ABSTRACT
In the Turkish Code of Obligations numbered 6098 (TCO), the termination of the lease contract is regulated by a bilateral separation as the ordinary termination reasons and the extraordinary termination reasons. Thereunder, while the ordinary termination reasons are dividing into two as expiry of duration (TCO a.327) and notification of termination (TCO a.327-329); the extraordinary termination reasons are stated in three chapters as major causes (TCO a.331), bankruptcy of lessee (TCO a.332) and death of lessee (TCO a.333). In this study, the termination of the lease contract on the basis of extraordinary termination reasons has dealt.
I. INTRODUCTION
During the continuation of the contracts which are containing continuous debt relationship, it is possible for each parties that the continuation of the contract can not be unbearable in compliance with principle of honesty, in such cases each parties are entitled to terminate the contract on the basis of extraordinary termination reasons. Basically, the situation is not different in terms of lease contract, and the parties are allowed to terminate the lease contract before the expiry of duration of the contract in various provisions of the Turkish Code of Obligations. The extraordinary termination reasons are regulated respectively in articles 331-333 of the TCO as major causes, bankruptcy of lessee and death of lessee. In the event that some of these reasons occur, lease contract can be terminated immediately without complying with the termination periods or notification period of termination (TCO a.332/2) or can be terminated by complying with the notification period of termination (TCO a. 331/1, 333). In this study, the conditions and results of these extraordinary termination reasons will be dealt by focusing on each reason one by one
II. TERMİNATION THE BASİS OF MAJOR CAUSESA.
A. In General
The extraordinary termination of the lease contact for major causes is regulated under the article 331 of TCO. According to article; “Each of the parties may any time cancel the contract by following the legal cancellation notification period in the case of existence of important causes which make the continuation of the tenancy unbearable for the both parties. The judge shall rule he financial consequences of the extraordinary cancellation notification by considering the circumstances and conditions.”
Article 331 of the TCO which regulates the extraordinary termination for major causes is regulated as a general clause that can be applied to all kinds of lease contract regardless of the nature of the leasehold or whether the lease contract is for a definite or indefinite period. Accordingly, in the event that the existence of the major causes which render the continuation of the contract unconscionable, each party may terminate the contract at any time by complying with the legal notice period, without waiting for the period specified in the lease contract. In the text of the article, content of the major causes are not defined, therefore the determination of the major causes shall be made according to characteristics of the each event. The purpose of the legislator in not regulating the content of the major causes in a detailed way is that the major causes differ according to the terms of the lease contract1. the subject of the dispute and balance of the interest specified in the contract. Based on this, the judge was given the opportunity to make an assessment based on the needs of the concrete case2. Furthermore, it is possible to indicate the facts which are of major cause in the contract without limiting these reasons by doing so. According to provisions of the article, notice of termination may be made immediately upon the occurrence of the major cause, but the notice shall be valid at the end of the legally prescribed period of notice. As general, there is no rule concerning that the notice of termination shall be made in a specific form, however, the notice of termination in residence and roofed workplace leases is shall be made in writing taking into account of the 384th article.
Supreme Court’s 6th Law Department has specified the terms sought for termination of the lease contract for extraordinary reason in its decision numbered 2015/7331 E. and 2015/9163 K. as follows; “A valid lease contract concluded by and between the parties and the good causes which render the continuation of the contract unconscionable for the parties shall exist and the party who based on a good cause shall give notice of termination by complying notification period of termination as 3 months according to TCO a.329 and 3 days according to TCO a.330, in order the type of termination regulated under TCO a.331 to be used.”
B. Conditions of The Termination
1. Existence of The Lease Contract
First of all, existence of a valid lease contract is necessary in order the extraordinary termination right to be used. It is not important that the lease contract is whether for definite or indefinite time period and is related to a movable or immovable leasehold; in other words, TCO a.331 may be applied to all kinds of lease contracts. However, a bracket should be opened at this point to the Law numbered 7226 which enacted on 25.03.2020. According the provisional article number 10 on roofed workplace leases of this law, “Failure on the payment of the lease price that would operate from 01.03.2020 to 30.06.2020 shall not constitute a reason for termination of the lease contract and eviction.”
In order the provisions of TCO a.331 to be applied, it is not necessary for the leasehold to be handed over to lessee3. lease contract may be terminated even at a period when the lessee has not yet been handed over the leasehold4. In the event that the leasehold has not yet been handed over, termination shall be effective backwards5.
