with an example, the period for filing a lawsuit regarding the savings made by the defendant in case of insolvency will be 5 years. However, the savings subject to cancellation must have been made within 1 year before the insolvency.

FEES FOR CANCELLATION OF SAVINGS CASE

In the case of cancellation of the savings, the fee is calculated according to the relative fee rate. According to the established decisions of the Supreme Court, the calculation of the fee and the attorney's fee will be made based on the lesser of the amount of the receivable subject to enforcement proceedings and the value of the immovable property subject to disposition.

CASE FOR CANCELLATION OF SAVINGS, PRECAUTIONARY MEASURES

Precautionary injunction and precautionary lien may be requested along with the action for cancellation of the disposition. Temporary protection orders may be applied as a result of the evaluation made by the court. It is sufficient for the creditor to prove approximately his receivables in order to issue an injunction.

The concepts of provisional injunction and provisional lien are different concepts and these concepts should not be confused. An interim injunction is a protective measure taken to prevent the sale of goods to third parties during the litigation phase. Precautionary lien serves the purpose of preventing loss of rights due to liens that may be placed on the property in question by third parties during the litigation phase and to prevent the plaintiff from losing the lien order.

The Supreme Court is of the opinion that the precautionary measures imposed by the court in cases of annulment of disposition are considered as provisional attachment. As a matter of fact, in accordance with Article 281 of the EBL; The judge may issue a provisional seizure decision on the goods that are the subject of the dispositions subject to cancellation, upon the request of the creditor. The need and amount of the guarantee is assessed and determined by the court. However, if the case concerns the value of the disposed goods, a provisional attachment decision cannot be given without providing a guarantee.

RESULTS OF THE CANCELLATION OF THE SAVINGS CASE

If the creditor wins the case for cancellation of the disposition, the property in question will not change hands and will continue to remain in the possession of the third party. However, the creditor will be able to recover his receivables by seizing and selling the property as if it were the property of the debtor. In cases where the ownership of the property in question is transferred to someone else, the third person who made the transfer will be held responsible for the price. As a matter of fact, according to Article 283 of the EBL, it is possible for the annulment case to turn into a fee. In case of multiple transfers, all dispositions will be canceled unless the chain of fraudulent transactions is interrupted (in cases where bad faith is proven). However, if good faith is proven, the annulment case turns into a compensation case against the bad-intentioned persons (up to the well-intentioned person) in whose favor the disposition was made and who come after him.

The action for annulment of savings is a personal case and is valid only between the parties to the case. As we stated above, with the cancellation of the disposition, the disposition will be deemed invalid only against the creditor who filed the lawsuit and will continue to remain a valid disposition for third parties.

"The purpose of the actions for annulment of disposition regulated in articles 277 and following of the Code of Law is to ensure that some dispositions made by the debtor before the seizure or bankruptcy, which are actually valid, are invalid or inconclusive against the creditor due to "contrary to the rules of good faith", and therefore to collect the receivable by continuing with compulsory enforcement over that property. If the annulment case is proven, the plaintiff obtains the authority to obtain the right to obtain the right to dispose of the subject property through compulsory execution and the immovable property subject to disposition. ", the defendant may request the seizure and sale of that immovable property without the need to correct the record on the third party (EBL. Art. 283/1). For this legal reason, the annulment action is a legal action of a relative nature that allows the creditor to collect his receivables; it is not related to the same property subject to disposal." Supreme Court of Appeals 19th HD 2019/9821 K.