CommercialDisputes

Scope

This area covers contractual, receivable and compensation disputes between merchants and commercial enterprises, and those concerning a commercial enterprise. Sale of goods and services, dealership and distribution, carriage, current account and company partnership relationships are the principal subjects. In commercial relationships, the dispute sometimes stems from the invoice amount and sometimes from whether the work has been completed; the payment claim and the objections relating to the goods or services are addressed together and on the basis of concrete records.

Common issues

• Unpaid invoice amounts and current account receivables
• Disputes concerning defects, delay and performance under sales contracts
• Claims arising from the termination of dealership, distribution and agency relationships
• Compensation claims arising from breach of contract
• Receivables arising from cheques and promissory notes
• Disputes between partners and share transfer relationships
• Claims for annulment of objection where an objection has been raised in enforcement proceedings

How does mediation work in this type of dispute?

In commercial disputes, mediation is a precondition for bringing an action. Under Art. 5/A of the Turkish Commercial Code No. 6102, in commercial cases concerning receivable and compensation claims whose subject matter is the payment of a sum of money, and in actions for annulment of objection, negative declaratory actions and actions for restitution, an application must have been made to a mediator before the action is filed.

• The application is made to the mediation office at the competent courthouse; the parties may also agree on a mediator jointly.
• The mediator concludes the process within three weeks; in compelling circumstances, this period may be extended by a maximum of one week (Art. 18/A of Law No. 6325).
• If no agreement is reached, the final minutes drawn up are attached to the statement of claim; if the precondition has not been fulfilled, the action is dismissed on procedural grounds.
• A party that fails to attend the first meeting without a valid excuse is held liable for the entirety of the litigation costs, even if it is found to be partly or wholly right in the action.
• The precondition covers monetary receivable and compensation claims and actions for annulment of objection, negative declaratory actions and actions for restitution. Commercial claims that do not concern the payment of money, such as the annulment of a general assembly resolution, may fall outside this scope; in such cases, mediation is voluntary.
• Where there is an arbitration agreement or a special route of application, the relevant provisions are assessed separately; exceptions separately provided for by law are reserved. There is no single, fixed procedure for every commercial disagreement.

The mediator is an independent and impartial third party; the mediator does not make commercial choices on behalf of the parties and does not take the place of an expert examining the commercial books or of a court rendering a decision. The sessions are confidential and the process rests on the will of the parties. The settlement agreement becomes a document having the force of a court judgment under the conditions laid down in Law No. 6325.

Matters that may be discussed in the sessions

• Invoice and account items: the scope of the debt and the terms objected to
• Delivery of goods and services
• Returns and incomplete work
• Conditions for continuing the relationship: continuing to work together or only closing the existing account

One business may be awaiting payment while the other states that part of the service was not provided. In the sessions, it is established to which order, delivery or period each of these two statements relates; it is important that claims arising from different contracts are not confused with one another.

Process and points to note

Contracts, offers, orders, invoices, delivery notes, handover documents, commercial book entries, bank receipts and commercial correspondence are the documents to be reviewed. In commercial matters, taking steps such as formal notices, notices of defect and objections to invoices in due time affects the legal consequences. Applying to a mediator suspends limitation and preclusive periods to the extent provided by law.

The settlement text clearly states the amounts, dates, deliveries and mutual obligations. Where agreement is reached on one heading while another remains open, this distinction is also recorded in writing.

Our office’s approach

The office reviews commercial contracts and documents evidencing receivables and determines the basis of the claim and the procedural route. Drafting and reviewing contracts, preparing for the mediation process and, in matters where no agreement is reached, representation at the litigation and enforcement stages fall within the scope of this work. Where the role of mediator has been assumed in a dispute, the office does not act as counsel for any of the parties to that dispute.