ABSTRACT
The main subject of this article is to discuss the comparison of differentiating construction contracts in return for flat and revenue sharing construction contracts in the aspects of the acts imposed on the parties, their legal qualifications, types and form conditions to create independent sections. The main purpose of the article is to reveal in which situations construction contracts in return for flat and revenue sharing construction contracts are more favorable for the contractor and/ or the employer as a result of the comparison to be made.
I. INTRODUCTION
Construction contracts in return for flat and revenue sharing construction contracts are two important contracts of construction and real estate law that constitute the legal infrastructure of the construction sector, which has had an important place in the Turkish economy since the beginning of the 2000s. In this context, it includes the issues of comparison in terms of the structures, legal characteristics, form conditions and acts imposed on the parties of the construction contracts in return for flat and revenue sharing construction contracts frequently used in the context of the "urban transformation" phenomenon, which has an important place in Turkish law and has become a part of daily life, especially after 2010, in Turkey. Construction contracts in return for flat are defined as a doubletype mixed contract, in which the land owner undertakes to transfer the ownership of certain shares of the land to the contractor in return for the delivery of the determined independent sections of the building to be built on the land, its validity depending on the official form with rule of instantaneous performance and fully indebting both parties1. On the other hand, revenue sharing construction contracts are defined as a bilateral contract in which the contractor undertakes the obligations of constructing the structure undertaken to be created within the scope of the contract and mediating the marketing and sale of the independent sections, in which the contractor promises to sell the independent sections of the land owner to third parties in return, the contractor is obliged to share the income to be obtained as a result of the sale of the independent sections to be built2.
II. CONSTRUCTION CONTRACT IN RETURN FOR FLAT
A. Structure of the Contract
1. Definition and Factors
A construction contract in return for flat is also known by different names, such as "construction contract", "construction contract in return for land share"; "floor construction contract" in practice and it is referred to as "construction contract in return for land share" in Article 1009 of the Turkish Civil Code no. 8049 ("TCC"). Under the contract, one party (contractor) undertakes to construct an integral building by constructing independent sections on the land of the other party (land owner) and in return for the ownership of certain shares in the land within the scope of this contract. Since the construction contract in return for flat has the nature of a contract that encumbers the parties with liabilities, it comprises the factors of an agreement to be made between the land owner and the contractor, and the land owner's obligation to incur transfer liability of the land shares and the contractor's obligation to incur the liability of constructing independent sections according to this agreement.
2. Legal Characteristics and Features
a. Legal Characteristics
Since the construction contract in return for flat is not a contract regulated by law in terms of all three essential elements it contains, it is an atypical work and dual type mixed contract. Yet, the factors of the sale of the real estate and the contract of construction have come together in this contract.
b. Features
There are many types of construction contracts in return for flat used in practice, the main ones being; i. realization of the contract by transferring certain land shares to the contractor, ii. realization of the contract by transferring the land completely to the contractor and iii. the realization of the contract by transferring the land shares according to the stages in the construction3. In the event that the contract is realized by transferring certain land shares to the contractor, certain shares transferred to the contractor are required to be taken under collateral in order to protect the rights of the land owner, and the land owner is obliged to transfer the land shares to the contractor through sale. On the other hand, the land owner declares that a price as been received and ensures the establishment of a mortgage in favor of the shares transferred to the contractor, in accordance with the contract for the delivery of the independent sections to be built. In the event that the contract is realized by transferring the land completely to the contractor, the land is completely transferred to the contractor at the land registry and it is also possible to decide on the terms of the contract, such as the mode of sharing the independent sections to be made by the contractor in accordance with the contract, and what their qualifications will be. The main difference with the realization of certain land shares by transferring them to the contractor is that it is not necessary to establish construction servitude on the land share. In the event that the contract is realized by transferring the land shares according to the stage in the construction, unlike the first two options, it is determined which shares and sections will belong to the contractor and which to the land owner without mentioning the sale or promise of sale, and the land owner undertakes to give power of attorney for the sale of the shares left to the contractor under the contract to third parties in case the construction reaches certain stages.
