ÜNAL v. TURKEY and 6 other applications

Communicated on 17 September 2018

SECOND SECTION

Application no. 31707/07
Zeki ÜNAL against Turkey
and 6 other applications
(see list appended)

STATEMENT OF FACTS

A. The circumstances of the case

1. Background to the case

1. The applicants, Zeki Ünal (“the first applicant”) and Şükrü Karahasanoğlu (“the second applicant”), are former executives and directors of two previously public banks, namely Sümerbank and Etibank.

2. Sümerbank and Etibank were originally State-owned companies which operated in a number of different sectors, including the banking sector.

3. They were restructured for privatisation purposes and as part of the restructuring process their banking assets were transferred to two newly incorporated legal entities, Sümerbank A.Ş. (hereinafter “Sümerbank”) and Etibank Anonim Ortaklığı (whose title was later changed to Etibank A.Ş.) (hereinafter “Etibank”).

4. On 17 October 1995 Sümerbank was privatised and İpeks İplik Tekstil Sanayi A.Ş., a joint stock company owned by a businessman named H.G. and his companies, became the majority shareholder of the bank.

5. On 2 March 1998 Etibank was privatised and Medya İpek Holding A.Ş. (whose title was later changed to Medya Sabah Holding A.Ş.), a joint stock company, which at the time was partly owned by D.B. and his companies, became the majority shareholder of the bank.

6. Both applicants were appointed to the management and the board of directors of Sümerbank and Etibank following their privatisation and resigned from their duties before they were later taken over by the State.

7. The first applicant was the assistant general manager of Sümerbank from 30 September 1997 to 28 February 1998 and the general manager of Etibank from 10 March 1999 to 9 August 2000.

8. The second applicant was the general manager of Sümerbank and Etibank from 31 October 1995 to 16 February 1998 and from 2 March 1998 to 5 March 1999 respectively.

2. Background information on the Savings Deposit Insurance Fund

9. The Savings Deposit Insurance Fund (Tasarruf Mevduatı Sigorta Fonu – hereinafter “the Fund”) was established to protect depositors and enhance the stability of the banking system in 1983.

10. The Fund was a separate legal entity but remained under the control of the Central Bank of the Republic of Turkey and the Banking Regulation and Supervision Agency (Bankacılık Düzenleme ve Denetleme Kurumu ‑ hereinafter “the Agency”) until it became an independent administrative authority in 2003.

11. The Fund’s mandate, as described in the repealed Banks Act (Law no. 3182) of 25 April 1985, which entered into force on 2 May 1985, was initially limited to the insurance of the savings of deposit holders in banks.

12. The repealed Banking Activities Act (Law no. 4389) of 18 June 1999, which entered into force on 23 July 1999 and replaced Law no. 3182, extended the Fund’s mandate so as to include the management of resolution processes of financially distressed banks.

13. Law no. 4389 provided for the transfer of the management and supervision of a bank and the rights of its shareholders, except dividends, to the Fund in the event that the bank encounters certain financial problems (section 14 § 3) or its resources and assets are misused or abused by the majority shareholders (section 14 § 4).

14. Law no. 4491 of 17 December 1999, which entered into force on 19 December 1999, introduced important changes to Law no. 4389, especially its provisions governing the scope of the Fund’s mandate in respect of bank resolution processes.

15. Section 14 § 5, as amended by Law no. 4491, allowed the Fund to acquire the ownership of shares of a transferred bank on the condition that the Fund assumes the losses of the bank corresponding to its paid-up equity capital on the basis of its balance sheet at the time of the transfer.

16. Under the same provision, the Fund, in addition to the right to acquire the shares of a transferred bank, was also entitled to demand the return of or compensation for losses incurred by the bank as a result of misuse and abuse of its resources.

17. To recover those losses, under section 17 § 2 of Law no. 4389, the Fund was authorised to bring civil proceedings to engage the personal liability of the majority shareholders and the executives of the transferred bank who were responsible for the transactions which constituted misuse of the bank’s resources, regardless of whether or not the bank had gone bankrupt.

18. For the purpose of securing the recovery of those losses, the Fund was also entitled to request the courts to take precautionary measures, such as ordering an interim injunction on assets of those persons, by virtue of section 14 § 5 (b) of Law no. 4389.

19. Under section 15 of Law no. 4389, the Fund was also exempted from financial liabilities such as taxes, charges and levies.

3. The transfer of Sümerbank and Etibank to the Fund

20. Following the failure of the measures taken to improve their financial situation, fırst Sümerbank, by the Council of Minister’s decision of 21 December 1999, and then Etibank, almost a year later, by a decision of the Banking Regulation and Supervision Board (Bankacılık Düzenleme ve Denetleme Kurulu – hereinafter “the Board”) of 27 October 2000, were transferred to the Fund pursuant to sections 14 §§ 3 and 4 of Law no. 4389.

21. As a result, the Fund took over the management and supervision of those banks as well as the rights of their shareholders, except dividends.

22. The Fund also acquired ownership of the shares of Sümerbank, under section 14 § 5 of the Law no. 4389 as per the Council of Minister’s decision. In respect of Etibank, the documents in the case file suggest that the ownership of its shares was also eventually transferred to the Fund under the same provision.

4. Proceedings brought against the applicants by the Fund and subsequent legal and factual developments

23. Following the transfer of Sümerbank and Etibank to the Fund, the auditors of the Board examined the transactions that the former executives of those banks had authorised and approved in their capacity as directors and/or managers.

24. For each transaction which, according to the auditors’ reports, constituted a misuse or abuse of the bank’s resources in violation of the banking laws and rules of practice, the Fund brought separate personal liability lawsuits (the details of the lawsuits constituting the subject of the present applications are set out in the Appendix) against, among others, the applicants under section 17 § 2 of Law no. 4389.

25. In those lawsuits, the Fund asked the domestic courts not only to hold the applicants together with other defendants personally liable for the losses allegedly incurred by the banks as a result of those unlawful transactions but also to declare their personal bankruptcy under the same provision.

26. At the beginning of the proceedings, the Fund also asked the courts to place an injunction on the assets of the defendants, including the applicants, in accordance with section 14 § 5 (b) of the Law no. 4389.

27. With the exception of a few sets of proceedings, the courts granted the Fund’s requests and issued in each set of proceedings separate interim injunctions covering all assets of the applicants, including their movable and immovable properties, their receivables and rights against third parties, without requiring the Fund to post any collateral (see the table in the Appendix for cases in which the Fund’s request for injunction was granted and the scope of the injunction on the applicants’ assets).

28. While the proceedings against the applicants were pending, Law no. 4389 was amended by Law no. 4743 and Law no. 4672. The amendments not only granted the Fund exemptions specific to the proceedings for the recovery of losses of transferred banks but also extended the scope of receivables that it could claim in connection with those banks. The Fund was also granted additional powers such as the power to enter into agreements with the debtors and to ask the courts to suspend the lawsuits already filed for the duration of these agreements.

29. The Banking Activities Act (Law no. 5411) of 19 October 2005, which came into force on 1 November 2005, repealed and replaced Law no. 4389.

30. Law no. 5411 not only preserved the prrogatives of the Fund under Law no. 4389 but also endowed it with additional powers to collect its receivables in connection with a transferred bank. Accordingly, the Fund was authorised to take over the management and shareholding of companies owned by the majority shareholders of the banks and to sell the shares and assets of these companies in a bundle to achieve maximum collection of the amounts owed to it.

5. The proceedings concerning Sümerbank

31. The Fund brought one lawsuit against the first applicant and four lawsuits against the second applicant for the losses caused to Sümerbank as a result of loan transactions which they had authorised during their term as the managers and directors of the bank.

32. These proceedings constitute the subject of applications nos. 27112/08 and 32844/17 (see Part A of the table in the Appendix for details of these proceedings). The proceedings registered under the docket no. 2008/271 E. concerned both applicants, although separate decisions were delivered in respect of each applicant.

(a) The protocols signed between the Fund and the majority shareholders of Sümerbank

33. While these proceedings against the applicants were still pending, on 12 August 2004 the Fund signed a protocol with, among others, H.G and his companies (hereinafter “H.G. Group”), the majority shareholders of Sümerbank at the time the bank was transferred to the Fund. This protocol entered into force on 27 January 2006.

34. The protocol was aimed at restructuring the debt that H.G. Group owed to the Fund by reason of the loans and other transactions that had allegedly caused losses to Sümerbank and to set out the terms of the repayment of the debt. It also contained a special provision concerning the lawsuits filed by the Fund to recover the losses of Sümerbank. According to that provision, the proceedings against the applicants were to be suspended as long as the parties complied with the terms of the protocol.

35. The parties then signed additional protocols on 7 January 2009, 9 April 2010 and 25 June 2010 to supplement the original protocol of 12 August 2004.

36. The above protocols signed between the Fund and H.G. Group had an important impact on the evolution of the proceedings brought against the applicants. In some of the proceedings, the courts decided that the lawsuits had become devoid of subject-matter whereas in other proceedings the Fund decided to withdraw the lawsuits.

