In The Sale Of A Vehicle With A Forged Power Of Attorney, The Ownership Of The Vehicle Does Not Pass To The Good Third Party

In The Sale Of A Vehicle With A Forged Power Of Attorney, The Ownership Of The Vehicle Does Not Pass To The Good Third Party

General Assembly of Civil Chambers 2017/1422 E. , 2021/321 K.

“Case Law Text”

COURT :Civil Court of First Instance

1. At the end of the trial held due to the “determination and registration of vehicle ownership” case between the parties, the decision on the acceptance of the case given by the Fethiye 3rd Civil Court of First Instance was reversed by the 4th Civil Chamber of the Court of Cassation upon appeal by the defendant’s attorney, and the Court resisted against the reversal decision of the Special Chamber.
2. The decision of resisting was appealed by the defendant’s attorney.
3. After the documents in the file were examined by the General Assembly of Civil Chambers, the necessity was discussed:

I. JUDICIAL PROCESS

Plaintiff’s Claim:

4. The plaintiff’s attorney claimed that the 35 HS 693 plate vehicle, which was owned by his client engaged in car rental business and rented to the non-claimant Mustafa Özçulha, was not returned in due time, and that it was learned that it was sold to the defendant with a forged power of attorney by using his client’s identity information, and requested a decision to determine that the sale of the vehicle subject to the lawsuit to the defendant is invalid and to cancel the transaction and to register the traffic registration of the vehicle in the name of his client.

Defendant’s reply:

5. The defendant’s attorney made the first objection to the jurisdiction and claimed that the competent court is the Fethiye courts; in summary in his statements at the hearings; he argued that his client was in good faith, that he had no way of knowing the forgery of the sale and documents that took place at the notary public, that his client was the complainant in the file numbered 2012/22 of the Kocaeli Heavy Criminal Court and asked for a decision to dismiss the lawsuit.

Court Decision

6. With the decision of İzmir 4th Civil Court of First Instance dated 19.11.2012 and numbered 2011/396 E., 2012/510 K., it was decided to partially accept the lawsuit; upon the appeal of the defendant’s attorney, upon the reversal decision of the 4th Civil Chamber of the Court of Cassation dated 21.01.2014 and numbered 2013/4434 E., 2014/698 K., it was stated that the competent court is the Fethiye Civil Court of First Instance; and upon the Court’s decision dated 08.05.2014 and numbered 2014/169 E., 2014/255 K., it was decided to lack jurisdiction
7. Fethiye 3rd Civil Court of First Instance dated 29.01.2015 and 2014/238 E., 2015/31 K. With the decision no; the defendant was the first owner who took over the vehicle with a forged power of attorney, but he did not have any intimacy and friendship with Mustafa Özçulha, who realised the sale by using the forged power of attorney, therefore he was not in a position to know that the power of attorney was forged,

Therefore, it was decided that the defendant was in the position of a third party in good faith and the contrary could not be proved by the plaintiff, but the sale with a forged power of attorney did not transfer ownership, and it was decided to cancel the transaction regarding the sale of the vehicle, to register and register the vehicle in the name of the plaintiff, and not to hold the defendant responsible for the costs of the proceedings due to its good faith.

Special Chamber Reversal Decision:

8. The defendant’s counsel filed an appeal against the above-mentioned decision of the Court within due time.
9. With the decision of the 4th Civil Chamber of the Court of Cassation dated 16.09.2015 and numbered 2015/9610 E., 2015/9907 K;
“…1- According to the writings in the file, the evidence on which the decision is based and the reasons in accordance with the law, especially since there is no inconsistency in the evaluation of the evidence, the appellate objections other than those covered by the following paragraph should be rejected.
2- As for other appellate objections;
a) The lawsuit is related to the request for the cancellation and registration of the traffic registration and the determination that the sale transaction is invalid due to the sale of the vehicle made with a forged power of attorney. The court decided to accept the lawsuit and the judgement was appealed by the defendant.
The plaintiff, stating that he is the owner of the 35 HS 693 plate vehicle and at the same time he is engaged in car rental business, that the person named Mustafa Özçulha rented this vehicle but did not return it in due time, that as a result of his research, he learned that the vehicle was sold to the defendant with a forged power of attorney by using his identity information, and requested the determination that the sale transaction of the vehicle subject to the case is invalid and the cancellation and registration of the traffic registration.
Defendant defended that he bought the vehicle with the power of attorney regarding the sale given by the person who appears as the owner in the traffic record, and that the lawsuit should be dismissed due to good faith.
Although the defendant defended that he was in good faith, the court decided to accept the lawsuit since the first sale made with a forged power of attorney cannot be accepted as valid.
Article 988 of the Turkish Civil Code stipulates that the acquisition of ownership or limited real rights from the possessor of a movable in good faith is protected even if the possessor is not authorised to make such disposals.
If the possessor of a property has not entrusted it to another person, but has disposed of it for a reason such as theft, usurpation or forgetfulness, his acquisition is not valid even if the third party has acquired such a property in good faith. Indeed, Article 989 of the Civil Code contains a clear regulation on this issue. The possessor whose movable is stolen, lost or otherwise disposed of against his will may file a movable action within five years against anyone who has possession of that thing.
It is seen that the law has made a distinction between the goods left in trust and the goods that leave the owner’s hands without his consent in order to protect good faith. This distinction is based on the following idea; the person who entrusts the property to another person may be considered to have more or less taken a risk and to have taken the risk that the thing entrusted to him may be transferred to another person by the recipient. On the other hand, it cannot be said that the person who disposes of a good without his consent has endured such a risk in advance.

