Banks demand from people who request a loan from them to provide a collateral in return for the loan they will give. In practice, these guarantees are usually mortgages or sureties. However, another alternative for those who do not have a real estate that they can provide to the bank as collateral or a relative who can stand a surety for them is to transfer their claims that belong someone else to the bank as collateral. For example, if a merchant obtains a right to claim as a result of the sale he has made as a result of his commercial activity, he can transfer this claim obtained from the person he trades with to the bank as collateral in order to get a loan. This is a kind of an Agreement on transfer (assignment) of claims.
Future claims may be transferred to the bank as collateral. Aside from the ongoing legal debates regarding the transfer of claims that do not exist yet but will arise in the future, theSupreme Court states in its settled case-law that future claims can also be assigned (transfer) if certain conditions are met.
In this bulletin, we have explained the conditions under which the transfer of future claims is possible, the validity conditions of the transfer agreement and the results of the transfer.
1. Transfer (Assignment) of claim in general
The legal process that allows the claim to leave the assets of one person and to be transferred the assets of another person is called the transfer (assignment) of the claim. The transfer of claim is drawn up by a contract. As in every contract, the accordance of the declarations of intention on the transfer of the claim and the competence of the parties to make a declaration of intention on this matter are the conditions sought for the validity of the contract.
It is of course necessary for the assignor to have the power of appointment on the transferred claim for the transfer to be valid. Because the Agreement on the transfer of claim is not only a promissory transaction, but also an act of disposal. Because the Agreement on the transfer of claim has a direct effect on the assets of the parties and does not need to be performed separately. By a valid contract, the right is also transferred. For this reason, if the person transferring the claim under the contract does not have such a right or does not have the authority to transfer that right (for example, if there are restrictions on the claim such as attachment or pledge, or if the transferor has taken the title of insolvent), the contract will not enure and the claim cannot be transferred.
In addition to these general conditions, the Agreement on the transfer of claim to be valid must be made in writing to be valid. An agreement made in ordinary written form is sufficient, and there is no need for the parties to transfer the claim formally at the notary public. However, there is also no obstacle to concluding an agreement on the transfer of claim at a notary.
“Assignment of claim” is made by a written contract to be made between the assignor and the assignee (the new creditor).[1]
2. What Claims are Transferable?
It is also possible to transfer the claims that are legally transferable by the Agreement on the Transfer of Claims. Asset rights, that is, monetary rights, are the primary claims. Personal rights and some rights related to the person cannot be transferred. Naturally, strictly personal rights such as the inalienable right of residence, the right of usufruct, the right to disposition mortis causa, and the right to damages for mental anguish arising in favour of the non-faulty betrothed in case the engagement is breached, cannot naturally constitute the subject of the Agreement on the Transfer of Claims. Accessory rights related to the personality of the person transferring the right of claim cannot be transferred to the other party by the Agreement of Transfer of Claim.
“As soon as the assignment is made, the claims pass to the assignee accompanying with all the privileges and accessory rights on the claims. For this reason, all accessory rights and claims both that have been processed and not collected by the old assignor and have been still processing belong to the new assignor. As a matter of fact, as the legal relationship of the assignor with the debtor is broken off by the assignment, the transfer of the right of claim and the right to sue of the collection of the claim to the assignee, who has become the new owner,is a natural consequence of the assignment of the claims .”[2]
3. Is It Possible to Transfer a Future Claim as Collateral to Banks?
In order to respond positively to loan requests, banks ask the requester to provide a collateral in practice. In order to secure the loan receivables, banks generally prefer mortgages or sureties as collateral. However, another alternative for those who do not have a real estate that they can provide to the bank as collateral or a relative who can stand a surety for them is to transfer their claims that belong someone else to the bank as collateral. For example, if a merchant obtains a right to claim as a result of the sale he has made as a result of his commercial activity, he can transfer this claim obtained from the person he trades with to the bank as collateral in order to get a loan. This is concluded by a kind of an Agreement on transfer (assignment) of claims.
“If the creditor assigns the claim to its creditor as collateral for an existing debt, instead of pawning it, then the assignment of the claim will be made for the purpose of collateral.”[3]
These receivables, which are transferred to the banks as collateral, do generally not yet exist and will arise in the future. There are legal discussions about whether future receivables can be transferred. However, it is seen today that the Supreme Court have clarified this issue. As clearly stated in a Supreme Court decision;
“In the assignment of the claim, the assignor can transfer a right that she/he still has, or she/he can also transfer a future receivable that does not exist yet.”[4]
The point to be noted here is that; in order for a future claim to be transferred, the claim must be determined or determinable. The transfer of completely fictious, expected claims will be invalid. The reason for the claim, its source (for example, the existence of a signed contractual relationship) and the amount of the claim should be determined or determinable.. For example, the transfer of claims arising from a lease agreement is a good example of this situation. However, for such wholesale transfers to be valid, they must be limited in time or subject. Otherwise, there may be a danger that the economic asset of the assignor will be overburdened or destroyed.
