Introduction

The death of a founder does not necessarily end a family business. It can, however, completely change the balance of power inside the company.

A business that was previously controlled by one founder may suddenly have:

• a surviving spouse;
• several children;
• children from different marriages;
• siblings who actively work in the company;
• heirs who have never participated in the business;
• heirs who want immediate cash;
• heirs who want control;
• and heirs who believe company assets have been concealed from them.

The problem becomes particularly serious where the founder held a controlling interest.

A company that effectively had one decision-maker yesterday may have four or five competing heirs today.

The resulting dispute is therefore not merely an inheritance-law problem.

It is simultaneously a question of:

inheritance law, corporate ownership, voting rights, management, valuation, minority protection and corporate continuity.

The most important practical question is:

How can a family company survive when the founder’s death turns the heirs into hostile shareholders?

Under Turkish law, the answer depends heavily on the type of company, the articles of association, the structure of the inherited shares and whether the heirs can establish a workable mechanism for exercising corporate rights.

1. The First Legal Consequence of Death: The Shares Become Part of the Estate

Under Article 640 of the Turkish Civil Code (“TCCiv”), where there is more than one heir, an inheritance community arises automatically upon death and continues until the estate is distributed.

The heirs hold the estate jointly and, subject to statutory exceptions, must act together concerning estate rights. A court may appoint a representative for the inheritance community upon the request of an heir.

Therefore, when a founder dies, the first question is not simply:

“Who inherited 30% and who inherited 20%?”

The first question is:

What precisely entered the estate, and how can the inherited corporate rights legally be exercised before the estate is divided?

This distinction is critical.

The certificate of inheritance establishes inheritance status and statutory shares, but corporate rights must still be analysed under the Turkish Commercial Code (“TCC”).

2. The Inheritance Community and the Company Are Two Different Legal Structures

One of the most common mistakes in family-company disputes is to confuse:

the inheritance community

with

the company itself.

Suppose the deceased founder owned 60% of a limited liability company.

The founder leaves:

• a surviving spouse;
• two children.

The heirs become entitled to the inherited estate according to inheritance law.

But this does not necessarily mean that the company’s share register instantly becomes:

Spouse: 15%

Child A: 22.5%

Child B: 22.5%

The inherited share may remain subject to joint ownership within the inheritance community until allocation or partition is properly completed.

Where one limited-company capital share belongs to several persons, Article 599 TCC provides that the rights attached to that share may be exercised only through a joint representative appointed by them.

This is one of the first points that should be addressed after the founder’s death.

3. Failure to Appoint a Common Representative Can Paralyse the Company

Consider a founder who owned 60% of a limited company.

The remaining shareholder owns 40%.

After the founder dies, three heirs disagree with one another.

One heir supports the existing manager.

Another wants the manager removed.

The third refuses to participate.

If the inherited shares must be exercised through a common representative, the heirs’ inability to agree on representation can create a major governance problem.

The company may then struggle with:

• general assembly participation;
• voting;
• manager appointment;
• approval of financial statements;
• capital increases;
• profit distributions.

Article 599 TCC therefore has enormous practical importance in post-inheritance shareholder disputes.

A Turkish first-instance commercial court has also treated the failure to use a common representative for inherited shares as potentially affecting the legality of general assembly resolutions.

4. Inheritance of a Limited Liability Company Share Is Not an Ordinary Share Transfer

The position is particularly favourable to heirs under Article 596 TCC.

Where a limited-company capital share passes by inheritance, the rights and obligations attached to the share pass without requiring prior general assembly approval.

This is fundamentally different from an ordinary voluntary transfer governed by Article 595.

Accordingly, an existing majority shareholder cannot simply say:

“We do not recognise the deceased shareholder’s children.”

The inheritance produces legal consequences automatically.

However, the company retains a limited statutory mechanism to reject the heir as shareholder.

5. A Limited Company Can Reject the Heir — But Only Under Strict Conditions

Article 596 provides an important balancing mechanism.

The company may reject the person who acquired the share through inheritance within three months after learning of the acquisition.

But it cannot simply refuse recognition without financial consequences.