(b) Lawsuits which became devoid of subject-matter

37. In both proceedings under the docket nos. 2011/399 E. and 2012/291 E., the courts found it established that the payments made by H.G. Group to the Fund under the protocols dated 12 August 2004 and the additional protocols dated 7 January 2009, 9 April 2010 and 25 June 2010 had compensated the alleged loss claimed by the Fund. On that basis, the courts decided that the lawsuits had become devoid of subject-matter.

38. In the first set of proceedings under the docket no. 2011/399 E. brought against the second applicant only, the first-instance court awarded the applicant a fixed amount of 1,200 Turkish liras (TRY - equivalent to approximately 512 Euros (EUR) at the time of the decision) in attorney fees, noting that the status of the Fund should be taken into account under the terms of the Tariff on Minimum Attorney Fees (hereinafter “the Tariff”).

39. The second applicant appealed against the first-instance court’s decision, arguing that he should have been awarded attorney fees on a pro rata basis, i.e. in proportion to the amount claimed by the Fund.

40. The Court of Cassation dismissed the appeal on 14 April 2014 and upheld the first-instance court’s decision.

41. In the second set of proceedings under the docket no. 2012/291 E., the second applicant submitted a petition to the first-instance court on 28 September 2012 stating that he would agree to waive his right to litigation costs and attorney fees on the condition that the Fund also did the same.

42. However, at the hearing of 31 December 2012, the Fund asked the court to order the applicant to pay attorney fees, arguing that he had caused the filing of the lawsuit.

43. The first-instance court, in its decision delivered on the same date, held that there was no reason to award any attorney fees to either of the parties.

44. On 19 March 2013 the second applicant appealed against the decision, arguing that he could not be considered to have waived his rights to attorney fees since the Fund had not waived its rights and therefore the first‑instance court should have awarded attorney fees to him.

45. The second applicant did not inform the Court about the outcome of the appeal proceedings.

(c) Lawsuits which were withdrawn by the Fund

46. In two proceedings registered under the docket nos. 2008/271 E. and 2009/650 E., the Fund, during the course of those proceedings, decided to withdraw the lawsuits against the applicants.

47. The first set of proceedings under the docket no. 2008/271 E. concerned both of the applicants but the lawsuits against them were dismissed on separate dates.

48. At the hearing of 21 February 2011, the second applicant stated that he would waive his right to attorney fees provided that the Fund withdrew the lawsuit against him. Four days later, the Fund submitted a petition to the court expressing its wish to withdraw the lawsuit and waive its right to attorney fees and litigation costs as well as its right to appeal against the decision. Subsequently, by a decision dated 25 May 2011, the first-instance court severed the lawsuit against the second applicant (registering it under the docket no. 2011/293 E.) and dismissed it on account of its withdrawal by the Fund.

49. The lawsuit against the first applicant, however, continued and the court reached a decision on the merits. While the appeal proceedings in respect of the decision were pending before the Court of Cassation, the Fund submitted a petition to withdraw the lawsuit against the first applicant. The Court of Cassation quashed the decision on that ground and remitted the case to the first instance court. Subsequently, on 1 June 2017, the first‑instance court decided to dismiss the lawsuit (registered under the docket no. 2017/283 E. following remittal) by reason of the Fund’s decision of withdrawal.

50. In its decision, the court awarded the first applicant a fixed amount of TRY 7,920 (equivalent to approximately EUR 1,995 at the time of the decision) in attorney fees.

51. The applicant did not inform the Court as to whether he appealed against the decision and if so, about the outcome of the appeal proceedings.

52. The second set of proceedings under the docket no. 2009/650 E. concerned the second applicant only.

53. On 28 February 2011 the Fund informed the court that it wished to withdraw the lawsuit. On the same date, the applicant also submitted a petition to the court waiving his right to attorney fees and to appeal. Accordingly, on 9 March 2011 the court dismissed the lawsuit against the second applicant on the grounds that the lawsuit had been withdrawn.

6. The proceedings concerning Etibank

54. The Fund brought ten lawsuits against the applicants for the losses caused to Etibank as a result of loans and other types of transactions which they had authorised during their term as the executives of the bank.

55. These proceedings constitute the subject of application nos. 31707/07, 21932/08, 53870/09, 2458/11, and 3066/11 (see Part B of the table in the Appendix for details of these proceedings). Six of the proceedings registered under the docket nos. 2008/192-329-332-334-335 E. and 2009/396 E. concerned both applicants.

(a) The protocols signed between the Fund and the majority shareholders of Etibank

56. D.B. and his companies had gradually acquired all shares in Medya Sabah Holding A.Ş. and had become the majority shareholders of Etibank at the time Etibank was transferred to the Fund.

57. While the proceedings against the applicants were still pending, on 17 November 2003 the Fund made a protocol with, among others, D.B. and his companies, including Medya Sabah Holding A.Ş., (hereinafter “Medya Group”), which owned and operated a number of assets in the media sector, including the television channel ATV and the daily newspaper Sabah.

58. According to the protocol, Medya Group would transfer some of its assets in the media sector and assign its receivables under some of its commercial agreements to the Fund towards the settlement of the amounts that it owed to the Fund for losses caused to Etibank as the bank’s majority shareholder.

59. However, due to difficulties in the implementation of this protocol, D.B. entered into an arrangement with another businessman named T.C. who also owned companies that operated in the media sector (hereinafter “Merkez Group”).

60. According to that arrangement, the assets and the receivables that could not be transferred to the Fund would be acquired by Merkez Group, which, in return, would assume the obligations of Medya Group to the Fund under the protocol of 17 November 2003.

61. A protocol was made between, among others, the Fund, Medya Group and Merkez Group on 3 May 2005 to amend the protocol of 17 November 2003 pursuant to the terms of that arrangement and to put the amended protocol into force.

62. However, on an unspecified date, the Fund cancelled the protocols of 17 November 2003 and 3 May 2005 on the grounds that D.B. and T.C. had allegedly colluded in violation of the terms of these protocols.

63. As a consequence, the Fund, using the powers granted by Law no. 5411, took over the management, supervision and shareholders’ rights, except dividends, of the companies forming Medya Group and Merkez Group and also foreclosed the media sector assets of those companies.

64. The Fund put together the shares of these companies and their assets, which also included the television channel ATV and the daily newspaper Sabah, formed a single unit named ATV-Sabah Economic and Commercial Unit (ATV-Sabah Ticari ve İktisadi Bütünlüğü – hereinafter “the Unit”) and organised a tender for its sale.

65. On 5 December 2007 the Fund sold the Unit for 1.1 billion US dollars.

66. On 28 November 2008 the Fund made a new protocol with Medya Group and Merkez Group to set out the terms of repayment of the amount that Medya Group owed to the Fund with the proceeds from the sale of the Unit.

67. The relevant provisions of the protocol dated 28 November 2008 concerning the proceedings against the applicants and its entry into force read as follows:

Article 8.7

“Following the signing of this protocol, upon the withdrawal of civil or administrative lawsuits filed by the debtors and the finalisation of the lawsuits and execution proceedings brought by the Fund, in respect of the financial liability proceedings under the docket no. 2001/1299 E. pending before the 1st Commercial Court of Istanbul (to which the proceedings under the docket no. 2001/1578 E. were joined) ..., the proceedings under the docket nos. 2001/2190 E., 2001/2192 E., 2001/2193 E., 2001/2314 E., 2001/2323 E., 2002/118 E., 2001/1200 E., 2001/2191 E., 2001/2194 E. pending before the 1st Commercial Court of Istanbul ..., the proceedings under the docket no 2001/552 E. pending before the 3rd Commercial Court of Istanbul (to which the proceedings under the docket no. 2001/847 E. before the 8th Commercial Court of Istanbul and the proceedings under the docket no. 2001/863 E. were joined) ... the proceedings under the docket nos. 2002/563 E. and 2002/692 E. pending before the 1st Commercial Court of Istanbul for personal bankruptcy and all other personal bankruptcy and compensation proceedings, the Fund shall request the relevant courts to suspend these proceedings for all defendants and all claim amounts. Following the finalisation of the list of ranking for the ATV-Sabah Economic and Commercial Unit, the Fund shall take the necessary legal steps to ensure that the suspended financial liability, personal bankruptcy and recovery and compensation proceedings shall be rendered devoid of subject-matter insofar as concerning claims which fall within the scope of this protocol ...”

Article 18

“... This protocol shall enter into force after its signing by the parties provided that the debtors and/or their relatives by blood or by marriage and/or related real and legal persons withdraw the lawsuits that they had filed against the Fund, that they allow for the finalisation of all lawsuits and execution proceedings and the tender for the sale of ATV‑Sabah Economic and Commercial Unit and the list of ranking pertaining to the purchase price becomes final.”

68. Prior to their shares and assets being acquired by the Fund, Medya Group and Merkez Group companies were going concerns, which had been doing business with third parties. By taking the management, the shares and assets of those companies, the Fund also assumed their obligations towards third parties.

