Adjustment of Rental Fee

COURT OF APPEALS 6TH CIVIL DIVISION

7.  2015/7802 K. 2016/2888 T. 7.4.2016

• ADJUSTMENT OF THE RENTAL PRICE (While the court should have conducted an investigation into the existence of adaptation conditions in light of legal principles and made a decision based on the results, it was not correct to have made a decision based on an incomplete investigation and an expert report that was not deemed suitable and sufficient to make a decision)
• EXCESSIVE DIFFICULTY OF PERFORMANCE (If the performance requested from him is changed to the detriment of the debtor to the extent that it would be contrary to the rules of honesty and the debtor has not yet performed his debt or has performed it by reserving his rights arising from the excessive difficulty of performance, the debtor may request the judge to adapt the contract to the new conditions) (It was decided to partially adapt the rent on the grounds that the balance of performance was disrupted due to the economic conditions and the nature of the property, where the conditions of the contract became harsher against the tenant – It was wrong to take the expert report, which was not deemed suitable and sufficient to form a judgment, as basis)

ABSTRACT: The case is regarding the request for the adaptation of the rental fee as of the date of the lawsuit. If an extraordinary situation that was not foreseen by the parties at the time of the contract and was not expected to be foreseen arises for a reason not originating from the debtor and changes the existing facts at the time of the contract to the detriment of the debtor to the extent that it would be contrary to the rules of honesty to request performance from him, and if the debtor has not yet performed his debt or has performed it by reserving his rights arising from the excessive difficulty of performance, the debtor has the right to request the judge to adapt the contract to the new conditions, and if this is not possible, the debtor has the right to withdraw from the contract. In contracts with continuous performance, the debtor, as a rule, uses the right to terminate instead of the right to withdraw. Although the court ruled that the rental fee be partially adapted on the grounds that the balance of performance was disrupted due to the economic conditions where the contract conditions were aggravated against the tenant and the nature of the property; The plaintiff’s claim in the case is for the adaptation of the rental fee and while the court should have made an investigation into the existence of adaptation conditions in light of legal principles and decided according to the results, it is not correct to have made a decision based on an incomplete written examination and an expert report that is not deemed suitable and sufficient to make a decision.

CASE : The decision of the local court regarding the adaptation of the rental fee with the date and number written above has been appealed by the defendant within the time limit, all the papers in the file have been read and the necessary discussions have been made:

DECISION: The case is currently regarding the request to adjust the monthly rental fee of 1530 USD + VAT to 1000 USD including VAT as of the date of the case. The court accepted the case and decided to adjust the monthly rental fee to 2165 TL + VAT, equivalent to 1000 USD, effective as of 01.06.2014, and the defendant appealed the decision.

In the petition, the attorney for the plaintiff stated that the independent section in the shopping mall built by the defendant in Istanbul / Ataköy within the scope of the Marina project was rented with a 5-year lease agreement starting from 1.6.2012 to be used as a jewelry store, that people did not show sufficient interest in the shopping mall, that their will was misled and the lease agreement was made as a result of exaggerated and misleading advertisements, that the exchange rate had increased exorbitantly and that the rental fee remained exorbitant compared to its peers, and that the monthly rental fee which is currently 1530USD + VAT should be adjusted to 1000USD including VAT as of the date of the lawsuit. The defendant stated in his response petition that a 5-year contract was made to be used as a jewelry store, that monthly rental fees were agreed for each year, and that in the event of an extension of the contract, the contract would be terminated on 1.6. The court defended the rejection of the unfair and groundless lawsuit by stating that it was decided that the increase condition would be 6% in the article, that the parties were merchants, that there were no extraordinary conditions, that their responsibilities according to the contract were limited to delivering the leased property and that it was delivered in full. The court accepted the lawsuit and decided to adjust the monthly rental fee as 2165TL + VAT, equivalent to 1000USD, effective from 1.6.2014…….

In our law, the principles of commitment to contract (Ahde Vefa-Pacta Sund Servanda) and freedom of contract have been accepted. According to these principles, the contract should be implemented exactly as it was when it was made. In other words, even if the terms of the contract have become more difficult for the debtor later and the balance of obligations has changed due to subsequent events, the debtor should perform the obligation in the contract exactly as it was. The principle of commitment to contract constitutes the basic principle of contract law as a requirement of the rule of legal security, truthfulness and honesty. However, this principle is limited by other principles of private law. In Turkish law, it has long been adopted that adaptation cases can be filed by applying both the Clausula Rebus Sic Stantibus principle and the Collapse of the Basis of Transaction Theory, inspired by Articles 2 and 4 of the CC.

The adaptation case, which was adopted by the Supreme Court and constitutes an exception to the principle of commitment to contract, was also adopted during the enactment of the TCC No. 6098 and regulated under the article title “Excessive Difficulty of Performance” in Article 138 of Law No. 6098, as follows: “If an extraordinary situation that was not foreseen by the parties at the time the contract was made and was not expected to be foreseen arises for a reason not originating from the debtor and changes the existing facts at the time the contract was made to the detriment of the debtor to the extent that it would be against the rules of honesty to request performance from him, and the debtor has not yet performed his debt or has performed it by reserving his rights arising from the excessive difficulty of performance, the debtor has the right to request the judge to adapt the contract to the new conditions, and if this is not possible, the debtor has the right to withdraw from the contract. In contracts with continuous performance, the debtor, as a rule, uses the right of termination instead of the right of withdrawal. The provision of this article is also applied to foreign currency debts.” In the justification of the relevant article, it is stated that “This new regulation is related to the “collapse of the basis of the transaction”, which is accepted as one of the exceptions to the principle of commitment to the contract (pacta sunt servanda) in doctrine and practice. The basis of the adaptation request based on extreme difficulty of performance, which is different from the concept of impossibility, is the rules of honesty stipulated in Article 2 of the Turkish Civil Code. However, the adaptation of the contract to changing conditions or the exercise of the right of withdrawal depends on the realization of the following four conditions together.

a.An extraordinary situation that was not foreseen by the parties and was not expected to be foreseen must have occurred at the time the contract was made.

b.This situation should not be caused by the debtor.

c.This situation must have changed the facts existing at the time the contract was made to the detriment of the debtor to such an extent that requesting performance from her would be contrary to the rules of good faith.

d.The debtor must have not yet fulfilled her obligation or must have fulfilled it by reserving her rights arising from excessive difficulty in fulfillment.

Although the court ruled that the rental fee be partially adjusted on the grounds that the contract conditions were aggravated against the tenant and the balance of performance was disrupted due to the economic conditions and the nature of the property; the plaintiff’s claim in the case was for the adjustment of the rental fee and the court should have made an investigation into the existence of the adaptation conditions in the light of the principles explained above and decided according to the results, it is not correct to have made a decision based on an incomplete examination in writing and an expert report that was not deemed suitable and sufficient to make a decision. The decision should be reversed for these reasons.

CONCLUSION: For the reasons explained above, it was unanimously decided on 07.04.2016 that the defendant’s appeal objections be accepted and the judgment be REVERSED in accordance with Article 428 of the Civil Procedure Code, taking into consideration the provision of temporary article 3 added to the Civil Procedure Code No. 6100 by Law No. 6217, and that the appeal fee paid in advance be returned to the appellant upon request.