Obligations Law

Obligations Law regulates the debtor-creditor relationships between individuals and legal entities, establishing the mutual rights and obligations of the parties. This field is governed by the Turkish Civil Code and the Turkish Code of Obligations, covering all types of debt relationships. Obligations law addresses various significant issues, such as the formation of contracts, the consequences of contract breaches, claims for compensation, and debtor responsibilities. In this article, we will discuss the fundamental principles of obligations law, the formation of contracts, the rights of debtors and creditors, breach of contract, and compensation.

Obligations Law and Basic Principles
Obligations law regulates the obligations that arise through the mutual consent and will of the parties. When one person agrees to fulfill an obligation to another, a debt relationship is formed. Failure to fulfill these obligations creates legal responsibility. The basic principles of obligations law include fundamental principles like trust, justice, free will, and the rule of honesty.

The Turkish Code of Obligations is the primary legal text governing obligations law and addresses debt relationships in the following areas:

• Contracts: Agreements between parties and the rights and obligations arising from these agreements.

• Unilateral Legal Transactions: Debts created by the will of one party alone.

• Tort: A debt relationship arising from the unlawful harm caused by one person to another.

• Enrichment: A debt relationship arising when one person unlawfully increases another person’s assets.

Formation of Contracts
A contract is a legal transaction formed by the mutual will of two or more parties, creating reciprocal rights and obligations. Obligations law establishes detailed rules for the formation of contracts. For a contract to be valid, the parties must freely express their will and consent during the offer and acceptance stages. Additionally, the subject and purpose of the contract must be legal.

There are many types of contracts, each with its own specific rules. Some common types of contracts include:

• Sales Contract: A contract involving the mutual exchange of goods.

• Lease Contract: A contract where one party agrees to provide property for use for a certain period, and the other party agrees to make payments in return.

• Service Contract: A contract where one person commits to providing a certain service to another.

• Loan Contract (Credit Agreement): A contract where one person borrows money from another.

For contracts to be valid, the parties must express their consent and have a legal purpose. Otherwise, the contract may be considered invalid.

Debtor's Obligations and Creditor's Rights
When a debt relationship arises, the debtor agrees to fulfill a certain obligation, and the creditor has the right to demand the performance of this obligation. The debtor must fulfill their obligation in a timely and complete manner. Failure to do so results in default, and the creditor may claim compensation from the debtor.

If the debtor fails to fulfill their obligation, the creditor can use various enforcement methods to collect the debt. One such method is enforcement proceedings, and the creditor also has the right to claim compensation and interest. The failure to meet the obligation not only harms the creditor but also has legal consequences for the debtor.

Breach of Contract and Compensation
Failure to fulfill the terms of a contract constitutes a breach of contract, and the creditor has the right to demand compensation in such cases. Compensation for damage arising from a contract breach is one of the key issues in obligations law.

• Late Payment Compensation: If the debtor fails to fulfill their obligations as stipulated in the contract, the creditor may claim late payment compensation. This compensation is intended to cover the damage caused by the debtor’s failure to perform their obligations.

• Anticipated Damages: The parties may foresee a certain amount of damages in case of a breach of contract and may demand payment of that amount.

• Damage Compensation: Once the extent of the damage is determined, the creditor may claim compensation for the damage. The amount of compensation may vary depending on the specific circumstances of the case.

Compensation is paid to remedy the breach of contract, and it may also cover non-material damages in some cases.

Tort and Remedying the Damage
Tort arises when one person causes harm to another. The Turkish Code of Obligations provides for compensation of damages arising from torts. A tort is defined as harm caused by unlawful conduct.

When damage occurs due to a tort, the harmed party can demand compensation for the damage. The person claiming compensation must prove that there is a causal connection between the act and the harm.

Obligation Due to Enrichment
If a person unjustly enriches themselves at the expense of another’s assets, this person may enter into an obligation due to enrichment. The enriched party must return the unlawfully obtained property.

Objections and Cancellation in Obligations Law
Contracts may sometimes be unlawful, or one party may wish to terminate the contract. In such cases, obligations law regulates cancellation and objection rules:

• Voidable Contracts: A contract may be canceled if one party’s legal will is impaired. In voidable contracts, a party can cancel the contract due to a breach.

• Objection: A person may object to a debt transaction that has been unlawfully made against them, rendering it void.

Obligations law governs the debt and credit relationships between individuals and legal entities. The formation of contracts, the rights of debtors and creditors, contract breaches, and compensation are fundamental aspects of obligations law. This field continues to be one of the cornerstones of the legal system, regulating the mutual rights and obligations of parties.

Obligations law is an important field for both individuals and commercial businesses. Therefore, working with an expert lawyer is crucial to ensure that debt relationships are managed properly and the rights of the parties are protected.