EFFECTS OF UNLAWFUL UQUIDATION ON LEGAL ENTITY

Abstract

A legal entity ceases to exist and its liquidation is completed only if all legal relations embracing the entity are terminated, since the assumption according to which the entity vanishes without liquidation results unacceptable consequences with relation to the patrimony of the entity. Thus, an unlawful liquidation does not lead the entity to disappearance. The court before which a lawsuit involving the liquidated entity has competence to judge on whether the entity stili exists or not. However, the Turkish jurisprudence obliges the parties to file another lawsuit called restoration in order that the legal personality unlawfully liquidated is reinstated. The Turkish Code of Commerce has adopted the jurisprudence related to the restoration lawsuit and instituted the additional liquidation provisions.