As such, the interest of the third party who acquires the property in good faith is preferred to the interest of the person who entrusted the property, and the interest of the person who disposes of the property without his consent is not sacrificed. If a bona fide third party acquires a thing that has left the hands of its owner without his consent from an auction, a market or a person who sells such goods, the original owner’s ability to win the restitution lawsuit against this person and later taxpayers is subject to the following condition:

In such cases, the price given by the bona fide third party for the acquisition of this property must be returned to him by the plaintiff, that is, the original owner. If this condition is not fulfilled, the court cannot accept the restitution action brought by the original owner. The decision of the General Assembly of Civil Chambers dated 25/09/2002, numbered 2002/4-608 main, 2002/643 decision is in this direction.
From the scope of the file; it is understood that the plaintiff, who is engaged in car hire business, rented the vehicle belonging to him to the person introducing himself as Mustafa Özçulha and the vehicle was sold to the defendant by the person acting together with this person with a forged power of attorney containing the information belonging to the plaintiff.
Since the plaintiff rented the vehicle belonging to him to the person outside the case, the vehicle was disposed of with the consent of the owner. At this point, it is necessary to examine whether the defendant is in good faith or not. When the criminal investigation related to the incident and the evidence submitted to the file are evaluated together, the defendant should be accepted in good faith, since there is no evidence that the defendant wants to harm the plaintiff by acting together with the person who introduces himself as Mustafa Özçulha. Moreover, the court has accepted that the defendant is in good faith.
In that case; in order for the plaintiff to win the lawsuit for the determination of the ownership of the vehicle, the defendant must return the price paid by the defendant as the sale price. While the court should decide to dismiss the case if the price is not paid, it is not correct to accept the case on written grounds without payment. The decision should be reversed for this reason.

b) The court decided to cancel the registration of the vehicle subject to the lawsuit in the name of the defendant and to register it in the name of the plaintiff. Pursuant to Article 19 et seq. of the Law No. 2918, traffic registration procedures of vehicles have an administrative nature. In this respect, it is not correct to issue a registration decision that forces the administrative authorities to take a certain action. For this reason, the decision had to be reversed.”
Decision on Resistence:
10th Court’s decision dated 21.01.2016 and 2015/379 E., 2016/19 K. with the decision dated 21.01.2016 and numbered 2015/379 E., 2016/19 K; In addition to the reasons for the previous decision, although the possession of the vehicle subject to the lawsuit was transferred to the non-suit Mustafa Özçulha, this person is no longer in possession as a trustee due to the transfer of possession for a period of time and not returning it to the plaintiff at the end of the period, he was punished for the crime of abuse of trust in the criminal court and the decision became final, the vehicle subject to the lawsuit was not transferred to the defendant by this person, it was sold to the defendant with a false power of attorney issued by Kasım Orak,

which was not the case, and in the appellate examination made by the Special Chamber, the General Assembly of Law dated 25. 09.2002 dated 2002/4-608 E. and 2002/643 K. In the decision numbered 2002/4-608 E. and 2002/644 K., it is clearly stated that it is not sufficient for the person to take over in good faith alone, it is also necessary that the goods taken over should have been purchased from the places considered to be customary, that is, from an auction, a market or a seller who sells these goods, in this case, when the concrete case is considered, the vehicle in question was sold by the defendant at the auto market where the sale of vehicles is customary,

