Compensation for unjust occupation is a sum that an owner may claim from a person using its immovable property without permission, and because it arises irrespective of whether the occupier is at fault, it is also referred to in practice as compensation for wrongful occupation. This claim is not confined to immovable property in private ownership; it also arises in respect of publicly owned immovable property. Persons considered to be occupying an immovable property belonging to a public body or institution are served with a notice of compensation for unjust occupation, issued on the basis of an immovable property determination report drawn up by the administration.
Since the notice served is a final and enforceable administrative act, it is subject to the objection and annulment procedure laid down for administrative acts. In order to obtain the annulment of a notice of compensation for unjust occupation found to be unlawful, an application may be made to the administrative court within 60 days of service, within the framework of the Administrative Procedure Act No. 2577. It is also possible to request correction of the notice before bringing an action; for that purpose, a petition must be submitted to the administration concerned within 30 days of the date of service. The administration receiving the application is expected to reply within 30 days. If no reply, whether favourable or unfavourable, is received within that period, the request is deemed to have been rejected, and recourse to the courts may be had within the time limit for bringing an action running from the date of rejection.
In practice, notices are frequently issued for public immovable property by metropolitan municipalities, provincial and district municipalities, National Property units and governorships. Persons who consider that the notice served on them is unlawful may have the act set aside by way of objection or of an action.
Why Is the Notice a Final and Enforceable Administrative Act?
A notice of compensation for unjust occupation issued by the administration is generally regarded as a final and enforceable administrative act. Accordingly, when the unlawfulness of the notice is pleaded, the requirements of the objection or annulment procedure laid down for administrative acts must be observed.
The annulment of an act open to review by the administrative courts depends on at least one of the elements of competence, cause, form, subject matter and purpose being defective. That said, the existence of such a defect, and the fact that an action has been brought on that basis, does not affect the validity of the act until the action is concluded or a stay of execution is ordered. This is because administrative acts benefit from a presumption of lawfulness; in other words, the act continues to produce effects until it is annulled by a court. Objections to administrative acts and actions for annulment are a subject that must be addressed in detail in its own right.
The Immovable Property Determination Report
When the administration learns that an immovable property belonging to it is being wrongfully occupied, it draws up an Immovable Property Determination Report, and the amount of compensation for unjust occupation is set on the basis of that report. Whether the notice can stand as a matter of law depends on the lawfulness of the report on which it is founded. The elements that the report must contain are listed in Article 5(1) of the General Communiqué on National Property (No. 336). Accordingly, the information the report must contain in order to be valid is as follows:
- The persons occupying the immovable property,
- The date on which the occupation began,
- The surface area of the immovable property subject to the occupation or use,
- The purpose for which the immovable property is being used,
- Data that may be relied on in assessing the amount, together with any other information considered useful.
Since a report in which even one of these elements is missing will be treated as invalid, a notice issued on the basis of it is likewise devoid of legal value from the outset. Within 15 days of the day on which the wrongful occupation was established according to the report, the competent commission must assess the amount payable in respect of the immovable property.
Elements the Notice of Compensation for Unjust Occupation Must Contain
After the determination report has been drawn up, the competent commission assesses the amount within the 15-day period running from the day on which the occupation was established. The notice to be issued on the basis of that assessment is expected to contain the following information:
- The name, Turkish identity number and address of the person in the position of occupier,
- The address at which the occupied immovable property is situated,
- The administration’s share or square-metre portion in the immovable property concerned,
- The surface area of the occupied land, the nature of the occupation and the monthly amount of compensation assessed,
- The date and number of the commission decision on which the notice is founded,
- The total amount claimed and the period to which that debt relates,
- The period allowed to the occupier for payment,
- A warning that, in the event of non-payment, the administration may exercise its power of eviction and may collect its claim, together with default interest, by way of compulsory enforcement.
Where these elements are missing, annulment may be sought on the ground that the notice is defective as to form.
Competence in Assessing the Amount and Issuing the Notice
Where unauthorised use of an immovable property belonging to the administration is established, the amount is assessed within 15 days of the date of determination. The body making that assessment varies according to who owns the immovable property: if the property belongs to the Treasury, the Valuation Commission is competent; if it belongs to a municipality, the Mayoralty Valuation Commission is competent.
It is a statutory requirement that the commission convene with the participation of all its members. Since a decision assessing the amount taken with members missing will be defective as to competence, a notice issued on the basis of that decision likewise becomes unlawful.
The rule that commission members may not abstain constitutes a further statutory requirement; a decision taken contrary to that rule is vitiated by unlawfulness.
Assessment of the Amount of Compensation for Unjust Occupation
Whether the amount can be assessed lawfully depends on the commission carrying out an examination and evaluation of sufficient scope. Without prejudice to any additional research required by the particular case, the criteria that must always be taken into account during the assessment are as follows:
- The location and zoning status of the immovable property,
- Its surface area and character,
- In the case of agricultural land, its yield capacity,
- Whether or not it benefits from infrastructure services,
- The manner in which the immovable property is used and whether income is derived from the occupation.