B. Form of Contract
1. Form of Validity of the Construction Contract in Return for Flat
When taken into account the transfer or promise of the transfer of the foundation of the construction contract in return for flat, the form of this contract within the scope of the TCC is important for the validity of the contract. If the land shares corresponding to the independent sections to be built by the contractor are transferred to the contractor in the land registry, there will not be any legal invalidity related to the form. However, problem of form may come into question in cases where the construction servitude could not be established on the land or the independent sections were not transferred to the contractor even though they were established and the construction was subject to the condition that it would be transferred in return for its construction.
Since the construction contract in return for flat is a mixed contract that includes the factors of contracts for the sale of construction and immovable in terms of legal nature, the provisions regarding the validity of these types of contracts should be taken into account when evaluating the validity of the construction contract in return for flat. At this point, while contracts of construction are not subject to form in terms of validity in accordance with Article 12/1 of the Turkish Code of Obligations No. 6098 (“TCO”), the validity of contracts for the sale of real estate is subject to form in accordance with the provision of Article 706 of the TCC. In accordance with the provision in question; "The validity of contracts aiming at the transfer of immovable ownership depends on formally drawing up the contract.” As it can be understood from this provision, the TCC has made the sale of real estate official in the context of the validity condition. In addition, in Article 26 of the Land Registry Law No. 2644, it is clearly stated that contracts for the sale of immovable property must be made in the presence of the deed officer and official documents regarding the transfer of immovable ownership can only be drawn up by the deed officers.
In the light of these explanations, although the construction contract in return for flat contains the factors of the contract of construction that are not subject to any form condition in terms of validity, it can be concluded that the contract of this nature should be formally executed when taking into account that the land owner's liability in the construction contract in return for flat is to deliver the land and to transfer the ownership of certain shares.
Article 237/2 of the TCO has the provision that "the promise to sell, repurchase and purchase contracts shall not be valid unless they are formally drawn up". Accordingly, it can be understood that the TCO puts, as in the sale of immovable property; the promise of sale of the immovable is subject to an official form in the context of validity condition. The difference between the sale of immovable property and the preliminary contract for real estate sale is that, pursuant to Article 60 of the Notary Act No. 3456 (“NA”), the contract regarding the preliminary contract for real estate sale must be made in the presence of a notary public, not at the deed office. However, in this case, it does not change the fact that the validity of the contracts regarding the preliminary contract for real estate sale is also subject to form. In addition to this, in the event that the contractor wishes to transfer the land shares that were committed to be transferred to third parties within the scope of the preliminary contract for real estate sale concluded with the land owner, it will be sufficient for the contracts related to this to be subject to a plain written form. The reason for this is that the shares, which were committed to be transferred to the contractor with the promise of a construction sales contract in return for flat, are in the nature of a "right to claim" due to the fact that the ownership of the shares has not been transferred to the land owner and due to this situation, the contract between the contractor and the third party will be in the nature of assignment of claim.
