Suretyship is a legal institution to provide assurance (guarantorship) with the aim of providing personal suretyship. With this transaction, the surety personally assumes the risk of the principal debtor's failure to fulfil its obligation to the creditor. In general, there is a three-sided legal relationship in suretyship. The parties to this relationship are the surety, the principal debtor and the principal creditor. The parties may freely conclude the agreement on suretyship by complying the condition of formality, i.e., the date of suretyship, the amount of suretyship and the condition that joint and several suretyship must be written in handwriting by the surety him/herself. Accordingly, the suretyship agreement may be concluded before notary or in ordinary written form. However, unlike the surety agreement within the scope of the law of obligations, enforcement sureties can only be executed in the presence of the enforcement office (by the enforcement office director / officer authorised by the enforcement directorate), except for the same conditions in terms of form.
According to Article 581 of the TCO, "A suretyship agreement is a contract in which the surety undertakes to be personally liable to the creditor for the consequences of the debtor's non-performance". According to this definition, a surety agreement is an independent debt relationship between the creditor and the surety, which provides personal security to the creditor.1
Even though enforcement suretyship agreements are verbally and briefly mentioned in the Enforcement and Bankruptcy Law and their main basis is the Enforcement and Bankruptcy Law, they are the appearance of suretyship agreements, which are an institution of the Turkish Code of Obligations and regulated under the Turkish Code of Obligations, in the enforcement law. Since there is no detailed legislative regulation in the Enforcement and Bankruptcy Law as in the Turkish Code of Obligations, the provisions of the Turkish Code of Obligations shall be applied by analogy in terms of the procedures for the establishment of the enforcement suretyship agreements.2
In both institutions, the liability of the surety, who personally assumes the risk of the debtor's inability to fulfil his obligation to the creditor, is limited. In the first paragraph of Article 499 of the Swiss Code of Obligations, it is stated that the surety is liable for the maximum amount shown in the surety bond in all cases3. Article 589 of the TCO, on the other hand, stipulates that the surety shall be liable for the maximum amount in accordance with the referred Swiss law. According to Article 589 of the TCO: "In all cases, the surety is liable up to the maximum amount specified in the surety agreement." In order for the surety agreement to be valid, the maximum amount for which the surety is liable must be clearly indicated in the surety agreement (TCO Art. 583).
The most important point that distinguishes the suretyship contract from the enforcement suretyship is that, pursuant to Article 38 of the EBL, the sureties in the enforcement office are considered as documents in the nature of a judgement and are subject to the provisions on the enforcement of judgements. Unlike the suretyship agreement under the law of obligations, suretyships in enforcement can only be realised in the presence of the enforcement office. This requirement is understood from the wording of Article 38 of the EBL. Pursuant to the expression "sureties in the enforcement office" in the relevant legal provision, the enforcement sureties to be executed in the enforcement office in the presence of the enforcement director or officers, and the suretyship documents to be executed outside the enforcement office and especially in the presence of the enforcement director or deputy enforcement directors during the attachment proceedings are included in this scope.
In the surety agreement, the relationship between the principal creditor and the principal debtor must be a relationship that gives rise to a money receivable. Another point understood from the wording of Article 38 of the Enforcement and Bankruptcy Law is that the enforcement suretyship shall be deemed as joint and several suretyship. The condition of joint suretyship is accepted by law. In the reasoning of the article of the Execution and Bankruptcy Law, it is stated that it is aimed to strengthen the legal position of the creditor with joint suretyship4. When all these issues are taken into consideration, enforcement sureties are considered as a suretyship agreement, which is considered as one of the documents in the nature of a judgement in accordance with the EBL, where the principal debt relationship arising from a money receivable debt is undertaken by third parties as sureties in front of the enforcement office and subject to the provisions of joint and several suretyship, where the debt subject to enforcement proceedings is undertaken to be paid partially or completely.5.
The EBL does not contain any provision on the validity of the enforcement suretyship, and the nature of the liability is only specified. For this reason, the determination of the specific conditions of the enforcement suretyship is determined by judicial decisions and practice, as well as the application of the provisions of the TCO by analogy. However, in addition to the issues in the suretyship relationship established under the provisions of the TCO, even if an enforcement suretyship is duly established, an enforcement order cannot be sent to the enforcement surety before the finalisation of the proceedings against the debtor (principal debtor), and the surety can only be applied for a debt that has become due for the principal debtor. Another condition that will have the same result with the finalisation of the proceeding is the finalisation of the amount of the debt. For this reason, the file debt should not be the subject of dispute between the principal debtor and the principal creditor. The amount that the surety guarantees must be certain. Pursuant to Article 538 of the TCO, the maximum amount for which the surety is liable must be indicated by the surety in his/her own handwriting. In cases where there is more than one file debtor, it must be determined whether the surety is granted for only one of the debtors or for the entire file debt6. In order for the suretyship to be valid, the surety's declaration must be recorded in the minutes of enforcement and the bottom of the minutes must be signed. The minutes must be prepared in accordance with Article 8 of the EBL. The enforcement suretyship shall not be valid if the handwriting condition required by the TCO is complied with, and especially if the matters to be written in the surety's own handwriting are filled in by the enforcement manager and signed by the surety. Contrary to Article 582 of the TCO, enforcement suretyship cannot be conditional7. Enforcement surety fee must be paid (9.48 per thousand for 2023). If the enforcement surety fee is not deposited, the enforcement director shall not carry out subsequent transactions unless the fees to be collected from judicial proceedings are paid in accordance with Article 32 of the Law on Fees. Since the regulations on fees are mandatory and related to public order, they are automatically observed by the courts due to their duties. Pursuant to the provision, the court may refrain from sending an enforcement order and may reject this request of the parties. This matter must be completed after the establishment of the surety and until the surety is sent an enforcement order.