The commission is under a duty to carry out a search for comparables consistent with these characteristics of the immovable property. In other words, the rents or amounts of compensation for unjust occupation applied to nearby immovable properties of a similar character must always be taken into account in the new assessment. In assessing the amount, the opinions of bodies that may be expected to have knowledge of the immovable property — such as the municipality, the chamber of commerce, the chamber of industry, the chamber of agriculture and the commodity exchange — must also be sought. Where an action for annulment has been brought, the court must order an examination by a court-appointed expert in order to establish whether the characteristics of the immovable property correspond to those in the determination report and what the amount ought to be. The lawfulness of the findings and of the amount set out in the notice of compensation for unjust occupation can be revealed only in this way; a judgment given otherwise may constitute a ground for reversal on account of an incomplete examination.
Accordingly, an amount assessed without a search for comparables meeting the criteria listed above is unlawful. By the same token, an amount assessed without obtaining opinions from the administrative authorities and professional chambers with sufficient knowledge of the immovable property cannot be regarded as lawful.
Whether the administration may claim compensation for unjust occupation where structures serving a public purpose have been erected on Treasury property and the occupation has arisen in that way is a question that must be addressed separately under the heading of the administrative notice of compensation for unjust occupation.
For Which Period of Occupation May Compensation for Unjust Occupation Be Claimed?
Article 5(2) of the Communiqué on National Property contains the following provision:
General Communiqué on National Property (No. 336), Art. 5(2)
“It is a principle that determinations in respect of immovable properties be carried out at least once a year. However, in compulsory situations, the duration of determination programmes may exceed one year. Nevertheless, determination programmes may not be drawn up for a period longer than five years. In the preparation of the programmes, regard shall be had to the matters that immovable properties be subject to determination at least once every five years, that immovable properties deemed important be subject to determination every year, that immovable properties used for agricultural purposes be subject to determination with their harvest times also taken into account, and that immovable properties within municipal adjacent areas be subject to determination every year (over a longer period in compulsory cases). The defterdars in the provinces and the finance officers or, where they exist, the national property directors in the districts shall take the necessary measures for these determinations to be carried out.”
As a rule, the calculation is carried out on the basis of determinations made once a year; that interval may be extended where necessary. In every case, however, notices concerning compensation for unjust occupation calculated over a period longer than 5 years will be unlawful.
Excessive Increases and Changes in the Amount
One of the disputes most frequently encountered in this field is an extraordinary increase in the amount even though the immovable property continues to be used in the same manner. For example, if an immovable property belonging to a municipality has been operated as a kiosk for many years and the amount has been increased several times over without any other reason being given, even though there has been no change in the manner of use, the increase made is unlawful. Both the legislation and settled case law allow an action to be brought seeking annulment of a notice founded on such an increase. The relevant part of a decision of the Council of State on the subject reads as follows:
Council of State, 10th Chamber, E. 2018/744, K. 2019/7544, 7.11.2019
“In this situation, whereas a decision ought to have been given in assessing the amount of compensation for unjust occupation by comparison with the amounts of compensation for unjust occupation for the previous period arising from the use of the immovable property in the same manner, with comparable amounts of compensation for unjust occupation and rents, and with the immovable property forming the basis of the respondent administration’s valuation, and in such a way as to be not less than 3% of the property tax value of the immovable property, (…)”
Accordingly, occupiers who continue to use the immovable property in the same manner may obtain the annulment of new amounts that are to be regarded as excessive when compared with those of the previous period. To that end, it is sufficient to apply to the administrative court within the 60-day period running from service of the notice on them.
Objection Against the Notice of Compensation for Unjust Occupation
A person on whom a notice has been served and who considers the determination to be erroneous may apply by petition to the administration that adopted the act and request its correction. The petition must be submitted within 30 days of service. The administration, for its part, decides on the request within 30 days of the date of the application. The commissions examining a request for correction have the power to carry out, or arrange for, an on-site examination where they need to do so. Those commissions are also under a duty to observe the rules on convening with the full number of members, taking decisions by majority and not abstaining.
A person wishing to bring an action against the notice is not required to pursue the objection route first; an action for annulment may be brought directly. This point was expressly emphasised in a recent decision of the Assembly of Administrative Law Chambers of the Council of State:
Council of State, Assembly of Administrative Law Chambers, E. 2016/10, K. 2017/4317, 14.12.2017
“(…) although the objection route following a notice of compensation for unjust occupation is not a route that must absolutely be exhausted, where those concerned have recourse to it and request correction, the administration is obliged to consider that request, decide upon it and serve on the person concerned a corrected notice of compensation for unjust occupation.”
