A transfer of company property that is made without authority, as a sham, or contrary to the company's interests may, depending on the circumstances, lead to cancellation of the title and registration in the company's name, or to a claim for damages against those responsible. However, not every low-price sale is void, and the fact that a property belongs to the company does not give a partner the right to request the title in their own name. The company's legal personality, its representation authority at the time of the transaction, the required corporate resolution and the legal position of the buyer must be examined together. 124
In these files, three questions that look alike lead to different outcomes: Could the person who made the sale bind the company? Was the required internal company decision taken? And even if the transaction is valid, did the manager cause a loss to the company? The reversal of the title and the manager's liability for damages must be built on separate answers to these questions. 1
Why is company property separated from a partner's property?
A commercial company has legal personality separate from its partners. Ownership of a property registered in the company's name belongs to the company; holding one third of the capital does not mean that a partner holds a one-third share in every property in the company's name in the land registry. The separation of legal personality continues in single-shareholder companies as well. 1
A fall in the value of shares caused by a loss to the company is, in most cases, an indirect loss to the partner. Article 555 of the Turkish Commercial Code No. 6102 (TTK) regulates that compensation for a company loss may be claimed both by the company and by each shareholder; a shareholder's claim must seek payment of the compensation to the company. An allegation that the partner has an independent and direct loss of their own must be separately explained and proven. 1
This distinction must be reflected in the outcome section of the case. A claim for registration "in my name, in proportion to my share" taken from the company is not the same claim as registration in the company's name. If the claim is directed at the wrong rights holder, the action may be dismissed even if the defects in the transfer have been investigated. 4
How is the authority of the person who made the sale examined?
The trade registry as of the transaction date is decisive
A current signing-authority certificate alone is not sufficient. It must be determined who was authorized on the date of the sale, and in what form of representation. Sole signing authority versus joint signing authority, limits tied to the head office or a branch, and the registration and announcement of the appointment of a representative are each examined separately. A later removal of authority does not make earlier transactions void automatically. 1
For joint-stock companies, TTK Articles 370–373 form the basic framework of representation. For the representation authority of limited company managers, TTK Article 629 provides for the analogous application of the related provisions on joint-stock companies. The representative of the corporate body, a person acting under a power of attorney and a commercial proxy with limited authority must be kept apart. 1 A separate assessment of this subject appears in the article forged power of attorney, identity or signature-based land registry transfer cancellation.
An internal limitation and a limitation effective against third parties are not the same
Under TTK Article 371, restricting representation authority is, as a rule, not effective against good-faith third parties. The law draws a statutory distinction where joint representation has been registered and announced, or where limits specific to the head office and branches apply. Transactions outside the company's corporate purpose may also bind the company under the conditions set by law. For this reason, the conclusion "it is not in the articles of association, so the sale is absolutely void" cannot be reached directly. 1
On the other hand, these rules do not make the non-transferable organ powers under the law, or the grounds of invalidity that may apply to the concrete case, unimportant. A single transaction may raise questions of representation, a mandatory general assembly resolution and simulation at the same time. The legal source of each defect and its effect on the buyer should be shown separately. 15 Further details can be found in the article land registry cancellation due to abuse of a power of attorney.
Does every sale of company property require a general assembly resolution?
Bulk sale of a significant amount of assets in joint-stock companies
TTK Article 408/2-f counts the bulk sale of a significant amount of company assets among the non-transferable powers of the general assembly of a joint-stock company. This provision is not the same as "every property sale by the company". The economic weight of the transaction within the company as a whole, and its effect on operations, must be assessed. Neither a fixed monetary amount nor a single percentage applying to all companies is written in this provision. 15
The transfer of a property that is a vital production facility for the business cannot be treated in the same context as the ordinary stock sales of a company that trades in real estate. However, the defence that the sale is ordinary business activity should not be accepted without examination. Total assets, the revenue structure, the way the property is used and whether the company can continue its activity after the transaction must be shown with concrete documents. 5
Limited companies require a separate legal assessment
For a limited company, TTK Articles 616 and 623, the company agreement and the nature of the transaction are assessed together. Rather than applying the provision on joint-stock companies in Article 408/2-f to every limited company sale without explanation, the manager's ordinary management and representation limits should be examined. In a 2026 decision, the Court of Cassation (Yargıtay) addressed the transfer of a property on which the company's petrol station business was carried on, in this context. 14
What does the 2026 Constitutional Court decision say?
In its decision of May 13, 2026, E. 2025/226, K. 2026/112, the Constitutional Court (Anayasa Mahkemesi) rejected by majority vote the request for annulment directed at TTK Article 408/2-f. The rule governing the general assembly's authority over the bulk sale of a significant amount of company assets was therefore not annulled. The decision does not directly cancel the title to any specific company property; it is an abstract norm review decision. 5
The majority assessed the protective function of the provision for the interests of the company and its shareholders. The dissenting opinion emphasised the certainty of the "significant amount" criterion, the position of bona fide third parties who cannot access the company's financial data, and the severity of the risk of invalidity. This difference of opinion shows why the buyer's review cannot consist only of a signature circular. 5
No conclusion that "a general assembly resolution is mandatory for every company sale" should be drawn from the decision. First, it must be determined whether the concrete transaction falls within the scope of the rule. The main contribution of the decision is that it makes visible that the general assembly's authority, which cannot be exercised through representation, is a separate heading of assessment. 15
How are simulation (muvazaa), sale to a manager and transfers to relatives assessed?
