Promise of Sale of an Immovable — The Notarial Requirement and Land Registry Annotation

We explain in detail the notarial form requirement for a promise-of-sale contract for an immovable, the land registry annotation process, compulsory registration and the action for performance, under TBK Art. 29 and TMK Art. 1009.

The promise-of-sale contract for an immovable is an important legal instrument in the Turkish legal system, forming the preliminary stage of property transactions and placing the parties under an obligation to carry out the sale of a specified immovable in the future. Article 29 of the Turkish Code of Obligations No. 6098 and Article 1009 of the Turkish Civil Code No. 4721 set out its legal framework. This article deals comprehensively with the definition and legal nature of a promise-of-sale contract, its formal requirements, the notarial requirement, land registry annotation, compulsory registration, the action for performance and the problems in practice.

Definition and Legal Nature

A promise-of-sale contract for an immovable is a preliminary contract under which one or both parties assume an obligation to conclude a contract for the sale of a specified immovable in the future. Under TBK Art. 29, contracts for the future conclusion of a contract are valid and bind the parties. Unlike the principal contract of sale, a promise of sale does not directly transfer ownership; it merely places the parties under an obligation to conclude a contract of sale in the future.

A promise of sale is obligatory in nature; it does not transfer ownership of an immovable. The promisee as a rule proceeds against the other party to the contract. An annotation in the land register does not convert the personal right into a right in rem; under TMK Art. 1009 and Art. 26 of the Land Registry Law it renders the right assertable against subsequent rightholders.

The Notarial Form Requirement

For a promise-of-sale contract for an immovable to be valid it must be drawn up in official form before a notary. That requirement arises from TBK Art. 29/2 and Arts. 60/3 and 89 of Notaries Law No. 1512. The statute requires for the preliminary contract the same form prescribed for the principal contract. Since the sale of an immovable is subject to official form, so is the promise of sale. In drawing up the document the notary establishes the parties' intentions, composes the text in conformity with the law, reads it to them and takes their signatures to complete the transaction. Mere certification of signatures does not satisfy the statutory requirement of drawing up.

The sanction for non-compliance with form is absolute nullity. Under TBK Art. 12, contracts made without observing the form prescribed by statute are absolutely void, and either party may plead that nullity at any stage of the proceedings. The judge also takes non-compliance with form into account of the court's own motion. An action for cancellation of a land registry entry and re-registration cannot be brought on the basis of an absolutely void contract.

That said, the Court of Cassation also accepts exceptional situations in which, under the rule of good faith in TMK Art. 2, pleading non-compliance with form amounts to an abuse of right. Such situations are quite limited and are assessed on the circumstances of each case.

Content and Essential Elements

The principal elements of a valid and enforceable promise of sale are as follows:

The immovable: its land registry details or another criterion identifying it beyond doubt.
The price: a sale price that is determined or determinable by objective criteria.
Parties and representation: identity and any authority sufficient to make a promise of sale.
Intention to promise: a clear obligation to conclude a contract for the sale of the immovable in the future.
Performance arrangements: the maturity, payment, delivery and registration conditions; some of these details matter less for validity than for performance and proof.

Land Registry Annotation and Its Legal Consequences

Either party may request the annotation in the land register of a promise-of-sale contract drawn up before a notary. The annotation does not convert the buyer's personal right into a right in rem; it enables the right to be asserted against persons subsequently acquiring rights over the immovable. If the sale is not made or registration is not requested within five years of the annotation, the annotation is deleted by the land registry directorate of its own motion under Art. 26 of the Land Registry Law.

Where there is no annotation, a third party's acquisition is assessed within the framework of the good faith protection in TMK Art. 1023 and, on the facts, whether they knew of the promise of sale or exercised due diligence. It cannot be said that “if the immovable is transferred the buyer may in every case claim only damages”.