The company must simultaneously offer to acquire the shares:

• for its own account;
• for another shareholder; or
• for a designated third party

at their real value.

If the company does not expressly reject the transfer in writing within the statutory three-month period, approval is deemed to have been granted.

This rule has major practical consequences in family businesses.

The controlling branch of the family may therefore be able to prevent another branch from remaining inside the company — but only by paying the true economic value of the inherited interest.

6. The Three-Month Period Can Decide the Entire Dispute

Timing is critical.

The Court of Cassation has recently addressed this issue repeatedly.

In Court of Cassation 11th Civil Chamber, E. 2025/1965, K. 2025/7113, dated 27 November 2025, a dispute arose over a company’s attempt to reject shares inherited following the death of a limited-company shareholder.

The Court emphasised the three-month statutory mechanism under Article 596 and upheld the conclusion that the company’s rejection had occurred too late.

A 2026 Istanbul Regional Court decision similarly treated the deceased shareholder’s death as the relevant inheritance event and examined when the company had learned of that event for purposes of the three-month period.

Therefore, in a family-company dispute, one of the first documents counsel should create is a chronology containing:

• date of death;
• date the company learned of death;
• date inheritance documents were supplied;
• date of general assembly;
• date of any rejection decision;
• date of any real-value offer.

7. The Company Cannot Select Among Heirs Arbitrarily

Family disputes frequently produce discriminatory treatment.

For example:

The founder dies.

The surviving spouse and one child support the controlling branch of the family.

Another child is hostile to management.

Management recognises the cooperative heirs but rejects only the hostile heir.

That strategy may be legally vulnerable.

In Court of Cassation 11th Civil Chamber, E. 2024/6882, K. 2025/4578, dated 26 June 2025, the Court upheld a decision concerning a limited company where one heir had been denied admission while another heir in an equivalent legal position had been admitted.

The unequal treatment was found contrary to good faith and the equality principle.

The practical lesson is straightforward:

Corporate succession decisions should be based on legally defensible criteria, not family loyalty.

8. If the Company Rejects the Heir, “Real Value” Becomes the Main Battlefield

The next conflict usually concerns price.

The company may say:

“We will pay TRY 500,000 for the inherited shares.”

The heir may respond:

“Those shares are worth TRY 20 million.”

Article 597 TCC provides that where the real value of a limited-company capital share must be determined and the parties cannot agree, the value may be determined by the Commercial Court of First Instance at the company’s registered office.

The real value should not be confused with:

• nominal capital;
• paid-in capital;
• tax value;
• book equity.

Depending on the company, valuation may require consideration of:

• real estate;
• cash;
• machinery;
• receivables;
• intellectual property;
• customer relationships;
• profitability;
• future cash flows;
• goodwill;
• hidden reserves.

This is often where a family inheritance dispute turns into a full corporate valuation case.

9. Recent Court of Cassation Practice Confirms the Importance of Real Value

Recent Court of Cassation decisions demonstrate that the inheritance mechanism under Article 596 is closely linked to payment of real value.

In E. 2024/6388, K. 2025/5602, dated 23 September 2025, the Court reviewed a dispute concerning payment of the real value of inherited limited-company shares after the company refused recognition of the heirs.

Likewise, Court of Cassation 11th Civil Chamber E. 2024/2322, K. 2025/613 recognised that the shareholder designated to acquire inherited shares under Article 596 could seek judicial determination of their real value.

In practice, therefore:

removing an heir from the shareholder structure does not mean eliminating the economic value of the inheritance.

The fight usually moves from control to valuation.

10. Anonymous Companies Follow a Different Succession Regime

Family businesses are not always limited companies.

Many substantial Turkish family businesses operate as privately held joint-stock companies.

For unlisted registered shares, Articles 493 and 494 TCC become particularly important.

Where such shares are acquired through inheritance, the company may refuse recognition only by offering to acquire the inherited shares at their real value.

Article 494 also distinguishes between economic ownership and participation rights: in inheritance situations, ownership and financial rights pass immediately, whereas general assembly participation and voting rights may depend on company approval under the statutory transfer-restriction regime.

Therefore, identifying the precise company type and share category is essential before advising heirs.