2. Consequences of Non-Compliance to Form
As mentioned, since the construction contract in return for flat is a contract subject to an official form in terms of validity, the contract will be null and void if the contract is concluded in violation of the validity form in accordance with Article 12/2 of the TCO. However, considering Article 2 of the TCC, in some cases, claiming that the contract is invalid due to irregularity in form may fall within the scope of abuse of right, therefore, a breach objection cannot be raised. Accordingly, in a contract concluded without considering the form requirement, if the parties have jointly fulfilled the obligations agreed within the scope of the contract, then it would not be possible for the objection to be accepted in such a case, since it would be against the rule of goodwill for one of the parties to claim that the contract was in violation of the form. In this context, since the legislators cannot project in which cases the violation of the form will violate the rule of goodwill and/or the prohibition of abuse of right in advance, the determination regarding this will be at the discretion of the judge. In a decision of the Supreme Court Assembly of Civil Chambers, it was conclued that contrary to confirmed jurisprudence, a contract that is not made formally will be deemed null and void and that such a contract will not create a liability and it cannot be said that an unborn liability will be fulfilled, and in this case, it has been concluded that the principle of prohibition of abuse of right cannot be applied pursuant to Article 2 of the TCC. Due to the different decisions given by the Supreme Court on this issue, it has been argued that it is necessary to combine the caselaw, and the Supreme Court of Appeal found this application to be justified and adopted the following view with the Decision of Joint Chambers dated 30.09.1988 and numbered D.1987/2 D.1988/2,
“A compulsory registration case file based on a contract that was deemed void, as it created an obligation to transfer the ownership of an immovable property registered in the title deed but was not made in accordance with the format conditions stipulated by the law, cannot be accepted as a rule”;“ in addition, subject to the Property Ownership Law, in the event that the buyer pays all his liabilities by agreeing on the sale of the independent section without a valid contract regarding the sale of the independent section from the immovable, for which the construction has been started, and where the seller does not accept the transfer of ownership in the title deed, although the seller also delivers the independent section, the buyer is used as its owner4”
In parallel with this result, a construction contract in return for land share, which is concluded without complying with the required form, does not bind the parties and does not allow the parties to legally compel the other party to comply with the contract, as a rule; subsidiary obligations such as penal clauses accepted with a void contract are also invalid. Howeveras in the cases mentioned abovein cases where asserting the invalidity of the contract will be considered as an abuse of right, it is necessary to accept that the contract contrary to the form will create all the provisions and consequences of a valid contract.
C. Obligations of the Parties
1. Obligations of the Land Owner
It can be mentioned that the land owner has two basic obligations within the scope of the construction contract in return for flat. The first of these is to deliver the land subject to the contract to the contractor, free of all liabilities and ready for use; the second one is to transfer the ownership of the sections planned to belong to the contractor, as agreed under the contract once the contractor delivers the building to the land owner.
a. Liability of Land Delivery
Delivery of the land, which is the subject of the construction contract in return for flat and on which the construction will be made, to the contractor is the primary liability of the land owner. At this point, the land owner may be able to completely fulfill his/ her liability arising from this contract, provided that the land is delivered in a suitable and defect-free manner for construction. Otherwise, the land owner will be in default and held responsible, due to his/ her failure to deliver or not deliver the land. The opinion of the Supreme Court in this regard is as follows:
“The case is about the termination of the construction contract in return for the land share. In the section titled "delivery time" of the construction contract in return for land share dated 09.04.2008 between the parties, it is stated that the construction will be delivered within 12 months from the receipt of the building license and if the license is not obtained within five months from the contract, this situation will be considered a justifiable reason for the termination of the construction, and it has been decided that it will be evacuated within a month and the contractor will build according to this situation. Accordingly, the primary act of the land owners is to deliver the land to the defendant contractor as suitable for construction. Pursuant to Article 81 of the Code of Obligations, the party that does not fulfill its own performance in contracts that impose liabilities on both parties does not have the right to demand the other party to fulfill its obligation. Although it was claimed by the plaintiffs that they agreed that the rent of the places where they would live after evacuating the building would be paid by the defendant contractor as the reason for not evacuating the building, there is not any regulation in this direction in the contract between the parties. In this respect, it is not right for the plaintiff landowners, who fail to fulfill their obligation to evacuate the building on the land within two months from the contract date, to ask the defendant contractor to fulfill their obligation regarding delivery, thus, to terminate the contract on the grounds that this act is not fulfilled and while the case should be dismissed, it was not correct to make a written judgment with an erroneous reason.5 ”
“The case is related to the claim for the loss of rent and the collection of the missing value arising from the construction contract in return for the land share. In the concrete case, the plaintiffs, who are the land owners, did not deliver their land to the defendant contractor in accordance with the construction contract in return for the land share dated 23.08.2000, that they gave power of attorney to E.K. in accordance with the verbal agreement they made with the notified E.K. and that the construction permit was obtained by E.K. on 01.03.2001 and the construction was completed and it was understood that the title deed of the independent sections falling to the share of the defendant was not given to the defendant. Pursuant to Article 1 of the TCO, the plaintiffs who did not primarily fulfill their own obligations do not have the right to demand the performance of their act from the other party. In this respect, while the court should decide to dismiss the case for this reason, it was not correct to make a written judgment based on erroneous reasons.6 ”
The land owner's obligation to deliver the land, arising from the contract, includes the requirement that the said land be delivered in a suitable condition for construction and if there is a building to be demolished on the land subject to the contract, or if there is a tenant inside the building, the tenant must be evicted by the land owner, unless otherwise agreed in the contract. The contractor has the opportunity to force the landlord in this regard. The demolition of the old building should belong to the contractor unless otherwise agreed. However, in this regard, an evaluation should be made by taking into account the interpretation of the contract between the parties and the concrete event. For example, if there are some legal actions to be taken by the land owner regarding the building to be demolished and the contractor is not given authorization in this regard, it should be accepted that the land owner will be in default7.