69. Accordingly, the proceeds from the sale of the Unit, which comprised assets and shares of Medya Group and Merkez Group companies, would, therefore, also have to be used to repay the debts of those companies to those third parties, which the Fund had taken over.

70. To set out the way in which the proceeds from the sale of the Unit would be distributed to those third party creditors, the Fund prepared a list in accordance with Law no. 5411 and the Regulation on the Sale of Foreclosed Assets Forming an Economic and Commercial Unit by the Savings Deposit Insurance Fund (“the Regulation”) indicating the ranking of each creditor (hereinafter “the List of Ranking”).

71. The List of Ranking was published on the Official Gazette dated 2 December 2008.

72. Subsequently, some of the creditors of Medya Group and Merkez Group companies brought civil and administrative proceedings against the Fund seeking the annulment of the sale of the Unit or challenging their place in the List of Ranking.

73. Both the protocol of 28 November 2008 and developments related to those protocols had an important impact on the proceedings against the applicants concerning Etibank. In two lawsuits, the courts decided that the lawsuits had become devoid of subject-matter whereas in the remaining lawsuits, at the Fund’s request, the courts suspended the proceedings pursuant to the terms of the protocol.

(b) Lawsuits which became devoid of subject-matter

74. In both proceedings under the docket nos. 2001/1745 E. and 2008/192 E., the courts ruled that the lawsuits had become devoid of subject-matter and that there was no reason to deliver a judgment. The court held that while the conditions to declare the applicants bankrupt had been met, the borrowers in the impugned loan transactions had compensated the bank’s losses by fully repaying their debt.

75. In the first set of proceedings under the docket no. 2001/1745 E., the first applicant states that the court, in its decision dated 17 April 2006, ordered him to pay an amount of TRY 16,082.55 (equivalent to approximately EUR 9,800 at the time of the decision) in litigation costs. The applicant also states that he was ordered to pay a sum of TRY 400 (equivalent to approximately 243 EUR at the time of the decision) to the Fund in attorney fees.

76. The applicant appealed against this judgment to the Court of Cassation arguing, inter alia, that the court’s decision to impose on him litigation costs and attorney fees and not to award him any attorney fees on a pro rata basis was not in accordance with the law.

77. On 15 November 2007 the Court of Cassation dismissed the applicant’s appeal and upheld the decision of the first-instance court.

78. In the second set of proceedings under the docket no. 2008/192 E., by a decision of 17 April 2006 the court initially ordered both applicants to pay a certain amount in litigation costs and the first applicant to pay TRY 400 (equivalent to approximately 243 EUR at the time of the decision) in attorney fees.

79. The applicants appealed against this judgment to the Court of Cassation on grounds identical to the appeal lodged against the judgment delivered in the first set of proceedings (see paragraph 76 above).

80. On 22 February 2008 the Court of Cassation upheld the first-instance court’s judgment, except its decision concerning the litigation costs, and remitted the case to the first-instance court for a fresh calculation of litigation costs.

81. On 30 June 2008 the first-instance court ordered the applicants to pay an amount of TRY 11,678.43 (equivalent to approximately EUR 7,116 at the time of the decision) in litigation costs and held that there was no reason to issue a separate ruling as regards the parts of its previous judgment which had become final with the Court of Cassation’s decision.

82. On 21 May 2009 the Court of Cassation dismissed the applicants’ appeal.

(c) Lawsuits suspended at the Fund’s request

83. The remaining proceedings evolved, to a great extent, in the same manner.

84. The first-instance courts decided to suspend the proceedings against the applicants at the Fund’s request in accordance with the relevant provisions of the protocol of 28 November 2008 and the relevant provisions of Law no. 4389 and Law no. 5411 until the List of Ranking drawn up for the distribution of the proceeds from the sale of the Unit was final pursuant to Articles 6.2 and 8.7 of the protocol of 28 November 2008.

85. In their decisions, the courts also held that there was no need to make any determination as to attorney fees on the grounds that the suspension decision could not be regarded as a decision on the merits of the dispute.

86. The applicants appealed against these decisions, opposing the suspension of the proceedings and arguing, inter alia, that the courts’ decision not to award them any attorney fees, despite the fact that they were represented by an attorney throughout the proceedings, was not in accordance with the law.

87. The Court of Cassation dismissed the applicants’ appeal and upheld the judgments delivered by the first-instance court.

7. The interim injunction placed on the assets of the applicants

88. During the course of the majority of the proceedings where the courts granted the Fund’s request for an injunction, the domestic courts agreed to gradually narrow down the scope of the injunction so as to allow the applicants to use either their salary and retirement pension or the money in their accounts up to a certain amount.

89. However, except for a few proceedings mentioned below, the injunction on the applicants’ remaining assets was maintained despite the applicants’ repeated requests both before the first-instance court and the appellate court for a complete lifting of the injunction.

(a) Proceedings where the courts decided to lift the interim injunction

90. In two proceedings registered under the docket nos. 2008/192 E. and 2008/509 E concerning Sümerbank, where an injunction was placed on the assets of the second applicant only, the courts eventually decided to lift the injunction at the applicant’s request. In those proceedings, the courts held that the applicant’s assets had been automatically lifted (mürtefi) under section 112 of the repealed Civil Procedure Code (Law no. 1086) on account of the absence of any express ruling regarding the maintaining of the injunction in the decisions delivered by the first-instance court.

91. In two other proceedings registered under the docket nos. 2008/271 E. and 2009/650 E. also concerning Sümerbank, the injunction on the second applicant’s assets was lifted on account the withdrawal of the lawsuit by the Fund. In proceedings under the docket no. 2008/271, the Fund also withdrew its lawsuit against the first applicant and the court dismissed the lawsuit on 1 June 2017. However, the court did not make any determination as to the injunction in its decision. According to the applicant, in the absence of any ruling as to the lifting of the injunction, the injunction placed on his assets on 16 July 2001 and maintained with the decision of 5 January 2012 will continue to remain in place until the decision of 1 June 2017 becomes final.

(b) Remaining proceedings

92. In the remaining proceedings concerning Etibank where the court decided to suspend the lawsuit against the applicants upon the request of the Fund pursuant to the provisions of the protocol signed between the Fund and the majority shareholders, the applicants submitted fresh requests in 2014, requesting the court to lift the injunction on the grounds that maintaining of the injunction was no longer justified since the Fund had recovered the losses that the banks had allegedly incurred.

93. By a decision dated 12 March 2015 the court dismissed all of these requests. Referring to section 136 of the Law no. 5411, it noted that the decision to suspend the proceedings was not a decision on the merits of the case and that because the List of Ranking prepared for the distribution of the proceeds from the sale of the Unit had not been finalised not only was it not possible to make any determination as to the status of debts owed to the Fund but also the protocol of 28 November had not yet entered into force since the finalisation of the List of Ranking had been a pre-condition for its entry into force. On that basis, it concluded that there was no compelling reason to change or cancel the decision on the maintaining of the injunction and the lifting of the injunction would significantly impair or render impossible the vindication of the right in question and create a significant loss.

94. The applicants appealed against these judgments to the Court of Cassation, which dismissed the appeal, holding that the judgments were not subject to appeal.

B. Relevant domestic law

1. Provisions of the banking legislation concerning bank resolution processes and the Fund’s powers and privileges

(a) The Banks Act, Law no. 4389, as amended by Law no. 4491

95. The relevant provisions of the Law no. 4389 read as follows:

Section 14

“4. If the Agency determines that the shareholders of a bank who, directly or indirectly, alone or jointly, hold the bank’s management and supervision, have used the bank’s resources in their favour so as to jeopardise the secure operation of the bank or caused losses to the bank in such a way, the Board shall be authorised to transfer the management and supervision of the bank and the rights of its shareholders, except dividends, to the Fund.

5. (a) The Fund, in respect of a bank whose management, supervision and shareholders’ rights, except dividends, is transferred to it under paragraph 3 of this provision, taking as a basis the balance sheet to be prepared as of the transfer, shall be authorised to ...

(ab) take over the losses corresponding to the capital of the bank, provided that the losses do not exceed the savings covered by insurance and all of the shares are acquired, ...

(b) The Fund, in respect of a bank whose management, supervision and shareholders’ rights, except dividends, is transferred to it under paragraph 4 of this provision shall be entitled to:

(ba request the return of or compensation for the resources used in the way described in the said provision or the losses [of the bank] within the periods specified by it and the transfer of the shares [of the bank] to real and legal persons, who may be deemed to be appropriate by the Board ...”

Section 15

“1. The saving deposits in banks shall be insured by the Savings Deposit Insurance Fund, which is a public law body with separate legal personality. The Fund shall be responsible and authorised for strengthening the financial situation, restructuring and transfer to third parties of the banks whose shares and/or management and supervision have been transferred to it and to carry out all other tasks entrusted to it under this law ...

