Compensation (Damages)

Scope

The obligation to pay compensation depends on a ground of liability. The main grounds are a faulty and unlawful act (Turkish Code of Obligations, TBK, Article 49), non-performance or improper performance of an obligation (Article 112) and the debtor’s default (Article 118). In addition, there are cases in which fault is not required, such as the liability of the person who employs another (Article 66) and the liability of the owner and the operator of a business involving significant danger (Article 71). In a tort, the injured party proves the loss and the fault; if the amount of the loss cannot be fully proven, the judge determines an equitable amount (Article 50). The judge determines the compensation by taking into account the gravity of the fault (Article 51) and may reduce it in cases such as the contribution of the injured party (Article 52). Non-pecuniary damages may also be claimed for bodily injury and violation of a personality right (Articles 56, 58).

Practical Significance

Documenting the loss, establishing the causal link and monitoring the statute of limitations are decisive. A claim arising from a tort, as a rule, becomes time-barred under the statute of limitations two years after the date on which the injured party learned of the loss and of the person liable for compensation, and in any case ten years after the act; if the act constitutes an offense for which criminal law provides a longer statute of limitations, that period applies (Article 72). Special statutes may provide different periods. For claims arising from a contract, unless the law provides otherwise, the general ten-year period applies (Article 146). Contractual liability may be limited to a certain extent by an agreement made in advance; however, an agreement excluding liability for gross fault, any advance agreement excluding liability for obligations arising from an employment contract, and an agreement excluding liability for slight fault in services, professions or arts requiring expertise that can be carried out only with the permission of the law or of the competent authority are absolutely void (Article 115).

Commonly Confused Concepts

A contractual penalty is a performance agreed in advance for the case of non-performance (Article 179) and may be demanded even if the creditor has suffered no loss at all (Article 180); compensation, by contrast, redresses a loss that has actually occurred. In unjust enrichment, the aim is not to redress a loss but to return an enrichment that has no justified basis (Article 77). Severance pay (kıdem tazminatı) under labor law (Labor Law No. 1475, Article 14), notice pay (ihbar tazminatı) (Labor Law No. 4857, Article 17) and compensation for failure to reinstate (işe başlatmama tazminatı) (Labor Law No. 4857, Article 21), although the word ‘tazminat’ (compensation) appears in their Turkish names, do not depend on proof of a loss; their amounts are determined by law on the basis of wages. Tort and default are grounds that give rise to compensation; compensation is their result.