2. Existence of The Objective Causes Which Render the Continuation of The Contract Unconscionable
Essentially, the only cause that must arise in order to exercise the right of termination for an extraordinary reason is existence of important causes which make the continuation of the contract unbearable as per principle of honesty. The reason6 that makes the continuation of the contract unbearable in this manner must exist objectively7. The party who claims that the existence of the major cause and that cause makes the continuation of the lease contract unbearable for itself is obligated to prove this claim; the judge evaluates the existence of such causes in accordance with principle of honest and fairness which are regulated under the article 4 of the Turkish Civil Code8.
In the context of TCO a.331, major cause which makes the continuation of the contract unbearable neither defined nor be counted as numerus clausus, in other words it has been avoided to give an example of which circumstances would considered as major causes9. Accordingly, major cause should be audited on the basis of each concrete event whether it makes the continuation of the contract unbearable or not as per principle of honesty. Criterias such as the remaining duration of the contract, whether the major cause is temporary and whether this cause is predictable, defect of the parties. should be taken into consideration in determining the existence of the unbearableness factor. For example, if the expiration date of the contracts is near, the party wishing to terminate the contract may be expected to bear such matters, or it may be stated that temporary situations which the facts that leading unbearableness will not constitute a major cause for termination10. The major causes must be unforeseeable at the time that the contract was drawn up between the parties; if it can be foreseeable that these causes may arise in advance or if these causes occurs by a defect of a party, the lease contract cannot be terminated on the basis of the TCO a.33111. Likewise, the termination of the contract on the basis of the major causes that existed at the time drawing time of contract depends on the fact that the existence of these causes is not known or is not expected to be known at the drawing time of the contract; in other words, it is not possible to terminate the contract on the basis of these causes for the party who knows the major cause exists or is in a position to know the existence of the major causes at the drawing time of contract12. Even if the major causes are foreseeable, in the event that the consequences and extent of these causes are unforeseeable, they will be deemed to have occurred. The parties may decide by the contract some causes will be deemed as major causes in a numerus clauses manner13. but this shall not mean the restriction or annulment of the right to terminate the contract on the basis of major causes14.
In order for the lease contract to be terminated on the basis of major causes, it is not necessary for the addressee of the notice of termination to be defective. Because major cause may also base on a fact which is independent from the parties. However, there are also some opinions in the teachings that the parties do not have to be completely faultless, and it is sufficient to be less faulty for the party who seeks to terminate the contract15. The condition sought for the termination in the basis of major causes is that the fact that which constitutes the major cause makes the continuation of the lease relationship unbearable16. However, it should be noted that the party which caused the occurrence of the major cause by its own faulty conducts will not be able to terminate the lease contract on the basis of major cause. An example of this situation is that, the lessee who wishes to terminate the contract by showing his/her dismissal from his/her employment as a result of his/her own faulty actions as a reason17.
The reason for the termination may be arising from the lessor, the lessee or other external factors beside the parties. The external factors may be exemplified with causes such as wars, natural events and etc18.The source of the reason is not important. For example, conditions such as illness that occur in the people who live together with the lessee may be considered as major cause for the lessee19; however, in the event that the major cause is arising from one of the parties, defectiveness of the parties should be taken into account while deciding. In the event that the major cause is arising from the person of the party who makes the notification of termination, unpredictability shall also be examined either.
Whether the economic conditions of the parties may be considered as a major cause brings conflicts in its wake. According to some authors, changes in the economic conditions of the parties shall be considered as a major reason20. while according to some authors, this shall be included in the life risk of the party whose economic condition deteriorates and will not considered as a major reason21. As an example of the second opinion, in roofed workplace leases, stagnation of business of the lessee and economic stagnation shall not be utilized as a major reason and lessee will not have the extraordinary termination right on the basis of major causes can be given22.
There are different opinions on the doctrine about the practice in cases where there are multiple lessees or lessors. In case a major reason occurs in the person of single lessee, there is an opinion on the doctrine which argues that it is possible for the lessee in question to serve a termination notice; in this case the contract the contract will be terminated in terms of himself and will continue to exist in terms of other lessees23. According the opposing opinion, it is argued that arising a major reason in the person of one of the lessee’s is sufficient to terminate the lease contract in such a way as to be effective for all lessees24. According the second opinion, lessees must agree on the declaration of the termination will and serve a notice of termination jointly. The same assessment will made in case there are multiple lessees.
3. Serving the Termination Notice
In case a major reason arises, the party willing the terminate the contract may terminate the contract in accordance with the notification period of termination. As a rule, notice of termination is not subjected to any validity conditions, the important thing is that the notification must contains the will of termination and shall reaches to the opposite party25. However, notification must be made in writing in the residence and roofed workplace leases in accordance with the TCO a.34826.