11. Pay-Register Problems Should Be Addressed Immediately

Family conflicts often begin with the sentence:

“They will not put my name in the share register.”

In a joint-stock company, Article 499 provides rules concerning registration in the share ledger and recognises the importance of the register in relations with the company.

The Court of Cassation has continued to deal with disputes concerning inherited shares and shareholder recognition.

For example, E. 2024/5270, K. 2025/3591, dated 22 May 2025 concerned inherited joint-stock company shares and an heir’s request relating to recognition and registration.

Accordingly, inheritance counsel should not stop after obtaining the certificate of inheritance.

The corporate side must also be completed.

12. The Most Dangerous Period Is the First Six Months After Death

From a practical perspective, the greatest risk often arises immediately after the founder’s death.

Important questions suddenly arise:

• Who has access to company bank accounts?
• Who holds electronic banking passwords?
• Who controls company accounting?
• Who has physical possession of corporate books?
• Who is registered as manager?
• Who is authorised to sign?
• Who controls company e-mail and ERP systems?
• Are there pending general assemblies?
• Can company property be transferred?

Where family relationships are already strained, the person controlling the operational infrastructure may obtain a substantial advantage before the other heirs understand their legal position.

A succession dispute should therefore be treated as an urgent corporate-governance matter, not merely as an inheritance calculation.

13. First Practical Step: Create a Complete Corporate Succession File

Before deciding whether to litigate, counsel should obtain at least:

Inheritance Documents

• death certificate;
• certificate of inheritance;
• wills;
• inheritance agreements;
• marital property documents where relevant.

Corporate Documents

• current articles of association;
• historical articles;
• Trade Registry Gazette records;
• share ledger;
• share certificates;
• manager or board appointments;
• signature circulars;
• general assembly resolutions.

Financial Documents

• recent balance sheets;
• income statements;
• trial balances;
• shareholder current accounts;
• company bank statements;
• related-party accounts;
• dividend history.

The first objective is to determine:

Who legally owns what, who controls what, and what the company is economically worth.

14. Separate Ownership from Management

Another common source of family conflict is the assumption:

“I inherited shares, therefore I must also become a manager.”

That is not necessarily correct.

Corporate ownership and management are separate legal concepts.

An heir may become economically entitled to shares without automatically becoming:

• a limited-company manager;
• an authorised signatory;
• a joint-stock company board member;
• a company employee.

This distinction should be explained to the family immediately.

Many disputes can be reduced by separating:

economic ownership

from

operational control.

15. Not Every Heir Should Necessarily Run the Business

Consider a founder with three children.

Child A has worked in the company for twenty years.

Child B is a doctor.

Child C lives abroad and has never participated in the company.

Treating all three as co-managers merely because they inherited equal economic interests may create permanent dysfunction.

A workable succession agreement might instead provide that:

• Child A controls management;
• Child B and Child C retain economic interests;
• information rights are strengthened;
• dividends are governed by an agreed policy;
• exit rights are established;
• the company is independently valued at defined intervals.

The law does not require all heirs to perform identical corporate roles.

16. The Most Effective Solution Is Often a Structured Family Buyout

Where heirs fundamentally disagree about the future of the business, forcing them to remain shareholders indefinitely can destroy value.

A structured buyout is often commercially preferable.

Example:

Company value: TRY 300 million.

Three heirs each economically represent one-third of the inherited controlling interest.

Heir A wants to operate the company.

Heirs B and C want cash.

Possible settlement:

Heir A acquires B and C’s interests.

Purchase price may be paid:

• immediately;
• by instalments;
• through external financing;
• through a legally compliant corporate transaction.

The key issue becomes an independent valuation mechanism.

17. Never Negotiate a Buyout Without Determining the Company’s Real Economic Value

One heir often controls the company accounts.

That heir may offer:

“Your share is worth TRY 3 million.”

But the company may own:

• valuable real estate purchased decades ago;
• undistributed profits;
• trademarks;
• foreign subsidiaries;
• investment accounts;
• shareholder receivables;
• commercial goodwill.

Before negotiating, an independent valuation should ordinarily examine:

Adjusted Net Asset Value

Income / Discounted Cash Flow

Comparable Company or Transaction Multiples

depending on the nature of the business.

