The Concept of Land Share, Its Application, the Problems It Raises and the Action for Correction of Land Shares

Those authorized to determine land shares must allocate them objectively, fairly and in accordance with the law. In practice, however, some project architects and/or building contractors, for commercial reasons or because they are not experts on the subject, determine land shares in a manner far from objective and without considering the criteria set out in the law, as is well known to all. In many cases, land shares are seen to be determined incorrectly: arbitrarily, by dividing the land area by the total number of independent units in the main property and giving equal shares, or by taking as a basis only the size, that is, the square meters, of the independent units.

Since it is provided that, in urban transformation processes where full consensus cannot be reached, owners may take part in decisions in proportion to their shares (in proportion to their land shares) and may become right holders in proportion to their shares, the question of determining land shares correctly has become more important, particularly with Law No. 6306 on the Transformation of Areas under Disaster Risk. In our country, the fact that until 2007 land shares were established in an entirely uninformed and arbitrary manner has resulted in incorrect land shares in a significant portion of existing buildings. We strongly recommend that the right holders of independent units also secure in law the rights they actually hold in existing buildings and, to that end, file an action for correction of land shares.

To give an example, when the construction servitude (kat irtifakı) or condominium ownership is being established, the land share of a person who buys the large apartment on the top floor of the building will certainly be higher than the land share of a person who buys the small apartment at ground level. This is because, at the time condominium ownership is established, by objective standards a large apartment on the top floor will be much more valuable than a ground-floor apartment that gets no sun. In a possible dispute concerning land share, the price at which the apartment owner bought the apartment in the present case is of no importance whatsoever. Owners of independent units will have rights and obligations only in proportion to the land shares allocated to their independent units.

In this article, the concept of land share and the legal issues that may arise because of land share will be examined in a question-and-answer format under the heading “The Concept of Land Share, Its Application, the Problems It Raises and the Action for Correction of Land Shares”.

A. PART ONE: QUESTIONS

1. What is land share, and how is it established?

Article 2 of the Condominium Law (KMK), titled Definitions, defines land share. Accordingly, land share is described as “the co-ownership share of the land allocated to the independent units in accordance with the principle set out in this Law”. Likewise, Article 3 of the same Law, titled Nature of Condominium Ownership and Construction Servitude, explains how land share is to be established:

“Condominium ownership and construction servitude are established by clearly showing, in accordance with the principles of co-ownership, the land share allocated in the project in proportion to the values of each of the independent units of the main property subject to such ownership, calculated according to their location and size.”

2. Can land share be transferred separately from the independent unit?

Article 5 of the Condominium Law, titled Connection Between Independent Units and Land Share, provides that “Where condominium ownership is transferred to another person or passes by inheritance, the land share attached to it passes with it; land share cannot be transferred separately from condominium ownership or construction servitude, nor does it pass by inheritance, nor can it be encumbered with another right.” and thereby states that land share cannot be separated from the independent unit; by also providing in the same article that “Rights encumbering condominium ownership automatically encumber the land share as well”, it states that land share cannot be the subject of a separate right or debt. Land share moves together with the independent unit and forms an inseparable part of the independent unit itself. It is not possible to transfer land share separately from the independent unit.

3. Must each independent unit be given a land share, and can land share be left unattached to an independent unit (unassigned land share)?

By providing that “No land share may be left in the main property that is not attached to condominium ownership or in favor of which no construction servitude has been established”, Article 5 of the Condominium Law, titled Connection Between Independent Units and Land Share, states that a land share must be attached to each independent unit on which a construction servitude has been established and which has thus become a transferable right. The concept of land share is a constituent element for the concept of an independent unit to come into being. For these reasons, just as an independent unit without a land share is inconceivable, a land share left unassigned is equally inconceivable. In practice, however, contrary to the provision of the law, one sees land share left unassigned as a result of calculation or by land share being allocated to spaces that do not qualify as independent units.

4. What are the rights and obligations attached to land share regarding use of the common areas and contribution to common expenses?

Article 16 of the Condominium Law, titled On Common Areas, provides: “Unit owners own all the common areas of the main property in proportion to their land shares, in accordance with the provisions on co-ownership. Unit owners have the right of use in the common areas; unless otherwise agreed, the extent of this right in places such as the common coal store, garage, terrace, laundry room and laundry drying areas is proportional to the land share belonging to each unit owner.”

According to Article 20, titled “Contribution to the General Expenses of the Main Property”: “Unless otherwise agreed among them, each of the unit owners is obliged to contribute:

a) equally to the expenses for the doorkeeper, boiler operator, gardener and watchman and to the advance to be collected for them;

b) in proportion to their own land share, to the insurance premiums of the main property, to the maintenance, protection, reinforcement and repair expenses of all common areas and other expenses such as the manager’s salary, to the operating expenses of the common facilities, and to the advance to be collected for expenses.”