According the TCO a.329; “Each of the parties may cancel the lease contract for an immovable property or a movable property by following the three-month termination notification period for the end of the lease period determined by local custom or for the end of six-month lease period if there is no such a custom.” Accordingly, a lease contract for an immovable property or a movable property may be terminated by following the threemonth termination notification period. As per TCO a.330; “Each of the parties may anytime terminate a movable property lease contract by following the three days cancellation notification period. The lease of a movable property which is leased for occupational end by the Lessor and used for private ends by Lessee and may cancel the lease contract by notifying minimum one month before for the end of the three months least period. In this case, the Lessor shall not be entitled to claim for compensation of his damages.” Accordingly, a lease contract for a movable property may be terminated by notifying other party three days before the termination.
It is not specified in the law that when the notification of termination should be served. At this point, it is important that the notification of termination must be served before the major reason disappears, otherwise after the major reason disappears, the contract cannot be terminated on the basis of such reason. Although it is mentioned in TCO a.331 that the lease contract may always be terminated, notice of termination must be served within a short period of time following the occurrence of the major reason in accordance with the honesty rule. According an option on the doctrine, failure to serve a notice of termination for a long time after the claim that the major reason makes the continuation of the contract unbearable may be deemed contrary to the honesty rule27;while it is argued by opposing opinion that the major reason is not constitutes such unbearableness or the state of unbearableness has ended28.
While according the TCO a.331, in termination for a major reason, it is necessary to comply with the legal notification periods of termination specified in TCO a.329 and 330, there is not any obligation to comply with the termination periods29. The notice of termination to be made will begin to have consequences at the end of the legal notification periods of the termination.
C. Position Against Other Provisions
The first of the issues to focus on is the mutual positions of the TCO a.138 and TCO a.331. Mainly, the same conditions must be met in order for TCO a. 138 which specifies excessive difficulty of performance and TCO a. 331 which specifies extraordinary termination of the lease contract in the basis of major causes, to be applied; according the both provisions, a previously unforeseeable reason makes it unbearable for the one of the parties to expect the continuation of the contract under the existing terms in accordance with the honesty rule, and again, according the each provision, the terminator party must not be mistaken. Based on this, if these conditions which are common for both articles are occurred, the parties may entitled to terminate the contract on the basis of major reasons and/or to request adaptation of the contract. In other words, TCO a.138 and TCO a.331 will compete each other. Although the same conditions must occur in order for both articles to be applied, while the parties may request adaptation of the contract according the TCO a.138, it is not possible to request such adaptation but only possible to terminate the contract in the scope of TCO a.331. but based on the principle named “termination shall be the last resort”, it is generally argued in the in the doctrine that TCO a.331 will not prevent to request adaptation of the contract. Accordingly, even one of the parties has gone to the path of termination, if the unbearableness of the contract may disappear through adaptation, and if one of the parties has made objection in this direction, the judge must go to the path of adaptation of the contract since the conditions of the termination have not been occurred30. But it should be noted that if any of the parties have not objected to the adaptation, the judge should not consider this option ipso facto, but only should inspect whether the conditions of the TCO a.331 has occurred31.
Another issue to focus on is the mutual positions of the TCO a.331 and TCO a.315. Mainly, TCO a.315 relates to the consequences of lessee’s conducts contrary to debt32; however, it is also possible that such conducts may make the continuation of the contract unbearable from the point of the view of the lessor33. An opinion in the doctrine argues that TCO a.331 and TCO a.315 compete each other and the lessor is free to rely on the provision he wishes34. while another opinion argues that TCO a.315 is a special provision that if the conditions are met, parties must rely on only TCO a.31535.
D. Consequences of the Termination
1. Finality
The natural consequence of exercising the right of termination is that the lease contract finalizes at the end of the notification period of termination. In case there is a dispute over the existence of the major cause, such dispute will be concluded by the judge; the judge’s decision will be considered as a declaratory ruling36. Following the termination, the lessee will have an obligation to return all the goods and values left to him within the scope of the lease relationship37.
2. Compensation for Damages
The party who notices termination on the basis of major causes has no obligation to pay any compensation to contrary party. However, a wide discretionary power is given to the judge to determine the monetary consequences of termination as per second paragraph of the TCO a.33138. Accordingly, the judge will determine the monetary payment which the terminator party will make to opposite party, by taking into the situation and conditions, regardless of the defect of the terminator party. Monetary payment refers to positive loss of the interlocutor of termination, in other words, “positive losses” will be based in determining the monetary consequences of termination on the basis of major causes. Such losses can exemplified as prudential lease costs that the lessor is deprived of due to termination of the contract by lessee, the lease cost loss that the lessee is exposed to due to having to pay a higher lease cost, removal costs of the lessee and etc. Yet, the upper limit of the lessor’s loss will be the sum of the remaining lease costs39. In this way, it is provided to cover the loss of the interlocutor of termination due to finalization of the contract before the term. At this point, the expenses that the party who wants to compensate is saved and the values obtained due to the termination of the contract before its term, should be deducted from the compensation.
