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Misinterpretation of the Article and Its Implications
The article is misinterpreted in practice as illustrated in this
example case: There is a valid relation between A and B and A issues
a written acknowledgement of debt regarding his legally valid debt to
creditor B. This receivable of A from B is assigned to C with a simu-
lated assignment transaction. A, who finds out that the assignment
transaction is simulated, refuses to pay his debt to C. C claimed
the receivable arising from the simulated transaction and the Court
decided that A is the debtor and it cannot plead simulation as a defense
against C.
The article within this framework is misinterpreted and misapplied
beyond the intention of legislator with regards to object, subject and
purpose of the article.
To articulate this article with regards to its intended object, and
give it a legal effect in this illustration the debt contract between A and
B must be a simulated transaction. This simulated debt arrangement
shall be subsequently assigned to a third party with a valid assignment
transaction. However, it should be noticed in the example scenario that
the simulated transaction executed between A and B is not the subject
matter governed by the article but the legally valid assignment trans-
action between B and C is the one to consider closely. In other words,
there is a confusion as to which transactions should be considered as
simulated for implementation of the article.
When the article is examined attentively with regards to the person
stated in the article, it will be noticed that the person who cannot assert
the simulation allegations as a defense is the debtor of a simulated debt
arrangement. The person against whom the simulation cannot be
pleaded is a bone fides third party, who is not party to the simulated
transaction. In the example scenario, A, the debtor of a valid debt con-
tract, is not party to the simulated transaction. The most important part
with regards to the persons for this article is that C, who is assigned as
creditor to the simulated debt arrangement, is not bona fides third party
but it is actually a party of the simulated transaction.
The purpose of the article is the most important aspect of expound-
ing the intended signification of the article. The lawmaker’s will is pro-
tection of the bona fides third party and not protection of the parties to
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