Impact of Corona (COVID-19) Virus on Contracts
The Corona (Covid-19) virus, which was first seen in Wuhan, China and then spread all over the world, was declared by the World Health Organization (WHO) as a “Pandemic”, that is, an epidemic that spreads over a wide area and shows its effect. Declaring Corona virus as a Pandemic by WHO, seeing Corona virus cases in Turkey and taking various measures by the government (holidays of schools, cancellation of collective events, complete curfew for certain age groups and on weekends Covid 19 virus It raises many questions about the status of all contracts and legal relations between the parties.
What is Force Majeure?
A force majeure event is an extraordinary event that cannot be foreseen and resisted, which leads absolutely and inevitably to the violation of a general norm of behavior or debt that occurs outside the activity and business of the responsible or the debtor. Natural disasters such as earthquakes, floods, fires and epidemics are considered force majeure.
Force majeure is an event that prevents the performance of the debt and cannot be prevented despite the measures to be taken by anyone, unexpected, external and occurring outside the will of the debtor.
In the decision of the Supreme Court, it has been stated that epidemic diseases can also constitute force majeure. In order for the epidemic to be considered as a force majeure, it must be impossible to foresee the epidemic by the contracting parties, it must not be possible for the parties to resist the epidemic, and the debts undertaken by the parties in the contract must not be fulfilled due to the epidemic.
If the parties have specified natural disasters such as epidemics, earthquakes, floods, fires and public movements as force majeure in the contracts they have signed pursuant to TCO No. 6098, the occurrence of these situations will constitute force majeure for the contracting parties.
If epidemics are not specified as force majeure in the contract, the acceptance of epidemics as force majeure will vary depending on whether the parties affect the performance of their contractual obligations.
Effect of Force Majeure on Contracts
The effect of force majeure on contracts In Article 136 of the Turkish Code of Obligations No. 6098 under the title of IMPOSSIBILITY of fulfilment, “If the performance of the debt becomes impossible due to reasons for which the debtor cannot be held responsible, the debt ends.
The debtor, who gets rid of the debt due to impossibility in the contracts that impose a mutual debt, is obliged to return the performance taken from the other party in accordance with the provisions of unjust enrichment, and loses the right to demand the performance that has not yet been fulfilled. The cases where the damage arising before the performance of the debt is imposed on the creditor by law or contract are excluded from this provision.
If the debtor does not inform the creditor that the performance has become impossible without delay and does not take the necessary measures to prevent the damage from increasing, he is obliged to compensate the damages arising from it. has the provision.
Taking certain measures by governments to see the Corona virus in a country, to cause deaths due to the Corona virus and even to prevent the spread of the Corona virus is not enough to qualify the Corona virus as force majeure alone. In order for the Corona virus to be a force majeure for the parties of a contract, the parties must become unable to fulfill the debts / actions imposed on them in the contract due to the Corona Virus, and the Corona virus must affect the contractual parties to a degree that they cannot fulfill their debts.
If the performance of the contract has become impossible for the parties due to the nature of the contract and the current situation due to force majeure, the debts they have undertaken pursuant to the contract are terminated. For example, if a sales contract has been established between the parties and the delivery of the product subject to sale has become impossible due to force majeure, the seller will be relieved of the obligation to deliver the relevant product, and the buyer will be relieved of the obligation to pay the price of the product subject to sale. If the price of the product subject to sale has been paid by the buyer, this price will be returned to the buyer by the seller in accordance with the second paragraph of Article 136 of the TCO.
IMPOSSIBILITY OF PARTIAL EXECUTION – TCO ARTICLE 137
If the performance of the debt becomes partially impossible for reasons for which the debtor cannot be held responsible, the debtor will only get rid of the part that has become impossible. However, if this partial impossibility of performance was foreseen in advance, if it is clearly understood by the parties that such a contract would not be made, the entire debt will come to an end.
In contracts that impose a mutual debt, the debt of one party becomes partially impossible and if the creditor consents to partial performance, the counter performance will be performed at that rate.
DIFFICULTY TO OVERPERFORM-TBK ARTICLE 138
“An extraordinary situation, which was not foreseen and expected to be foreseen by the parties at the time of the contract, arises for a reason not arising 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 is against the rules of good faith, and the debtor has not yet fulfilled his debt or because the performance has become extremely difficult. The debtor has the right to ask the judge to adapt the contract to the new conditions, or to withdraw from the contract if this is not possible. In permanent contracts, the debtor uses the right of termination instead of the right of withdrawal as a rule. has the provision.
In case the parties are unable to fulfill their obligations due to force majeure; the situation where the performance arising from the contract becomes impossible according to the conditions of the situation Article 136 of the TCO, if it becomes partially impossible, the TCO. Article 137 of the TCO will be applicable in case the performance of the act becomes significantly more difficult.
The most important point in the reflection of force majeure to the contracts is that the force majeure event that makes the performance of the debt impossible must be notified to the other party of the contract. If due to force majeure, the current situation and the declaration of intent are not notified to the creditor by the debtor, and if measures are not taken to prevent the creditor’s damage from increasing, the debtor will be responsible for the damages that the creditor will suffer.
Although it is not possible for money debt to become impossible in accordance with the principle of “No perishables”, which dominates Turkish Law, it is possible to request an adaptation within the scope of the aforementioned article in the event that due to force majeure it becomes significantly difficult to make the payment over the price agreed by the parties and the conditions of Article 138 of the TCO are met. will be the subject.
The existence of the following conditions is sought in the provisions of article 138 of the TCO:
The extraordinary change of circumstances and conditions, the fact that this change is unpredictable and unpredictable for the parties during the establishment of the contract, or even if it was foreseen, it was not taken into account by the parties when establishing the contract,
Changing circumstances and conditions overtly and openly disrupt the balance between the obligations imposed on the parties by the contract,
The fact that the relevant party is not at fault in the change of circumstances and conditions,
the performance of the acts has not yet been completed or the performance has been made with reservation.
TBK art. If we examine the 138 application in terms of a lease agreement; The fact that consumers move away from crowded areas causes turnover losses for retail operators. The tenant is not in a position to know the risk of Covid 19 when concluding the lease, and this risk does not arise from the tenant. However, since the non-payment of the rent brings the risk of eviction, the replacement of the adaptation case may come to the fore with the payment of the rent with reservations.
Is Corona Virus (COVID-19) Force Majeure?
Corona virus has been detected in our country and in most countries of the world. Since the number of Corona Virus cases is increasing day by day, various measures are taken by governments to prevent the spread of Corona virus. The effect of these measures can be at the national level as well as at the international level, and their impact on legal relations may differ.
The determination of whether the Corona virus constitutes a force majeure for the parties to the contract should be evaluated separately for each contractual relationship.
Due to the presence of the corona virus in our country, all educational institutions, schools and universities for precautionary purposes were closed with the Presidential Decree, and collective events, fairs and concerts were canceled. This constitutes a force majeure event for the organizer who will organize the concert, the business where the concert will be held, and the consumers who will go to the concert, and the debts of the contracting parties end.
Since the shopping centers are closed but no restrictions are imposed for online shopping, there is no restriction on the work-delivery of cargo companies, Covid-19 does not constitute a force majeure for product/service purchase-sale contracts over the internet, unless there is a case of defective goods or otherwise legally reneging on the contract. The buyer will pay the price of the products, the seller will fulfill the obligation to deliver the products, and the parties will not be able to return from the contract due to Covid-19.