It follows from this that the owner of a property with a larger land share has the right to make greater use of the common areas. At the same time, that owner will also contribute more to the general expenses.

5. Can an independent unit be added to the main property, and how will the distribution of land shares be determined in the case of an addition?

Article 44 of the Condominium Law, titled “Addition of Independent Units”, provides that additions to the main property must be made unanimously. Likewise, the said Law has made the determination of the land shares allocated to all independent units in the main property subject to a decision to be taken unanimously.

“For adding a floor on top of the main property, or building a full floor in place of an existing setback floor, or the subsequent construction or addition, on the ground or basement floors or on the vacant part of the land, of the places listed in the second paragraph of Article 24:

a) a unanimous decision of the assembly of unit owners to this effect;

b) the redetermination, in accordance with procedure and unanimously, of the land shares to be allocated to all independent units, including the new additions, according to the situation the main property will be in after this construction are required.”

“The subject of the action consists solely of the request to convert the roof floor into a full floor and to correct the land shares in the land register according to the new situation that will arise. For a setback floor to be converted into a full floor, one of the first two conditions is that the assembly of unit owners decides on this unanimously and that the land shares to be allocated to all independent units, including the new additions, according to the situation the main property will be in after this construction, are determined anew in accordance with procedure and unanimously.” (Court of Cassation (Yargıtay), Assembly of Civil Chambers, Docket No. 1976/5-1992, Decision No. 1977/374, 13.4.1977)

6. Where land share has not been allocated in proportion to the shares of the independent units, or not correctly, what remedies are open to those whose rights are infringed?

By providing that “Where land shares have not been allocated in proportion to the shares of the independent units, each unit owner or holder of a construction servitude may apply to the court for the land shares to be readjusted. The land share allocated to each of the independent units under this paragraph cannot be changed on account of a subsequent increase or decrease in the value of those units. The provision of Article 44 is reserved.”, Article 3 of the Condominium Law, titled “Nature of Condominium Ownership and Construction Servitude”, has granted each unit owner and each holder of a construction servitude who considers that their right has been infringed the right and authority to have the land share readjusted by filing an action before the courts.

7. Who can file the action for correction of land shares, and against whom?

Anyone who owns an independent unit in the main property can file the action for correction of land shares. The point to note here is that a person who was an owner in the main property at the time the land shares were registered and who was aware of the registration cannot file this action. If that person transfers their independent unit, the new owner’s right to file an action is reserved. A tenant or the holder of a servitude has no right to file an action.

“...Since it is understood that the plaintiff was a unit owner in the main property at the time of the registration of independent unit No. 13, whose land share the plaintiff seeks to have corrected, and was aware of the land share allocated, all the unfounded objections raised in the appeal on points of law are to be rejected and the judgment, which is in accordance with procedure and law, is to be UPHELD pursuant to Article 370/1 of the Code of Civil Procedure (HMK)…” (Court of Cassation, 20th Civil Chamber, Docket No. 2019/2849, Decision No. 2019/5582, 7.10.2019)

In actions for correction of land shares, all owners of independent units other than the plaintiff must be named as defendants. Otherwise, since the parties will not have been properly constituted, the action will have to be dismissed. What is involved here is mandatory joinder of parties.

“Since, by the nature of the action, the decision to be given at the end of the proceedings also closely concerns the rights of the owners registered in the land register of all independent units in the main property subject to the action, in order to ensure the enforcement of the judgment and having regard to the principle of procedural economy, the latest land register records showing all independent units of the main property subject to the action should have been obtained, the owners of the independent units joined to the action, and judgment then rendered according to the result arising from the claims and evidence of all the parties, whereas…” (Court of Cassation, 20th Civil Chamber, Docket No. 2017/5442, Decision No. 2019/1190, 20.2.2019)

8. In an action for correction of land shares, as of which date will the court take the land and building value into account? What factors will be considered in determining land share? Can witnesses be heard?

While it is appropriate in actions for correction of land shares to take as a basis the value on the date the construction servitude was established, if condominium ownership was established without a construction servitude having been established, the land share value of the independent unit on the date of transition to condominium ownership will be taken into account.