b. Liability to Deliver Independent Sections Made
It is one of the most basic elements of the contract that the land owner undertakes to transfer the ownership of the land shares agreed in the contract concluded between the parties against the contractor in the construction contract in return for flat. Just as the land owner agrees to pay a certain price to the contractor in the contract, he/ she also commits to the price to be paid here. The mentioned transfer may be carried out collectively or in stages, before or after execution8.
2. Liabilities of Contractor
a. Liability to Make and Deliver the Structure
The senior liability of the contractor in the construction contracts in return for flat is to complete the construction subject to the contract and to deliver the independent sections that will belong to the land owner within the scope of the contract; at this point, the liability to delivery will be deemed to have been fulfilled, as a rule, by making an explicit or implicit notification of the completion of the construction to the land owner9. The moment the liability to deliver is fulfilled, a situation that is frequently encountered in practice is the condition that the delivery is conditional on the occupancy of the building. Nevertheless, the delivery of the building and the acceptance of the construction are also different concepts. Although there is not any need for a special delivery for the delivery of the building; the acceptance of the construction is a declaration of intent of the land owner that the contractor sees the building built in accordance with the contract and will not make any claims of defect10. Therefore, the fact that the independent sections have been actually received by the land owner under the contract does not necessarily mean that the building has been accepted as gospel.
b. Duty of Loyalty and Care
Although the contractor's duty of loyalty is not clearly regulated in the TCO in the context of construction contracts in return for flat, the obligation of notification of the contractor is regulated broadly in Article 357/3 of TCO. The obligation of notification is a part of the duty of loyalty and accordingly, the contractor is obliged to immediately notify the land owner of all situations that may prevent the completion of the work in full and at the time agreed in the contract.
At this point, the duty of care view in the context of the construction contract in return for flat, as Karayalçın states, is to take the behavior of an experienced and expert contractor as a criterion, as in the measure of a "foresighted businessman" regulated in the TKK in parallel with this issue11.
III. REVENUE SHARING CONSTRUCTION CONTRACTS
A. Structure of the Contract
1. Definition and Factors
Revenue sharing construction contracts, first in our law, came into effect in line with provision 4/1/ç12 of the Housing Development Administration (“TOKİ”) Tender Regulation on Sales, Transfer, Succession, Lease, Barter, Limited Real Rights Establishment and Revenue Sharing for Land Sale (“TOKİ Regulation”), it was defined as “revenue sharing in return for the sale of land”. This definition is; “provided that the income is defined in the specification, the income to be obtained from the sale of the construction or parts of the constructions where the contractor will cover the entire cost of the project, in accordance with the project deemed appropriate by the administration, in the land and/or field owned by the administration, is the contract between the administration and the contractor according to the principles determined in the contract”. A revenue-sharing construction contract according to a definition in the doctrine is, “The contract in which the land owner is obliged to give representative authority to the contractor regarding the sale of these independent sections and to share the income to be obtained from this sale with the contractor in return for the contractor's obligation to create and sell independent sections”13.
Hereinbelow, revenue sharing construction contracts entered our law primarily with the TOKİ Regulation article and then started to be concluded by private entities. Since the revenue sharing construction contract, like the construction contract in return for flat, has the nature of a contract that imposes liabilities on both parties, first of all, there is an agreement between the land owner and the contractor and the land owner is obliged to share the income to be obtained from the sale of independent sections based on this agreement. On the other hand, it includes the elements of construction such as making independent sections, selling these independent sections on behalf of the land owner and incurring delivery liabilities to the buyers14.
