ABSTRACT
According to the Enforcement Law, an objection to the order of payment suspends the proceedings automatically. In that case, the debtee should prefer either withdrawal of appeal or annulment of objection. In this article, the procedure of annulment of objection will be analyzed.
The procedure of annulment of objection, which is a way to continue the enforcement proceeding without judgement even if it is suspended by the objection of debtor, is regulated by the Articles 68-70 of the Enforcement and Bankruptcy Law (“EBL”). In the event the debtor objects to the order of payment within seven days and suspends the enforcement proceeding, the debtee may file an “annulment of objection lawsuit” before court of enforcement within six months in order to dismiss the objection. This six-month-period is a statutory limitation against the debtee.
I. INTRODUCTION
According to annulment of objectional, the debtees can only prove the existence of their debt within the documents which are listed under Article 68-68/a. In principle, the debtors can only prove their objection using these documents as well.
In Turkish legal doctrine, there are different ideas concerning the legal character of annulment of objection procedure. Some authors describe it as a declaratory procedure1 while others describe it as an action for performance. In the Supreme Court practice, annulments of objection applications are not considered as lawsuits as a matter of technicality, even if they are in the jurisdiction of court of enforcement2. The reason for this is that the courts of enforcement verdicts on annulment have no effect on the material law since they do not decide on the execution or non-execution of a case; they just provide the continuation of execution by annulling the objection which suspends the proceeding.
II. ANNULMENT OF OBJECTION
In the annulment of objection lawsuit, the court of enforcement makes a limited and formal examination. That is to say that the requesting party must prove his demand based upon the documents listed under Article 68 of the Enforcement and Bankruptcy Law (“EBL”). These documents are stated respectively as;
i. A deed including an acknowledgement of pecuniary debt and its signature,
ii. Vouchers or other documents given by the competent authority,
iii. A deed including notarized signatures,
iv. Loan contracts and related account abstracts which have not been issued to objection within in prescribed terms,
v. Other documents or vouchers duly drafted by crediting party.
There are two types of annulment of objection that are governed by the EBL, which are “Definite of Annulment Objection” and “Temporary Annulment of objection”.
i. If the debtor suspends the proceeding by objecting to the debt itself, the debtee may file a lawsuit demanding definite annulment of objection (EBL Art. 68),
ii. If the debtor suspends the proceeding by objecting to the signature, the debtee may file a temporary annulment of objection lawsuit (EBL Art. 68/a).
III. DEFINITE ANNULMENT OF OBJECTION
A. Requirements
The conditions which are mentioned below must come into force so that the debtee may file a definite annulment of objection3:
i. There must be a valid enforcement proceeding without judgement executed by the debtee.
ii. In the proceeding without judgement, there must be a valid and liquidated debt in material law.
iii. The debtor must object to the payment order in the prescribed term.
iv. The debtee must not take an action for annulment of objection before the general court in power.
v. The debtee must file a lawsuit within six months from the date of notification of the objection of the debtor.
vi. The debtee must have the documents listed under Article 68/1 which provide the debtee with power to file a definite of annulment of objection lawsuit.
1. Deeds Including an Acknowledged Signature
In case the signature under the deed with a certain value, which is the basis of the enforcement procedure, is acknowledged by the debtor, the debtee may prove their claim and provide annulment of the objection definitely.
If the debtor objects based on non-fulfillment of contingent liabilities, the court of enforcement will overrule the claim of annulment of objection. However, if the debtee can prove that the condition is fulfilled by presenting a document listed under Article 68/1, the court will decide to annul the objection.
2. Deeds Including Notarized Signatures
Deeds including unconditional acknowledgement and notarized signature may as well provide definite annulment of objection. One should note that the deeds listed under Article 68/1 of the EBL are not the deeds drafted by notary. Deeds drafted by notary, including an unconditional acknowledgement, are considered as court verdicts and a debtee who possesses such a document may start the enforcement proceeding as if they have a court order.
