New development
Law No. 7445 on the Amendment of the Execution and Bankruptcy Law and Certain Laws (“Law“), published in the Official Gazette dated 5 April 2023 and numbered 32154, made significant amendments to Law No. 6326 on Mediation in Civil Disputes (“Mediation Law“) and expanded the scope of disputes that can be resolved through mandatory and voluntary mediation.
This legal alert provides details regarding voluntary and mandatory mediation provisions introduced by the Law in relation to real estate and rental law disputes. You may access a legal alert where we provide a more comprehensive analysis of the other amendments made under the Law, here.
What does the Law regulate?
- Voluntary mediation has been introduced for the resolution of certain real estate disputes.
Pursuant to Article 17/B of the Mediation Law introduced by the Law, disputes regarding the transfer of immovable property or the establishment of limited rights in rem on an immovable property are now eligible for voluntary mediation.
If the parties agree in writing and the mediator makes a record of this decision, upon the request of the mediator, an annotation may be made to the land registry regarding the restriction of the power of disposition for a period not exceeding three months and limited to the mediation process. This annotation will be removed upon the request of the mediator if the parties cannot agree or if the parties agree to remove the annotation; otherwise it will be removed automatically at the end of the three-month period.
In the event that the parties agree at the end of the mediation process, the settlement document will be issued by observing the limitations, procedures and principles set forth in the laws regarding the transfer of the immovable property or the establishment of limited rights in rem on the immovable property.
- Mediation has been introduced as a procedural prerequisite for some real estate and rental law disputes.
Pursuant to Article 18/B of the Mediation Law introduced by the Law, it is necessary to apply for a mandatory mediation before filing a lawsuit in the following disputes: disputes arising from a lease relationship (except for provisions regarding the evacuation of leased immovable property through execution proceedings without judgment according to Enforcement and Bankruptcy Law No. 2004), the allocation of movable and immovable property, and the elimination of joint ownership and disputes arising from Condominium Law No. 634 and the neighboring rights regulated under Turkish Civil Code No. 4721.
If the parties reach an agreement at the end of the mediation process, the settlement document will be issued by observing the limitations, procedures and principles set forth in the laws regarding the immovable property.
These amendments will enter into force on 1 September 2023.
Conclusion
The introduction of voluntary mediation for disputes related to the disposal of immovable property resolved the debate as to whether such disputes are suitable for mediation.
In addition, the introduction of mandatory mediation for some real estate and rental law disputes and the obligation for the parties concerned to apply to a mediator before filing a lawsuit — particularly for rental law disputes, the number of which is increasing rapidly these days — are positive developments in terms of easing the workload of the courts and resolving disputes faster.