3. The Fund shall be exempt from all types of tax, charges and levy ...”

Section 17

“1. If it is determined that the decisions and transactions of a bank’s board of directors, chairman and members of the credit committee, general managers, assistant general managers and officers whose signatures bind the bank have caused the bankruptcy of the bank, they may be personally held responsible for the amount of losses that they caused to the bank and by virtue of a Board decision and at the request of the Fund the courts may decide on their personal bankruptcy. If these decisions and transactions are made to benefit the shareholders of a bank who, directly or indirectly, alone or jointly, hold the bank’s management and supervision, this provision shall apply to the shareholders for the benefits that they acquired ...

2. This provision shall also apply to the shareholders of the banks whose management, supervision and rights of shareholders, except dividends, or shares have been transferred to the Fund pursuant to paragraphs 3, 4 and 5 of section 14, who also have been referred to in paragraph 1 of this provision, and to employees of the bank referred to in paragraph 1 of this provision, who have been responsible for the transactions mentioned in paragraphs 3 and 4 of section 14, regardless of whether the bank had gone bankrupt.

3. The provisions of paragraph 5(b) of section 14 pertaining to declaration of assets and precautionary measures shall also apply mutatis mutandis to this provision.”

(b) Law no. 4672 amending Law no. 4389

96. The relevant parts of section 15 § 3 of Law no. 4389 as amended by Law no. 4672 and section 15 § 7 added by Law no. 4672 read as follows:

Section 15

“3. ... As regards the receivables that it has taken over, the Fund shall be authorised to carry out all kinds of transactions, including discount, reaching of a settlement, acquisition of movable and immovable properties and all kinds of rights and receivables, without being subject to limitation, and to set these off against the amounts owed to it ...

7. ... (b) the amounts due from the use of bank resources and assets by the shareholders of banks whose shares have been partly or wholly transferred to the Fund and who, directly or indirectly, alone or jointly, hold the management and supervision of that bank, or their executives who, through the board of directors, credit committees, branches and other authorised persons or officials or using other means, acquired or helped third persons acquire money, property, rights and receivables by way of creating, directly or indirectly, a security interest on the bank’s resources and assets in favour of third parties, showing these as collateral, extending loans to persons who do not have the means to repay, extending loans to secure financing, opening accounts in domestic and foreign banks and financial institutions under the name of deposit or other names or using these accounts as collateral or for other purposes or through other unlawful transactions, shall be considered to be owed to the Fund. ...”

97. Provisional section 1 of Law no. 4672 stipulated that some of the provisions added to Law no. 4389 by Law no. 4672, including section 15 § 7, shall also apply to the receivables owed to the Fund in connection with banks whose management, supervision and shareholding rights, except dividends or shares, have been transferred to the Fund prior to the entry into force of Law no. 4672.

(c) Law no. 4743 amending Law no. 4389

98. The relevant part of section 15 § 3 of the Law no. 4389 as amended by the Law no. 4743 provides:

Section 15

“3. ... As regards all of its receivables under this law, including those which it had taken over or it is tasked and authorised to claim in lawsuits or execution proceedings, the Fund shall be authorised to carry out all kinds of transactions including discount, to settle, to acquire movable and immovable properties and all kinds of rights and receivables, without being subject to limitation, so as to set these off against the amounts owed to it, to enter into agreements with debtors, including the rescheduling of the repayment of the debt and within the framework of these agreements to take or not to take precautionary measures as per sections 14 and 17 of this law, to file or not to file lawsuits or to request the courts to suspend the civil lawsuits already filed for the duration of these agreements ...”

(d) Law no. 5411 repealing and replacing Law no. 4389

99. The relevant parts of Law no. 5411 read as follows:

Section 108

“The majority shareholders and executives of banks which have been transferred to the Fund ... shall return and compensate for the resources used as explained in the below paragraphs as well as the damages arising from such misuse, within the period given by the Fund, without prejudice to the provisions of this law governing personal liability.

For the purposes of this provision, the banks’ resources and assets used by the majority shareholders and executives of banks, through the board of directors, credit committees, executives, branches and other authorised persons and officials to acquire or help third persons to acquire money, property and any kind of rights and receivables directly or indirectly by way of creating a security interest on the bank’s resources and assets, showing these as collateral, extending loans to persons who do not have any credibility, extending loans to secure financing, opening accounts in domestic and foreign banks and financial institutions under the name of deposit or other names or using these accounts as collateral or for other purposes or through other ways, shall be considered as fraudulently misused resources. ...”

Section 132

“... As regards the receivables collected by it, the Fund shall be authorised to carry out all kinds of transactions including discount, to settle, to sell or buy back, to acquire movable and immovable properties and all kinds of rights and receivables on account of its claim under the conditions it will specify; to enter into agreements with debtors including a new repayment plan for its receivables, to apply or not to apply precautionary measures according to the principles and procedures to be determined by its board pursuant to the provisions of this law under the agreements it has concluded with the debtors, to file or not to file lawsuits and to ask the court to suspend the lawsuits already filed for the duration of those agreements. ...”

Section 134

“If the Fund considers it useful for the collection of its receivables, it shall be authorised to take over the shareholders’ rights, except for dividends, associated with all and/or some of their shares, and their management and control, ... , of the following regardless of whether these are indebted to the Fund:

(a) the subsidiaries [of a bank transferred to the Fund],

(b) the legal person shareholders holding the majority of the shares of a bank transferred to the Fund,

(c) the companies in which the legal and real person majority shareholders of a bank transferred to the Fund are majority shareholders, and

(d) the shareholders of companies acting on behalf of the above-listed persons and entities or acquiring funds or rights on their account.

The Fund ... shall be authorised to sell the shares of companies owned by the persons referred to in this provision and/or licences, permits and all other rights and assets, including rights arising from the temporary frequency utilization, channel utilization and concession agreements ... and/or all properties owned by these companies or those assets in proportion to the shares taken over by the Fund and to apply the proceeds to set off against its receivables or to pay the debts owed by those companies ...

In order to ensure the collection of its receivables, the Fund shall be authorised to bring together the attached assets, the rights arising from licences, permits and concession contracts and all other rights and assets under the contracts that are accessories or inseparable parts of these assets but do not have a separate economic value alone so as to sell these in a manner that will ensure commercial and economic integrity, to sell the attached properties even though these are owned by more than one debtor and/or more than one creditor, to establish the payment method and currency of the tender value, the conditions required to be met by buyers, the payment date, other principles and procedures applicable to the tender as well as sale conditions ... , to acquire the commercial and economic unit towards the settlement of the debts owed to the Fund ... The board of the Fund shall set up a sale committee consisting of a minimum of three members to execute the sale process and shall appoint the chairman of the committee ... The estimated value of the commercial and economic unit shall be set by the board of the Fund on the basis of a report to be prepared by the sale committee taking into account the valuation reports prepared by expert persons and entities ... The list of ranking for the distribution of the proceeds of the tender shall be prepared by the sale committee ...

Other principles and procedures applicable to the sales to be carried out pursuant to this provision shall be set out in a regulation to be issued by the Fund ...

The proceeds of the sale of the assets and properties of real and legal persons, either as a commercial and economic unit or separately under this provision, shall be used to repay the outstanding debts of the companies, in the following order: the debts arising out of the purchase of technical knowledge, software, hardware, equipment, goods and services, the debts to the State and social security organisations ... and the remaining part shall be used to pay the debts owed to other public bodies and entities and regulatory bodies on a pro rata basis provided that these debts accrued prior to the date of the sale. ...

The Fund shall be authorised to place precautionary attachment on the money, goods, rights or receivables cited in this article or to put them in custody and take over any such assets at a value to be determined taking into appraisal reports ... to set off against its receivables. ...”

Provisional Section 11

“Sections 14, 15, ... , 17, ... of Law No. 4389, which is repealed by this law, shall remain applicable until the Fund collects all kinds of receivables and finalises all kinds of procedures initiated against banks whose shareholder rights, except dividends, as well as management and control have been transferred to the Fund ... , prior to 26 December 2013.

The provisions of sections 14 §§ 5 and 6 of Law no. 4389, which have been repealed by this law, shall continue to apply for banks in connection with which procedures were carried out under section 14 of Law no. 4389 ...”

Provisional Section 16

“The provisions of this law which are favourable to the Fund and facilitate the collection of its receivables, shall apply retroactively.”

(e) The Regulation on the Sale of Foreclosed Assets Forming an Economic and Commercial Unit by the Savings Deposit Insurance Fund

100. The relevant provisions of the Regulation issued by the Fund provide:

Section 4

“The assets owned by one or more real or legal persons that are attached ... , licences, permits and concession agreements and rights arising out of the provisional or permanent use of frequency and channel and agreements that are accessories or inseparable parts of these properties, rights and/or assets and all or part of all other properties, rights and/or assets including those under those contracts that do not have a separate economic value shall constitute a commercial and economic unit.”

Section 26

“1. The list of ranking pertaining to the distribution of the proceeds of the sale of the commercial and economic unit shall be prepared by the sale committee as per Law no. 5411 after the tender price is paid by the purchaser.