2. Legal Characteristics and Features
a. Legal Characteristics
A revenue sharing construction contract is a conclusive contract in terms of its legal nature15. Since the revenue sharing construction contract is a type of contract that results in mutual liabilities of both parties to the contract, it has the characteristics of a consensual, synallagmatic (reciprocal) and mixed contract. At this point, the mixed nature of the revenue sharing construction contract results from the fact that it contains the elements of sales, construction, real estate brokerage and ordinary partnership agreements, which are regulated in the law, and these elements came together in a way that the law had not envisaged and formed a single contract of another type that was not regulated by the law16. Thereupon, it is concluded that the revenue sharing construction contract is a mixed contract under the heading of anonymous contracts17.
b. Features
There are many types of revenue sharing construction contracts used in practice, the main ones are; “provision for general land sale”, “provision for the sale of land with a minimum income commitment”, “provision for the sale of land with the condition of sharing in kind” and “provision for the sale of land predicting the transfer of shares in the land registry”.
i. Revenue Sharing Construction Agreement for Provision for General Land Sale:
A general land sale (promise to sell) revenue sharing construction contract is the simplest form of such contracts. Accordingly, the contractor will build independent sections on the land provided by the land owner; carry out the necessary activities for their sale, of which the income from the sale will be shared between the parties in the manner and rate agreed in the contract as the independent sections are sold18.
ii. Revenue Sharing Construction Contract for Provision for the Sale of Land with a Minimum Income Commitment:
The elements of this type of revenue sharing construction contract are: that the contractor first builds the independent sections, markets and sells the independent sections that are built/to be built on behalf of the land owner, and undertakes the minimum income to be obtained by the land owner. In return, it is the land owner's commitment to transfer the land share corresponding to the independent sections to the third party buyers and to share the income to be obtained with the contractor, and ultimately the parties agree on these issues. The contractor, in accordance with the revenue sharing construction contract, which includes a minimum income commitment formed by these elements, will be obliged to pay the minimum income it has undertaken against the landowner, even if the independent sections built under the contract have been sold. In the event that the expected income cannot be obtained, the contractor is obliged to make up the difference, but in case he earns more than the determined minimum income, this excess income will not be left to the contractor and will be shared between the land owner and the contractor at the rate determined by the parties within the scope of the contract.
iii. Revenue Sharing Construction Agreement for Provision for the Sale of Land with the Condition of Sharing in Kind:
The parties to a revenue sharing construction contract may not want to determine the revenue sharing ratio while concluding the contract, considering the possibility that the independent sections to be built under the contract may not be sold for a while. In order to achieve this, if there are any unsold independent sections after a certain period of time, the parties may terminate the revenue sharing method and decide to share the unsold independent sections in kind. In this case, the sharing procedure is often indicated in the contract.
iv. Provision for the sale of land Predicting the Transfer of Shares in the Land Registry
In a revenue sharing construction contract in return for the sale of land (promise to sell), transfer of a share at the land registry to the contractor is out of question. The contractor has a right on the income from the sale of the independent sections, according to the terms of the contract. However, it is possible for the contractor, who has become the partner/seller of the independent sections to be built/built with the contract, to request the transfer of shares at the land registry from the land owner to third parties that can be defined as customers, within the terms of the contract.