“If, in the present case, there are just causes for the land shares to be readjusted, this examination must be carried out according to the date of the construction servitude or, if condominium ownership was established without a construction servitude being established, the date of condominium ownership. For this reason, the date of the construction servitude or of the transition to condominium ownership of the property subject to the action must first be determined.” (Court of Cassation, 20th Civil Chamber, Docket No. 2019/2005, Decision No. 2019/3843, 10.6.2019)

In actions for correction of land shares, the court bases its assessment on many factors, such as the floor on which the independent unit in question is located, its area, heating system, lighting, architectural use and location, frontage and view at the time condominium ownership or construction servitude was established. In addition, the person making the claim may prove the claim by any kind of evidence, including witnesses.

“The first condition for land shares to be readjusted is that the land shares were determined out of proportion to the values of the independent units. In claims based on this matter, the court must evaluate all the evidence, compare the value of the independent unit with the land share allocated to the unit and seek to establish equivalence. In carrying out this exercise, factors such as the type of the independent units, the floor on which they are located, their area, heating system, lighting, architectural use and location, frontage and view are taken as the basis for the assessment; increases and decreases in value arising from changes in zoning status, type and view, and from maintenance and repair works, after the date to be taken as the basis for the assessment are not taken into account.” (Court of Cassation, 20th Civil Chamber, Docket No. 2019/5696, Decision No. 2019/7038, 2.12.2019)

“...as regards the sea view, a decision should be rendered according to the resulting outcome, hearing witnesses as well if necessary.” (Court of Cassation, 18th Civil Chamber, Docket No. 1998/5277, Decision No. 1998/8427, 7.7.1998)

9. Until when can the action for correction of land shares be filed?

The action for correction of land shares can be filed for as long as the main building retains its construction servitude or condominium ownership status. During this period, no limitation or peremptory periods can be said to run. In particular, actions concerning land share problems that arise in the urban transformation process must be filed before a decision is made to demolish the main building; otherwise, since an action can no longer be filed, each right holder will, under the title deed converted into co-ownership in shares, have rights only to the extent of their land share.

“Since the main property subject to the action has been demolished, there can be no question of independent units subject to condominium ownership or construction servitude, and it is therefore not possible to apply Article 3 of the Condominium Law to the dispute. Actions concerning the redetermination of land shares can be filed for as long as the main building retains its construction servitude or condominium ownership status.” (Court of Cassation, 18th Civil Chamber, Docket No. 2007/9977, Decision No. 2008/2372, 3.3.2008)

Demolition of the building is not required for construction servitude or condominium ownership to come to an end; even though the building physically continues to exist, construction servitude or condominium ownership may also come to an end for reasons such as the main building falling into ruin, being expropriated or the zoning plans being annulled. In these cases, too, an action for correction of land shares can no longer be filed.

10. In an action for correction of land shares, can the court be asked, as an interim injunction to prevent demolition, to order that the demolition be stopped?

Article 389 of the Code of Civil Procedure, titled Conditions for Interim Injunctions, reads as follows:

"(1) An interim injunction may be granted concerning the subject matter of the dispute where there is concern that, owing to a change that may occur in the existing situation, obtaining the right will become considerably more difficult or entirely impossible, or that a disadvantage or serious damage will arise because of delay. (2) The provision of the first paragraph shall also apply to non-contentious judicial matters insofar as it is compatible with their nature."

We have stated that the action for correction of land shares can be filed for as long as the main building retains its construction servitude or condominium ownership status. Since an action for correction of land shares cannot be filed if the main building is demolished, and obtaining the right will therefore become entirely impossible, an order may be given to stop the demolition of the building as an interim measure.

Similarly, it may also be debated whether an interim injunction can be granted for buildings that fall within the scope of the “Law on the Transformation of Areas under Disaster Risk” No. 6306. Indeed, the original text of that Law stated that a stay of execution could not be ordered in actions filed against the administrative acts carried out. However, this provision was annulled by the Constitutional Court’s decision dated March 1, 2014 and February 27, 2014, Docket No. 2012/87, Decision No. 2014/41. It follows from this that an interim injunction, which produces the same consequences as a stay of execution, may be granted regardless of whether the building falls within the scope of Law No. 6306.

B. PART TWO: PROPOSALS

1. What is the historical development of the procedure for determining land shares, and what practices could be introduced to prevent future judicial disputes in the process of determining land shares?

Historically, the regulation of land share has gone through three different phases.

1) Land share was determined by the unit owners on the basis of freedom of will and was subject to immutability based on co-ownership in shares.

2) Between 1983 and 2007, it was stated that, subject to the provision of KMK Art. 3/2, land share was again subject to the unit owners’ freedom of will, but also to the intervention of the judge.

2) After 2007, the period began in which, subject to the provision of KMK Art. 3/2, land share is established by the project architect independently of freedom of will, but is subject to the intervention of the judge.