2. Following the deduction of the costs related to the sale, provided that they accrue prior to the date of sale, the outstanding debts under section 25 of this regulation and the debts owed to the State and social security authorities shall be first paid out and the remaining part shall be used to pay the debts owed to other public bodies and entities and regulatory bodies on a pro rata basis ...

4. A copy of the list of ranking shall be ... published in the Official Gazette.

5. Objections to the list of ranking can be made within 15 days. The time period starts from the date of its publication.”

2. Provisions concerning litigation costs and attorney fees

101. Under Turkish law, the party against whom the first instance court decided has an obligation to bear the court fees (yargılama giderleri).

102. The court fees include not only different items of expenditure made by the court throughout the proceedings, which is in practice referred to as litigation costs, but also attorney fees (vekalet ücreti) which are payable in the event that the party in favour of whom the court decided is represented by an attorney.

103. Depending on the nature and the subject-matter of the dispute and the relevant provisions in the applicable laws, a court may award in attorney fees a fixed sum set out in the Tariff or calculate the attorney fees on a pro rata basis, i.e. in proportion to the amount in dispute.

(a) Civil procedure legislation

104. The relevant provisions of the repealed Civil Procedure Code (Law no. 1086) pertaining to the awarding of court fees in the event of withdrawal of the lawsuit or a decision that the case is devoid of subject matter read as follows:

Section 94

“The party which withdraws or accepts [the lawsuit] shall be required to pay the court fees as if [the court] ruled against him/her ...”

Section 425

“In lawsuits where it is not possible to reach a decision on account of the death of a party or abandonment of the lawsuit, the judge shall decide on the court fees.”

105. The relevant provisions of the Civil Procedure Code (Law no. 6100), which entered into force on 4 February 2011 and repealed and replaced Law no. 1086, pertaining to the awarding of court fees in the event of withdrawal of the lawsuit or a decision that the case is devoid of subject matter decision, read as follows:

Section 312

“The party who makes a withdrawal or acceptance declaration shall be ordered to pay court fees as if he/she had been found against ...”

Section 331

“If there is no reason to deliver a decision on the merits of the dispute on account of the lawsuit becoming devoid of subject-matter, the judge shall determine the court fees by taking into account the validity [of the claims] of the parties at the time of the introduction of the lawsuit.”

(b) The provisions of the Tariff on attorney fees

106. As a general rule, the Tariff stipulates that in the event that the subject-matter of the legal services provided by an attorney is money or has a monetary value, the attorney fees shall depend on the amount of the claim and be calculated by applying the coefficients provided for in the annex of the Tariff to the amount in question.

107. In limited situations enumerated in the Tariff and in cases where there is an express provision of law, regardless of the subject-matter and the nature of the dispute, the court shall award a fixed sum that is provided in the annex to the Tariff in attorney fees.

108. The amount of the fixed attorney fees and the coefficients used to calculate pro rata attorney fees are updated with the publication of the tariff for the next year in the Official Gazette at the end of each year.

109. The Tariff also stipulates that if the court, after the completion of the evidence collection stage, for some reason decides that the lawsuit had become devoid of subject-matter or the lawsuit is withdrawn the fees in the Tariff shall be awarded in full.

110. The aforementioned terms of the Tariff remained the same throughout the years and were in force at the time the domestic courts delivered their decisions in the present cases.

(c) The provisions of the banking legislation on attorney fees

111. The relevant provision of Law no. 5411, concerning attorney fees in the proceedings brought by the Fund in respect of banks whose operating permits have been revoked, provides:

Section 133

“If the liquidation process of the banks whose operating permits have been revoked have been completed but the receivables of the bankruptcy and liquidation administrations have not been collected, the Fund may file lawsuits against the shareholders, former members of the board of directors and auditors who have been found responsible for the compensation of the losses that they have caused by their actions ... within five years following completion of the liquidation ...

In proceedings brought or to be brought [by the Fund] under this provision, a fixed sum shall be paid in attorney fees to the party in whose favour the dispute is settled.”

3. Provisions concerning interim injunctions

(a) Civil procedure legislation

112. The relevant provisions of the Law no. 1086, pertaining to interim injunction, read as follows:

Article 103

“... The judge may order the imposition of an interim injunction in circumstances where the deferral [of action] may be dangerous or may cause significant harm, with a view to averting such danger or damage.”

Article 105

“A request for an interim measure shall be submitted to the judge by a written petition. Immediately after the request and as a matter of urgency both parties shall be summoned and the required decision shall be given even if they do not attend.”

Section 110

“The party requesting the ordering of an interim injunction shall be required to post collateral to secure the potential losses that the other party or third persons may incur as a result of the interim injunction. If the circumstances so require, the judge may waive such obligation and if the party requesting the interim injunction is the State or a person benefitting from legal aid the posting of collateral shall not be required.”

Article 112

“Following the pronouncement or delivery of the judgment on the merits, the interim measure shall be lifted. However, the court may decide to prolong the measure for a period that it shall set to ensure the enforcement of the judgment ...”

113. The relevant provisions of the Law no. 6100, pertaining to interim injunction, provide:

Article 389

“If there is a concern that a change in the existing situation would significantly impede or make impossible the vindication of a right or the delay would cause harm or serious loss, a preliminary injunction in respect of the subject-matter of the dispute may be ordered.”

Article 396

“If it is established that the situation and the conditions have changed, [the court] may order to change or lift the interim injunction, without requiring collateral.”

Article 397

“... 2. The effects of the interim injunction, unless stated otherwise, shall continue until the decision becomes final.”

Article 399

“1. If it is determined that the party who obtained a preliminary injunction did not have a valid ground at the time of the request for the preliminary injunction or the preliminary injunction is lifted automatically or upon objection, that party shall be required to compensate the loss [of the other party] caused by the interim injunction ...

2. Proceedings for unjust preliminary injunction shall be brought before the court which decided on the merits of the dispute.

3. The right to bring the compensation proceedings shall be time-barred within one year following the finalisation of the judgment or the lifting of the preliminary injunction.”

(b) The banking legislation

114. The relevant provision of section 14 § 5 of the Law no. 4389, as amended by Law no. 4491, reads as follows:

Section 14

“The Fund shall be authorised ...

(bb) to request the shareholders who, directly or indirectly, alone or jointly, hold the management and supervision and the real person shareholders who own more than 10% of the shares in the legal person shareholders to provide a declaration of property showing the immovable properties, participations, movable properties, rights, receivables and securities that can be attached and all kinds of revenues and salaries belonging to them, their spouses and children under custody as well as the immovable properties, movable property rights, receivables and securities that can be attached which they acquired either free of charge or for a consideration within the last two years prior to the declaration,

(bc) to request the court to take all precautionary measures for the protection of the interests of creditors, including the ordering of an interim injunction or precautionary attachment on the assets owned by the shareholders who hold directly or indirectly, alone or jointly, hold the management and supervision [of the bank], without being required to provide collateral. ...”

115. Sub-paragraph (c) of section 14 § 7 added to the Law no. 4389 by Law no. 4672 reads as follows:

Section 14 § 7

“c) If ... the Fund elects to bring an action or initiate execution proceedings to collect its receivables, sections 2, 23 and 29 of the Law on Charges (Law no. 492) and section 1 of the Law on the Levy of Charges for the Construction of Prisons and Court Houses and the Fees Charged to Prisoners for Food (Law no. 2458) shall not apply in those proceedings. The requirement concerning the submission of collateral to request interim injunctions and precautionary attachment and the payment of charges by the other party to receive and serve a copy of the judgment shall also not apply to ... the Fund ...”

116. The relevant provisions of the Law no. 5411 provide:

Section 136

“To ensure the collection of the Fund’s receivables, the interim injunction and precautionary attachment decisions delivered in the lawsuits and execution proceedings brought by the Fund as per the provisions of this law, in respect of money, all properties, rights and receivables shall constitute the legal security of the receivables which form the subject-matter of these lawsuits and proceedings and shall remain until the court judgments become final or the execution proceedings end ...”

Section 138

“In case any kind of lawsuit and execution proceedings to which the Fund is a party is concluded against the Fund in whole or in part, the compensation and penalties stated in the Execution and Bankruptcy Law No. 2004 shall not apply to the Fund. ...”

COMPLAINTS

The applicants complain that the suspension of the lawsuits brought against them upon the unilateral request of the Fund, a prerogative conferred on the Fund, in the majority of the lawsuits, subsequent to their respective introduction dates, resulted in the lawsuits hanging over them for an indefinite time period by precluding the courts from reaching a conclusive decision and therefore constituted a violation of their right to fair hearing guaranteed under Article 6 of the Convention. They submit that because the courts did not deliver a decision on the merits of the dispute in those suspended proceedings they were not awarded any attorney fees despite being represented by an attorney throughout the entire proceedings. In respect of the proceedings in which they received a fixed sum in attorney fees or did not receive any sum (registered under the docket nos. 2011/399 E., 2012/291 E. and 2008/271 E. (2017/283 E.)), they further submit that the domestic courts should have awarded them attorney fees in proportion to the amount claimed by the Fund as per the provisions of the Tariff. In applications nos. 31707/07 and 21392/08, concerning the proceedings under the docket nos. 2001/1745 E. and 2008/192 E., the applicants also complain about being unfairly held responsible to pay the litigation costs and attorney fees, arguing that in the event of the lawsuit becoming devoid of subject-matter under the applicable legislation the party who caused the filing of the lawsuit can be held responsible for litigation costs.