Family relationships should not substitute for financial due diligence.

18. Shareholder Current Accounts Are Especially Important After Death

Family businesses frequently have extensive financial relationships between the deceased founder and the company.

The accounts may show:

• company receivable from founder;
• founder receivable from company;
• shareholder loans;
• advances;
• personal expenses paid by company;
• dividends declared but unpaid.

These balances may belong partly to:

the estate

and partly affect:

the value of the company shares.

They must therefore be analysed separately.

For example, the founder may have:

TRY 20 million share value

plus

TRY 8 million shareholder receivable against the company.

The inheritance dispute should not treat these as the same asset.

19. The Second Major Solution: Partition the Estate Strategically

Article 642 of the Turkish Civil Code provides, as a general principle, that an heir may request division of the inheritance unless continuation of the community is required by law or contract.

From a family-business perspective, however, immediate fragmentation of company ownership is not always desirable.

Instead of dividing every estate asset proportionately, the family may structure the partition so that:

• operating-company shares go to one heir;
• real estate goes to another;
• cash or investment assets go to another;
• equalisation payments balance the inheritance shares.

This can preserve the business while giving each heir economic value.

Such arrangements must be designed together with the applicable company-transfer rules, tax consequences and formal requirements.

20. If Heirs Cannot Cooperate, an Inheritance Representative May Become Necessary

Article 640 allows an heir to request appointment of a representative for the inheritance community until partition.

This can be important where:

• the heirs cannot jointly exercise rights;
• litigation must be pursued on behalf of the estate;
• company rights require organised representation;
• estate assets risk being prejudiced.

The representative does not automatically resolve every corporate-law question, but can prevent total paralysis of the inheritance community.

21. Information Is Usually the First Real Shareholder Dispute

After the funeral and inheritance proceedings, the most common corporate dispute is:

“My sibling controls the company and refuses to show me the accounts.”

For limited companies, Article 614 TCC gives each shareholder a statutory right to request information concerning company affairs and accounts and, subject to statutory conditions, to examine company records.

For joint-stock companies, Article 437 contains the corresponding information and inspection framework. Recent Court of Cassation decisions continue to emphasise the importance of properly using these statutory information mechanisms before relying on alleged information obstruction as part of broader corporate claims.

Therefore, post-inheritance litigation should often begin with a precise documentary information demand.

22. What Should the Heir Request?

A generic request such as:

“Show me all company records”

may be strategically weak.

Instead, consider requesting specific information concerning:

• last five years’ financial statements;
• company bank accounts;
• payments to family members;
• manager compensation;
• shareholder current accounts;
• loans to affiliated companies;
• transfers of real estate;
• major customer contracts;
• dividends;
• related-party transactions.

The objective is to identify whether control of the family company is being used to shift economic value away from the heirs.

23. Special Audit May Be Necessary

If suspicious transactions appear, ordinary information rights may not be enough.

For joint-stock companies, Articles 438 et seq. provide the special-audit mechanism.

Through Article 635, the special-audit rules are also applicable to limited companies.

This can be particularly valuable where one family branch alleges:

• undisclosed related-party transfers;
• company assets sold below market value;
• payments to the controlling sibling;
• unexplained consultancy expenses;
• customer diversion.

A properly targeted special audit can convert family accusations into independently examinable corporate facts.

24. Challenge Unlawful General Assembly Decisions Quickly

Another typical post-inheritance tactic is to use a general assembly while the heirs are disorganised.

For example, the controlling branch may attempt to:

• appoint itself as management;
• remove another family member;
• approve questionable accounts;
• increase capital;
• amend the articles;
• approve related-party transactions.

General assembly resolutions contrary to the law, articles or good-faith principle may be subject to annulment or, for sufficiently serious defects, nullity/non-existence arguments.

In limited companies, Article 622 refers to the joint-stock-company rules governing challenges to general assembly resolutions.

Importantly, the ordinary annulment period is generally three months from the decision date.

Therefore, heirs should not spend six months attempting informal family reconciliation while allowing statutory litigation periods to expire.

25. Capital Increase Can Turn an Inheritance Dispute Into a Squeeze-Out

Suppose the founder dies owning 40%.