With the amendment made in 2007 to Article 3 of the Condominium Law, it was provided that land share in the construction servitude/condominium ownership project would be determined according to the location and size of the independent units. The former text of the article referred to determination in proportion to the value of the independent unit.

Nature of condominium ownership and construction servitude (Article 3): “Condominium ownership and construction servitude are established by clearly showing, in accordance with the principles of co-ownership, the land share allocated in the project in proportion to the values of each of the independent units of the main property subject to such ownership, calculated according to their location and size. Where land shares have not been allocated in proportion to the shares of the independent units, each unit owner or holder of a construction servitude may apply to the court for the land shares to be readjusted. The land share allocated to each of the independent units under this paragraph cannot be changed on account of a subsequent increase or decrease in the value of those units. The provision of Article 44 is reserved.”

It would be appropriate for land share to be determined according to a report prepared by a licensed real estate appraiser, by entrusting the matter to the Valuation Experts Association of Türkiye (Türkiye Değerleme Uzmanları Birliği), a professional organization with legal personality in the nature of a public institution. It should not be forgotten that land share is determined not only in proportion to a quantity based on the square meters of the independent units but – when the Law and the decisions of the Court of Cassation are examined together – according to the total value, by taking into account many factors such as the type of the independent units, the floor on which they are located, their area, heating system, lighting, architectural use and location, frontage and view. This information, however, does not fall within the expertise of the architects and engineers who author the project.

Uncertainty and technical inadequacy in determining land share can be prevented by transferring the task of determination to a licensed real estate appraiser. There is no doubt that, in this way, the number of actions for correction of land shares reaching the courts will decrease. It is an evident fact that a determination based solely on architectural knowledge does not reflect the true ratio and increases the workload of the courts.

In this context, we propose that the following provision be added to the Law, to follow paragraph 1 of Article 12 of Condominium Law No. 634:

“The Valuation Experts Association of Türkiye is authorized to determine the land shares to be determined in accordance with the provisions of this Law. The land share distribution table prepared by the panel designated by the Valuation Experts Association of Türkiye and signed by the owner or all the owners establishing condominium ownership shall be submitted to the land registry office by the person concerned or by the project architect.”

2. Is it possible to remove actions for correction of land shares from the jurisdiction of the courts in order to reduce the workload of the judiciary?

Within the scope of the “Judicial Reform Strategy” published in May 2019, “Simplifying Civil and Administrative Proceedings and Increasing Their Effectiveness” was set as an objective. To achieve this goal, it was decided to carry out work aimed at removing certain non-contentious judicial matters from the jurisdiction of the courts so as to reduce the workload of the judiciary.

As regulated in our laws, all requests for correction of land shares must be brought before the courts. The aim of simplifying proceedings and increasing their effectiveness makes it necessary to distinguish between cases in which all owners of independent units agree on the correction of land shares and cases in which they do not.

The final agreement on the correction of land shares: we believe that, regardless of whether any land share has been left unassigned, and applicable only to non-contentious matters in which all owners of independent units agree, it could be carried out by the Valuation Experts Association of Türkiye under the coordination of the General Directorate of Land Registry and Cadastre. At the same time, it would be appropriate to leave the court route open for contentious matters in which no agreement can be reached.

In this context, we propose that the following provision be added to the Law, to follow paragraph 3 of Article 3 of Condominium Law No. 634:

"Regardless of whether any land share has been left unassigned, if the decision to correct the land shares has been taken unanimously by all owners of the independent units in the main property, an application may be made to the Valuation Experts Association of Türkiye before applying to the court. The new land share distribution table prepared by the panel to be designated by the Valuation Experts Association of Türkiye shall be submitted to the land registry office by the person concerned. In corrections made under this paragraph, the consent of the beneficiaries of rights in rem and personal rights shall also be required. The proposed land share distribution table shall be served on the persons concerned by the Land Registry Office. Within 1 (one) month of service, the right holders and those claiming that their interests have been infringed may file an objection with the competent civil court of peace under the Code of Civil Procedure No. 6100 dated January 12, 2011. The land share distribution becomes final if no objection is filed or, upon an objection, with the decision to be rendered by the civil court of peace. A copy of the decision rendered by the Civil Court of Peace upon an objection shall be notified to the Valuation Experts Association of Türkiye and to the relevant land registry office."

In all these processes, it will be in the parties’ interest to obtain legal support from a lawyer in order to avoid any loss of rights.

Att. Taha Hüseyin Çebi

This article is a general assessment prepared in accordance with the legislation in force on its date of publication; it does not constitute a legal opinion. This English text is a translation of the Turkish original; in case of any discrepancy, the Turkish version prevails.