An action for the annulment of the title deed and registration based on incapacity arises where the person carrying out the transaction lacked the capacity to perform legal transactions at the moment the immovable was transferred. Through this action, the invalidity of a sale or gift effected by a person without capacity to act is asserted; the deletion of the land registry record and the re-entry of the immovable in the name of the former owner are sought.
The decisive criterion in such files is not the person’s general state of health but whether they had capacity of discernment on the day the transaction was carried out. A plea of incapacity is therefore examined by assessing the particular circumstances of the case together with the medical data.
Below we address in detail the concept of incapacity, the situations in which transactions will be deemed invalid, the parties to the action, the regime of time limits, the conduct of the proceedings and the decisions that may be given.
The Concept of Legal Incapacity
Incapacity describes the situation in which a person’s ability to perform legal transactions is either wholly absent or restricted. For the purposes of the Turkish Civil Code, capacity of discernment is the precondition for concluding a valid transaction. Transactions carried out by a person lacking that capacity are as a rule deemed invalid from the outset.
For that reason, the real question to be answered in files concerning the annulment of the title deed and registration based on incapacity is not the person’s general state of health, but whether capacity of discernment was present on the date of the transaction.
Definition of Incapacity
Incapacity means that a person lacks the ability to conclude transactions producing legal consequences. Under our law, for capacity to act to be spoken of, the person must have capacity of discernment, must be of full age and must not be under restriction.
Among these elements, capacity of discernment lies at the centre of incapacity actions. Transactions concluded by a person deprived of that capacity through mental illness, dementia, serious illness or similar causes are treated as invalid.
In Which Cases Is a Transaction Deemed Invalid?
For the invalidity of a legal transaction to be spoken of, the person must have lacked capacity of discernment on the day of the transaction. A sale, gift or similar disposition made in such circumstances produces no legal consequences.
By way of example;
- A transaction concluded while under the heavy influence of medication or alcohol
- A transfer of an immovable carried out by a patient with advanced-stage dementia
- A sale made by a person suffering from severe mental illness
are situations in which the transaction may be deemed invalid. That assessment is, however, made within the circumstances of each individual case and as a rule must be supported by medical data.
The Distinction Between Full Incapacity and Limited Capacity
Full incapacity is the situation in which a person lacking capacity of discernment cannot conclude any legal transaction at all. Transactions made by such persons are treated as invalid from the outset.
In limited capacity, by contrast, the person does have capacity of discernment, but cannot carry out certain transactions alone. Such persons may perform particular transactions only with the consent of their legal representatives.
Accordingly, whereas in the case of full incapacity the transaction is regarded as absolutely void, transactions concluded in the case of limited capacity are for the most part regarded as voidable.
The Effect of Conditions Such as Mental Illness, Advanced Age and Dementia
Mental illness, dementia, Alzheimer’s disease and similar conditions may remove a person’s capacity of discernment entirely, or may weaken it considerably. The validity of transactions concluded in such circumstances is assessed on the basis of the person’s mental state on the day of the transaction.
Nevertheless, merely being of advanced age or having received a diagnosis does not on its own produce a finding of incapacity. What is decisive is whether the person was able to grasp the consequences of the transaction they concluded and whether they were able to form their will soundly.
The Decisive Role of the Condition at the Time of the Transaction
The most critical point in these files is whether the person had capacity of discernment on the date of the transfer. Having fallen ill before or after the transaction does not on its own render the transaction invalid.
The courts therefore look in particular for the answer to the following question:
“Did the person have capacity of discernment on the date on which the immovable was transferred?”
This point is generally determined by assessing:
- Witness statements
- Medical opinions
- Hospital records
- The report of a court-appointed expert
- Health reports
together.
In Which Situations Does Incapacity Arise?
Incapacity is in issue where there are circumstances that remove or seriously restrict a person’s ability to perform legal transactions. Not every health problem or advanced age, however, leads to that result of itself. What matters is whether capacity of discernment was present on the day of the transaction.
In practice such allegations are assessed through medical findings, hospital records and expert reports; the courts reach their conclusions according to the particular circumstances of each case.
Mental Illness or Mental Weakness
Mental illness and mental weakness are among the principal causes capable of removing capacity of discernment. In such circumstances the person may not be in a position to appreciate the consequences the transaction they conclude will produce.
Schizophrenia, bipolar disorder, severe depression and similar psychiatric conditions may lead to a finding that capacity of discernment was absent on the date of the transaction. Even so, the existence of the illness is not regarded as sufficient on its own; what really matters is the effect of the illness at the moment of the transaction.
Dementia, Alzheimer’s Disease and Similar Conditions
Illnesses such as dementia and Alzheimer’s disease may considerably weaken memory, judgement and decision-making ability. These diagnoses are therefore frequently relied upon in pleas of incapacity.
In such files the courts weigh the stage the illness had reached and the person’s mental state on the date of the transaction in the light of medical documents and expert opinions. Transactions concluded in the advanced stages of the illness in particular are in most cases treated as invalid.
