Limitation of Liability, Force Majeure and Hardship in Turkish Commercial Contracts: What Articles 112 to 138 of the Code of Obligations Provide, Which Exclusions Are Void, How Impossibility and Default Are Treated, When a Court Adapts a Contract, and How a Company Should Draft the Three Clauses

A liability cap, a force majeure clause and a hardship clause arrive in almost every contract a foreign-owned company in Turkey asks me to review, and almost every one I read was written for another legal system. The Turkish Code of Obligations has firm rules that the templates ignore. It presumes the debtor's fault on any breach, voids any advance exclusion of liability for gross fault, voids exclusions for slight fault where the debtor's activity needs a licence, treats standard terms that the other side was not told about as unwritten, and lets a court adapt or unwind a contract for an extraordinary and unforeseeable change of circumstances. The Commercial Code then measures every company against the standard of the prudent businessperson, which is the yardstick a Turkish court applies when a merchant says that an event was unforeseeable. This page sets out those rules from the statute, the way they interact with the penalty and interest rules, and how a purchasing or sales department should draft each clause for either side.

Sources, checked 11 September 2026. Turkish Code of Obligations No. 6098, Articles 20 to 27, 50 to 52, 97, 98, 112 to 126, 136 to 138, 146, 147 and 179 to 182; Turkish Commercial Code No. 6102, Articles 18, 19, 21, 23 and 1530.

The default position: fault presumed

Article 112 of the Code of Obligations makes the debtor liable for the creditor's loss where an obligation is not performed at all or not properly, unless it proves that no fault can be attributed to it. Article 114 makes the debtor answerable for every degree of fault, measured by the nature of the transaction and more leniently where the transaction brings the debtor no benefit, and applies the tort provisions by analogy to breach of contract, which imports the judge's power under Articles 50 to 52 to assess the loss equitably where it cannot be proven exactly, to fix compensation by the gravity of fault, and to reduce it where the creditor consented to or contributed to the loss. Default is governed by Articles 117 to 119: the debtor of a due obligation falls into default on the creditor's notice, or without notice on a date fixed together or by a valid unilateral determination; once in default it owes delay damages unless it proves it was not at fault in falling into default; and it answers even for accidental events, unless it proves it was not at fault or that the accident would have struck the object even with timely performance. Article 122 adds loss exceeding default interest on money debts, again unless the debtor proves the absence of fault. In supplies between businesses, Article 1530 of the Commercial Code supplies default without notice and the 2026 rate, on the late payment page.

What cannot be excluded

Article 115 sets the limits. An advance agreement that the debtor will not be liable for gross fault is absolutely void. An advance agreement that the debtor will not be liable for any obligation arising from an employment contract with the creditor is absolutely void. And where a service, profession or art requiring expertise may only be carried on with a licence from the law or the competent authority, an advance agreement excluding liability even for slight fault is absolutely void; that third rule reaches banks, insurers, contractors, freight forwarders, energy companies and every other licensed operator, and it is the rule that most foreign templates breach. Article 116 makes the debtor liable for the acts of the auxiliaries to whom it entrusts performance, allows that liability to be excluded in advance in whole or in part, and voids the exclusion where the activity needs a licence. Article 27 then voids clauses contrary to mandatory law, morality, public order or personality rights, and keeps the rest of the contract alive unless it clearly would not have been concluded without them.

Caps, standard terms and the prudent businessperson

The Code contains no article on caps as such; a cap is a term the parties are free to agree under Article 26 within the limits of Articles 115 and 27. Its weak point in practice is not its amount but the way it was agreed. Articles 20 to 25 treat as general terms and conditions any clauses one party prepared in advance for repeated use and presented to the other, regardless of where they sit or how they are labelled. Such terms are deemed unwritten unless, at contracting, the drafter expressly informed the other party of their existence, gave it the opportunity to learn their content, and the other party accepted them; terms foreign to the nature of the contract are unwritten in any event; an unclear term is read against the drafter; clauses letting the drafter change the terms unilaterally are unwritten; and terms contrary to good faith that burden the other party cannot be included at all. A cap buried in a group's global terms, referenced by a link in a purchase order, is the classic case of a clause that a Turkish court treats as unwritten. Between merchants, Article 18(2) of the Commercial Code adds that every merchant must act as a prudent businessperson in all its commercial activities, a standard that raises what a company is expected to have foreseen and read, and Article 19 presumes a merchant's debts to be commercial and makes a transaction commercial for both parties where it is commercial for one.