For example, transfering all the debts to be arised to someone else is null. Instead, it is considered legally possible and legitimate to transfer the claims, which are limited to a certain amount or time, arising from a certain contractual relationship.
In summary, transferring a claim to the bank for collateral purposes according to certain conditions, even if the claim has not yet existed, is an accepted practice in the case-law of the Supreme Court. If the person transferring the claim to the bank does not pay the credit debt to the bank, the bank may demand and collect the claim from the debtor.
4. Is the Borrower’s Consent Required When Transferring the Claim to the Bank?
As a rule, the debtor’s permission or approval is not required for the transfer of the claim. Because for the borrower, it doesn’t really matter who she/he will pay the debt to. An agreement on assignment between the owner of the claim and the person who takes over the claim will result in the transfer of the claim even if the debtor does not give consent.
The principle of “not aggravating the legal status of the debtor due to the transfer” has been adopted in order to protect the debtor regarding the transfer of the claim. Because in this case, the debtor is affected by a contract in which he does not take part. For this reason, the debtor can claim all the means of defense (pleas) it has against the transferor against the bank when it learns about the transfer. For example, the debtor can avoid paying the debt by raising statue of limitations or defense of non-payment.
5. Is It Mandatory to Notify the Debtor of the Transfer of Claim?
Notifying the debtor of the transfer of claim is an act that indicates to whom the debtor can get rid of its debt by making a payment. It does not affect whether the transfer of the claim is valid or invalid. In practice, banks add a provision to the Agreement on the transfer of claim and stipulate that the transfer shall be notified to the debtor. In this way, the debtor can only get out of his debt by paying the debt to the bank after the notification made. If the debtor makes a payment to the assignor without the approval of the bank despite the notification made, the debtor cannot get out of the debt. If the debtor have to pay twice, the debtor can recover what it paid by filing a lawsuit against the assignor under the provisions of unjust enrichment.
It is possible for the debtor to get out of his debt if it makes a payment to the former creditor as it is unaware of the transfer of the claim. That is why the notification has such an importance.
The legal consequences of the notification made to the debtor do not necessarily have to be stated in the notification text. These consequences happen ipso jure.
Conclusion
In order to get a loan from banks, it is possible to transfer a claim to the bank as collateral. Unless the Agreement on the transfer of claim is made in writing, it will not be valid. The claim to be transferred may be a claim that exists or that will exist in the future. Certain conditions are required for the transfer of future receivables to be valid. If the loan debt to the bank cannot be paid on time, the bank will be able to demand payment from the debtor through execution or lawsuit, since the demand and collection authority for the claims transferred as collateral will be transferred to the bank.
References
EREN, Fikret, Borçlar Hukuku Genel Hükümler, Beta Yayıncılık, Ankara, 2011, p.1180-1194.
ŞENER, Oruç Hami, “Bankanın Rehinli Alacaklı Sıfatına Sahip Olduğu Adi Alacak Rehninde Rehnin Borçluya İhbarı Ve İhbarın Sonuçları”, Dokuz Eylül Üniversitesi Hukuk Fakültesi Dergisi, Vol: 11, Issue 2, 2009, p. 195-250 (Publication Year: 2011).
DALCI, Nurcihan, Alacağın Toptan Temliki, Yüksek Lisans Tezi, Ankara Üniversitesi Sosyal Bilimler Enstitüsü Özel Hukuk (Medeni Hukuk) Anabilim Dalı, 2009, Ankara.
13rd Civil Chamber of the Supreme Court, 2019/2135 E., 2019/6116 K., T.14.05.2019.
13rd Civil Chamber of the Supreme Court, 2016/18730 E., 2019/6711, T.28.05.2019.
Supreme Court Assembly of Civil Chamber,2013/1907 E., 2015/1060 K., T.18.03.2015.
13rd Civil Chamber of the Supreme Court, 2014/40855 E., 2015/35505 K., T.03.12.2015.
[1]13rd Civil Chamber of the Supreme Court, 2019/2135 E., 2019/6116 K., T.14.05.2019.
[2]13rd Civil Chamber of the Supreme Court, 2016/18730 E., 2019/6711, T.28.05.2019.
[3]Supreme Court Assembly of Civil Chamber,2013/1907 E., 2015/1060 K., T.18.03.2015.
[4]13rd Civil Chamber of the Supreme Court, 2014/40855 E., 2015/35505 K., T.03.12.2015.