Compensation for Loss in Contractual Liability

Legal Article · 12 November 2026
Av. Thomas Andreas Di Constantinople

Compensation for breach of contract aims to remedy the loss caused to the creditor by complete or improper non-performance. Under Article 112 of the Turkish Code of Obligations, the debtor is liable unless they prove that no fault can be attributed to them. The creditor must establish the contractual obligation, breach, loss, and connection between them.

The Performance Interest and Scope of Loss

Calculating loss may involve comparing the position that would have existed had the contract been properly performed with the actual financial position. Additional expenses and specifically lost profit may be included. Not every contractual breach requires an award equal to the contract price without proof of any loss.

In default, the creditor's options to seek performance, claim damages instead of performance, or withdraw from the contract differ according to the conditions and elections in Article 125 of the Turkish Code of Obligations. The interest in performance and losses incurred through reliance on the contract should not be combined as though they were the same head of loss.

Article 114 of the Turkish Code of Obligations permits analogous application of tort provisions. The injured person's contribution and causation therefore remain important. If the debtor used an auxiliary person in performance, Article 116 must be assessed separately. Exclusion clauses are not sufficient merely because they exist; their validity must be examined within mandatory limits.

Source

Turkish Code of Obligations No. 6098, Articles 112–116, 125.

This article has been prepared for general legal information purposes.