3. The Documents Which are Duly Drafted by State Offices or Competent Authorities within the Limits of Their Powers
Because these documents are drafted by competent authorities or state offices, they do not include the signature of debtor. Hence, there is no need to have an avowal of debtor’s signature or notarization. For these documents listed under Art. 68/1 of the EBL to be able to provide annulment, they must state that the debtor accepts unconditional payment of a pecuniary debt. If the debtor acknowledges the provisional attachment minute, the debtee may request annulment of objection from the court of enforcement based on the provisional attachment minute. The debtors can only prove that the signature on the documents do not belong to them by filing a case based on claim of forgery.
4. The Documents Which are Related to Credit Institutions
According to Art. 68/b of the EBL, for credits that are working in the form of bank overdraft or short, mid, long term credit, the creditor should send an account abstract through a notary public to the address of loaner stated in the loan contract within fifteen days following the term of accrual of interest. If the loaner does not object to the content of account abstract within one month, the loaner may claim that the account abstract is contrary to facts only after the debt is paid.
B. Consequences of not Submitting any Documents which may Provide Annulment of Objection
If the court of enforcement detects that the debtee does not prove their annulment claim based on the documents listed under Art. 68-I of the EBL, then it should deny the annulment request of the debtee.
After detecting that the documents presented does not comply with Art. 68 of the EBL, it is known that in practice some courts of enforcement were deciding that they are not authorized to examine these claims and deciding on non-jurisdiction. However, Supreme Court decisions state that under these circumstances, courts of enforcements should decide to deny the objection of annulment instead of deciding on non-jurisdiction5.
C. Burden of Proof Regarding the Debtor in terms of Definite Annulment of Objection
In case the debtee proves their claim with the above stated documents, the proof of burden regarding the annulment of the objection passes on to the debtor. If the debtors prove their counter claim in response, the court of enforcement shall deny the demand of annulment. The debtors are obliged to prove their objection by only using the documents listed under Art. 68/I of the EBL. However, some objections cannot be engaged with a document due to their nature, which leads us to two possible conditions:
i. The objections which cannot be proven with a document because of their nature
ii. The objections which can be proven with a document
Objections such as an execution office being unauthorized or the bankrupt debtor does not acquire new goods, cannot be considered based on documentation due to their nature. Yet the court of enforcement is authorized to examine these objections. The debtor does not have to present any document to prove these. The court of enforcement apart from these exceptions is unauthorized to examine the objections which are not suitable to proven with a document. For example, in an objection of misapprehension, fraud, menace6, simulation, and loss of capability7 or in objections claiming that the document has been forged or the services or goods which the bill was based on were defective8, and therefore the proof with a document is not possible. Hence, in the event that the debtor cannot show any document to prove these objections, the court of enforcement shall annul the debtor’s objection without inquiry9.
Apart from the aforementioned occasions, the objections may be proven by a document. For the debtors to be able to prove their objection before the court of enforcement, these objections must be presented clearly to the enforcement office in the statement of objection.
D. Legal Procedure
Court of enforcement makes its examination in accordance to the simple legal procedure but cannot give a verdict without holding a hearing. Therefore, court of enforcement summons the debtees and the debtors to the hearing as soon as possible upon the demand of annulment. The cases, submitted to the court of enforcement shall be considered as “urgent cases”. Therefore, the annulment of objection requests may still be examined in judiciary recess10.
Turkish Code of Civil Procedure states that, in cases under simple jurisdiction, a claim can be proven by witness and oath if necessary. However, in cases of annulment of objection, the courts of enforcement cannot accept witness or oath as a proof. The reason is that the claims of debtor and debtee can only be proven by documents listed under the EBL Art. 68 in the annulment cases.
In case the court of enforcement decides that the signature on the ordinary document belongs to the debtee, the court denies the request of the annulment and sentences the debtee to pay a pecuniary penalty. The court of enforcement annuls the objection of the debtor definitely in case it detects that the signature does not belong to the debtor.
In case the debtee accepts the signature under the ordinary document presented by the debtor but claims that the document has been subject to forgery, the court of enforcement has the authority to have the document examined for forgery. Upon detection of authenticity, the court of enforcement shall decide on definite annulment of debtor’s objection.