Age-Related Cognitive Decline
Advanced age does not of itself amount to incapacity. Where, however, there is age-related cognitive decline, forgetfulness or serious weakening of the faculty of judgement, it may be concluded that the person lacked capacity of discernment.
The courts therefore do not look at the person’s age alone; they carry out their assessment having regard also to the person’s mental state, their abilities in daily life and their conduct at the time of the transaction.
Transactions Concluded Under the Influence of Alcohol, Narcotics or Medication
Situations leading to a temporary loss of capacity of discernment may also be considered within this scope. Transactions concluded under excessive consumption of alcohol, the use of narcotic substances or the effect of strong medication in particular may be deemed invalid.
What is decisive in these situations is whether it can be established by concrete evidence that the person lost control of their consciousness and will at the time of the transaction.
Transactions Carried Out by a Person Under Guardianship
Persons placed under guardianship by court order carry out their legal transactions as a rule through their legal representatives. Transactions concluded by a person under guardianship acting alone are in most cases treated as invalid.
The existence of a guardianship order therefore constitutes an important presumption for the purposes of pleas of incapacity. The validity of the transaction is nevertheless assessed according to the circumstances of the particular case.
Parties to the Action
In actions for the annulment of the title deed and registration based on incapacity, correctly identifying the parties is decisive for the sound conduct of the proceedings. As a rule the person alleged to have lacked capacity at the time of the transaction, or their heirs, is the claimant; the person who acquired the immovable, or a subsequent owner, holds the status of respondent.
In some situations the action must be directed against several persons jointly. Where the immovable has changed hands, or has been transferred to more than one person, the action must be brought against all those concerned.
Standing as Claimant
This action may be brought by the person alleged to have lacked capacity at the time of the transaction, or by those empowered to protect their rights.
The persons who may act as claimant are principally the following:
- Heirs
- The guardian or the trustee
- The person alleged to have lacked capacity
- Other persons holding a legal interest deserving protection
- The legal representative
Where the person lacking capacity has died, the action is mostly brought through the heirs. As regards persons under guardianship, the process is generally conducted through the guardian or the trustee.
Standing as Respondent
The action is as a rule directed against the person who acquired the immovable from the person lacking capacity. Where the immovable has subsequently been passed on to others, the action must be brought against the last owner or against the person holding a right over the immovable.
Within this scope the following persons may stand as respondent:
- Persons holding a right in rem over the immovable
- The person who acquired the immovable
- The subsequent owner or third parties
Situations Involving Mandatory Joinder of Parties
In certain situations the action must be directed against several persons jointly. In particular, where:
- A right in rem has been created over the immovable
- The immovable has been transferred to more than one person
- The immovable is subject to co-ownership in shares
the action must be brought against all those concerned. Otherwise the action may be dismissed on procedural grounds.
Is There a Statute of Limitations in an Incapacity Action?
Actions for the annulment of the title deed and registration based on incapacity are as a rule not subject to any statute of limitations or preclusive period. The reason for this is that such actions are directed at setting aside the invalid transaction concluded by the person lacking capacity and at protecting the right of ownership.
Since transactions carried out by a person deprived of capacity of discernment are treated as legally invalid, actions of this kind are generally not made subject to any particular time limit.
Within this framework:
- The fact that the person lacking capacity did not have recourse to the courts for a long period
- The fact that the immovable has been used for years by the person who acquired it
- The fact that many years have passed since the transaction
do not on their own require the dismissal of the action.
The Proceedings
Since actions for the annulment of the title deed and registration based on incapacity concern ownership of an immovable and therefore rights in rem, they are conducted within a particular procedural framework.
A technical examination is carried out in most proceedings; where a medical assessment is required, a court-appointed expert report is obtained. The courts do not confine themselves to the diagnosis given; they assess the person’s mental state, conduct and decision-making ability at the time of the transaction as a whole. Incapacity files are therefore among the actions requiring a detailed examination of the evidence.
Courts with Subject-Matter and Territorial Jurisdiction
In these actions subject-matter jurisdiction as a rule lies with the Civil Court of First Instance.
As regards territorial jurisdiction, the action must be brought before the court of the place where the immovable is situated. That rule is one of exclusive jurisdiction and cannot be varied by agreement between the parties. The file must accordingly be opened before the Civil Court of First Instance at the place where the immovable is situated.
Application for an Interim Injunction
In incapacity actions an interim injunction may be sought in order to prevent the immovable in dispute from being passed on to third parties. If there is a possibility that the immovable will change hands during the proceedings, the entry of a prohibition on sale and transfer in the land registry record may be requested from the court.
That application may be made when the action is brought and may equally be raised as the proceedings continue. Where the claimant establishes their case to the standard of prima facie proof, the court may order an injunction temporarily preventing the transfer.
