Representation provisions have been stipulated in articles 40 and following, in Turkish Code of Obligation numbered 6098 ("TCO") which has entered into force on 01.07.2012. The TCO has two sections as "authorized representation" and "representation without authority".
Authorized Representation
According to article 40 of TCO, the consequences of a legal proceeding issued in the name and on behalf of principal by an authorized representative shall bind the principal directly.
If the representative issues proceedings without informing his title, then the consequences of such legal proceedings shall bind the representative. However, if the other party is in a position to know existence of such representation relationship or if the issuance of legal proceeding with the representative or the principal does not make any difference, then the consequences of such legal proceeding shall bind the principal directly.
According to article 41 of TCO, while determining the content and degree of the representation authority, it is important to evaluate if such representation authority is raised from a legal proceeding or public law.
If the representation in the name and on behalf of principal is raised from public law, the content and degree of the representation authority shall be determined pursuant to legal provisions and if representation is raised from a legal proceeding, then the content and degree of the representation authority shall be determined pursuant to such legal proceeding.
If the representation authority is notified to the third parties, then the content and degree of the representation authority shall be determined in accordance with this notification.
According to article 42 of TCO, it is regulated that the principal may always limit or cancel the representation authority arising from legal proceeding. It is void to withdraw from this right previously.
If the principal informed the third parties directly or indirectly that he has granted authority for representation, then he shall notify such third parties about cancellation in part or in whole of such representation authority. Otherwise, he may not allege against bonafide third person that he has cancelled such authority.
Article 43 of TCO regulated termination of representation authority arising from legal proceeding. Accordingly, unless otherwise agreed, the representation authority arising from legal proceeding shall be terminated if (i) the principal or the representative dies; (ii) there is a declaration of absence; (iii) the principal or the representative lost legal capacity; or (iv) the principal or representative is bankrupted. The termination of legal entity also results with the same consequences.
According to article 44 of TCO, it is stipulated that in case that the representative is granted with a certificate of authorization, the representative shall deliver such document to the principal or submit it to the place which the judge determines after termination of representation.
If the representative or its successor does not take the necessary actions in order to deliver the certificate, then they shall indemnify the damages of bonafide third parties.
According to article 45 of TCO, as long as the representative is not informed regarding termination of its authority, then the principal and his successor shall be bond with the consequences of legal proceedings issued by the representative. However, in case the third parties know the termination of such authority, this rule shall not be applied.
Representation without Authority
According to article 46 of TCO, in case a person issues a legal proceeding without an authorization, then the principal may only be bond with this proceeding if he gives his approval.
The other party, with whom the unauthorized representative proceeds, may request from the principal to inform within an appropriate time whether he will give approval or not. If the proceeding is not approved within such time, then other party gets free from being bond with such proceeding.
Article 47 of TCO, regulates that if the principal does not give approval expressly or implicitly, the indemnification of such damage arising from null proceeding may be requested from the unauthorized representative. However, in case the unauthorized representative proves that the other party knows his unauthorized representation then the indemnification of such damage may not be claimed from him.
Indemnification of other damages may also be claimed from unauthorized representative with fault, on an equitable basis.
In Conclusion
The TCO articles 40 and following stipulate representation provisions under two sections as "authorized representation" and "representation without authority".
The consequences of a legal proceeding issued in the name and on behalf of principal by an authorized representative shall directly bind the principal. If the representation is raised from a legal proceeding, then the content and degree of the representation authority shall be determined pursuant to such legal proceeding. If the representation authority is notified to the third parties, then the content and degree of the representation authority shall be determined in accordance with this notification. The principal may always limit or cancel the representation authority arising from legal proceeding.
In case a person issues a legal proceeding without an authorization, then the principal may only be bond with this proceeding if he gives his approval. If the principal does not give approval expressly or implicitly, the indemnification of such damage arising from null proceeding may be requested from the unauthorized representative.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