Since it is clear that it was not purchased through a gallery or auction, but was purchased directly from the defendant Kasım Orak through a forged power of attorney, it is not possible to benefit from the principles in the aforementioned decision of the General Assembly of Civil Chambers, therefore, the plaintiff is not required to return the sale price, but the defendant is not held responsible for the costs of the proceedings because the defendant is a bona fide third party;

Regarding whether a registration decision can be made regarding the vehicles, the land registry office is also an administrative institution, the execution of the judgement can be ensured by making a direct registration decision in the land registry cancellation and registration cases filed in the courts, and in the same way, in terms of vehicles, the records of the traffic registration supervision branch directorate have an explanatory nature of ownership like the land registry,

On the contrary, if only a determination decision is given by the courts in the cases for the determination and registration of the vehicles, the decision cannot be executed directly since it does not contain an execution provision, there are different jurisprudence among the Supreme Court of Appeals departments on this issue and this issue will create a contradiction in practice, and the jurisprudence should be unified.
Appeal of the Resistence Decision:
11. The resisting decision was appealed by the defendant’s attorney within the period.

II. DISPUTE

12. The dispute before the General Assembly of Civil Chambers by way of resisting;
a) In the concrete case, whether the vehicle subject to the lawsuit left the hands of the plaintiff with his consent, whether the non-suit Mustafa Özçulha was in possession as a trustee in the sense of Article 988 of the Turkish Civil Code No. 4721 (TMK), and whether the defendant, who is in the position of a bona fide third party, should be refunded the vehicle price he paid,
b) Whether it is possible to decide on the registration of the vehicle with the judgement.

III. REASON

13. It is necessary to make a separate evaluation in terms of the above-mentioned incompatibilities.
Regarding the dispute in subparagraph (a);
14. Before proceeding to the resolution of the dispute, it is useful to set forth the legal regulations and principles regarding the subject matter.
15. Movable property is regulated between Articles 762 and 778 of the Civil Code. Movables (movables) are defined in Article 762 of the TCC as “tangible things that can be transported in terms of their qualities and natural forces that are suitable for acquisition and are not covered by immovable property”. In this respect, the sale of all kinds of tangible goods that can be transported independently from one place to another without any change in their essence (e.g. automobiles, bags, armchairs, chairs, wheat, barley, etc.) is the sale of movables, as well as the sale of natural forces such as electricity, water, gas, natural gas, which are not included in the ownership of immovable property and are suitable for acquisition (property acquisition).
16. In this respect, it would be more accurate to define the sale of movables as “the sale of everything that is not immovable (real estate)”. According to Article 763/1 of the TCC, transfer of possession is required for the transfer of ownership of movable property.
17. As a rule, the validity of the sale of movables is not subject to a formal condition. According to Article 988 of the TCC;
“The acquisition of a movable by a person who acquires ownership or a limited right in rem over it in good faith from its possessor in the capacity of a trustee shall be protected even if the possessor is not authorised to make such dispositions”.

The conditions for the application of this article are as follows
i- The right in rem must have been acquired from the possessor as a trustee,
ii- The winner of the right in rem is a third party,
iii- The third party has acquired a right in rem,
iiii- The third party has acquired the right in rem in good faith,
iiiii- The existence of other elements of validity in the third party’s acquisition, other than the power of disposition (Sirmen, L.: Property Law, 5th Edition, Ankara 2017, p. 91 et seq.).
18. The fulfilment of these conditions leads to the legal consequence that the previous possessor, whose right of ownership has been terminated, cannot file a movable action or an action of appropriation against the third party.
19. However, if the possessor of a property has not entrusted it to another person, but has disposed of it for a reason such as theft, usurpation, forgetfulness, etc., its acquisition is not valid even if the third party has acquired such a property in good faith. Indeed, Article 989 of the TCC is very clear in this regard:
“The possessor whose movable is stolen, lost or otherwise deprived of its possession against his will may file a movable action within five years against anyone who has possession of it.
If this movable was acquired in good faith from auction or market or from those who sell similar goods, a movable action may be brought against the first and subsequent acquirers in good faith, provided that the price paid is returned.
In other matters, the provisions regarding the rights of the bona fide possessor shall apply.”
20. It is seen that the Law has made a distinction between the goods left in trust and the goods that leave the hands of the owner without his consent in order to protect the good faith. This distinction is based on the following idea; the person who entrusts the property to another person may be considered to have more or less taken a risk and to have taken the risk that the thing entrusted to him may be transferred to another person by the recipient.