Burden of Proof and Evidence
In these actions the claimant bears the burden of proving that the person lacked capacity of discernment on the date the transaction was carried out. The decisive element for the outcome is therefore the quality and sufficiency of the evidence submitted.
The evidence most frequently relied on in practice is the following:
- Land registry records and official transaction documents
- Forensic medicine or court-appointed expert reports
- Health reports and hospital records
- Records and information concerning the person’s daily life
- Witness statements
The court assesses this evidence as a whole in seeking to establish the person’s mental state on the date of the transaction.
Court Fees and Litigation Costs
Actions for the annulment of the title deed and registration based on incapacity are as a rule among the files subject to an ad valorem fee. The fee calculated over the value of the immovable must therefore be paid when the action is brought.
In the course of the proceedings items such as:
- Witness expenses
- Costs of the on-site examination
- The court-appointed expert’s fee
- Service costs
may also arise. At the conclusion of the proceedings these costs are as a rule borne by the losing party.
Attorney Fees
At the conclusion of these actions, attorney fees are awarded in favour of the successful party in accordance with the Minimum Attorney Fee Tariff. As the file is subject to an ad valorem fee, the attorney fees are likewise calculated on an ad valorem basis.
Depending on the agreement signed between the party and their lawyer, contractual attorney fees may also be in issue.
Appellate Remedies
Judgments given in actions for the annulment of the title deed and registration based on incapacity are open to appellate remedies. An appeal may be lodged within 2 weeks of the date of service against the judgment of the court of first instance.
Judgments given at the conclusion of the appeal examination may in turn be taken to appeal on points of law if they exceed the monetary threshold laid down in the statute.
Outcomes of the Action
If the court finds that the person lacked capacity of discernment on the date the transaction was carried out, it will hold the conveyance effected to be invalid. In that case the land registry record created unlawfully is annulled and the re-registration of the immovable in the name of the true holder of the right is ordered.
The outcome of the action is not, however, confined to the annulment of the record. Depending on the features of the case, registration of the immovable in the name of the former owner, registration in the names of the heirs in proportion to their shares, or, in certain situations, an award of damages, are all possible.
Annulment of the Land Registry Record
If the court concludes that the person lacked capacity on the date of the transaction, the sale, gift or similar disposition made by that person is treated as legally invalid. The land registry record created as a result of that transaction is therefore annulled.
With the annulment of the record, the transfer of ownership effected unlawfully is set aside.
Registration of the Immovable in the Name of the Former Owner
Together with the annulment of the record, the court orders the re-registration of the immovable in the name of the person found to have lacked capacity. The immovable thus returns to the owner it had before the transaction was carried out.
If the person lacking capacity has died, the immovable is registered in the names of their heirs.
Registration in Proportion to Inheritance Shares
Where the person alleged to have lacked capacity has died and the action has been brought by the heirs, the court may order the registration of the immovable in the names of the heirs in proportion to their shares.
This outcome is encountered particularly frequently in disputes involving more than one heir.
Claim for Damages
In some situations annulment of the land registry record may not be possible. Where the immovable has passed to a third party acting in good faith in reliance on the register in particular, a claim for damages arises in place of annulment.
In such situations claimants may seek compensation for the loss they have suffered. That loss most often takes the form of the value of the immovable or of the losses arising from being deprived of its use.
Related Topics
For disputes of a similar nature, the following topics may also be examined:
- Action for Annulment of Title Deed and Registration on the Ground of Wrongful Registration
- Action for Annulment of Title Deed and Registration on the Ground of a Forged Document
- Action for Annulment of Title Deed and Registration on the Ground of Abuse of a Power of Attorney
- Action for Annulment of Title Deed and Registration Based on a Fiduciary Transaction
- What Is an Action for Annulment of Title Deed and Registration? In Which Cases Is It Brought?
Independent Legal Assessment
In incapacity files, the element determining the fate of the proceedings is not the allegation itself but the quality of the medical records relating to the day of the transaction. Where prescriptions issued close to the date of the transfer, hospital attendances, neurology and psychiatry examination notes and care records have not been gathered, the forensic medicine examination frequently fails to reach a definite conclusion. At the same time, since the likelihood of the immovable being passed on to third parties acting in good faith increases with every passing day, raising an application for an injunction at the very moment the action is brought carries particular importance.
In a concrete dispute the following headings should be prioritised:
- Obtaining in full the health records covering the date of the transaction
- Including in the statement of claim an application for a prohibition on transfer to be annotated on the land registry record
- Tracing the chain of transfers of the immovable and constituting the parties accordingly
- Investigating at the outset whether a guardianship or restriction order exists
- Correctly determining the value on which the ad valorem fee is based, so as to eliminate the risk of an underpaid fee
- Assessing an alternative claim for damages against the possibility that annulment is not available
Independent Legal provides advisory and litigation services in disputes concerning ownership of immovables, from the assessment of a plea of incapacity through to the implementation of the registration judgment.