Concept and Types of Rejection of Inheritance

Rejection of inheritance refers to the act by which an heir declines to accept the inheritance that devolves upon them upon the death of the decedent, thereby relinquishing their inheritance rights. The Turkish Civil Code regulates rejection of inheritance in two forms: actual rejection (TCC Art. 605/1) and deemed rejection (TCC Art. 605/2). Both types of rejection enable the heir to be released from the rights and obligations arising from the inheritance; however, they differ significantly in terms of application conditions, deadlines, and methods of proof.

Actual rejection is the explicit rejection of inheritance by the heir through an oral or written declaration to the civil court of peace within three months from the date they learned of the decedent's death. Actual rejection is a time-bound act that requires an active declaration of will by the heir. The three-month period is a prescriptive period, and upon its expiry, the heir is deemed to have accepted the inheritance (TCC Art. 610).

Deemed rejection, the main subject of this article, has a different structure from actual rejection. Under TCC Art. 605/2, if it is clearly apparent or officially established at the date of the decedent's death that the decedent was unable to pay their debts (was insolvent), the inheritance is deemed rejected. In deemed rejection, the heir is not required to make any declaration; the insolvency presumption operates automatically.

Legal Basis of Deemed Rejection: TCC Art. 605/2

TCC Art. 605/2 constitutes the fundamental legal basis for deemed rejection. According to this provision: 'If the insolvency of the decedent at the date of death is clearly apparent or officially established, the inheritance is deemed rejected.' This provision was introduced to protect heirs from the risk of being deemed to have accepted an insolvent inheritance.

The foundation of deemed rejection rests on the 'insolvency presumption.' Insolvency refers to the situation where the decedent's active assets (receivables, immovable properties, movable properties, bank accounts, etc.) are less than their passive liabilities (debts, obligations, tax debts, etc.). This situation can be demonstrated in two ways: being clearly apparent or being officially established.

Clearly apparent: If it is known by everyone at the date of the decedent's death that they were insolvent -- for example, if seizure proceedings were carried out at their home, enforcement files were opened, or they had numerous unpaid debts -- this situation is considered clearly apparent. The clearly apparent state is a factual situation and is determined by evaluating the concrete circumstances.

Officially established: This refers to the situation where the decedent's insolvency has been proven by an official document or procedure. A bankruptcy decision, certificate of insolvency, or failure to object to a payment order are examples of officially established insolvency.

The Deemed Rejection Presumption and Burden of Proof

The regulation in TCC Art. 605/2 is in the nature of a presumption. In cases of insolvency, the inheritance is deemed rejected; however, this is an ordinary (rebuttable) presumption. Heirs or creditors have the opportunity to rebut this presumption.

For the deemed rejection presumption to operate, there is no need to file a lawsuit or make a declaration. If insolvency exists, the inheritance is automatically deemed rejected. However, in practice, a declaratory lawsuit generally needs to be filed for deemed rejection to be established and to be usable in official transactions. This lawsuit is the declaratory action for deemed rejection of inheritance.

An important distinction must be noted regarding the burden of proof. When heirs rely on the deemed rejection presumption and assert that the inheritance is deemed rejected, they must prove the insolvency. Conversely, creditors or other interested parties who claim that the estate is not insolvent may also prove the contrary. Proof can be made by any type of evidence: enforcement files, certificates of insolvency, bank account statements, immovable and movable property records, tax debts, medical expenses, and other documents.

Declaratory Action for Deemed Rejection of Inheritance

Deemed rejection occurs automatically under TCC Art. 605/2; however, in practice, heirs generally need to file a declaratory action to benefit from the deemed rejection presumption. This lawsuit is called the declaratory action for deemed rejection of inheritance and aims to establish through a court decision that the estate is insolvent.