Showing a sale in the land registry when no sale actually took place, and a real sale made at a price contrary to the company's interests, are different claims. For simulation, the real and common intention of the parties is examined. A low price, close kinship, the absence of a payment record, no change in the use of the property and transfers at short intervals are facts that may be assessed together; none of them alone gives a definitive result in every case. 23
Where a board member transacts with the company, on their own behalf or on behalf of another, the permission and invalidity regime of TTK Article 395/1 is important for joint-stock companies. For limited companies, the scope of the reference in Article 644 must be read separately; automatically transferring all paragraphs of Article 395 is not correct. Conflict of interest, the duty of loyalty and self-dealing are considered together with the concrete representation relationship. 1
If the buyer later transferred the property to another person, the protection of reliance on the land registry and the examination of good faith under Articles 1023–1024 of the Turkish Civil Code No. 4721 (TMK) may come into question. A person who is a party to a directly void transaction and a person who later acquires rights on the basis of an entry without legal basis are not in the same position. The effect of an internal authority problem within the company against third parties and the principle of reliance on the land registry must not be substituted for one another. 12 The article sham property transfer and land registry cancellation may also be read in this respect.
Who brings the action, and against whom?
The company may pursue its own right through valid representation. A claim of liability for a loss to the company is assessed within the framework of TTK Article 555. Where cancellation of a land registry entry is sought, the current registered owner must be a party, and the claim must be made in favour of the correct rights holder. For damages, it must be explained which manager is liable for which act. 123
Where the person representing the company is also responsible for the dispute, the conflict of representation must be resolved. Whether the company's organs can take a decision, the authority of another representative or, where necessary, the mechanism of a trustee (kayyım) are examined. If the company has been struck off the register after liquidation, its legal personality and the need for supplementary liquidation under TTK Article 547 and related provisions must be assessed before an action is continued in the company's name. 12 The explanations in the article good faith of a third party and land registry cancellation may be used for comparison.
The 2026 decision of the 11th Civil Chamber: an error of registration in a partner's name
In the decision of the 11th Civil Chamber of the Court of Cassation (Yargıtay 11. Hukuk Dairesi) dated February 26, 2026, E. 2025/6160, K. 2026/1115, the sale by a manager, to another partner, of a property transferred to a limited company was in dispute. The claimant partner, relying on their capital share, requested that part of the property be registered in their own name and the other parts in the names of the partners in proportion to their shares. 4
The regional court of appeal (bölge adliye mahkemesi) stated that, in a claim based on loss to the company, registration may be requested in the name of the company rather than of a partner, and it rejected the claims in the case accordingly. The Court of Cassation affirmed the decision. Although the file contained discussion of the general assembly resolution and the sale price, those issues did not in themselves correct the wrong registration claim. The practical lesson is that a company share and a land registry share must not be confused in the petition. 4
How are jurisdiction, mediation and time limits determined?
Disputes arising from manager liability under the TTK and from the company relationship are assessed in terms of their commercial nature. The jurisdiction of the commercial court of first instance is not determined merely by the property being registered in the company's name; the basis of the claim and the relationship of the parties matter. For claims concerning rights in rem, the exclusive territorial jurisdiction over immovable property under Article 12 of the Code of Civil Procedure No. 6100 (HMK) is also taken into account. 13
Mediation as a condition precedent to litigation under TTK Article 5/A relates to certain monetary claims of a commercial nature. A claim solely for cancellation of title and registration, and a monetary claim for manager liability, should not be treated as the same. In joint or alternative (terditli) claims, the nature of each claim must be examined and the application procedure set up accordingly. 1
Under TTK Article 560, a claim for damages against those responsible is time-barred two years from the date the loss and the responsible person became known, and in any event five years from the act causing the loss. The exception reserved by law for acts requiring a longer criminal limitation period remains. These periods are not applied automatically to every legal ground of a claim for cancellation of title. 1
The effect of the annulment of a general assembly resolution and of discharge (ibra) must also be assessed separately. The three-month annulment period under TTK Article 445 and the consequences that TTK Article 558 attaches to discharge must not be confused with the limitation period for manager liability. Without distinguishing between a claim of nullity (butlan) and voidability, one cannot say that "once a resolution has been taken, no action can be brought at all." 1 For detailed information, the article statute of limitations and preclusive periods may also be read.
