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agreement, shall not be applied to the mortgages existing prior
to the effective date of the TCO.
The mortgage that is subject to this lawsuit was established in
2008, which is prior to the effective date of the TCO. Due to this fact,
and in the light of the Implementation Law, Articles 1 and 7, the Court
of Cassation has decided that the regulations on general transaction
terms of the TCO shall not be implemented in this case, and the plain-
tiff bank shall be able to continue the execution proceeding to the detri-
ment of the defendant, determined as a joint surety that is limited to the
mortgage margin in the mortgage agreement table, within the scope of
the Law that was in effect on the date of the execution proceeding.
Conclusion
Although it is stated in the decision that the objections shall be
refused, and the execution proceeding shall continue, due to the fact
that the execution proceeding was initiated prior to the effective date of
the TCO, the Court of Cassation has enabled the validity assessment of
the general transaction terms for the clauses imposed by the banks to
the mortgage agreement determining the mortgagor as a joint debtor
and surety. In light of this decision, and pursuant to the Implementation
Law, Articles 1 and 7, following 01.07.2012, the effective date of the
TCO, the clauses that the banks add to the loan agreements, which ren-
der the mortgagor as a joint debtor and surety, shall be deemed to not
have been written.
LAW OF OBLIGATIONS
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