Service Charges in Turkish Condominiums: Allocation, Late Payment Compensation and Collection

Disputes over the allocation and non-payment of common expenses (service charges) are among the most frequent in apartment buildings and residential complexes. Condominium Law No. 634 sets out in detail how expenses are shared and what remedies are available against an owner who does not pay.

1. How are expenses shared?

Under Article 20 of the Condominium Law (CL), unless otherwise agreed, unit owners must contribute:

• equally: to the costs of the doorman, boiler operator, gardener and security guard, and the advances collected for them;
• in proportion to their land share: to the building's insurance premiums, the maintenance, protection, reinforcement and repair costs of common areas, other costs such as the manager's salary, and the operating costs of common facilities.

Where the management plan provides a different allocation, that provision applies. In any dispute, the management plan should therefore be examined first.

2. Is "I don't use it, so I won't pay" a valid defence?

No. Under CL Article 20/1-c, unit owners cannot avoid paying their share of expenses and advances by waiving their right to use common areas or facilities, or by claiming that they do not need them because of the position of their own unit. For example, the owner of a ground-floor flat cannot automatically avoid lift expenses on the grounds that they do not use the lift; a different arrangement can only be made through the management plan or an agreement among the owners.

3. Late payment compensation

A unit owner who does not pay their full share of expenses and advances must pay late payment compensation calculated at five percent per month for the days of delay (CL Art. 20/2). This rate was reduced from ten percent to five percent by Law No. 5711 in 2007.

4. Liability of tenants and other occupants

Under CL Article 22, persons who continuously occupy a unit under a lease, a right of residence or any other basis are jointly and severally liable with the unit owner for the owner's expense and advance debt and late payment compensation. However, a tenant's liability is limited to the rent they owe, and any payment they make is deducted from the rent.

5. Collection remedies

• Lawsuit and enforcement: The manager or any of the other owners may sue or initiate enforcement proceedings against a non-paying owner (CL Art. 20/2).
• Statutory mortgage: If the debt cannot be collected by these means, a statutory mortgage for the debt amount determined by the court is registered on the debtor's unit in favour of the other owners, upon the written request of the manager or any owner (CL Art. 22/2).
• Priority: The owners' claims for common expenses have priority (CL Art. 22/3).

For disputes arising from the Condominium Law, applying to a mediator before filing suit is a precondition (Law No. 6325 Art. 18/B). This should also be borne in mind for lawsuits filed after an objection to enforcement proceedings.

6. Challenging owners' assembly resolutions

Resolutions of the owners' assembly on matters such as the amount of service charges or the operating budget may be challenged by an action for annulment before the civil court of peace where the building is located. Under CL Article 33, the time limits are:

• for an owner who attended the meeting and voted against, one month from the date of the resolution;
• for an owner who did not attend, one month from learning of the resolution and in any event six months from the date of the resolution.

No time limit applies to resolutions that are non-existent or absolutely null and void.

Conclusion

In common expense disputes, the management plan and owners' assembly resolutions should be examined first, and the debt and late payment compensation calculated correctly. Owners wishing to challenge resolutions should remember that the one-month period is short.

This article is provided for general information purposes only and does not constitute legal advice. Legal support is recommended for specific disputes.