While determining such amount, the judge will take into account the lessor’s loses on lease costs, lessee’s losses on his commercial life, the fact that the lessee had rent a new leasehold for a higher price and the fact that lessor had leased the leasehold to a third party for lower price and etc. The judge will also take into account the economic conditions of the parties and the behaviors that leading the parties to terminate the contract. In event that the lessee will have pay equalization payment within the scope of TCO a.331, the judge shall also take TCO a.325 into account. According the provision of the article, the amount of the compensation that lessee will pay is limited for a reasonable period which the leasehold may be leased with similar terms and conditions. Accordingly, in the event that the lessee is obligated to pay equalization payment in accordance with the TCO a.331, TCO a.325 shall constitute the upper limit of the payment40.
In addition to these explanations of monetary consequences, it should be noted that, an opinion in the doctrine argues that TCO a.331/2 is not a imperative provision; in other words, the parties may decide whether compensation shall be paid or not in case the contract is terminated on the basis of major causes41. According to another opinion in the doctrine, it is argued that the parties have no ability to limit the authority granted to the judge by law on determining the lump sum to be paid as compensation, while opposing opinion states that it is possible for the parties to determine the amount of compensation in advance. Upon second opinion, determined compensation amount should be considered invalid, in the scenario that the high compensation amount restricts the right to terminate the contract on the basis of extraordinary reasons42. Lastly, it should be noted that, the judge may also decide parties to not to pay such equalization payment, by taking into account the situation and conditions.
III. BANKRUPTCY OF LESSEE
A. In General
The extraordinary termination of the lease contact for bankruptcy of lessee is regulated under the article 332 of TCO. According to article; “If the lessee bankrupts after handing over the leased property, the lessor ask for a warranty for exeutory rentals. The lessor shall give a reasonable time to the lessee and the bankrupt’s estate for getting the warranty. If such a warranty is not given to the lessor in the specified time, the lessor may immediately cancel the contract without following a new termination notification period.” If lessee bankrupts, the lessor will be in danger of receiving the lease, and he will no longer be expected to continue the lease relationship. Therefore, the lessee’s bankruptcy is regulated as one of the reasons for the termination on the basis of extraordinary reasons under the TCO a.332. According to majority43 opinion in the doctrine, provision specified under TCO a.332 is imperative44. Accordingly, parties can not determine that the contract will terminate on its own in the event that the lessee goes bankrupt and likewise, the parties can not eliminate the opportunity of the lessor to demand guarantee and his right to terminate the contract in the event that the demanded guarantee is not provided by the lessee45.
B. Conditions of the Termination
1. Bankruptcy of Lessee
The first condition that must occur is that the lessee becomes bankrupt. According to article 43 of the Enforcement and Bankruptcy Law (“EBL”), “Individuals or legal entities, who are defined as trader under the Turkish Commercial Code or who are subject to provisions of trader and also who are defined to be subject to bankruptcy by the private regulations will be subject to bankruptcy even though they are not a trader.”. Based on this, TCO a.332 may only be applied in terms of the people listed in the article 13 of the EBL.
As it stated in the TCO a.332, the lessee must become bankrupt after the delivery of leasehold46. In the event that the lessee became bankrupt prior to establishment of the contract, the lessor will only be able to rely on the provisions related to mistake. If the lessee is bankrupt at the stage where the contract is established but the subject matter of the contract (leasehold) has not yet been delivered to lessee, the majority opinion in the doctrine argues that the lessor may avoid performing his duty arising from the contract and cancel the contract if the guarantee is not shown by the lessee within the reasonable time, in accordance with TCO a.9847.
2. Ask for Warranty from Lessee and Bankrupt’s Estate by Giving a Reasonable Time
In order for the lease contract to be terminated on the basis of TCO a.332 following the bankruptcy of lessee, the lessor must demand warranty to be given for the executory lease costs by giving both the lessee and bankrupt’s estate a reasonable time in writing. As it stated in text of article, the notice must be made in writing to both the lessee and bankrupt’s estate. Requirement of written form is regulated as the condition for validity48. Such demand is not subjected to any period of prescription or time bar, as long as lessee’s bankruptcy continues, the lessor will always be able to demand the warranty to be given. In the same way, a reasonable period of time must be given both the lessee and bankrupt’s estate separately, which leads the fact that the provision of TCO a.332 cannot find an application area before the bankrupt’s estate is established and such fact creates many problems in practice. During the period while the bankrupt’s estate has not yet been established, the lessor will not be able to rely on the provision of TCO a.332, so the only opportunity he has will be to terminate the contract due to default of the lessee in accordance with TCO a.315, but the lessor will not be able to commence execution proceedings demanding eviction against the bankrupt lessee.