The enforcement surety given during the precautionary attachment is also valid, and the validity of the surety continues as long as the proceedings against the principal debtor are not cancelled. Even if the enforcement surety is duly obtained in case of precautionary attachment, the enforcement order cannot be issued to the enforcement surety unless the proceeding is finalised in terms of the principal debtor by performing transactions complementary to the precautionary attachment for the principal debtor, and it will not be possible to continue the proceeding if the amount of debt is not finalised. During the precautionary attachment, it is possible to become an enforcement surety provided that the proceeding is finalised at a later date8. The examination of the validity of the enforcement suretyship shall be brought to the agenda upon the objection or complaint to be made by the surety upon the sending of a proper enforcement order to the surety9. The contrary of an enforcement suretyship can only be proved by a document of the same strength (a writ or a document in the nature of a writ). For this reason, it will be possible to object to an enforcement surety whose validity conditions have been fulfilled only with a document of this nature. In addition, according to last paragraph of Article 8 of the EBL, the enforcement minutes constitute a presumption that can be proved otherwise about the matter they cover. In other words, enforcement minutes are valid until the contrary is proved. However, if the minutes of enforcement document this legal transaction (for example, in the case of enforcement suretyship - if the minutes are signed), then it is possible to prove the contrary of the minutes only with written evidence.10
Consequently, even if the legal basis of the enforcement suretyship is Article 38 of the Enforcement and Bankruptcy Law, it is impossible to consider it separately from the suretyship provisions in the Law of Obligations. In other words, although enforcement suretyship bonds are regulated under the Enforcement and Bankruptcy Law, the said law contains very limited information regarding this institution (i.e. that it has the nature of a judgement and the state of joint and several liability). The function, validity and legal foundations of enforcement sureties are based on the principles of the Code of Obligations.
Footnotes
1. (Emil Beck, The New Guarantee Law, Zurich, 1942, Art. 492, No. 43; Gümüş, p. 535; Hugo Oser/ Wilhelm Schönenberger (Trans. İsmet Sungurbey), Commentary on the Swiss Law of Obligations, Ankara, 1964, p. 85; Gökhan Şahan, Termination of the Guarantee Agreement, Master's Thesis, Kayseri, 2007, p. 5; Zevkliler/ Gökyayla, p. 530; Özen, p. 47.)
2. "Since there is no special provision in the EBL on the form of enforcement suretyship, Article 482 (581) and the following articles of the TCO must be applied". Court of Cassation 12th Civil Chamber, 01.02.1977 D., 100421/10099.
3. (Beck, Art. 499, Nr. 5; Hüseyin Avni Göktürk, "Inadequacy of our Suretyship Law and the New Swiss Suretyship Law", AÜHFD, C. 7, S. 3-4, 1950, p. 346; Ata Karatay, "A Comparative Study on the Amended Suretyship Provisions of the Swiss Code of Obligations", IBD, C. 26, S. 11-12, 1952, pp. 629-630; Pierre Cavin, (Amil Artus), "Yeni Kefalet Hukuku", Adalet Dergisi, S. 8, 1942, p. 997.)
4. ...The position of the creditor has been strengthened by accepting the presumption of succession for execution sureties" (Government justification for Law No. 538),
5. Timuçin Muşul, Execution and Bankruptcy Law Volume II, 6th Edition, Adalet Publishing House 2013, p. 1082; Tanrıver, Execution with Writ, p. 128; Talih Uyar, Execution Documents, Journal of Ankara Bar Association 2004/3, p. 75; Baki Kuru, Enforcement and Bankruptcy Law Handbook, p. 896; Süha Tanrıver, Enforcement and Appeal Sureties, Ankara Bar Association Journal, 1989/6, p. 972; Talih Uyar, Enforcement and Bankruptcy Law Commentary C.2, Feryal Printing, 2nd Edition, Ankara 2009, p. 3333.
6. Decision of the Court of Cassation General Civil Council dated 10/02/2010 with the Merits No. 2010/22 and Decision No. 2010/60 (www.hukuktürk.com).
7. Muşul, p. 1083; Decision of the 12th Civil Chamber of the Court of Cassation dated 07/07/2011, with the Merits No. 2010/33472 and Decision No. 2011/14889 (www.hukuktürk.com). Pursuant to Article 582 paragraph 1 sentence 2 of the TCO, "a suretyship agreement may be concluded for a debt that will arise in the future or that is subject to a condition, in order to become effective when this debt arises or the condition is fulfilled". While suretyship agreements may be subject to a delaying or cancelling condition, enforcement suretyships cannot be subject to such a condition due to their nature. However, it may be possible to regulate the enforcement suretyship by stipulating a certain due term.
8. Decision of the 12th Civil Chamber of the Court of Cassation dated 21/02/2011 with the Merits No 2010/21262 and Decision No. 2011/1181 (www.hukuktürk.com).
9. Muşul, p. 1084; " ....But since the validity of the suretyship can be examined upon the objection of the surety after the enforcement order is sent...", Decision of the 12th Civil Chamber of the Court of Cassation dated 24/10/2005 with the Merits No. 2005/16843 and Decision No. 2005/20657 (www.hukuktürk.com).
10. LAW OF OBLIGATIONS AND ENFORCEMENT Atatürk University Faculty of Law, Department of Civil Procedure and Enforcement - Bankruptcy Law Burçin Yazıci, ENFORCEMENT SURETY IN THE FRAMEWORK OF ENFORCEMENT LAW p.15.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