The applicants further maintain that the interim injunction placed on their assets at the Fund’s request, which in some cases lasted for over ten years on average while in others it is still being maintained by the domestic courts unjustifiably deprived and continues to deprive them of a large of portion of their assets in violation of their right under Article 1 of Protocol No. 1, even though the Fund mostly recovered its alleged losses from the majority shareholders of the banks by way of friendly settlements.

QUESTIONS TO THE PARTIES

1. As regards the complaints under Article 6 of the Convention in relation to the proceedings against the applicants concerning Etibank that were suspended by the domestic courts at the request of the Savings Deposit Insurance Fund (“the Fund”) (see the table in the Appendix for the details of those proceedings):

(i) Was the principle of equality of arms guaranteed under Article 6 § 1 of the Convention respected in those proceedings regard being had to the fact that the right to request the suspension or resumption of the proceedings was conferred on the Fund only and that the domestic courts suspended the proceedings for the duration of the protocol between the Fund and the majority shareholders of Etibank without providing an opportunity for the applicants to submit their comments on the Fund’s request? In this connection, did the applicants have any real opportunity to oppose to the Fund’s request for the suspension of the proceedings or request the courts to resume the suspended proceedings? Finally, did the suspension of the proceedings for an uncertain time period preclude the applicants’ right to obtain a determination of the dispute by a court (see, mutatis mutandis, Kutić v. Croatia, no. 48778/99, §§ 25-30, ECHR 2002‑II)?

(ii) In light of the Court’s case-law (see Stankiewicz v. Poland, no. 46917/99, 6 April 2006, ECHR 2006-VI), were the domestic courts’ decisions not to issue any ruling regarding attorney fees in those proceedings compatible with the requirements of a fair hearing under Article 6 § 1 of the Convention, taking into account the fact that they were represented by an attorney and an important portion of their assets had been placed under interim injunction? In that connection, could the protocols made between the Fund and the majority shareholders of the bank be regarded as settlement agreements which, according to the applicants, would make attorney fees in proportion to the amounts claimed by the Fund due in their favour as per the provisions of the Tariff on Minimum Attorney Fees adopted by the Union of Turkish Bars Association (“the Tariff”) and published in the Official Gazette?

2. As regards the complaints under Article 6 of the Convention in relation to the proceedings set out below brought by the Fund against the applicants concerning both Sümerbank and Etibank:

(i) Did the decision not to award any attorney fees to the second applicant in the proceedings registered under the docket no. 2012/291 E. as well as the decision to award both applicants only fixed sums in attorney fees in the proceedings under the docket nos. 2011/399 E. and 2008/271 E. (2017/283 E.), render those proceedings unfair within the meaning of Article 6 of the Convention, regard being had to the fact that the domestic courts did not provide any reasoning as regards their decisions on attorney fees and that for cases with the same outcome the Tariff provides for the payment of attorney fees in full and in proportion to the amount in dispute (see Stankiewicz, cited above)? In this respect, the Government are asked to clarify the legal basis for the determinations made by the domestic courts concerning attorney fees in the aforementioned proceedings.

(ii) Did the decision to order the applicants to pay litigation costs and attorney fees without providing an adequate reasoning in the proceedings under the docket nos. 2001/1745 E. and 2008/192 E., impose a considerable financial burden on the applicants and restrict their right of access to court in violation of Article 6 of the Convention taking into account that a significant portion of their assets had been placed under interim injunction by decisions delivered by the domestic courts in other proceedings and that in cases where the lawsuit becomes devoid of subject-matter, the applicable law required the courts to make a determination as to which party was in the right at the beginning of the proceedings in making a decision as to the litigation costs (see, among other authorities, Stankov v. Bulgaria, no. 68490/01, §§ 54-55, 12 July 2007, and Sace Elektrik Ticaret ve Sanayi A.Ş. v. Turkey, no. 20577/05, §§ 27-28, 22 October 2013)?

3. As regards the complaints under Article 1 of Protocol No. 1 regarding the proceedings in which the courts decided to freeze the applicants’ assets (see rightmost column of the table in the Appendix for those proceedings) and regardless of whether the interim injunction was eventually lifted or is being still maintained:

(i) Did the interim injunction orders issued by the domestic courts constitute an interference with the applicants’ right to peaceful enjoyment of their possessions?

(ii) If so, was the interference proportionate, in particular did it impose a significant burden on the applicants, in view of the fact that the interim injunction orders were maintained for a long time period, in some cases exceeding sixteen years and that according to the submissions of the applicants the Fund had, during the course of the proceedings, recovered to a great extent, from the majority shareholders of the banks, its claims in connection with the losses incurred by the those banks and for the remaining part it had obtained significant guarantees under the protocols that it had made with the majority shareholders?

(iii) As regards the proceedings under the docket nos. 2008/192 E., 2008/509 E. and 2008/271 E. (2011/293 E.), where the courts lifted the interim injunction on the second applicant’s assets, did the applicant have an effective remedy under Turkish law to recover from the Fund the losses that he suffered due to the interim injunction taking also into account the provisions of Law no. 5411, including section 138, which provides for immunities and privileges for the Fund in the event that the courts do not rule in its favour in the proceedings concerning transferred banks.

The parties are invited to provide the following information and/or documents:

Application no.

Docket no.

Information requested from the parties

31707/07

2001/1745 E.

The reasoned decision delivered by the first-instance court on 17 April 2006, ordering the first applicant to pay litigation costs and attorney fees

27112/08

2008/271 E. (2017/283 E.)

- Information and documents as to the date of the receipt of the quashing decision of the Court of Cassation of 10 May 2007 and whether a request for rectification was submitted

- Information and documents as to whether the decision of 1 June 2017 has been finalised – if not submission of all documents relevant to the ensuing proceedings, including petitions submitted by the parties and the decisions taken by the Court of Cassation

3066/11

2002/692 E.

- The decision of 21 June 2002 placing an interim injunction on the first applicant’s assets

- The decision of 24 October 2002 by which the injunction was partly maintained

- Information and documents concerning the appeal proceedings against the decision of 23 February 2009 including petitions submitted by the parties and the decisions taken by the Court of Cassation and the outcome of the proceedings

- Information as to the developments regarding the injunction following the decision of 23 February 2009

2001/1299

All documents concerning the proceedings which were not submitted with the application including, in particular, the decisions of 31 October 2002 and 9 February 2009 which set out that the interim injunction on the first applicant’s assets shall be maintained

2008/329 E.

2008/334 E.

2008/335 E.

- Clarification as to whether an interim injunction was placed on the applicant’s assets – while the domestic court dismissed with its decision of 26 October 2001 the request for the placing of an injunction on the applicant’s assets, as regards the proceedings under the docket no. 2008/335 in the decision of 12 March 2015 and as regards the remaining proceedings according to the applicant’s allegations, the courts ordered the maintaining of the injunction on the applicant’s assets

- The decisions of 12 March 2015 rendered by the domestic courts in the proceedings under the docket nos. 2008/239 and 2008/334

32844/17

2012/291 E.

Information and documents regarding the outcome of the appeal proceedings

In addition to the information and/or documents set out above, the parties are also invited to inform the Court and submit relevant documents as to:

 the latest status of the list of ranking pertaining to the sale of the ATV-Sabah Economic and Commercial Unit,any developments that are relevant to the proceedings which constitute the subject of the present applications, in particular information about the suspended proceedings and interim injunctions which have been maintained by the courts, andthe proceedings brought by the applicants against the Fund for the recovery of the losses that they suffered due to the placement of interim injunction on their assets (if any).

APPENDIX

No.

Application no.

Lodged on

Applicant

Date of birth

Place of residence

Date and details of the initial proceedings

Docket No. of the Final Proceedings

Interim

Injunction

Date and Reasoning of the Final Court Decision

Ruling on Attorney Fees/ Litigation Costs

Appeal Proceedings against the Decision on Merits

Complaints Communicated to the Parties

A. PROCEEDINGS CONCERNING SÜMERBANK   

32844/17

21/04/2008

Şükrü KARAHASANOĞLU

01/02/1947

Istanbul

14/08/2000

2000/973 E.

1st Commercial Court of Istanbul

Amount claimed:

248,569,000,000,000 old Turkish liras (TRL)[1] (equivalent to approximately EUR 425,579,380)

2012/291 E.

18/09/2000: Dismissal of the request for injunction

31/12/2012:

Lawsuit became devoid of subject-matter on the grounds that the payments under the protocol of 12 August 2004 covered the bank’s losses

No reason to rule any attorney fees in favour of any party

19/03/2013: Appeal against the first-instance court’s decision

Article 6:

Absence of any ruling on attorney fees in favour of the applicant

11/07/2000

2000/846 E.

