The debtor objected to the payment order: six months or one year?

In enforcement proceedings without a judgment, the debtor can stop the proceedings by objecting within seven days of service of the payment order. The creditor then has two routes: removal of the objection before the enforcement court, or an action for annulment of the objection before the general courts. The choice depends largely on the documents in hand.

Removal of objection: fast, but document-dependent

Under Article 68 of the Enforcement and Bankruptcy Law, the creditor may ask the enforcement court to remove the objection within six months of being notified of it. This route is fast, but the claim must be based on a debt acknowledgement whose signature has been admitted or notarised, or on the official documents listed in the law. Many commercial receivables based on invoices and account statements do not meet this requirement.

Annulment of objection: slower, but broader

Under Article 67, the creditor may file an action for annulment of the objection in the general courts within one year of being notified of the objection. Any type of evidence may be used. For commercial receivables, mediation is a precondition to this action, and the time bar does not run while mediation is ongoing.

The one-year period is strict. Once it expires the receivable does not disappear, but the option of resuming the existing enforcement proceedings is lost and the creditor must file a new lawsuit.

Enforcement denial compensation

If the annulment action succeeds and the claim is liquid, meaning its amount is fixed or easily calculated from documents, the court may order the debtor to pay compensation of at least twenty per cent of the claim. The same compensation may be imposed on a creditor who pursued unjustified enforcement in bad faith.

Before starting enforcement

A possible objection should be anticipated when the enforcement request is prepared. The document the claim rests on, whether it is sufficient for removal of objection and whether the claim will count as liquid should be assessed from the outset. That way, when an objection arrives, choosing the route does not take days and no deadline is missed.

Sources

• Enforcement and Bankruptcy Law No. 2004 (Turkish)