The lessor will only be able to ask for a warranty for executory lease costs49. At this point, it will be important to determine which lease costs are executory. According to one opinion in the doctrine, the lease costs prior to opening of bankruptcy considered as executory50. while according to a second opinion the lease costs prior to the notification will be considered as executory and no warranty may be asked for such lease costs51.The amount of the warranty to be given will be determined according the remaining term of lease contract (fixed term lease contract)52.
TCO a.332 does not specify the length of the time period which shall be given by the lessor; instead, it was stated in the article that “The lessor shall give a reasonable time to lessee and bankrupt’s estate for getting a warranty.” In this way, it was stated that the time to be given by the lessor should be determined according to the conditions of the concrete event. The amount of the warranty that will be given should be based on when determining the reasonable time, because as the amount of warranty increases, the reasonable time period should also be determined relatively long53. The reasonable time period will begin after the arrival of the notice for both lessee and bankrupt’s estate. According to an opinion in doctrine, based on the provisions of default of lessee, the lessor will be able to terminate the lease contract immediately in the event that it is foreseen that giving a reasonable time to lessee and bankrupt’s estate will be ineffective based on manners of them54.
3. No Warranty Given During the Reasonable Time Period Given by Lessor
Although a reasonable time has given by the lessor in order for bankrupt lessee to provide a warranty, lessor’s right to terminate the contract will arise if no warranty is given by lessee and/or bankrupt’s estate55. At this point, it does not matter who gives the warranty, in other words, it makes no differences whether it is given by lessee or a third party56. However, the warranty must cover the executory lease costs and additional costs and shall be acceptable by the lessor57. There is no difference between the facts that the warranty is inadequate, unacceptable or has never been given.
If prior to the bankruptcy of the lessee, the lessor has been given in the amount of sufficient warranty in terms of receivable lease costs, in this case, no new and additional warranty will required to be given by the lessee or bankrupt’s estate. In same way58. according to an opinion in the doctrine, in the event that lessor has the right of lien and if the lienable item constitutes sufficient warranty for lessee, no new and/or additional warranty will be required to be given by the lessee or bankrupt’s estate, since the source of the warranty does not matter as well as who gave it, the obligation to give the warranty will disappear as long as it is sufficient to meet the lessor’s receivables. But it should be noted that in order for disappearance of the obligation to give warranty, right of lien should have been used in accordance with TCO a.338, and the liened item can only be deemed as warranty of six months’ lease costs as per TCO a.336; if the remaining term of the contract is more than six months, warrant shall be given for the part of the term which is more than six months59. Lastly, in the scenario that there are multiple lessees and all lessees are liable to lessor jointly, there will be no obligation to give warranty if the presence of other lessee’s constitutes sufficient assurance from the lessor’s point of view60; but in order for this situation to be in question, the financial situations of the lessees other than those who are bankrupt must be good.
C. Notice of Termination
In the event that the warrant is not give to lessor within reasonable time period which is given by lessor to lessee and bankrupt’s estate in writing, the lessor must submit anotice of termination in order to terminate the contract61. The lessor may submit the notice at any time following the expiration of the reasonable time period. However, it should be noted that failure to notify the lessee about the termination for a long time period following the expiration of reasonable time period may be considered as implicit declaration of intent on continuation of the contract62. In the same way, if the warranty given after the expiration of reasonable tine period but not yet before the notice of termination is accepted, the lessor may considered as to have implied waiver on the right to terminate the contract.
Although a form condition has been stipulated in law that this reasonable time period must be given in writing to lessee and bankrupt’s estate by lessor, there is such form condition stipulation in the law in relation to notice of termination to be made at the end of the reasonable time period; however, the notice of termination in residence and roofed workplace leases must be made in writing in accordance with TCO a.348.
D. Position Against Other Provisions
There is a close relationship between the provisions of TCO a.331 which regulates the extraordinary termination of the contract on the basis of major reasons and TCO a.332 which regulates the extraordinary termination of the contract on the basis of bankruptcy of the lessee. According to majority opinion in the doctrine, there is a general-special provision relationship between the provisions TCO a.331 and TCO a.332. Respectively, if the necessary conditions for both provisions have been met, provisions of TCO a.332 will find an area of application63.
