What is Postponement of Execution?

What is a Postponement of Execution? | Attorney Dilek Yavuz Uysal

What is Postponement of Execution?

Suspension of execution (or suspension of enforcement) is the process by which a debtor in an enforcement proceeding based on a court judgment can suspend the execution process until the case is concluded at a higher court by providing a specific security and obtaining a decision from the Court of Appeals or the Court of Cassation. Since, as a general rule, finality is not required for the enforceability of decisions rendered by local courts, enforcement proceedings will continue even if an appeal has been filed. The continuation of enforcement proceedings while there is a possibility of the court decision being overturned or reversed in appeal or cassation reviews creates a risky situation for the debtor. To counter this risk, the law provides the debtor with the option to have the proceedings suspended.

Implementation of the Delay of Execution Order

 To briefly discuss the practical importance of a stay of execution, a court decision may result in the losing party being ordered to pay compensation. For example, in a compensation lawsuit for a traffic accident, the losing party is ordered to pay 20,000 TL. Once the reasoned judgment is written, the plaintiff will initiate enforcement proceedings to collect this payment. On the other hand, the defendant may wish to appeal the local court's reasoned judgment to present their objections. In this case, while the trial would actually continue in a higher court, the defendant will be forced to pay the debt due to the enforcement proceedings. At this point, as soon as the enforcement proceedings are initiated, the defendant-debtor should deposit a security deposit sufficient to cover the debt with the enforcement office, obtain a stay of execution document, and suspend the enforcement proceedings until the appeal trial is concluded. The main purpose of a stay of execution is to avoid unjustly paying the debt during the continuation of the trial, since there is a possibility that the decision may be corrected or overturned.

Procedure Required for a Deferment of Execution Order

Certain procedural requirements must be met in order to carry out a stay of execution. Firstly, as mentioned above, the case file subject to the judgment must be appealed/cassated along with the request for a stay of execution, and the enforcement proceedings based on the judgment must be duly served on the debtor. Following the service, the debtor must first obtain a "marginal note" stating that they will appeal/cassate the first-instance court decision that forms the basis of the enforcement proceedings. This marginal note is obtained from the first-instance court that issued the decision.

In order for a stay of execution order to be issued, a security deposit must first be placed in the enforcement file. The security deposit must cover the current debt in the enforcement file, along with three months' interest on the current debt. The security deposit can be made in cash or in the form of a letter of guarantee from any bank. To determine the exact amount of the security deposit, the debtor must submit a cover account request to the enforcement file. This cover account includes a combined calculation of the principal debt, fees, interest, and attorney's fees.

After the security deposit is paid and the relevant document is obtained, the debtor must obtain a grace period certificate from the enforcement file. This certificate indicates the time granted to obtain a decision to suspend the enforcement proceedings. If the debtor's security deposit is deemed sufficient, they can apply to the enforcement office for a sixty-day grace period certificate to obtain a decision to suspend the enforcement proceedings. Within sixty days, the enforcement file will remain suspended until the Supreme Court issues a decision confirming or overturning the decision. If the debtor fails to obtain a decision to suspend the enforcement proceedings from the Supreme Court within sixty days, they can apply to the enforcement office again for an additional thirty-day grace period. If the debtor still fails to obtain a decision to suspend the enforcement proceedings within this additional period, the creditor can request the deposited security deposit from the enforcement office for the purpose of collecting the debt.

ÖTo summarize:

1. The reasoned judgment is served.
2. Upon notification of the reasoned judgment, an appeal is filed requesting a stay of execution, and a memorandum is obtained from the court.
3. The security deposit amount is calculated by adding 3 months' interest to the debt in question, and the security deposit amount determined by the cover account is deposited with the enforcement office.
4. Applications made through the lawyer portal should follow this procedure:.
   Civil Court Case Filing > Enforcement Court > File Type: Miscellaneous Case > Case Type: Enforcement Based on a Court Judgment (Suspension of Enforcement (Article 36 of the Enforcement and Bankruptcy Law)) > Unit; Relevant Enforcement Office > File No. > Inquire
5. The application fee, the fee for suspending enforcement, and the advance payment for expenses are paid during the application process. If the application is accepted, these fees are recorded as revenue for the treasury; if rejected, they are refunded.
6. If the Enforcement Court decides to "Postpone the Enforcement (Suspension of Enforcement)," this decision is notified to the Enforcement Directorate file and the court.
7. A grace period certificate is obtained from the enforcement office.