Impossibility and force majeure

Turkish law, like Montenegrin law, has no statutory definition of force majeure. Article 136 provides that where performance becomes impossible for reasons the debtor cannot be held responsible for, the obligation ends; in bilateral contracts the debtor released by impossibility must return what it received under the rules on unjust enrichment and loses its right to the counter-performance not yet received, except where the law or the contract placed the risk on the creditor before performance; and the debtor that fails to notify the creditor without delay and to take the measures needed to prevent the loss from growing is liable for the resulting loss. Article 137 covers partial impossibility: the debtor is released only from the impossible part, unless it is clear the contract would not have been made had that been foreseen, and in bilateral contracts the counter-performance is reduced proportionally if the creditor accepts partial performance. Article 119 keeps a debtor already in default liable for accidental events. A force majeure clause sits on top of these rules: it defines the events, requires notice within a fixed period, suspends performance, allocates costs during suspension, and gives a termination right after a fixed period. Because the statutory release requires impossibility, a clause that excuses performance for events that merely make it harder or more expensive, such as a supplier's insolvency or a price spike, gives the debtor protection the Code does not, and is enforceable as a contractual allocation of risk within the limits of Article 27.

Hardship under Article 138

Article 138 gives the debtor a remedy short of impossibility. Where an extraordinary situation that the parties did not foresee and were not expected to foresee at contracting arises for a reason not attributable to the debtor, changes the facts existing at contracting to the debtor's detriment to such a degree that demanding performance would be contrary to good faith, and the debtor has not yet performed or has performed while reserving its rights, the debtor may ask the judge to adapt the contract to the new conditions and, where adaptation is not possible, may rescind the contract; in continuing contracts the debtor terminates instead of rescinding. The article applies to foreign currency debts as well. Four points decide most Article 138 disputes between companies. The event must be extraordinary and unforeseeable, and a merchant's foresight is measured by Article 18(2) of the Commercial Code. The debtor must not have performed, or must have reserved its rights when it performed, which is why a supplier that keeps delivering at the old price without a written reservation loses the remedy. Adaptation comes before rescission, so the court's first instinct is to rewrite the price or the deadline, not to end the contract. And the article is a default rule, so a contract may allocate the risk of specified events to one party in advance, subject to Articles 27 and 25.

Remedies on breach

Articles 123 to 126 give the creditor its choices once the debtor is in default. In bilateral contracts the creditor may grant an appropriate additional period or ask the judge to fix one; no period is needed where the debtor's situation or conduct shows it would be useless, where performance has become useless to the creditor because of the default, or where the contract shows that performance will not be accepted after a fixed time. After the period, the creditor may always demand performance and delay damages, or, by immediate notice, waive performance and claim damages for non-performance or rescind the contract, in which case both parties are released and recover what they performed, with the creditor also claiming the loss caused by the contract's failure unless the debtor proves it was not at fault in falling into default. In continuing contracts that have begun, the creditor may terminate and claim the loss from early termination. Article 97 lets a party withhold its own performance until the other performs or tenders, and Article 98 lets a party whose counter-claim is endangered by the other's insolvency or a fruitless attachment withhold performance until security is given and rescind if it is not given within an appropriate period. In sales between merchants, Article 23 of the Commercial Code confines the buyer's rights to the undelivered part where partial performance was accepted without reservation, and requires obvious defects to be notified within two days of delivery and hidden ones within eight days of inspection.