B. Form of Contract
A revenue sharing construction contract includes a preliminary contract for real estate sale in terms of its content. At this point, in view of the promise to sell the immovable having the quality of the preliminary contract of the contract regarding the sale of the immovable, the provision in Article 29/2 of the TCO, "except for the exceptions stipulated in the laws, the validity of the preliminary contract depends on the form of the main contract to be established in the future" should be taken into consideration19. An exception is stipulated in Article 237/2 of the TCO, unlike the other preliminary contracts regarding the promise to sell immovable, and it is stated that the contract in question will not be valid unless it is formally drawn up pursuant to the provision of the law. In addition, pursuant to Article 60/3 of the NA, the preliminary contract for real estate sale is made by notary public through formal regulation. In this way, it is a condition of validity that construction contracts based on income sharing are also made in statutory form at the notary. Although there is not a legal regulation, according to the accepted view in practice, preliminary contracts for real estate sale can also be drawn up by deed officers at the land registry. Since the deed officers are authorized to draw up the main contract, the "potest etiam minus" rule will apply at this point and they will be able to draw up the real estate sales promise contract20. As stated in Article 12/2 of the TCO, since the form stipulated for the contracts in the law is a validity condition, the contracts concluded without complying with the form stipulated in the TCO will be null and void21. Thus, everyone has to act in good faith in exercising their rights and performing their obligations22. According to this principle, which is the general rule of human relations in society, the argument that it will not have legal consequences is not heard against invalid contracts whose acts are performed23.
C. Obligations of the Parties
1. Obligations of the Contractor
a. Obligation to Complete and Deliver the Construction
Because of the fact that the revenue sharing construction contract is basically a construction contract, the most basic obligation of the contractor is the completion and delivery of the construction owed under the concluded contract. At this point, the contractor's performance of the said obligation means that the independent section in question is left to the right owner in such a way that it can be used within the scope of the contract. Accordingly, the delivery obligation consists of making it suitable for use in accordance with the purpose for which it was designated and notification of this upon completion of construction.
b. Duty of Loyalty and Care
The contractor's duty of loyalty and care to the land owner is not limited to the construction obligation; it also applies to the marketing and sale of independent sections made within the scope of the contract. At this point, the contractor is under the obligation to protect and watch over the interests of the land owner. Therefore, the contractor is obliged to act in favor of the landlord within the scope of this contract and to refrain from actions that will cause the land owner harm24.
“Regarding the contractor's duty of loyalty and care in a revenue sharing construction contract, the aforementioned relevant provisions of the construction contract find application by analogy in terms of the contractor's obligation to construct the structure agreed in the contract. Again, the contractor is under the obligation of the representative to show the prices of the independent sections with regard to the marketing and sale of the independent sections25”. The contractor is obliged to act at the stages of negotiating the prices, marketing and selling the independent sections to the buyers by taking into account the interests of the land owner, as well as themselves.
c. Obligation for the Presentation and Sale of Independent Sections Built/ To be Built
Revenue sharing construction contracts actually includes an element of the brokerage contract regulated in Article 520 of the TCO as it includes the contractor's act of marketing and selling the independent sections built/ to be built. It is not possible for the contractor to completely get out of obligations under this contract by constructing the agreed structure by complying with the obligation of due care and loyalty, and has the obligation to perform the necessary activity/ activities to market and sell the independent sections built by complying with the duty of care and loyalty in order to achieve the purpose of earning income, which is the main purpose of the contract. The appearance of the duty of loyalty and care imposed on the contractor under the contract, within the scope of this obligation, is that the contractor must personally fulfill his obligation to mediate the sales contract.
Even if it is the contactor’s obligation, there are no obstacles for the landowner to carry out transfer transactions by means of finding the people who will buy the independent sections within the scope of the revenue sharing construction contract as long as it complies with the provisions of the revenue sharing construction. As a rule, the sale of independent sections within the scope of this contract is carried out by the contractor by proxy to the land owner. The land owner gives power of attorney to the contractor for the realization of the sales.
IV. COMPARISON OF THE CONTRACTS
A. Similar Features
The similarities between construction contracts in return for flat and revenue sharing construction contracts in terms of the features described in the article are manifested in their legal qualities, elements and obligations to the parties. The similarities of the said contracts in terms of their legal qualities are that both contracts are onerous and mixed contracts that impose liabilities on both parties. The similarities between the two contracts, which are the subject of the article, in terms of the liabilities imposed on the parties, appear in the points of duty of loyalty and care, the obligation to deliver the independent sections according to the contract, warranter liability, considering that the contracts contain the elements of both the contract of construction, and the contract of sale of the immovable.