Debtor may prove that the debt had been paid, through the witness statement11, in case the ordinary document got lost under custody of an official or due to forcemajor causes or an unexpected incident. However, it is not possible to hear witness statements in court of enforcement, so the debtors shall not be able to prove their claim through the witness statement.
The court of enforcement may give a decision about annulment of the objection in two ways;
i. Rejection of “annulment of objection” demand
ii. Acceptance of “annulment of objection” demand
If the court of enforcement rejects the demand of objection based upon the merits of the case, it may sentence the debtee to pay compensation, valuing at least 20% of the debt amount that was objected to the enforcement office by the debtor. The debtor may execute the enforcement procedure based on the court of enforcement’s compensation decision. Rejection of the annulment of objection request may not be considered as final judgment12. This decision may only be considered as a final judgement for the ordinary enforcement proceeding. The debtee may still file a lawsuit in the general courts in power in order to demand the same amount.
If the court of enforcement accepts the request of objection based on the merits of the case, it may sentence the debtor to pay compensation, valuing at least 20% of the wrongfully denied debt amount that was objected to the enforcement office. With the annulment of the objection as a final decision, the debtor’s objection would be abolished. This decision may be considered as the debtor had never been objected to the enforcement pro-cedure. The debtee may request the continuation of the enforcement procedure, which was stopped by the objection of the debtor.
If the value of proceeding debt in dispute is above the limit for appeal, the court’s decision will be appealable.
IV. TEMPORARY ANNULMENT OF OBJECTION
A. In General
If the debtee proceeds based on an ordinary deed and the debtor denies the signature on it, the debtee may not request a definite annulment of objection, but a temporary annulment may be requested. If the court of enforcement esteems that the signature belongs to the debtor, it may annul the objection temporarily. The debtee may not demand continuation based on the decision of temporary annulment. The enforcement proceeding continues to be suspended for a period of seven days which is given to bring an action for denial of debt. If there is an action for denial of debt, the proceeding continues to suspend until the verdict. The debtee may only demand a provisional seizure based on the temporary annulment.
The explanations mentioned in the definite annulment of objections, and in particular the term and the conditions, are also valid for the term of ordinary deed that provides the debtee to request for annulment of the objection and its conditions. This is because in this situation, the signature on the ordinary deed has already been denied by the debtor.
The debtee may immediately request before requesting annulment of objection comparable signatures of the debtor to be demanded from relevant authorities by the execution office upon notification of the objection13.
The debtee may apply the court of enforcement for temporary annulment of the objection within six months from the date of notification of the statement of objection.
B. Legal Procedure
The court of enforcement examines the temporary annulment request according to ordinary proceedings. It should be noted that the debtor must attend to the hearing held by the court of enforcement. If the debtor does not attend the hearing, the court of enforcement may decide to annul the objection temporarily based on this particular reason without further inquiry. Because of the debtor’s obligation to attend the first hearing, legal invitations must be sent to the debtor. Initially, the court of enforcement requests their explanations from both parties. Then, the court makes an examination to determine whether there is an unconditional acknowledgement of payment in the bill of debt. If the bill of debt does not include an unconditional acknowledgement of payment, the court of enforcement rejects the request of temporary annulment without having the signature examined.
If the bill of debt presented by the debtee includes an unconditional acknowledgement of payment and the debtor has not stated any other objections than falsification of signature when objecting to the payment notice, the court of enforcement immediately has the signature examined upon debtee’s request of temporary annulment. The examination of signature is conducted by comparing the signature on the ordinary deed with signatures which are known to belong to the debtor. The court decides whether the denied signature belongs to the debtor according to the comparison14. There are two ways to get a signature that surely belongs to the debtor;
i. Determination with applicable and comparable documents
ii. Acquiring debtor’s hand writing example before the court
The documents which have been previously signed for any reason by the debtor are considered as applicable and comparable documents.