On the other hand, it cannot be said that the person who disposes of a good without his consent has endured such a risk in advance. As such, the interest of the third party who acquires the property in good faith is preferred to the interest of the person who entrusted the property, whereas the interest of the person who disposes of the property without consent is sacrificed.
21. If a bona fide third party acquires a thing that has left its owner’s possession without his consent from an auction, a market or from a person who sells such goods, the original owner’s ability to win the restitution lawsuit against this person and subsequent purchasers is subject to the following condition: In such cases, the price given by the bona fide third party for the acquisition of this property must be returned to him by the plaintiff, i.e. the original owner. If this condition is not fulfilled, the judge cannot accept the restitution action brought by the original owner (Art. 989/2. of the TMK).
22. When the presumptions of possession regulated in the TCC are evaluated, the condition of returning the price paid as regulated in Article 989/2 of the TCC for the acceptance of the movable property lawsuit directed to the first or subsequent acquirers in good faith is exclusive to the case that the movable property was acquired in good faith from the auction or from the market or from those who sell similar goods, and there is no other legal regulation regarding the payment to the person in good faith.
23. The condition of return in return for consideration is only applicable to movable property that has left the owner’s possession against his/her will. The plaintiff, who has acquired such a movable property under the conditions stipulated in Article 989/2 of the TCC, may be obliged to return it only on condition that the price paid for its acquisition is given to him (Akipek, J.: Turkish Property Law, 2nd Edition, Ankara 1972, p. 256).
24. As a matter of fact, the same principles were accepted in the decision of the General Assembly of the Court of Cassation dated 21.02.2018 and numbered 2017/4-1367 E., 2018/249 K.
25. As mentioned above, although the validity of the sale of movables is not subject to a formal condition as a rule, some special laws stipulate a validity condition for the sale of movables.
26. Paragraph (d) of Article 20 of the Highway Traffic Law (KTK) numbered 2918 states
“All kinds of sales and transfers of registered vehicles shall be made by notaries based on the registration certificate or traffic registration records issued in the name of the vehicle owner, provided that it is determined that there is no debt of motor vehicles tax, default interest, delay interest, delay increase, tax penalty and traffic administrative fine due to the vehicle to be sold and transferred and there is no measure or record restricting the sale and/or transfer on the vehicle. All kinds of sales and transfers not made by notaries are invalid.”

27. As it can be understood from the article stating that all kinds of sales and transfers of registered vehicles shall be made by notaries, contracts that give rise to an obligation to transfer the ownership of a motor vehicle registered in the traffic registry must be made in an official form in order to be valid.
28. In other words, although motor vehicles registered in the traffic registry are movable goods in terms of their structure, the transfer of their ownership is subject to a special and specific regulation condition, unlike movables and immovables. In order to transfer the ownership of a motor vehicle registered in the traffic registry, the possession of the vehicle must be transferred based on an official contract with the owner of the vehicle.
29. The fact that it is stated that these contracts will be made “on the basis of the registration certificate issued in the name of the vehicle owner or traffic registration records” means that, unlike other contracts that give rise to an obligation to transfer ownership, no one other than the owner of the motor vehicle can make the contract in question. This situation makes it impossible to acquire rights from the possessor in the capacity of trustee, which is generally the case for movables, in terms of motor vehicles.
30. The fact that the person who does not have the authority to dispose of is somehow registered as the owner in the traffic registry is not sufficient to protect the acquisitions of bona fide third parties who acquire rights from this person. Because in our law, the traffic registry does not have the function of disclosing the rights in rem on the motor vehicle to the outside world, and there is no regulation on the protection of trust in the appearance reflected by the traffic registry. (Özçelik, B.: Transfer of Motor Vehicle Ownership from an Unauthorised Person and its Consequences, Journal of Ankara University Faculty of Law, Vol. 68, No. 4, p. 841)
31. It should be noted immediately that the ownership of a motor vehicle cannot be acquired through goodwill pursuant to Article 988 of the TCC. Because, in every case where the motor vehicle is taken over from a person other than the owner, there is an additional reason for invalidity other than the lack of the transferor’s power of disposition. Namely, in order to acquire the ownership of a motor vehicle pursuant to Article 20/d of the TCC, there is a need for an official contract with the owner of the vehicle, which creates an obligation to transfer ownership, and the transfer of possession of the vehicle for the purpose of transferring ownership.