E. Consequences of Termination
As the natural result of the termination, in the event that the contract is terminated on the basis of bankruptcy of lessee, the contract will be finalized. In contrast to the termination on the basis of major causes which regulated under the TCO a.331, no compensation is provided in TCO a.332 which regulates the termination on the basis of bankruptcy of lessee, because here the contract is not violated by the lessee but yet lessee becomes bankrupt. There are various opinions in the doctrine concerning the validity of contractual provisions that regulates the lessee’s obligation to pay compensation in the event of the bankruptcy; according to one opinion, such provisions should be considered as valid64, while opposing opinion argues that such contractual provisions shall be deemed invalid as provisions of TCO a.332 are imperative65.
IV. DEATH OF LESSEE
A. In General
The extraordinary termination of the lease contact for death of lessee is regulated under the article 333 of TCO. According to article; “In case of death of the lessee, his heirs may cancel the contract by following the legal termination period for the end of the nearest cancellation period.”
In doctrine it is argued that provision of TCO a.333 is relative imperative provision. Accordingly, the terms and consequences of the provision may not be changed by providing otherwise in the lease contract, and the right of the heirs to terminate the contract may not be eliminated by adding a provision in this manner to the contract66.
It should be noted that although TCO a.333 provides the heirs of the lessee the right to terminate the contract, existence of this article does not constitute an impediment for heirs from relying on other termination reasons. As per principle of legal subrogation, the heirs have acquired other termination rights owned by the deceased lessee in accordance with the law.
According to majority opinion in the doctrine, the provision of TCO a.331 regulating the termination of the lease contract on the basis of major causes will not be applied in the event of death of lessee since TCO a.333 is a special provision that regulated for this unique situation and TCO a.331 is regulated as a general rule for the reasons for extraordinary termination. While termination of the contract on the basis of provision of TCO a.333 gives the heirs of the lessee the opportunity to terminate the lease contract without paying any kind of compensation67, it seems unlikely and illogical for heirs of the lessee to rely on the provision of TCO a.331 in order to terminate the contract which may be against the them, by taking into account the terminator party’s obligation to pay compensation in the event that the contract is terminated in accordance with TCO a.311.
B. Conditions of the Termination
1. Death of Lessee
In order for heirs to terminate the lease contract on the basis of extraordinary reason, the only condition to be met provided by the law is the death of lessee; such a right will not be born on the heirs before the lessee deceases. One of the issues that should be mentioned here is that the lessee’s absence has been decided by the judge. As provided in TCC a.35, “the rights associated with death shall be used as if the death of the absent had been proven” in the event that the lessee’s absence was decided. Based on this, heirs of the lessee will be able to exercise their extraordinary termination rights if the lessee’s absence is decided68. It is mainly argued in the doctrine that the provision of TCO a.33 will not be able to applied in the event that the legal entities are terminated by merging or splitting69.
C. Declaration of Termination
As provided for in TCO a.333, the contract will not be finalized on its own in the event of the death of lessee; a declaration of termination must be made by the heirs of the lessee. Court’s 6th Law Department has stated such situation in its decision numbered 2014/12398 E. and 2015/6414 K. as follows; “Either according to 265th article of Code of Obligations numbered 818 or TCO a.333, it is accepted that the contract will not be finalized on its own following the death of lessee.”. Since the heritage is jointly owned by the heirs and right to terminate the lease contract is included in the heritage, all lessees must declare notice of termination in order for the contract to be terminated. Although the nature of the situation that will occur in the event that some heirs do not want to be a party of the lease contract while some want to continue the contract is controversial in the doctrine, Inceoğlu states that solution of the problem depends on the recognition that the lessee who has declared termination has ceased to be a party to the contract. Respectively, the heirs who notify termination will cease to be party to the contract, while the heirs who do not notify termination will continue to be party to the contract70.
Another issue that should be discussed is that death of a single lessee in the event that there are multiple lessees. According to the majority opinion in the doctrine, in such cases, TCO a.333 will not find an application area and the surviving lessee(s) will be able to terminate the lease contract on the basis of a justified reason.
In contrast to the provision of the TCO a.332 governing the extraordinary termination of the contract on the basis of bankruptcy of lessee, the declaration of termination is not subject to any form as per TCO a.333; it is possible for parties to subject the declaration of termination to a certain form via an arrangement to be made in the contract. In addition, although TCO a.333 does not provide a certain form condition for declaration of termination, in accordance with TCO a.348, which regulates the termination of the contract in residence and roofed workplace leases, the declaration of termination must be made in writing to terminate such lease contracts.