The lawsuit may be filed as contested or non-contested. It is also possible for an heir to raise deemed rejection as a defense against enforcement proceedings or a claim for payment directed at the heirs by the decedent's creditors. In this case, the heir can be released from liability based on the insolvency presumption even without having made an actual rejection declaration.

Competent court: The competent court in a declaratory action for deemed rejection of inheritance is the civil court of first instance. The authorized court is the court at the decedent's last place of domicile.

Plaintiff: Heirs or persons whose inheritance rights are affected may be plaintiffs. Each heir may file the lawsuit individually or jointly.

Defendant: The lawsuit may be filed against the decedent's creditors or without naming a defendant. In proceedings or lawsuits filed by creditors against heirs, the heir may raise deemed rejection as a defense.

Filing Deadline

One of the most important aspects of deemed rejection is the filing deadline. Unlike actual rejection, there is no definitive three-month prescriptive period. According to Court of Cassation case law, there is no time limitation for deemed rejection. Heirs may file a declaratory action at any time or raise deemed rejection as a defense in proceedings and lawsuits directed at them.

However, this unlimited timeframe is subject to certain limitations. If the heir has taken possession of the estate, used estate assets, or disposed of them, they are deemed to have implicitly accepted the inheritance (TCC Art. 610). In cases of implicit acceptance, the deemed rejection presumption can no longer be relied upon. Therefore, it is of great importance that heirs do not touch the estate assets and do not carry out any disposition over the estate.

Necessary acts performed without taking possession of the estate (such as covering funeral expenses, paying rent for the residence, and other urgent and necessary expenditures) are not considered implicit acceptance. The Court of Cassation has accepted that such necessary acts do not constitute acceptance of the inheritance.

Determination of an Insolvent Estate

In a deemed rejection lawsuit, the court determines whether the estate is insolvent. This determination is made by comparing the decedent's active and passive assets at the date of death.

Active assets of the estate: All asset values owned by the decedent at the date of death constitute the active assets. These include immovable properties (verified through land registry records), movable properties (vehicles, bank accounts, securities, valuable items), receivables (claims to be collected from third parties), rental income, and other economic values.

Passive liabilities of the estate: All debts of the decedent at the date of death constitute the passive liabilities. These include bank loan debts, personal debts, tax debts, social security debts, debts in enforcement files, surety debts, indemnity obligations, and funeral expenses.

The court determines the active and passive assets of the estate through an expert report. If the passive liabilities exceed the active assets, the estate is deemed insolvent and the operation of the deemed rejection presumption is established. The expert report examines in detail the fair market values of immovable properties, bank account balances, debt amounts in enforcement files, and other financial elements.

Consequences of Deemed Rejection

When deemed rejection is established, the inheritance is deemed rejected for all legal heirs. Unlike actual rejection, deemed rejection covers all heirs; that is, when one heir raises the insolvency claim, the other heirs are also deemed to have rejected the inheritance. However, if one of the heirs has explicitly accepted the inheritance, deemed rejection does not apply to that heir.

In cases of deemed rejection, the liquidation of the estate is carried out under TCC Art. 612 et seq. The insolvent estate is liquidated according to bankruptcy provisions. If any surplus remains after the debts of the estate are paid at the conclusion of liquidation, this surplus is distributed to the heirs; however, a surplus is generally not expected in an insolvent estate.

The most important consequence of deemed rejection is that heirs cannot be held personally liable for the debts of the decedent. As with actual rejection, in deemed rejection the heir is not liable for the debts of the estate with their personal assets. Creditors can only collect their claims from the estate assets.

Rights of Creditors

In cases of deemed rejection, the rights of the decedent's creditors are also protected. Creditors have the right to collect their claims from the estate assets. Deemed rejection does not eliminate creditors' rights over the estate; it only terminates the personal liability of the heirs.

Creditors may rebut the deemed rejection presumption. Creditors who prove that the estate is not insolvent -- i.e., that the active assets exceed the passive liabilities -- may prevent the application of the deemed rejection presumption. In this case, the heirs are deemed to have accepted the inheritance and become personally liable for the decedent's debts with their personal assets.