Authenticity of the signature on the ordinary deed is examined using a comparable signature of the debtor. If this is not possible, the court of enforcement can demand the debtor’s signature examples to acquire a comparable signature. It is not possible to request proof by witness or oath when it comes to detecting whether the signature on the ordinary deed belongs to the debtor or not.
As a result of aforementioned signature examination, the court of enforcement may decide on accepting or denying the request of temporary annulment based on whether the signature is genuine or not.
C. Consequences of Rejection of the Temporary Annulment Request
The court of enforcement which denies the request of temporary annulment shall sentence the debtee to pay a compensation valuing no less than 20% of the issued debt value with the rejection verdict15. Rejection of the temporary annulment of objection request means that the debtee may not continue to the enforcement proceeding. But this verdict is not considered as a definitive judgement by means of material law16. Hence, the debtee may take an action of debt for the same amount before the general court in power.
D. Consequences of Temporary Annulment Decision
The temporary annulment of objection decision only affects the enforcement law. These effects are:
i. Ability to request provisional seizure
ii. Obligation to submit a declaration of properties
iii. Ability to file an action in denial of debt
The debtor may file a case for denial of debt within seven days from the date of notification or pronouncement of the judgement. In case the debtor does not file a case for denial of debt, the temporary annulment shifts to definite annulment of objection. After that point, the debtor may only file a negative declaratory action (EBL Art. 72, III) or an action for refund.
V. CONCLUSION
The advantages and disadvantages of annulment of the objection as an institution, which is more preferable because of the reasons such as litigation under ordinary proceeding and being rather practical, should be evaluated in combination. One should note that the annulment or refusal of objection cannot be considered as a definitive judgement by means of material law.
Because the debtors may file a negative declaratory action at any time in these cases to prove their claims and have the execution proceeding cancelled, The debtee may file a lawsuit in general courts in power to prove their claim as well.
This emphasizes the doctrine that considers the “annulment of objection” lawsuits as declaratory actions which provide continuation of the enforcement proceeding rather than actions of performance.
BIBLIOGRAPHY
Taylan Özgür Kiraz, “İcra Mahkemesinde İtirazın Kaldırılması”, http://www.turkhukuksitesi.com/showthread.php?t=72830 (Access: 27.05.2016)
Ejder Yılmaz, Baki Kuru, Ramazan Arslan, İcra ve İflas Hukuku (Ders Kitabı), Yetkin Hukuk Yayınları, 28. Edition, Ankara 2013
Fatma Altay “İcra Hukukunda İtirazın Kaldırılması” http://www.turkhukuksitesi.com/ makale_1403.htm (Access: 27.05.2016)
FOOTNOTE
1 Ejder Yılmaz, Baki Kuru, Ramazan Arslan, İcra ve İflas Hukuku (Ders Kitabı), Yetkin Hukuk Yayınları, 28. Edition, Ankara 2013, p. 186.
2 The Supreme Court 12th Civil Chamber’s decision dated 30.01.1986, numbered 1985/7618, 1986/981.
3 Fatma Altay, “İcra Hukukunda İtirazın Kaldırılması”, http://www.turkhukuksitesi.com/ makale_1403.htm (Access: 27.05.2016).
4 Yılmaz, Kuru, Arslan, p. 183.
5 Turkish Supreme Court 12th Civil Chamber’s decision dated 20.06.2013, numbered 2013/11650, 2013/23341.
6 LOO Art. 30-39.
7 TCC Art. 9-16.
8 LOO Art. 219 ff.
9 Taylan Özgür Kiraz, “İcra Mahkemesinde İtirazın Kaldırılması”, http://www.turkhukuksitesi.com/ showthread.php?t=72830 (Access: 27.05.2016).
10 CCP Art. 103/1-h.
11 CCP Art. 203/e.
12 CCP Art. 303.
13 CCP Art. 211/1-b.
14 The Supreme Court General Civil Assembly’s decision dated 06.02.2008, numbered 2008/12-77 2008/90.
15 The Supreme Court General Civil Assembly’s decision dated 4.6.2013, numbered 2003/15-404 2003/381.
16 CCP Art. 303.