Apart from form and source of declaration of termination, the time of the declaration is to be made is another issue to be focused on. Both termination period and notification period of termination are included in the text of TCO a.333; accordingly, the contract may be terminated “by following the legal termination period for the end of the nearest cancellation period.”, since TCO a.333 gives the right to end the continuous debt relationship arising from the lease contract upon death of the lessee, in does not give any right to terminate the relationship immediately71. As mentioned in the extraordinary termination of lease contract on the basis of major causes, a lease contract for an immovable property or a movable property may be terminated by following the three-month termination notification period for the end of the six months lease period; while a lease contract for a movable property may be terminated by notifiying other party three days before the termination. According to majority opinion in the doctrine, in the event that heirs of the lessee do not make declaration of termination effective from the end of the nearest termination period, the right of termination on the basis of lessee’s death will disappear, since it is clearly stated in TCO a.333 that the right of termination may be used “the end of the nearest termination period”. According to İnceoğlu, this opinion will only be able to find application if “heirs of the lessee are aware of lease contract, the phenomenon of death and that they are heirs”. According to another opinion in the doctrine, in the event that lessee deceases shortly before the expiration of the legal termination period, it is possible for heirs to declare the termination effective from the end of the following termination period.
The last issue that should be focused on in relation to the declaration of termination is in cases where such declaration is not required. Although the issue is controversial, some authors in the doctrine argue that if all of the nearest heirs reject the heritage, the contract will end its own.
D. In Terms of Residence and Roofed Workplace Leases
In TCO a.356, there are some restrictions provided on termination of residence and roofed workplace lease contracts in the event of death of the lessee. It is stated in TCO a.356 that; “Partners, partners’ heirs who has the same profession or craft, and the dwellers who live in the same residence of dead lessee may maintain the lease contract as long as they follow the provisions of the contract and the law.”
The first condition sought for TCO a.356 to be applied is that the contract relates to the lease of a residence or roofed workplace. It is clearly mentioned in the text of TCO a.356, by whom the continuation of the lease contract may be requested. Accordingly, in terms of roofed workplace leases, the partners of death lessee and partners’ heirs who has the same profession or craft, and in terms of residence leases, the dwellers who live in the same residence of death lessee, have right to continue the contract. In terms of residence leases, the phenomenon of living in the same residence with death lessee should be continuous72. Although it stated int the article that whom may benefit from such right, there is no clarity on how this right will be used. It is clear that with the death of the lessee, the heirs will acquire the title of party, in this case, the heirs will be able to ensure the continuation of the contract by becoming a party of the contract without serving any declaration; while those who are not heirs will not be able claim the title of party by themselves. If those who are not heirs continue to use leasehold and pay the lease costs, it can be deemed that these people will tacitly obtain the title of party. Thus, this situation is reinforced by saying “…may maintain the lease contract as long as they follow the provisions of the contract and the law.” In TCO a.356. It should be noted that it is also possible for people who are not heirs to make a clear declaration of will, rather than engage in implied behaviors to ensure the continuation of the contract. If these people who are not heirs do not want the contract to continue, all they have to do is not use the leasehold, in other words, they have no obligation to terminate the contract by declaring termination.
E. Consequences of Termination
As the natural result of the termination, in the event that the contract is terminated on the basis of death of lessee, the contract will be finalized. However, since the contract has finalized from the completion of the termination notice period, executed lease costs until the end of the termination notice period will have to be paid73. In contrast to the termination on the basis of major causes which regulated under the TCO a.331, no compensation is provided in TCO a.333 which regulates the termination on the basis of death of lessee, because here the contract is not violated by the lessee but yet lessee deceases.
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FOOTNOTE
1 Aydın, Kira Sözleşmesinin Sona Ermesi, p. 184.
2 Seliçi, Sona Erme, p. 186-187.
3 İnceoğlu, Kira Hukuku Cilt 2, p. 223; Aydın, p. 182
4 İnceoğlu, p. 223, Aydın, p. 182
5 İnceoğlu, p. 223, Aydın, p. 182, Seliçi, p. 223
6 İnceoğlu, p. 231
7 Aydın, p. 186.
8 Gümüş, Kira, p. 320-321.; Gümüş, p. 268.; Aral/Ayrancı, S.325.; Daşlı, p. 130-131.; Bkz. Tunaboylu, S.532.; Seliçi, p. 187.; Günel, s.223.; Şahin, p. 85.; Şafak, p. 163.
