A study on the deposit (within the meaning of Art. 177 of the COT), the actual forfeiture (art. 178 of the COT), and the resolutive penalty (the last paragraph of Art. 179 of the COT)
Efe Can YıldırırActs that parties fulfill or undertake to fulfill in order to prove a contract concluded or to be rid of an undertaken commitment are frequently encountered in both daily and commercial life. When taking this situation into consideration, legislators have considered the importance of these types of centuries-old habits by introducing regulations to the Turkish Code of Obligations (TCO) on earnest money, forfeit money, or withdrawal and termination by paying a penalty and attaching certain legal consequences. This study aims to analyze each of these concepts separately in terms of theory and practice. The first section will analyze earnest money from the point of view of its nature, function, and fate in the event of performance or non-performance of the main performance obligation, as well as the application or non-application of the last paragraph of Article 182 in the TCO concerning the reduction of the contractual penalty. In particular, the first section will discuss the provisions of the German Civil Code concerning deposits and their compatibility with Turkish law. The second and third chapters will examine the concepts and similar functions of forfeit money and withdrawal or termination by paying a penalty from the point of view of their nature, their functions, and their fate in the event of performance or non-performance of the main performance obligation, as well as the application or non-application of the last paragraph of Article 182 in the TCO concerning the reduction of the contractual penalty. In this context, these sections will only analyze Swiss law regarding the examination of these concepts, given the exceptional nature of these provisions.
Une étude sur les arrhes (au sens de l’art. 177 du COT), le dédit reel (l’art. 178 du COT) et la peine résolutoire (le dernier alinéa de l’art. 179 du COT)
Efe Can YıldırırDans la vie quotidienne comme dans la vie commerciale, il arrive fréquemment que les parties exécutent ou s’engagent à exécuter certaines prestations afin de prouver le contrat qu’elles ont établi et parfois de se débarrasser des engagements qu’elles ont pris. Compte tenu de cette situation, le législateur, prenant en considération l’importance de ces habitudes séculaires, a introduit dans le Code turc des obligations des dispositions relatives aux arrhes, au dédit réel et à la peine résolutoire et y a attaché certaines conséquences juridiques. Cette étude vise à analyser chacun de ces concepts séparément en termes de théorie et de pratique. Dans le premier chapitre, les arrhes seront analysées du point de vue de sa nature, de sa fonction, de son sort en cas d’exécution ou d’inexécution de l’obligation de prestation principale, et de l’application ou non du dernier alinéa de l’art. 182 COT concernant la réduction de la clause pénale. Les dispositions du Code civil allemand concernant les arrhes seront notamment mentionnées - dans la mesure où elles sont compatibles avec le droit turc. Dans le deuxième et troisième chapitres, les concepts du dédit réel et de la peine résolutoire, qui ont des fonctions similaires, seront examinés du point de vue de leur nature, de leurs fonctions, de leur sort en cas d’exécution ou d’inexécution de l’obligation de prestation principale, et de l’application ou non du dernier alinéa de l’art. 182 COT concernant la réduction de la clause pénale. Dans ce contexte, seule le droit suisse sera analysé pour l’examen de ces concepts, compte tenu de la nature exceptionnelle desdites dispositions.
Acts that parties fulfill or undertake to fulfill in order to prove a contract concluded or to be rid of an undertaken commitment are frequently encountered in both daily and commercial life. When taking this situation into consideration, legislators have considered the importance of these types of centuries-old habits by introducing regulations to the Turkish Code of Obligations (TCO) on earnest money, forfeit money, or withdrawal and termination by paying a penalty and attaching certain legal consequences. This study aims to analyze each of these concepts separately in terms of theory and practice.
According to Art. 177 para. 1 of the TCO, a sum of money paid by one of the parties at the time of the conclusion of the contract is considered proof of the conclusion of the contract (arrha confirmatoria). Earnest money, by virtue of it facilitating a function in terms of proof of conclusion of the contract and accentuation of the binding nature of this legal act, strengthens the creditor’s position, similar to the contractual penalty. The payment of earnest money does not constitute an agreement distinct from the contract to which it relates. If the contract for the conclusion of which the sum of money paid as evidence is invalid, the agreement between the parties concerning this performance will also be invalid. According to Art. 177 para. 2 of the TCO, earnest money whose evidentiary quality for the conclusion of a contract is as a general rule presumed by the legislator to be set off against the principal claim (i.e., the principal obligation of the paying party). Although the presumption of the second paragraph is that it is to be deducted from the principal performance, the retention of earnest money by the beneficiary without deduction may be provided for in accordance with an agreement between the parties. If the principal obligation of the payer becomes impossible due to a circumstance for which they are responsible, the earnest money that is given in principle as proof of the conclusion of the contract is to be deducted from the amount of damages that the debtor (payer) is obliged to pay in accordance with the new legal presumption under the terms of the Art. 177 para. 2 of the TCO. If the contracting party terminates the contract for which the earnest money was paid at the time of its conclusion due to a breach of contract by the payer, the fate of the earnest money will be determined by whether it is a resolution or a termination.
Forfeit money can be defined as a sum of money that provides the payer with the power to withdraw from the contract without requiring a valid reason (licentia paenitendi). According to Art. 178 of the TCO, forfeit money is paid at the time a contract is concluded, giving the contracting parties the power to withdraw from the contract. The agreement concerning the forfeit money must be concluded in accordance with the form of the contract to which it relates. When the forfeit money is delivered, the parties obtain facultas alternativa concerning the performance of their contractual obligations or the resolution/termination of the contract. According
to the first sentence in Art. 178 of the TCO, both parties are deemed to have the right to terminate the contractual relationship in the event of payment of the forfeit money. The rest of the article states the fate of the forfeit to be governed by the party terminating the contract. Thus, if the payer withdraws from the contract, the real forfeit money amount will remain with the beneficiary; if the beneficiary withdraws from the contract, they will be obliged to return double the forfeit money to the payer. If the right to withdraw from the contract is not exercised, the actual forfeiture should be set off against the principal claim in analogy with the Art. 177 para. 2 of the TCO, unless the parties agree otherwise. The question of whether the last paragraph of Art. 182 of the TCO concerning the reduction of the contractual penalty is applicable to the actual forfeit money is controversial. In a contract where the resolutory penalty has been stipulated, the creditor can only demand performance of the principal obligation. The creditor’s claim for performance can be paralyzed by the debtor’s payment of the penalty. If the parties have agreed on a penalty, the debtor is the one who must prove that it is also a resolutory penalty. In other words, the contractual penalty is presumed, not the resolutory penalty. Given the nature of the resolutory penalty, which differs fundamentally from the contractual penalty in that it only provides the debtor with the power to withdraw from the contract instead of remaining bound by it, it cannot be deduced under the terms of the last paragraph of Art. 182 in the TCO on the grounds that the sum is excessive even by analogy, unless the contracting parties attribute a contractual penalty to the resolutory penalty.