Action for Annulment of the Notice of Compensation for Unjust Occupation
As we stated at the outset, the notice is a final and enforceable administrative act. An action may therefore be brought against the administration on the ground that it is defective in respect of any one of the elements of cause, subject matter, purpose, form or competence. The action must be brought within 60 days of the date of service. Where, on the other hand, an objection has first been made to the administration, the time limit for bringing an action is suspended; following any decision by which the administration rejects the request for correction, the suspended time limit resumes running from where it stopped.
To illustrate with an example: where the objection route is taken 15 days after service, the 60-day period is suspended. From the date on which the decision rejecting the objection is served on the person concerned, an action may then be brought before the administrative court within the remaining 45 days.
Frequently Asked Questions
Is representation by a lawyer mandatory before the administrative court?
Turkish law allows parties to defend and represent themselves in person before the courts; save for a few limited exceptions, representation by a lawyer is not mandatory. No such requirement is laid down for the administrative courts either. However, because of the complexity of administrative law legislation and the short and strict time limits laid down in the Administrative Procedure Act No. 2577, errors of procedure and of substance that are difficult to remedy may be made where the process is conducted by persons who are not lawyers. It is therefore advisable to obtain assistance from lawyers practising in the field of administrative law before any step is taken.
What are compensation for unjust occupation and the notice of compensation for unjust occupation?
Compensation for unjust occupation is compensation claimed on account of the use of an immovable property belonging to the administration by natural or legal persons without permission having been obtained, irrespective of whether the administration has suffered loss and of whether the user is at fault. The notice, for its part, is the document sent by the administration to a person alleged to be using the immovable property without a contractual basis, stating that the amount assessed must be paid within the period allowed.
What can be done if the amount is considered excessive compared with comparables?
The Valuation Commission is under a duty to carry out a search for comparables consistent with the characteristics of the immovable property. A person who finds the amount assessed excessive compared with its comparables may lodge an objection with the administration within 30 days of the day on which the notice was served. Where the objection is rejected or only partly upheld, an action for annulment of an administrative act must be brought before the administrative court in order to have the notice annulled.
For how many years in arrears may compensation for unjust occupation be claimed at most?
Compensation for unjust occupation may be calculated in respect of a person alleged to be occupying Treasury property only for a period of five years running backwards from the date on which the occupation was established. If the notice has been issued for a period exceeding five years counted back from the date of determination, it must be annulled.
May compensation for unjust occupation be claimed for an immovable property under a lease agreement?
Compensation for unjust occupation arises where Treasury property is used without the administration’s permission and without any contractual relationship. It is unlawful to issue a notice in respect of an immovable property used on the basis of a lease agreement. An objection may be lodged with the administration within 30 days of service of such a notice; where the objection is rejected or only partly upheld, an action for annulment must be brought before the administrative court.
Does a debt for compensation for unjust occupation issued in the name of the deceased come to an end?
Since a notice issued by the administration in respect of the deceased is not penal in character, the debt is not extinguished by the death of the deceased. The heirs are jointly and severally liable for the debt set out in the notice.
Does payment of the amount prevent eviction?
The fact that payment has been made does not prevent eviction from Treasury property. Upon the request of the administration, the occupied immovable property is vacated through the local civil administrative authority within a period of no more than 15 days and handed over to the administration.
Is partial annulment of the notice possible?
If, following the on-site examination and the examination by a court-appointed expert carried out in the action for annulment, it is concluded that the true amount is lower than that stated in the notice, partial annulment of the notice may be ordered.
The Independent Legal Assessment
Although in disputes over compensation for unjust occupation the file is often first argued on the basis of the size of the amount, the reasoning that actually leads to annulment is usually procedural. A deficiency in the determination report, the commission convening with members missing, or the amount being assessed without a search for comparables may result in the act being set aside without the merits being reached. When a defence strategy is being built, the lawfulness of the underlying documents should therefore be reviewed first, and the argument over the amount left to a second stage.
The following points are recommended for consideration in managing the process:
- Reviewing, on the face of the document, whether the determination report contains the mandatory elements
- Examining the commission decision in terms of the quorum for convening and for taking decisions, and comparing the date and number of the decision with the notice
- Calculating whether the period claimed exceeds five years counted back from the date of determination
- Making a comparison with the amounts for previous periods so as to substantiate an allegation of an excessive increase in numerical terms
- Diarising the 30-day period where the objection route is to be taken, or the 60-day period where an action is to be brought directly, and correctly calculating the suspended period
- Expressly pleading in the petition, at the litigation stage, a request for an on-site examination and an examination by a court-appointed expert
Independent Legal provides advisory and litigation services throughout the entire process in disputes over compensation for unjust occupation concerning public immovable property, from the preparation of the objection petition through to the conduct of the action for annulment.
This briefing note has been prepared for general information purposes. Since administrative law legislation, and in particular the Administrative Procedure Act No. 2577, contains more detailed rules than other branches of law, we recommend obtaining legal assistance from lawyers practising in this field before any step is taken, so that no rights are lost.