9 Av. Zeynep Dönmez, Kira Sözleşmesinin Önemli Sebeple Feshi, İstanbul Barosu Dergisi, p. 171
10 İnceoğlu, p. 233
11 Turan Şahin, Kira Sözleşmesinin Önemli Sebeplerle Olağanüstü Feshi, Ankara Üni. Hukuk Fak. Dergisi, p. 343, 344
12 İnceoğlu, p. 234
13 Aydın, p. 236
14 Aydın, p. 219
15 Aydın, p. 220; İnceoğlu, p. 236
16 Altınok Ormancı, Haklı Sebeple Fesih, p. 158.
17 Günel, p. 217; İnceoğlu, p. 235
18 İnceoğlu, p. 236
19 Gümüş, p. 270; Günel, p. 220; Aydın, p. 192,193; İnceoğlu, p. 237
20 Gümüş, p. 270
21 İnceoğlu, p. 240
22 İnceoğlu, p. 231
23 Gümüş, p. 271; Aydın, p. 221
24 Günel, p. 271; İnceoğlu, p. 246
25 İnceoğlu, p. 247; Gümüş, p. 272; Aydın, p. 229
26 İnceoğlu, p. 247; Gümüş, p. 272
27 Murat Aydoğdu/Nalan Kahveci, Türk Borçlar Hukuku, Özel Borç İlişkileri, 2nd Edition, Ankara 2014, p. 649
28 Acar, Kira Hukuku Şerhi, p. 582; İnceoğlu, p. 250 v.d.;
29 Av. Zeynep Dönmez, p. 172.
30 İnceoğlu, p. 227
31 İnceoğlu, p. 227, 228
32 İnceoğlu, p. 224 33 İnceoğlu, p. 224
34 İnceoğlu, p. 224
35 İnceoğlu, p. 224; Aydın, s. 245
36 İnceoğlu, p. 251
37 Acar, p. 582.
38 Acar, p. 583.
39 Acar, p. 583.
40 İnceoğlu, p.255
41 İnceoğlu, p. 257; Gümüş, p. 273, 274 4
42 Gümüş, p. 257; Aydın, p. 239
43 İnceoğlu, p. 257, 258
44 İnceoğlu, p. 259; Gümüş, p. 291
45 İnceoğlu, p. 259
46 İnceoğlu, s. 263
47 Yavuz/Acar/Özen, s. 265; İnceoğlu, s. 264; Gümüş, s. 290; Aydın, s. 150; Doğan, Sona Erme, s. 241
48 Akyiğit, s. 137; İnceoğlu, , s. 265
49 İnceoğlu, s. 266
50 Aydın, s. 159; İnceoğlu, s. 263
51 İnceoğlu, s. 266
52 Tandoğan, cilt I/2, s. 229; İnceoğlu, 266; Yavuz/Acar/Özen, s. 266; Gümüş, s. 293; Aydın, s. 159; Doğan, s. 243
53 İnceoğlu, p. 267; Akyiğit, p. 137
54 İnceoğlu, p. 269; Gümüş, p. 292, 293; Doğan, p. 245
55 İnceoğlu, p. 270; Gümüş, p. 294
56 İnceoğlu, p. 270; Burcuoğlu, Tahliye, p. 279; Arpacı, Borçlar Özel, p. 249
57 İnceoğlu, p. 270;
58 İnceoğlu, p. 271;
59 İnceoğlu, p. 272;
60 İnceoğlu, p. 272; Gümüş, p. 293
61 İnceoğlu, p. 269; Burcuoğlu, p. 278
62 İnceoğlu, p .272; Doğan, p. 246
63 İnceoğlu, s. 260; Gümüş, s. 267
64 Tandoğan, s. 229; Doğan, s. 247
65 İnceoğlu, s. 277; Gümüş, s. 291
66 İnceoğlu, s. 279
67 Yavuz/Acar/Özen, p. 260.
68 Aydın, p. 130; İnceoğlu, p. 281
69 Tandoğan, p. 237; Yavuz/Acar/ Özen, p. 286; Zevkliler/Gökyayla; p. 322; Arpacı, p. 251; Erzurumluoğlu, Sona Erme, p. 44; Gümüş, p. 262; Aydoğdu/Kahveci, p. 582; Doğan, p. 306; Aydın, p. 130
70 İnceoğlu, p. 283
71 Gümüş, s. 262; Yavuz/ Acar/ Özen, S. 260; Tandoğan, S. 238; Zevkliler/ Gökyayla, S. 321; Arpacı, s. 147; Tandoğan, s. 238; Akkanat, s. 146.
72 İnceoğlu, p. 293
73 İnceoğlu, p. 294