Drafting for the buyer

Carve gross fault out of the supplier's cap expressly, since Article 115(1) does so anyway and an express carve-out avoids the argument; for licensed suppliers, carve out slight fault too, because Article 115(3) will. Keep the cap above the loss the buyer can foresee, and make sure it was negotiated rather than presented, so that Articles 20 to 25 cannot be turned against it by either side. Define force majeure narrowly, exclude events within the supplier's sphere, require notice within a fixed number of days, and give the buyer a termination right after a fixed suspension period. Allocate the risk of input costs and exchange rates to the supplier in a clause that names them, which is the buyer's answer to Article 138. State whether the delay penalty is within or on top of the cap, and remember that a merchant supplier cannot have the penalty reduced, on the penalty clauses page. And build the notice mechanics of Articles 117 and 123 into the contract, using the notary, registered letter or registered electronic mail channels of Article 18(3) of the Commercial Code between merchants.

Drafting for the supplier

Cap liability at a defensible figure, typically the contract price or the annual fees, express it as the total liability from all causes including the penalty, and negotiate it in the body of the contract rather than in attached terms. Exclude indirect loss and lost profit expressly, within the limits of Article 115. Define force majeure widely enough to cover the events the supplier cannot control, because the statutory release under Article 136 requires impossibility, not difficulty. Keep Article 138 alive, and add a price adjustment or renegotiation procedure with a termination right that runs before anyone goes to court. Reserve rights in writing on every delivery made at a price the supplier considers no longer fair, since Article 138 is lost by unreserved performance. And insist on a proper acceptance procedure, since Article 23 of the Commercial Code gives the buyer only two and eight days to notify defects.

When the clause is tested

A liability dispute in Turkey turns on whether the debtor proves the absence of fault under Article 112, whether the exclusion survives Article 115 and, for attached terms, Articles 20 to 25, whether the event made performance impossible under Article 136 or merely harder under Article 138, and whether the notices required by Articles 117, 123 and 136 were sent through the right channel. Claims from contracts for work are time-barred after five years under Article 147(6) unless the contractor's gross fault is involved, and other contract claims after ten years under Article 146. Recovery against a Turkish company is set out on the debt collection page and the page for claims against Turkish companies, and disputes seated abroad or in arbitration on the arbitration page.

Whose side we are on, and how we are paid

The counterparty's lawyer drafted the cap for the counterparty and put it in the attached terms on purpose. The sales manager signed the force majeure clause because the deal was closing. The plant manager kept delivering at the old price to keep the customer and did not write the reservation that Article 138 requires. None of them is paid to tell you, before you sign, that your exclusion for slight fault is void because your activity is licensed, that your cap is unwritten because it sits in a linked document, or that your right to adaptation was lost with the last unreserved delivery.

We take no commission or referral fee from contractors, suppliers, agents or counterparties, in any form, on any file. The fee you pay us is our only income from your matter, and it does not depend on whether a claim is paid or a contract is signed. Because our position does not move with the outcome, telling a buyer that its cap will not hold, or a supplier that its force majeure clause covers nothing the Code does not already cover, costs us nothing to say.

One boundary, stated plainly. We are lawyers, not licensed investment advisers and not insurers. We do not decide how much risk a business should carry. What we protect is the Turkish legal position: a cap that survives Articles 115 and 20 to 25, a force majeure clause that says what the Code does not, a hardship clause that keeps or allocates the Article 138 risk on purpose, and notices sent through the channels the Commercial Code prescribes. The legal function these pages belong to is described on the outsourced legal counsel page.

Before the next contract is signed or the next claim is made

Send us the draft or the contract, the attached terms, the correspondence about the event, the notices sent and received and the evidence of loss on either side. We will tell you what the three clauses are worth under Turkish law, what must change before signature, whether an event releases or merely burdens performance, and what notice or reservation preserves the position. Our corporate work is described on the corporate law page.

What this page does not settle

Warranty for defects in sales and construction contracts, product liability, liability in tort, insurance, consumer contracts, employment contracts beyond Article 115(2), the specific hardship rules for leases and the conduct of litigation are separate subjects. Whether a given event is extraordinary and unforeseeable is decided by the court on the facts, and this page states the statute, not a forecast.