B. Differences
Although construction contracts in return for flat and revenue sharing construction contracts have some similarities in certain aspects, they also contain different features from each other in many aspects. First of all, in construction contracts in return for flat, unlike revenue sharing construction contracts, there is not a common will between the parties regarding the sharing of the profit or revenue26. This difference actually occurs in terms of the purposes of the contracts in question at the stage of establishment. The revenue sharing construction contract resembles an ordinary partnership contract established between the parties in this respect27. Another difference between the relevant contract types is manifested in the losses that arise/ may arise in the delivery of the independent sections built within the scope of the contracts. In the construction contract in return for flat, if the independent sections that the contractor is obliged to build are purchased by third parties, the third party will not be able to claim any rights from the land owner if the delivery obligation arising from the said sale is not fulfilled. On the contrary, in a revenue sharing construction contract, in case the contractor refrains from delivery and the independent section or sections are delivered in a defective, late and incomplete manner the landlord will also be jointly liable against third parties within the scope of Article 638/3 of the TCO, since the joint will of the parties regarding income sharing is an ordinary partnership.
In addition, another significant difference between the two types of contracts is the transfer of ownership of the independent sections subject to the contract. In the construction contract in return for flat, the land owner undertakes to transfer the independent sections determined by the contract to the contractor at the land registry. On the other hand, in the revenue sharing construction contract, the land owner does not have any transfer obligation to the contractor28. As a rule, in the context of the part to be transferred, some of the independent sections will be transferred to the contractor in the construction contract in return for flat, whereas in the revenue sharing construction contract, there is not a transfer of the independent sections to the contractor. In addition, in the construction contract in return for flat, the land owner has the right to use or lease the independent sections that belong to him under the contract, while in the revenue sharing construction contract, since the income obtained after the sale of the independent sections will be shared between the parties, the landlord cannot benefit from the independent sections in this way29.
The revenue sharing construction contract was first started to be implemented in line with the TOKİ Regulation and it began to be concluded by private law subjects in the following process. Thereafter, although the revenue sharing construction contract was initially planned to be concluded between the administration and the private law subject, it started to be made between private law subjects since it is a mechanism that can be used by every land owner and contractor later on30. On the contrary, there is not a historical development of the construction contracts in return for flat originating from the administration.
V. CONCLUSION
In this article, the features of construction contracts in return for flat and revenue sharing construction contracts are mentioned and in the context of these features, the similarities and differences of the contracts are pointed out. Although construction contracts in return for flat have been used for a longer time than revenue sharing construction contracts, today, both contract types are preferred to meet the different demands of land owners and contractors in terms of building independent sections. Although the two types of contracts are parallel to the point of making independent sections, they differ from each other in the context of the transfer of ownership of the independent sections that are basically built and the sharing of the income from the sale of the independent sections between the parties. When an evaluation is made in terms of the interests of the parties, especially in the revenue sharing construction contract, the contractor is jointly liable with the land owner under the TCO in case the contractor does not fulfill the act of creating independent section(s) for which he is contractually responsible, or if he/ she fulfills it in a deficient/defective manner in the revenue sharing construction contract. The land owner not being able to use or lease the sections left to him/ her within the scope of the contract can be handled as a situation against the land owner within the scope of revenue sharing construction contract. In a revenue sharing construction contract, the fact that the sale of independent sections is on the contractor as a rule may be seen as a separate responsibility for the contractor, but may be a convenience for the land owner. In general, the primary goal of the contractor is to sell the independent sections in the early term and to meet the construction expenses on this wise. In return, since the land owner aims at the maximum income he can obtain from the independent sections, the early sale will not be as important as it is for the contractor. For this reason, in the construction contract in return for flat, the contractor will be able to decrease the value of the independent sections belonging to the land owner by selling the independent sections at a lower price than the land owner intends to sell. When making a contract between the parties, the relevant provisions may be included in the contract in order to eliminate this possibility. By evaluating the concrete event, the demands, needs and priorities of the parties, both contract types can be used for both the land owner and the contractor.
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YAŞAR KARAYALÇIN, Issues and Opinions in Private Law, Ankara 1975.