Relevant Supreme Court Decision:

SUPREME COURT OF APPEALS, 12TH CIVIL CHAMBER – Date: 01.03.2016 Case No: 2015 / 29201 Decision No: 2016 / 5734

Subject: If the letter of guarantee or cash security provided for a stay of execution order covers the entire claim, including all its ancillary costs, the existing attachments become excessive.’

In the specific case, it was observed that the enforcement proceedings without a court order, initiated by the creditor through general attachment, were halted upon the debtor's objection; the creditor's request for the annulment of the objection was accepted by the ... Civil Court of First Instance with its decision dated May 29, 2015, numbered 2014/593 and 2015/435, and the objection was partially annulled; the creditor submitted the court order to the enforcement office and requested attachment, and the attachments were applied by the enforcement office; the debtor submitted an indefinite and irrevocable guarantee letter dated July 1, 2015, to the enforcement office in exchange for the debt in the file, and the enforcement office issued a grace period document to the debtor.

According to Article 36 of the Enforcement and Bankruptcy Law; if the debtor who appeals the judgment proves that the awarded money or goods have been deposited with an official authority, or provides movable collateral, shares, bonds, immovable collateral, or a valid bank guarantee acceptable by the enforcement court to cover the value of the awarded money or goods, or if the debtor's property sufficient to cover the awarded money and goods has been seized, the enforcement officer shall grant the debtor a suitable period of time to obtain a decision from the Supreme Court for the postponement of the enforcement.

While a letter of guarantee or cash deposited to obtain a stay of execution order from the Supreme Court of Appeals does not constitute payment, if the security deposited by the debtor covers the entire debt in the enforcement file, including all its ancillary claims, as of the date of deposit, it is undeniable that the existing attachments will become excessive, and the continuation of the attachments will be incompatible with Article 85/last paragraph of the Enforcement and Bankruptcy Law. Therefore, the court should have evaluated whether the security deposited by the debtor at the time of obtaining the stay of execution document covered the entire debt in the file as of that date and made a decision accordingly. The ruling to accept the complaint with insufficient examination and written justification is incorrect.

Result: The debtor's appeal is accepted, and the court decision is REVERSED for the reasons stated above, in accordance with Articles 366 of the Enforcement and Bankruptcy Law and 428 of the Code of Civil Procedure. The advance payment of court fees shall be refunded upon request. The right to request a correction of the decision is open within 10 days of the notification of the judgment. This decision was made unanimously on March 1, 2016.

Obtaining a Deferment of Execution Order from the Enforcement Court

A stay of execution, or suspension of execution, in enforcement proceedings based on a court judgment allows the creditor to halt the enforcement proceedings until the appeal or cassation review is concluded, in exchange for a security deposit provided by the debtor to the enforcement office. Thanks to this decision, the debtor, by paying the security deposit to the enforcement office, ensures that the proceedings are suspended during the appeal review and also prevents the creditor from placing a lien on their assets, thus escaping the pressure of forced execution. After obtaining a grace period certificate, the debtor in an enforcement case based on a court judgment must obtain a stay of execution order from the enforcement court to suspend the proceedings until the appeal or cassation review is completed. To obtain a stay of execution order, an application must be submitted to the enforcement court with a petition. The petition must include:;

• A note indicating that the decision subject to enforcement proceedings was appealed or filed for cassation with a request for stay of execution.,
• File account for the period after 3 months (90) days, which is the basis of the grace period document,
• A copy of the receipt or letter of guarantee relating to the cash deposit.,
• A grace period document is required. Applications to the Enforcement Law Court will be made as separate case files through the legal distribution office or via UYAP (National Judicial Network).

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