Creditors may also, in cases where heirs have improperly disposed of or concealed estate assets, use their rights under the TCO and enforcement and bankruptcy law to request the annulment of these transactions. The action for annulment of disposition (EBL Art. 277-284) stands out as an important legal instrument in this context.

Differences Between Deemed Rejection and Actual Rejection

There are significant structural differences between deemed rejection and actual rejection. Knowledge of these differences is necessary for heirs to choose the correct legal path.

Status of Descendants in Deemed Rejection

In actual rejection, the descendants of the rejecting heir are also placed in a position to reject, and the descendants must also make a separate rejection declaration (TCC Art. 614). In deemed rejection, the situation is different. If deemed rejection occurs due to an insolvent estate, the inheritance is deemed rejected for all legal heirs, and there is no need for descendants to make a separate rejection declaration.

However, the status of descendants must also be evaluated in cases of deemed rejection. Under TCC Art. 612/2, if all of the nearest heirs reject the inheritance, the estate is liquidated by the civil court of peace according to bankruptcy provisions. If any value remains after liquidation, this value is given to the right holders as if the rejection had not occurred.

The deemed rejection for minors and restricted persons is of particular importance. The interests of persons under parental authority or guardianship must be protected. Legal representatives (parents or guardians) must carry out the necessary procedures on behalf of minors and restricted persons and obtain court permission when necessary.

Practical Issues Encountered in Deemed Rejection Cases

Some important practical issues are encountered in deemed rejection cases. Knowledge of these issues helps heirs manage the process more effectively.

Complete determination of estate assets: The complete determination of all active and passive assets of the decedent is generally a challenging process. Immovable properties must be investigated through the land registry directorate, vehicles through the Police Directorate, bank accounts through banks via the BRSA, debts through enforcement directorates and tax offices. Incomplete investigation may lead to erroneous insolvency determination.

Risk of implicit acceptance: Heirs' use of estate assets, residing in estate property, withdrawing money from bank accounts, or collecting estate receivables may be considered implicit acceptance. In cases of implicit acceptance, the deemed rejection presumption cannot be relied upon. Therefore, it is of vital importance that heirs do not touch estate assets until the case process is completed.

Objections by creditors: Creditors may object to the deemed rejection presumption by claiming that the estate is not insolvent. In this case, the court decides after evaluating the evidence of the parties. Creditors' right of objection may extend and complicate the deemed rejection process.

Dispositions made during the decedent's lifetime: The decedent's transfer of assets before death (sale, gift, lifetime maintenance agreement, etc.) may have reduced the active assets of the estate. Whether these transfer transactions are fraudulent must be separately evaluated. If fraudulent transfers are annulled, the estate's active assets may increase and the insolvency situation may change.

Practical Recommendations for Deemed Rejection

Some practical recommendations can be offered for heirs wishing to benefit from deemed rejection of inheritance. First, upon learning of the decedent's death, a comprehensive investigation into the estate assets should be conducted. Whether the estate is insolvent should be determined; if it is insolvent, estate assets should not be touched in any way.

If it is not possible to decide within the three-month actual rejection period or if the three-month period has passed, the deemed rejection route should be evaluated. Since there is no time limitation for deemed rejection, heirs can use this route at later stages as well. However, the condition is that they must not have taken possession of the estate.

If enforcement proceedings are initiated by creditors against the heirs, the heirs may apply to the enforcement court and raise deemed rejection. This defense prevents the heir from being held personally liable for the debts of the decedent.

Obtaining attorney support during the case process is of great importance. Professional legal consultation on the complete determination of estate assets, proving insolvency, and avoiding the risks of implicit acceptance is of vital importance.

This content has been prepared for general informational purposes and does not constitute legal advice. It is recommended that you consult an attorney for specific disputes.