1.What is a Claim of Appropriation?
Article 96 of the Execution and Bankruptcy Law No. 2004 states:
“If the debtor shows a property in his/her possession as the property or pledge of another person, or if a third party claims ownership or pledge right on that property, the execution office shall record this in the seizure and execution minutes and notify the two parties.”
And in the second paragraph of Article 85 of the same Law:
“The debtor or the persons holding the property together with the debtor, if a third party has a limited real right such as ownership or pledge right on the movable property or if the movable property has been seized by a third party, must declare this to the seizing officer and request that the declaration be recorded in the seizure minutes, and the seizing officer must invite the debtor or the persons holding the property together with the debtor to this declaration. The seizure of such goods and the goods that have been seized by a third party with precautionary attachment or claim of appropriation shall be postponed to the later stage.”
The claim of appropriation, as expressed in the figure, is the debtor’s claim that the seized property belongs to a third party or is pledged to a third party, or that the third party claims that the property belongs to him or that he has a right of pledge over the property. Therefore, a third party may claim that the ownership of the property belongs to him, as well as the lien debtor may claim that the property belongs to a third party.
2.Forfeiture Case
The claim of appropriation is a prerequisite for the action of appropriation in the enforcement law. Pursuant to Article 99 of the EBL, if the seized property is not in the possession of the debtor but is in the possession of a third party who claims ownership or other real rights over it, this property is not taken under custody if this person accepts to be a trustee.
The execution manager gives the creditor a seven-day period to file a forfeiture action against the third party before the execution court. If the forfeiture lawsuit is not filed within the 7-day period, the third party’s claim is deemed accepted. Until the lawsuit filed by the creditor in due time is finalized, the seized property cannot be sold.
On the other hand, if the property is seized while it is in the debtor’s possession, Article 99 of the EBL is not applicable, and the procedure must be carried out according to Articles 96 and 97 of the EBL. In the event that the debtor shows a property in his/her possession as the property or pledge of another person or a third party claims ownership or pledge right on that property, the execution office shall record this in the seizure and execution minutes and notify the two parties.
At the same time, the enforcement office gives the parties (creditor and debtor) a three-day period to notify whether they have any objections against the claim of appropriation. If the parties have no objection at the end of the three-day period, the claim of appropriation is deemed accepted. If the objection is made after the three-day period, it will be invalid and will not have any consequences.
If the creditor or debtor objects to the claim of appropriation, the file shall be sent to the Enforcement Court to examine the objections. The Enforcement Court shall decide on the continuation or termination of the enforcement proceeding according to its opinion as a result of its examination. The decision of the Court of Execution on the continuation of the proceeding is final.
The third party is obliged to file a forfeiture action before the enforcement court within seven days following the notification or notification of the enforcement court decision. In the event that a claim for appropriation is not filed within this period, the third party shall be deemed to have waived his claim against the creditor.
The third party, who has not been given the opportunity to file a claim for appropriation, may file a claim for appropriation in the enforcement court within seven days from the date he learns about the seizure, about the seized thing or about the price if it has been sold and the price has not yet been given to the creditor. Otherwise, he loses his right to assert this claim in the same proceeding.
3.Competent and Authorized Court in Forfeiture Case
Forfeiture actions are filed before the enforcement law court. The Supreme Court accepts that it is possible to file forfeiture actions in the court where the main enforcement proceedings are filed and in the court of the defendant’s domicile, and if there is more than one defendant, the lawsuit may be filed in the court of the domicile of one of the defendants.
4.Proof of Seizure Claim
All kinds of evidence may be submitted in forfeiture lawsuits. There is no legal restriction on the presentation of evidence in these cases. Therefore, witnesses may be heard, experts may be examined, discoveries may be made and oaths may be offered.
According to the judgment to be established as a result of the examination made within the scope of the claim of appropriation; If the attachment on the property can be lifted or if it is determined that the property belongs to the debtor, it is determined by the judgment that the property on which the claim of appropriation is asserted can be seized. In this case, the goods will be subject to the sale process.
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