The heirs collectively inherit that interest.

The other family branch owns 60%.

Shortly after death, the majority causes a substantial capital increase.

The heirs do not have sufficient liquidity to participate.

Their percentage falls dramatically.

A capital increase may be commercially legitimate.

But if designed primarily to dilute a hostile heir, it may be challenged depending on the circumstances.

This issue should therefore be examined immediately where:

• the capital increase is unusually large;
• no genuine financing need exists;
• the majority has superior access to funds;
• pre-emption rights are restricted;
• timing follows directly after the inheritance dispute.

26. Management Misconduct Should Be Separated From the Inheritance Dispute

The sibling who runs the business may say:

“This company belongs to me because I worked here for twenty years.”

The other heirs may say:

“You are stealing our inheritance.”

Neither proposition automatically answers the legal question.

If management has actually harmed the company through:

• self-dealing;
• asset diversion;
• unlawful related-party transactions;
• misappropriation;
• below-value transfers,

the appropriate response may include a manager or director liability claim under the TCC.

The inheritance dispute and management-liability dispute should therefore be legally distinguished even if they arise from the same family conflict.

27. Sometimes the Correct Solution Is for One Heir to Leave the Company

For limited companies, Article 638 permits a shareholder to seek judicial exit where just cause exists.

This may be more sensible than trying to dissolve the entire company.

Potentially relevant circumstances can include:

• permanent family hostility;
• systematic exclusion;
• denial of information;
• serious breach of trust;
• inability to exercise shareholder rights;
• management abuse.

The court may also adopt interim measures protecting the claimant’s position during the litigation.

28. The Nuclear Option for a Limited Company: Just-Cause Dissolution

Article 636/3 TCC allows every limited-company shareholder to request dissolution where just cause exists.

The court is not, however, required to destroy the business.

Instead, it may:

• order payment of the claimant’s real share value and remove the claimant from the company; or
• impose another appropriate and acceptable solution.

Recent Court of Cassation case law emphasises this flexibility.

In Court of Cassation 11th Civil Chamber E. 2024/3166, K. 2025/3401, dated 15 May 2025, long-standing shareholder conflict, criminal complaints and destroyed trust were considered in a limited-company dispute. The company remained active, and the courts preferred a shareholder-exit solution rather than dissolution, reflecting the principle that dissolution should generally be a last resort.

29. Family Conflict Can Be a Genuine Just Cause

A family relationship does not itself create a right to dissolve a company.

However, where family hostility becomes permanent corporate dysfunction, the result may change.

Relevant circumstances may include:

• irreversible loss of trust;
• repeated lawsuits;
• criminal complaints;
• inability to make corporate decisions;
• misuse of company resources;
• systematic exclusion;
• persistent denial of information.

The Court of Cassation and the General Assembly of Civil Chambers have increasingly addressed family-company conflicts through the concept of just cause.

In a 28 May 2025 decision, the General Assembly of Civil Chambers accepted that irreparable loss of trust and continuing disputes within a family joint-stock company could reach the level of just cause under Article 531 TCC, while still favouring an alternative solution over dissolution where appropriate.

30. The Rules Are Different for Joint-Stock Companies

For a limited company:

every shareholder may rely on Article 636/3.

For a joint-stock company, Article 531 requires shareholders representing at least:

• 10% of the capital in a private company;
• 5% in a publicly held company

to seek dissolution for just cause.

This distinction is particularly important after inheritance.

If a deceased shareholder’s interest becomes fragmented among several heirs, an individual heir may no longer satisfy the Article 531 threshold.

This is another reason heirs may need to coordinate their corporate strategy.

31. Article 531 Can Be Extremely Powerful in Family Joint-Stock Companies

Article 531 also allows the court, instead of dissolution, to order:

• payment of the claimant shareholders’ real share value;
• removal of the claimants;
• another appropriate solution.

The Court of Cassation has long emphasised the importance of preserving economically valuable family companies where a buyout can resolve the shareholder dispute.

In E. 2015/9088, K. 2016/2352, the Court held that even where significant conflict existed in a family company, alternative solutions protecting the continued existence of the company should be considered.