2nd Commercial Court of Istanbul

(three lawsuits under the docket nos. 2001/14-539-940 E. were joined to this docket)

2008/271 E.

(Separate under docket no. 2011/293 E.)

18/05/2000: Injunction on all assets (Decision of 6th Commercial Court of Ankara)

21/09/2000: Lifting of the injunction on the movable assets and maintaining of the injunction on the remaining assets

23/01/2001: Reinstatement

of injunction on the movable assets

09/05/2006: Lifting of the injunction on the salary

09/05/2011: Lifting of the injunction on account of the withdrawal of the lawsuit

25/05/2011:

Dismissal of the lawsuit on account of its withdrawal by the Fund

21/2/2011:

The applicant’s waiver of his right to attorney fees

25/5/2011:

No request by the parties for attorney fees and therefore no reason to rule

on attorney fees

25/02/2011: The Fund’s waiver of its right to appeal

Article 1 of Protocol No.1:

Placing of an injunction on assets for almost eleven years

06/07/2000

2000/825 E.

9th Commercial Court of Istanbul

Amount claimed:

TRL 151,400,000,000 (equivalent to approximately EUR 254,682)

2011/399 E.

33rd Commercial Court of Istanbul

No request for injunction

13/03/2012:

Lawsuit became devoid of subject-matter on the grounds that the payments under the protocol of 12 August 2004 covered the bank’s losses

The applicant was awarded a fixed amount of TRY 1,200 (equivalent to approximately EUR 512 at the time of the decision) in attorney fees

14/04/2014: The Court of Cassation upheld the judgment dismissing the appeal and the decision became final

Article 6:

Awarding of a fixed sum in attorney fees instead of awarding of attorney fees on a pro rata basis

04/08/2000

2000/957 E.

2nd Commercial Court of Istanbul

2009/650 E.

07/09/2000: Injunction on all assets

21/09/2000: Lifting of injunction on all assets except for immovable properties

09/03/2011: Lifting of the injunction on account of the withdrawal of the lawsuit

09/03/2011:

Dismissal of the lawsuit on account of its withdrawal by the Fund

28/02/2011:

The applicant’s waiver of his right to attorney fees

09/03/2011:

No reason to rule on attorney fees

28/02/2011: The applicant’s waiver of the right to appeal

Article 1 of Protocol No.1:

Placing of an injunction on assets for almost eleven years

27112/08

27/05/2008

Zeki ÜNAL

23/01/1948

Istanbul

11/07/2001

2000/846 E.

2nd Commercial Court of Istanbul

(three lawsuits under the docket nos. 2001/14-940 E. were joined to this docket)

Amount claimed:

TRL 66,374,119,000,000

(equivalent to approximately EUR 57,536,311)

2008/271 E. (Separate decision under docket no. 2017/283 E.)

16/07/2001: Injunction on all assets

26/12/2001: Request for the lifting of the injunction

20/09/2002: Dismissal of the request

09/05/2006: Decision to maintain the injunction on the applicant’s assets except for his salary

05/01/2012: Maintaining of the injunction until the decision becomes final

01/06/2017: No ruling about the injunction in the decision

01/06/2017:

Dismissal of the lawsuit on account of its withdrawal by the Fund

The applicant was awarded a fixed amount of TRY 7,920 (equivalent to approximately EUR 1,995 at the time of the decision) in attorney fees

The applicant did not inform the Court about the developments in the appeal proceedings

Article 6:

Awarding of a fixed sum in attorney fees instead of awarding of attorney fees on a pro rata basis

Article 1 of Protocol No.1:

Maintaining of an injunction on assets for over sixteen years

B. PROCEEDINGS CONCERNING ETİBANK   

21392/08

06/08/2009

Şükrü KARAHASANOĞLU

01/02/1947

Istanbul

27/06/2001

2001/1200 E.

1st Commercial Court of Istanbul

Amount claimed:

TRL 3,185,455,000,000

(equivalent to approximately EUR 2,963,536)

2008/192 E.

29/06/2001: Injunction on all assets

23/05/2011: Lifting of the injunction on the grounds that it had automatically lapsed

30/06/2008:

Lawsuit devoid of subject-matter on account of the repayment of the loan by the borrower

The court ordered the applicant to pay the Fund TRY 11,678.43 (equivalent to approximately EUR 7,116 at the time of the decision) in litigation costs

21/05/2009: The Court of Cassation upheld the judgment dismissing the appeal and the decision became final

Article 6:

Ordering of the applicant to pay litigation costs even though the lawsuit had become devoid of subject-matter

Article 1 of Protocol No. 1:

Placing of an injunction on assets for over sixteen years   

31707/07

18/07/2007

Zeki ÜNAL

23/01/1948

Istanbul

27/06/2001

2001/1200 E.

1st Commercial Court of Istanbul

Amount claimed:

TRL 3,185,455,000,000

(equivalent to approximately EUR 2,963,536)

2008/192 E.

No complaint about the interim injunction

30/06/2008:

Lawsuit devoid of subject-matter on account of the repayment of the loan by the borrower

17/04/2006:

The court ordered the applicant to pay a certain sum in litigation costs and TRY 400 (equivalent to approximately 243 EUR at the time of the decision) in attorney fees

30/06/2008: Following the quashing of the decision of 17 April 2006

the applicant was ordered to pay the Fund TRY 11,678.43 (equivalent to approximately EUR 7,116 at the time of the decision) in litigation costs

21/05/2009: The Court of Cassation upheld the judgment dismissing the appeal and the decision became final

Article 6:

- Ordering of the applicant to pay litigation costs and attorney fees even though the lawsuit had become devoid of subject-matter

07/05/2008

24/08/2001

1st Commercial Court of Istanbul

Amount claimed:

TRL 2,397,666,666,601

(equivalent to approximately EUR 4,088,288)

2001/1745 E.

04/09/2001: Dismissal of the request for injunction

17/04/2006:

Lawsuit devoid of subject-matter on account of the repayment of the loan by the borrower

The applicant was ordered to pay the Fund a fixed sum of TRY 400 (equivalent to approximately 243 EUR at the time of the decision) in attorney fees and TRY 16,082.55 (equivalent to approximately EUR 9,800 at the time of the decision) in litigation costs

15/11/2007: The Court of Cassation upheld the judgment dismissing the appeal and the decision became final

Article 6:

- Ordering of the applicant to pay litigation costs and attorney fees even though the lawsuit had become devoid of subject-matter

53870/09

07/08/2009

Şükrü KARAHASANOĞLU

01/02/1947

Istanbul

19/10/2001

2001/2193 E.

1st Commercial Court of Istanbul

Amount claimed:

TRL 2,309,320,672,346

(equivalent to approximately EUR 1,562,343)

2008/509 E.

26/10/2001: Injunction on all assets

21/11/2001: Request for the lifting of the injunction

27/12/2001: Dismissal of the request

23/05/2011: Lifting of the injunction on the grounds that it had automatically lapsed

31/12/2008:

Suspension of the proceedings pursuant to the protocol of 28 November 2008

No reason to rule on attorney fees since there is no decision on the merits

15/06/2009: The Court of Cassation upheld the judgment dismissing the appeal and the decision became final

Article 6:

- Suspension of the proceedings at the unilateral request of the Fund

- Absence of any ruling on attorney fees in favour of the applicant

Article 1 of Protocol No. 1:

Placing of an injunction on assets for almost ten years   

2458/11

27/08/2010

Şükrü KARAHASANOĞLU

01/02/1947

Istanbul

21/01/2002

2002/118 E.

1st Commercial Court of Istanbul

Amount claimed:

TRL 12,419,803,776,963

(equivalent to approximately EUR 10,619,891)

2008/331 E.

30/01/2002: Dismissal of the request for injunction

23/02/2009:

Suspension of the proceedings until the list of ranking for the sale of the Unit is finalised pursuant to the protocol of 28 November 2008

No reason to rule on attorney fees since there is no decision on the merits

15/03/2010: The Court of Cassation upheld the judgment dismissing the appeal and the decision became final

Article 6:

- Suspension of the proceedings at the unilateral request of the Fund

- Absence of any ruling on attorney fees in favour of the applicant

19/10/2001

2001/2192 E.

1st Commercial Court of Istanbul

Amount claimed:

TRL 22,487,732,463,222

(equivalent to approximately EUR 15,213,811)

2008/333 E.