A person who holds the possession of a motor vehicle with the consent of the owner in any way (possessor as a trustee) cannot conclude a valid transfer agreement, since he cannot meet the conditions of “having a registration certificate (licence)” or “being registered as the owner in the traffic registry”, which are required for the notary to draw up a contract that gives rise to an obligation to transfer ownership, as stipulated in Article 20/d of the TCC. As explained, since the transfer of possession without a valid agreement will not transfer the ownership of the motor vehicle, the third party who transfers the possession cannot acquire the ownership of the vehicle even if he/she is in good faith (Özçelik, B., p. 847).
32. Pursuant to the express provision of the Law, in order for a contract for the sale of vehicles registered in the traffic registry to have legal consequences, it is a condition of validity that the contract is made in official form pursuant to Article 20/d of the TCC. With the aforementioned provision, the legislator, by requiring an official contract to be concluded at a notary public for the transfer of ownership of a vehicle, intends to regulate that the will of the parties can only be of value if they are united in the manner stipulated in the law, otherwise it will not produce results and will be invalid.
33. In the concrete case, the plaintiff delivered the vehicle registered in his name to the defendant Mustafa Özçulha for the purpose of renting, and then the vehicle was sold to the defendant in good faith by the defendant Kasım Orak at the notary public with a power of attorney, which was found to be forged, and these issues are not in dispute between the Special Chamber and the Court.
34. Although the defendant is in good faith, according to Article 20/d of the TCC, a valid contract must exist for the transfer of ownership of the vehicles. However, since the contract between the parties in the case at hand is based on a forged power of attorney, there is unauthorised representation and it will not be possible to talk about a valid contract. Since the registration is invalid for the defendant, who is in the position of the first hand who received the assignment with a forged power of attorney, it cannot be said that the ownership of the vehicle has passed to the defendant, considering that he is in good faith, and it cannot be accepted that the acceptance of the lawsuit filed by the plaintiff is conditional on the return of the vehicle price paid by the defendant.
Regarding the dispute in subparagraph (b);
35. The registration of motor vehicles is an administrative act. The court’s decision on registration in the traffic register is a decision forcing the administration to take action. However, in the judicial jurisdiction, a decision forcing the administration to take action cannot be made.
36. Although it comes to mind that judgements regarding registration can be made in cases related to immovable properties, this issue stems from the regulations in the Turkish Civil Code, and no such authority and duty is given to the courts regarding the registration of motor vehicles in the TCC.

37. Due to the nature of the dispute, the main issue to be discussed at this point is the function of the registration regulated under Article 19 of the TCC for vehicle sales, and in this regard, the principle of trust in the registry should be addressed first.
38. As explained above, the determination of sovereignty over movables is achieved through possession, whereas for immovables, this determination is made through the title deed registry. In the absence of the principle of trust in the registry, which is explicitly stipulated by the legislator for immovable property in Article 1023 of the TCC, in other words, in the absence of a legal regulation that constitutes an exception to the rules of the TCC regarding movable property, it cannot be said that the traffic registry records have the equivalent power to the protection provided by the land registry.
39. As a matter of fact, the same issue was also emphasised in the decision of the General Assembly of Civil Chambers dated 05.12.2019 and numbered 2017/13-505 E., 2019/1289 K.
40. In this case, since the plaintiff has requested a registration decision regarding the vehicle subject to the lawsuit, based on the principle that there is a minority in the majority, the court should be content with deciding to determine the ownership of the vehicle subject to the lawsuit in relation to the main lawsuit. The well-established practices of the Court of Cassation are in this direction and the contrary evaluation is misleading.
41. As a result, it was necessary to decide to approve the decision of resisting, which is in accordance with the procedure and law in terms of the dispute in paragraph (a), together with the reasons stated in the decision as well as the extended justification and reasons explained above, and in terms of the dispute in paragraph (b), it was found to be against the procedure and the law to resist the previous decision while complying with the Special Chamber reversal decision adopted by the General Assembly of Civil Chambers.

IV. CONCLUSION :

For the reasons explained;
The appellate objections of the defendant’s counsel with respect to the dispute in sub-paragraph (a) are rejected and the decision to resist is APPROVED with the expanded justifications and reasons explained above,
With the acceptance of the appeal objections of the defendant’s attorney in terms of the dispute in subparagraph (b), the decision to resist shall be reversed in accordance with Article 429 of the Code of Civil Procedure No. 1086, which is being applied according to the provisional Article 3 of the Code of Civil Procedure No. 6100, for the reasons shown in the Special Chamber reversal decision,
Pursuant to Article 440/III-1 of the same Law, it was decided unanimously and definitively on 23.03.2021, with the way of decision correction closed.

 

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