ARTICLE
8 September 2015

Constitutional Court Holds Property Owners Entitled To Receive Interest And Inflation If Payment Delays Occur During Expropriations

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The full text of a Constitutional Court decision was published in Official Gazette number 29442 on 11 August 2015.
Turkey Real Estate and Construction
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The full text of a Constitutional Court decision was published in Official Gazette number 29442 on 11 August 2015. The decision holds that during a land expropriation, if a delay occurs between determining the compensation amount and payment to the landowner, interest and inflation should be taken into account and added accordingly to ensure property rights are not violated.

In these circumstances, the applicants claimed their right to a fair hearing and property rights had been violated on the basis that:

  • A different method had been applied to calculate the expropriation amount compared to other law suits.
  • A judgment on the dispute had not been made within a reasonable period of time.
  • A loss of value had occurred due to the length of time which elapsed between the determination and payment.

The Constitutional Court rejected the applicant's first and second claims. However, the Constitutional Court upheld the third claim, determining that the applicant's property rights had been violated by the loss of value.

The court noted that due to the public interests involved, legislative principles must be applied and consideration paid when expropriating properties from landlords. Accordingly, a property's real value must be paid in cash and in advance. The Constitutional Court went on to state that if payment is delayed, the previously determined amount cannot be taken as the property's real value. Rather, the administration must consider interest and inflation, then compensate the difference to ensure property owners do not receive unjust treatment.

The full text of the Constitutional Court's reasoned decision can be found at this link (only available in Turkish).

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