FOOTNOTE
1 Hasan Erman, Construction Agreements in Return for Flat, 3. Edition, Istanbul 2010, p.1.
2 Emrehan Inal, The Concept of Conclusive Contract and Revenue Sharing Construction Contract 2. Edition, Istanbul 2011, p. 149
3 Cevdet Yavuz, Special Provisions of Turkish Code of Obligations, 10. Edition, Istanbul 2014, p. 590.
4 Yargıtay 19. H.G.K, T. 30.09.1988, E. 1987/2, K. 1988/2 (Supreme Court 19. H.G.K, T. 30.09.1988, D.1987/2, D. 1988/2).
5 Yargıtay 23. HD. 16.01.2013, 2012/5827 (Supreme Court 23. HD. 16.01.2013, 2012/5827).
6 Yargıtay 23. HD. 05.12.2012, 5820/7174 (Supreme Court 23. HD. 05.12.2012, 5820/7174).
7 Nezih Sütçü, Construction Contract in Return for Flat in all Aspects in Practice and Theory Volume-1 6. Edition, Istanbul 2014, p. 342.
8 Ece Karaduman, Construction Contract within the Framework of Urban Transformation Legislation, Istanbul May 2021, p. 197.
9 Haluk Tandoğan, Private Liability Relations of Law of Obligations, Istanbul 1998, p. 125.
10 Haluk Burcuoğlu, The Rights of the Employer arising from the Guarantee Against Fault in the Construction Contract and the Periods to be Complied Especially for the Use of These Rights, Istanbul 1990, p.217.
11 Yaşar Karayalçın, Issues and Opinions in Private Law, Ankara 1975, p.22.
12 03.05.2006 tarih, 26157 sayılı Resmi Gazete (Official Gazette dated 03.05.2006, numbered 26157).
13 Emrehan Inal, The Concept of Conclusive Contract and Revenue Sharing Construction Contract, Istanbul 2011, p. 149.
14 Yavuz, Code of Obligations Courses, 16. Edition, Istanbul 2019, pp.606- 607.
15 Özlem Yalıncak, Revenue Sharing Construction Contracts, T. C. Ankara University Institute of Social Sciences, Department of Private Law, September 2019, p.35-36.
16 Umut Şenocak, Book of Construction Contract Based on Revenue Sharing, Istanbul 2012, p.40.
17 Inal, Conclusive, 2.Edition, Istanbul 2011, p. 193-194.
18 Yavuz, Code of Obligations Courses, 16. Edition, Istanbul 2019, p. 608.
19 Eren, General Provisions of the Code of Obligations, p. 351.
20 Eren, General Provisions of the Code of Obligations, p. 197.
21 Eren, General Provisions of the Code of Obligations, p. 327.
22 Cengiz Kostakoğlu, Construction Law and Construction Contract in Return for Flat, 8. Edition, Istanbul 2000, p.71.
23 Kostakoğlu, Construction Law and Construction Contract in Return for Flat, p. 71.
24 Mustafa Alper Gümüş, Special Provisions of Code of Obligations Volume 2, Istanbul 2010, p.45.
25 Umut Yeniocak, Gelir Paylaşımına Dayalı İnşaat Sözleşmesi, Ankara 2013, s.77.
26 Vehbi Umut Erkan, Construction Agreements, Ankara 2019, p. 142.
27 Murat Oral, Revenue Sharing Construction Contract, Başkent University Institute of Social Sciences, Ankara 2020, p.38.
28 Sütçü, Construction Contract in Return for Flat Volume-1, 6. Edition, Istanbul 2014, p.52.
29 İnal, Gelir Paylaşımlı Inşaat Sözleşmesi, 2.Bası, Istanbul 2011, s.228.
30 Güler Gümüşsoy Karakurt, Legal Nature of Revenue Sharing Construction Contract, Journal of Istanbul Kültür University Faculty of Law (İKÜHFD) Gift to Prof. Dr. Turhan ESENER, Vol.15, 5.1, January 2016 (Special Issue) Gift Vol. II, p. 788.
