Press Release No: Constitutionality Review 14/22

Press Release concerning the Decision Annulling the Provision Characterising the Onerous Dispositive Transactions between Spouses as Donation

The Constitutional Court, at its session dated 16 December 2021, found unconstitutional and annulled the amended Article 278 § 3 (1) of the Enforcement and Bankruptcy Law no. 2004, insofar as it related to the phrase “spouses …”, and held that the relevant decision would be effective after nine months as from the date of its publication in the Official Gazette (file no. E. 2021/52). 

Contested Provision

It is stipulated in the contested provision that the onerous dispositive transactions between spouses, ascendants, descendants, relatives by marriage up to the third degree (including this degree), the adopter and the adoptee shall be considered as donation.

Ground for the Request for Annulment

It was maintained in brief that the contested provision, which stipulated that all dispositive transactions between the debtor and her/his spouse -who was the third person and not a party to the debtor-creditor relationship- during a period when the former still had the full authority for dispositive transactions shall be considered as donation, limited the spouses’ right to property, which was contrary to the principle of equality. It was further argued that not enabling those concerned, in the course of the actions to be brought, to prove that the impugned dispositive transaction had been genuine and the relevant price had been paid, as well as not allowing the person in favour of whom the impugned transaction had been made to defend herself/himself impaired the essence of the right to legal remedies. In this regard, the contested provision was claimed to be unconstitutional.

The Court’s Assessment

The impugned provision restricts the right to property as well as the right to legal remedies, as it provides that in the actions for annulment of the dispositive transactions, the onerous dispositive transactions between spouses, one of whom is the debtor, shall be considered as donation.

Pursuant to Article 13 of the Constitution, fundamental rights and freedoms may be restricted only by law and in conformity with the reasons mentioned in the relevant articles of the Constitution, and such a restriction must be proportionate. In this sense, the formal existence of a statutory regulation which intends to restrict the right to property and right to legal remedies is not sufficient, and the applicable provisions must also be definite, accessible and foreseeable, in order to avoid all risks of arbitrariness. Therefore, the legality, which is specified as a criterion for restriction in Article 13 of the Constitution, should be interpreted in the light of the principle of rule of law enshrined in Article 2 of the Constitution.

It is set forth in Article 35 § 2 of the Constitution that the right to property may be restricted by law only in view of public interest. On the other hand, no ground for restriction is specified in Article 36 of the Constitution regarding the right to legal remedies; however, it is acknowledged that the rights for which no specific reason for restriction is envisaged are also subject to certain limitations stemming from the nature of the right. Besides, a given right of this nature may be restricted on the basis of the rules embodied in other articles of the Constitution.

The notion of public interest also brings about the discretionary power conferred upon public authorities, and this criterion, which does not have an objective definition, should be considered separately in the particular circumstances of each case. In this scope, it is apparently aimed at through the contested provision that the debtor’s any attempt not to pay her/his debt to the creditor and the latter’s unsuccessful efforts to collect her/his receivables will be prevented; that given the difficulty in revealing the actual will of the parties of the dispositive transaction, which is often implicit, the creditor shall be thereby subject to a less strict rule on the burden of proof; and that in this way, a contribution shall be made to the maintenance of economic balance, peace and justice within the society.

In addition, the entitlement to bring an action for the annulment of dispositive transactions and the annulment of onerous dispositive transactions, which are considered as donations, are conditional upon the fulfilment of certain conditions. Accordingly, in cases where the execution proceedings are finalized, but the receivables could not be collected partially or completely, then an action for annulment can be brought, and only the disposition transactions made by the debtor after the given debt to the creditor has been incurred may be annulled. Besides, a time-limit is prescribed for the annulment of dispositive transactions, according to which only the transactions made in the last two years, retroactively, starting from the date of attachment, insolvency or opening of bankruptcy can be annulled, and an action for annulment can only be filed within a period of five years starting from the date of the impugned transaction. In consideration of the foregoing, it is clear that in view of the contested provision, the right to bring an action for annulment was made conditional upon certain circumstances.

In addition, it is set forth in the contested provision that the onerous dispositive transactions between the debtor and her/his spouse shall be considered as donation, regardless of any other conditions, and the contrary can be neither argued nor proven. Thus, it will be no of importance whether the price of the property subject to the disposition transaction was paid in full or in excess, the transaction was also in favour of the creditors, the creditors did not sustain damages due to the said transaction, and the creditors’ ability to collect their receivables or to start the compulsory enforcement proceedings was not hampered or it was facilitated. The contested provision stipulating that the onerous dispositive transactions between the debtor and her/his spouse shall definitely be considered as donation precludes the parties’ ability to raise claims and to defend themselves regarding the aforementioned issues, as well as to submit evidence, information and documents to prove them.

As such, the impugned provision upsets the fair balance to be struck between the general interest and the individual interest, and thus imposes a disproportionate restriction on the right to property, along with the right to legal remedies.

Consequently, the contested provision has been found unconstitutional and therefore annulled.

This press release prepared by the General Secretariat intends to inform the public and has no binding effect.