That principle remains central to modern family-company litigation.

32. Not Every Family Complaint Is Enough for Dissolution

An heir should be cautious before filing a broad claim stating:

“They do not give me dividends and do not like me, therefore dissolve the company.”

Recent Court of Cassation decisions show that the alleged wrongdoing must be proven.

For example, E. 2024/5951, K. 2025/4282, dated 18 June 2025 involved a family-company dispute in which shareholders alleged inheritance conflicts, denial of information and mismanagement. The courts rejected the claim where the relevant misconduct had not been sufficiently established.

Evidence therefore matters more than family narratives.

33. But Serious Asset-Stripping Allegations Must Be Properly Investigated

The opposite is also true.

Where the heir alleges that the controlling family branch is actually emptying the company, the court should not dismiss the issue merely because another remedy may theoretically exist.

In Court of Cassation 11th Civil Chamber E. 2025/971, K. 2025/6677, dated 6 November 2025, the Court held that serious allegations involving misuse of company resources and “emptying” of the company required substantive investigation, including consideration of special-audit and expert evidence.

Thus:

Corporate continuity does not mean immunity for abusive management.

34. A Practical Resolution Model: Separate Control From Economic Value

In many family businesses, the best solution is neither equal management nor liquidation.

Instead:

Operating heir

receives corporate control.

Non-operating heirs

receive:

• shares without management rights;
• stronger information rights;
• a defined dividend framework;
• buyout rights;
• cash or other estate assets.

This can preserve the operating company while preventing every family disagreement from becoming a general assembly crisis.

35. Another Resolution Model: Divide the Business, Not Every Share

Suppose the family owns:

• a manufacturing company;
• commercial real estate;
• a logistics subsidiary;
• financial investments.

Instead of all heirs remaining shareholders in every entity, a negotiated restructuring might allocate:

• manufacturing operations to one family branch;
• real estate to another;
• investment assets to another.

Equalisation payments can then be considered.

This type of restructuring requires careful examination of:

• corporate transfer restrictions;
• creditor interests;
• tax consequences;
• valuation;
• inheritance partition rules.

But commercially it can be much healthier than permanent forced co-ownership.

36. Shareholders’ Agreements Can Prevent the Second Generation From Repeating the Conflict

Once the immediate inheritance dispute is resolved, the family should generally establish a written governance mechanism.

A shareholders’ agreement may address issues such as:

• board or manager appointment rights;
• reserved matters;
• dividend policy;
• share-transfer restrictions;
• pre-emption rights;
• buy-sell procedures;
• valuation methodology;
• death and incapacity;
• dispute resolution;
• confidentiality;
• non-compete obligations.

However, the agreement must be coordinated with the articles of association because contractual provisions do not always produce the same corporate effects as provisions validly incorporated into the company’s constitutional documents.

37. A Family Constitution Can Help — But It Does Not Replace Company Law

Large family groups sometimes adopt a “family constitution.”

This may determine:

• who may work in the business;
• qualifications for management positions;
• whether spouses can become shareholders;
• succession principles;
• dividend expectations;
• family council procedures.

Such arrangements may be commercially valuable.

But they should not be confused with statutory corporate rights.

A family constitution cannot simply override:

• mandatory provisions of the TCC;
• inheritance rights;
• shareholder rights;
• valid articles of association.

Legal implementation therefore matters.

38. What Should the Lawyer Do in the First 30 Days?

A practical post-inheritance corporate strategy should normally begin immediately.

Step 1 — Identify the Company Type

Is it:

• limited company;
• joint-stock company;
• group of companies?

Step 2 — Establish the Deceased’s Exact Ownership

Check:

• trade registry;
• share ledger;
• share certificates;
• articles of association.

Step 3 — Analyse the Estate

Obtain the inheritance certificate and identify whether the shares remain jointly owned.

Step 4 — Secure Representation

Determine who may exercise inherited corporate rights.

Step 5 — Protect Information

Request current financial and corporate records.

Step 6 — Check Deadlines

Especially:

• Article 596’s three-month period;
• general assembly annulment periods;
• other procedural deadlines.