What should the evidence file contain?
| Review area | Priority documents |
|---|---|
| Representation at the time of the transaction | Trade registry records, announcements, representation resolution, power of attorney |
| Required organ decision | General assembly and board resolutions, notices and meeting records |
| Importance of the property to the company | Financial statements, records of use and income, business documents |
| Reality of the sale | Official deed, bank transactions, commercial books, accounting records |
| Current ownership and third parties | Current land registry extract, transfer dates, mortgages and related documents |
Commercial books and bank records should be evaluated together. A sale entry in the accounts does not in every case resolve whether the money was actually paid, and a bank transaction does not by itself show which debt the payment relates to. If it is claimed that a signature or decision document is forged, the original document and an appropriate examination method are important. 3
To guard against a further transfer of the property, an interim injunction may be requested under Article 389 et seq. of the Code of Civil Procedure No. 6100 (HMK). An injunction does not finally resolve the ownership dispute; the protection requested must be linked to the danger shown. A complaint about a manager alone does not mean that an obstacle to transfer has been created in the land registry. 3 The article evidence preservation may also be reviewed in relation to this topic.
If the title cannot be recovered, for which loss is the manager liable?
For liability under TTK Article 553, the breach of duty, fault, loss and causal link are examined. Where it is alleged that company property was disposed of at a low price, the value of the property, the price received, loss of use and other heads of loss are separated and justified. Not every commercial failure automatically gives rise to manager liability. 1
If the property has been recovered, the effect of that recovery on the calculation of loss must be taken into account. A result under which the same economic loss is compensated twice, once through the whole property and once through the full price, cannot be reached. Claims belonging to the company, to the partner and to a creditor must be separated from one another; where there is bankruptcy, TTK Article 556 must be considered separately. 1
If there is an independent error arising from the keeping of the registry, see the State's liability under TMK Article 1007; for the steps after a judgment has been obtained, enforcement of the land registry judgment may be examined separately.
Conclusion
A strong action against an irregular transfer of company property is built on a sound claim, the correct rights holder and the correct relief. The representation at the time of the transaction, the required organ resolution, the reality of the sale and the position of third parties must each be evaluated separately. The 2026 decisions show both the practical importance of the general assembly's authority over the sale of a significant amount of company assets and the distinction that company property cannot be requested in a partner's name.
Frequently Asked Questions
I own half of the company; can I request half of the property in my name?
A capital share is not a direct land registry share in company property. A claim based on a loss to the company should, as a rule, be made in favour of the company. If there is an independent personal right claim, it is explained separately. 14
If the manager has sole signing authority, is every sale valid?
No. Alongside representation authority, the mandatory organ resolution, conflict of interest, simulation and the position of the buyer are also examined. A power-of-attorney document does not resolve all legal problems. 145
Is a general assembly resolution mandatory in every property sale?
TTK Article 408/2-f relates to the bulk sale of a significant amount of company assets in joint-stock companies. Without determining the scope of the transaction and the type of company, the same answer cannot be given for all sales. 15
Did the 2026 Constitutional Court decision remove the general assembly requirement?
No. In its decision of May 13, 2026, numbered 2026/112, the Constitutional Court rejected by majority vote the request for annulment directed at the relevant provision. 5
Is the sale of a company property to a relative simulation on its own?
Not on its own. The real intention, payment, price, use and other facts are assessed together. Kinship may be one piece of data in the concrete examination. 23
What is the time limit for a damages action against a manager?
The rule under TTK Article 560 of two years from learning of the loss and five years from the act, and the exception for longer criminal limitation periods, are assessed. Periods for discharge and for other types of claim are examined separately. 1
Can an action not be brought if the company has been struck off the register?
Supplementary liquidation and the necessary registration procedures may arise under TTK Article 547. The party and representation status of a struck-off company should be resolved before it is dealt with as if it were an operating company. 1
Sources and legal bases
- Turkish Commercial Code No. 6102, in particular Articles 4, 5, 5/A, 125, 369–373, 395, 408, 445–447, 547, 553–560, 616, 623, 626, 629 and 644; official text, accessed October 13, 2026. Source link
- Turkish Civil Code No. 4721, legal personality, representation trusteeship (kayyım) and Articles 1023–1025; Turkish Code of Obligations No. 6098, Article 19 and the representation provisions; official texts, accessed October 13, 2026.
- Code of Civil Procedure No. 6100, in particular Articles 12, 26, 190, 199–211, 219–222 and 389 et seq.; official text, accessed October 13, 2026. Source link
- 11th Civil Chamber of the Court of Cassation (Yargıtay 11. Hukuk Dairesi), February 26, 2026, E. 2025/6160, K. 2026/1115. Full text of the decision; a claim concerning a limited company's property and the rejection of a claim for registration in a partner's favour. A secondary full text was reviewed; accessed October 13, 2026.
- Constitutional Court, May 13, 2026, E. 2025/226, K. 2026/112. Official decision record; full text of the reasoning, ruling and dissent. Rejection of the request for annulment of TTK Article 408/2-f. The full text from the secondary publication was relied on; accessed October 13, 2026.