Action to Compel Registration

Where the seller fails to transfer title despite a promise-of-sale contract, the buyer may, on the conditions, bring an action to compel registration. Under TMK Art. 716 a person for whom an immovable is not registered despite the existence of a legal cause enabling ownership to be acquired may bring an action against the person preventing registration. An action for compulsory registration (cancellation of the entry and re-registration) is a performance action in which the buyer relying on a promise-of-sale contract asks the court to cancel the entry in the seller's name and order registration in their own name. The following conditions must be met together:

A valid contract: there must be a promise of sale drawn up in official form before a notary; the relationship between non-compliance with form and the rule of good faith may be examined separately in very exceptional circumstances.
Counter-performance: the price obligation must have been performed under the contract or be ready for performance; where necessary, the outstanding balance must be deposited.
Possibility of registration and the parties: the land registry record, subsequent transfers, the annotation and the third party's good faith are examined. That the immovable has been transferred does not automatically produce only a damages outcome in every file.
Time limit: where the general ten-year limitation period applies it is calculated from the date of maturity; specific facts and the rule of good faith are also assessed.

Action for Performance and Damages

Where registration has become impossible or the debtor has acted in breach of contract, the creditor may, according to the circumstances, claim specific performance, withdrawal, or positive or negative damages. Positive and negative damages have different legal consequences; they cannot be claimed cumulatively for the same breach without stating the basis and the election. Penalty clauses and earnest money provisions are examined separately under the contract text and the Code of Obligations. The general ten-year limitation period begins not on the day the contract was signed but on the date the claim fell due. Where no maturity date was fixed, TBK Art. 90 and the date on which performance became demandable are assessed. Where a promise of sale has been performed in fact over a long period together with the transfer of possession, the relationship between a plea of limitation and the rule of good faith may be examined on the facts.

Termination of a Promise-of-Sale Contract

A promise-of-sale contract for an immovable may terminate for various reasons:

Performance: the promise is fulfilled by the final sale and registration.
Agreement to terminate: the parties may agree mutually, having regard to the statutory form and vested rights.
Limitation: this does not extinguish the obligation of itself; it gives rise to a defence that may be raised.
Impossibility of performance: fault, counter-performance and damages consequences are assessed separately under TBK Art. 136 et seq. Expropriation or the demolition of a building does not in every case make the transfer of a share in the immovable legally impossible.
Default and withdrawal: the conditions in TBK Arts. 117 and 123–126, the exceptions as to an additional period and the contract provisions apply together.

The Relationship with Construction Contracts in Return for Land Share

A construction contract in return for land share is a contract of mixed nature combining the transfer of a share in an immovable with the obligation to produce a work, and is subject to official form. The transaction may be drawn up at the land registry directorate or at a notary authorised by statute; mere certification of signatures is not sufficient. The rights arising from the contract may be annotated in the land register under TMK Art. 1009. Whether non-compliance with form may be pleaded, the parties' level of performance and the rule of good faith are assessed separately on the facts.

Promise-of-Sale Contracts Made by Foreigners

The general reciprocity requirement for foreign natural persons was abolished in 2012. Acquisition is subject to the country and person restrictions determined by the President, whether the immovable is in a special security or military prohibited zone, the district and national area limits, and a national ceiling of thirty hectares per person. The President may increase that thirty-hectare limit by up to double. That a promise of sale may be drawn up does not mean that the final acquisition will comply with those restrictions.

Whether the foreign party's identity document, a translation and an interpreter are required is determined by whether the person speaks Turkish, the language of the document and notarial and land registry practice; the same chain of documents is not mandatory in every transaction. Since 4 July 2023, notaries have also been able to draw up contracts for the sale of immovables in addition to promises of sale.

Promises of Sale in the Light of Case Law

In settled practice, official form as a condition of validity, the promisee's right to seek registration, the effect of the annotation on subsequent acquisitions, the relationship between a plea of limitation and the rule of good faith in long-standing performance where possession has been transferred, and the third party's good faith are examined on the specific facts.

Points to Bear in Mind in Practice

Before the transaction, the parties' identity and authority to represent, the land registry record, encumbrances, the planning position, the price and payment schedule, the delivery and registration dates, the request for an annotation, any penalty clause and the costs should be clearly settled. A promise of sale does not transfer ownership; a final sale or registration is required.

Frequently Asked Questions

Does an annotation create a right in rem?

No. It renders the personal right assertable against subsequent rightholders.

How long does the annotation remain in the register?

If the sale or registration is not requested within five years it is deleted of the registry's own motion under Art. 26 of the Land Registry Law.

When does limitation begin?

As a rule on the date the claim falls due, not on the date of the contract.

Is reciprocity required for foreigners?

There is no general reciprocity requirement; the person, country, place and area restrictions in Art. 35 of the Land Registry Law apply.