Step 7 — Preserve Company Value

Investigate unusual asset transfers or changes in management.

Step 8 — Value the Shares

Before negotiating any buyout.

39. What Should the Lawyer Avoid?

Several mistakes repeatedly worsen family-company disputes.

Do not assume the inheritance certificate solves the corporate issue.

It does not.

Do not allow informal family negotiations to consume litigation deadlines.

Three months can pass very quickly.

Do not accept nominal capital as share value.

The company may be worth substantially more.

Do not appoint every heir as manager merely to create “equality.”

This can create permanent paralysis.

Do not immediately demand dissolution of a profitable company.

Courts frequently prefer less destructive remedies.

Do not rely solely on accusations of misconduct.

Build the accounting and documentary evidence.

40. Practical Example: The Founder Dies With 70% of a Limited Company

Assume:

Founder: 70%

Brother: 30%

The founder dies and leaves:

• surviving spouse;
• two children.

The founder’s 70% interest passes into the inheritance structure.

The founder’s brother wants to retain control and refuses to recognise one child as a shareholder.

The company should immediately examine Article 596.

If it intends to reject the inherited shareholder position, it must comply with the statutory three-month mechanism and make a real-value acquisition proposal.

If the family cannot agree on exercising the inherited share, common representation issues under Article 599 also arise.

If the company attempts to recognise only preferred heirs while excluding another without legally defensible grounds, equality and good-faith objections may arise in light of recent Court of Cassation practice.

This single death may therefore generate four separate legal questions:

1. inheritance ownership;
2. corporate recognition;
3. voting representation;
4. real share valuation.

41. Practical Example: Two Siblings Inherit a Profitable Business

Father owned 100% of Company X.

After his death:

Daughter: 50%

Son: 50%.

The son has operated the company for fifteen years.

The daughter has never worked there.

The daughter now demands:

“I own half, so I want half of every management decision.”

The son responds:

“I built the company, so you should have no control.”

Neither extreme necessarily creates a sustainable business.

A more commercially rational settlement may involve:

• son remaining manager;
• daughter receiving transparent financial information;
• independent annual audit;
• defined dividend policy;
• agreed buyout mechanism;
• independent valuation;
• restrictions on related-party transactions.

Corporate litigation should often be used to create leverage for such a structure rather than as the automatic end goal.

42. When Litigation Becomes Unavoidable

Court proceedings may nevertheless be necessary where one family branch:

• refuses to recognise inherited rights;
• manipulates the share register;
• denies all information;
• transfers company assets;
• dilutes inherited shares;
• pays itself excessive benefits;
• refuses a fair buyout;
• creates permanent corporate paralysis.

Depending on company type and facts, possible proceedings may include:

• determination/registration of share ownership;
• annulment or nullity of general assembly resolutions;
• information and inspection proceedings;
• special audit;
• manager/director liability;
• judicial removal or restriction of managers;
• shareholder exit;
• just-cause dissolution;
• judicial determination of real share value.

The correct claim must be matched to the actual corporate problem.

Conclusion: The Goal Should Be to Divide the Family Conflict Without Destroying the Company

Family-company inheritance disputes are among the most difficult commercial disputes because the parties are fighting about more than money.

They may also be fighting about:

• control;
• family history;
• recognition;
• the founder’s intentions;
• who contributed most to the business.

Company law, however, ultimately requires these emotional conflicts to be translated into legal questions.

The central issues are:

Who inherited the shares?

How can those shares currently be exercised?

Does the company have a statutory right to reject an heir?

If so, what is the true economic value of the shares?

Who should manage the company?

Are minority heirs receiving information and economic rights?

Has company value been diverted?

Can one family branch buy out another?

Should the estate be partitioned differently?

Has the dispute become sufficiently serious to justify judicial exit or dissolution?

The most successful strategy is usually not to insist that every heir remain equal in every corporate role.

A functioning family-business succession separates:

ownership, management, economic value and family relationships.

Where that separation can be achieved through a properly valued buyout, inheritance partition or governance agreement, the business may survive the founder.

Where it cannot, Turkish corporate law provides increasingly powerful judicial mechanisms to end the shareholder relationship without necessarily destroying the underlying company.