26/10/2001: Injunction on all assets

27/12/2001: Dismissal of the request for the lifting of the injunction on the assets

24/10/2002: Lifting of the injunction on the salary, the pensions and the accounts up to TRL 10,000,000 or USD 5,000 or EUR 5,000

03/11/2008: Request for the lifting of the injunction

23/02/2009: Maintaining of the injunction on the remaining assets

07/05/2014: Request for the lifting of the injunction

12/03/2015: Dismissal of the request

27/04/2017: The Court of Cassation upheld the decision of 12 March 2015

23/02/2009:

Suspension of the proceedings until the list of ranking for the sale of the Unit is finalised pursuant to the protocol of 28 November 2008

No reason to rule on attorney fees since there is no decision on the merits

07/10/2010: The Court of Cassation upheld the judgment dismissing the appeal and the request for rectification and the decision became final

Article 6:

- Suspension of the proceedings at the unilateral request of the Fund

- Absence of any ruling on attorney fees in favour of the applicant

Article 1 of Protocol No. 1:

Maintaining of an injunction on assets for over sixteen years

19/10/2001

2001/2323 E.

1st Commercial Court of Istanbul

Amount claimed:

TRL 33,251,361,435,883

(equivalent to approximately EUR 22,495,818)

2008/336 E.

24 /04/2002: Dismissal of the request for injunction

23/02/2009:

Suspension of the proceedings until the list of ranking for the sale of the Unit is finalised pursuant to the protocol of 28 November 2008

No reason to rule on attorney fees since there is no decision on the merits

15/3/2010:

The Court of Cassation upheld the judgment dismissing the appeal and the decision became final

Article 6:

- Suspension of the proceedings at the unilateral request of the Fund

- Absence of any ruling on attorney fees in favour of the applicant

2458/11

3066/11

27/08/2010

08/11/2010

Şükrü KARAHASANOĞLU

01/02/1947

Istanbul

Zeki ÜNAL

23/01/1948

Istanbul

19/11/2001

2001/2314 E.

1st Commercial Court of Istanbul

Amount claimed:

TRL 10,552,728,842,231

(equivalent to approximately EUR 8,139,271)

2008/332 E.

18/02/2002: Injunction on all assets of both applicants

18/11/2002: Lifting of the injunction on the salary, the pensions and accounts up to TRL 10,000,000 or USD 5,000 or EUR 5,000

03/11/2008: Request for the lifting of the injunction

23/02/2009: Maintaining of the injunction on the remaining assets

07/05/2014: Request for the lifting of the injunction

12/03/2015: Dismissal of the request for both applicants

25/02/2016: The Court of Cassation upheld the decision of 12 March 2015

23/02/2009:

Suspension of the proceedings until the list of ranking for the sale of the Unit is finalised pursuant to the protocol of 28 November 2008

No reason to rule on attorney fees since there is no decision on the merits

18/03/2010: The Court of Cassation upheld the judgment dismissing the appeal and the decision became final

Article 6:

- Suspension of the proceedings at the unilateral request of the Fund

- Absence of any ruling on attorney fees in favour of the applicants

Article 1 of Protocol No. 1:

Maintaining of an injunction on assets for over thirteen years

19/10/2001

2001/2191 E.

1st Commercial Court of Istanbul

Amount claimed:

TRL 2,060,528,888,889

(equivalent to approximately EUR 1,394,026)

2008/334 E.

26/10/2001: Injunction on the assets of the second applicant only

27/12/2001: Dismissal of the request for the lifting of the injunction on the assets

24/10/2002: Lifting of the injunction on the salary, the pensions and the accounts up to TRL 10,000,000 or USD 5,000 or EUR 5,000

03/11/2008: Request for the lifting of the injunction

23/02/2009: Maintaining of the injunction on the assets of both applicants

07/05/2014: Request for the lifting of the injunction

12/03/2015: Dismissal of the request for both applicants

22/02/2016 (Docket Nos. 2008/334-335) and 25/02/2016 (Docket No. 2008/329): The Court of Cassation upheld the decision of 12 March 2015

23/02/2009:

Suspension of the proceedings until the list of ranking for the sale of the Unit is finalised pursuant to the protocol of 28 November 2008

No reason to rule on attorney fees since there is no decision on the merits

25/03/2010

(Docket No. 2008/329) and

15/03/2010 (Docket Nos. 2008/334-335) The Court of Cassation upheld the judgment dismissing the appeal and the decision became final

Article 6:

- Suspension of the proceedings at the unilateral request of the Fund

- Absence of any ruling on attorney fees in favour of the applicants

Article 1 of Protocol No. 1:

Maintaining of an injunction on assets for over fourteen years

19/10/2001

2001/2194 E.

1st Commercial Court of Istanbul

Amount claimed:

TRL 9,608,750,000,000

(equivalent to approximately EUR 6,500,687)

2008/329E.

19/10/2001

2001/2190 E.

1st Commercial Court of Istanbul

Amount claimed:

TRL 26,739,995,778,551

(equivalent to approximately EUR 18,090,630)

2008/335 E.

16/03/2001

2001/552

3rd Commercial Court of Istanbul

Amount claimed:

TRL 112,402,403,131,488

(equivalent to approximately EUR 126,025,367)

2009/396 E.

2nd Commercial Court of Istanbul

10/04/2001: Injunction on all assets of both applicants

13/07/2006: Maintaining of the injunction until the decision becomes final

22/06/2001: Partial lifting of the injunction on the applicants’ salaries and pensions

27/09/2001: Lifting of the injunction on the applicants’ salaries

21/10/2002: Lifting of the injunction on the second applicant’s salary, pensions and accounts up to TRL 10,000,000 or USD 5,000 or EUR 5,000

21/12/2009: Maintaining of the injunction on the remaining assets

21/12/2009:

Suspension of the proceedings pursuant to the terms and conditions of the protocol and section 15 (3) of the Law no. 4389 and section 132 (10) of the Law no. 5411

No reason to rule on attorney fees since there is no decision on the merits

25/05/2011: The Court of Cassation upheld the judgment dismissing the appeal and the decision became final

Article 6:

- Suspension of the proceedings at the unilateral request of the Fund

- Absence of any ruling on attorney fees in favour of the applicant

Article 1 of Protocol No. 1:

Maintaining of an injunction on assets for over sixteen years   

3066/11

09/11/2010

Zeki ÜNAL

23/01/1948

Istanbul

02/05/2002

2002/563 E.

1st Commercial Court of Istanbul

Amount claimed:

TRL 28,795,051,521,800

(equivalent to approximately EUR 23,310,980)

7 May 2002: Dismissal of the request for injunction

23/02/2009:

Suspension of the proceedings until the list of ranking for the sale of the Unit is finalised pursuant to the protocol of 28 November 2008

No reason to rule on attorney fees since there is no decision on the merits

23/09/2010: The Court of Cassation upheld the judgment dismissing the appeal and the decision became final

Article 6:

- Suspension of the proceedings at the unilateral request of the Fund

- Absence of any ruling on attorney fees in favour of the applicant

10/06/2002

2002/692 E.

1st Commercial Court of Istanbul

Amount claimed:

TRL 2,376,106,273,197

(equivalent to approximately EUR 1,714,132)

21/06/2002: Injunction on all assets

24/10/2002: Lifting of the injunction on the salary, the pensions and the accounts up to TRL 10,000,000 or USD 5,000 or EUR 5,000

23/02/2009: Maintaining of the injunction on the remaining assets

23/02/2009:

Suspension of the proceedings until the list of ranking for the sale of the Unit is finalised pursuant to the protocol of 28 November 2008

No reason to rule on attorney fees since there is no decision on the merits

The applicant did not inform the Court about the developments in the appeal proceedings

Article 6:

- Suspension of the proceedings at the unilateral request of the Fund

- Absence of any ruling on attorney fees in favour of the applicant

Article 1 of Protocol No. 1:

Maintaining of an injunction on assets for over sixteen years

25/06/2001

2001/1299 E.

1st Commercial Court of Istanbul

(two lawsuits under docket nos. 2001/1578-2363 E. were joined to this docket)

Amount claimed:

TRL 521,445,156,583,210

(equivalent to approximately EUR 467,251,462)

12/07/2001: Injunction on all assets

04/10/2001: Request for the lifting of the injunction

04/10/2001: Dismissal of the request for the lifting of the injunction

31/10/2002: Maintaining of the injunction

18/04/2014: Request for the recognition of the automatic lifting of the injunction by virtue of section 112 of the Law no. 1086

09/05/2014: Dismissal of the request on the grounds that the request does not conform with section 112 of the Law no. 1086 and section 397 § 2 of the Law no. 6100 as the lawsuit has only been suspended

13/05/2014: Request for the lifting of the injunction

12/03/2015: Dismissal of the request for the lifting of the injunction

17/02/2016: The Court of Cassation upheld the decision of 12 March 2015

09/02/2009:

Suspension of the proceedings until the list of ranking for the sale of the Unit is finalised pursuant to the protocol of 28 November 2008

No reason to rule on attorney fees since there is no decision on the merits

25/05/2012: The Court of Cassation upheld the judgment dismissing the appeal and the decision became final

Article 6:

- Suspension of the proceedings at the unilateral request of the Fund

- Absence of any ruling on attorney fees in favour of the applicant

Article 1 of Protocol No. 1:

- Maintaining of an injunction on assets for over fifteen years

[1]. On 1 January 2005 the Turkish lira (TRY) entered into circulation, replacing the former Turkish lira (TRL). TRY 1 = TRL 1,000,000.

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