Is an Arbitration Agreement in a Fixed Term Contract Enforceable in the Event of the De Facto Continuation of the Relationship at the End of the Term? Critique of a Recent Decision by the 11th Civil Chamber of the Court of Cassation

Işık Önay

Article Details

Is an Arbitration Agreement in a Fixed Term Contract Enforceable in the Event of the De Facto Continuation of the Relationship at the End of the Term? Critique of a Recent Decision by the 11th Civil Chamber of the Court of Cassation

Authors:

Işık Önay

Publisher:

Istanbul University

Main Topics:

Çevre ve Kaynaklar Hukuku (Diğer)

Journal:

Public and Private International Law Bulletin Vol.43 Issue 2, pp.491-516

Document Type:

Article

Publication Date:

12/2023

Document Language:

Turkish

Document ID (Org No.):

2001311466

pISSN:

2651-5377

Keywords:

Abstract:

 This article deals with a specific problem regarding the interpretation and scope of arbitration agreements. Following the expiration of the term in a contract pertaining to a continuous legal relationship, parties sometimes continue their relationship within the framework of the same or similar rights and obligations without entering into a further agreement explicitly. In such a case, the problem arises of whether the arbitration clause regarding the first contract covers disputes arising out of the legal relationship that continues beyond the initially agreed-upon term. In order to answer this question, what the de facto continuation of the legal relationship between the parties means should first be determined in terms of law of obligations. Have the parties implicitly extended the term of the contract between them, or have they implicitly established a new contract with the same content? With respect to this controversial issue, the author argues that the will of the parties as a rule is in favor of the first alternative. Secondly, answering the question requires an interpretation of the arbitration agreement to determine its scope. The interpretation of arbitration agreements is ultimately governed by the general principles of contract interpretation. According to the view advocated in this study, arbitration agreements should be interpreted broadly and in line with the trends in international arbitration. The explanatory notes by the legislator regarding arbitration legislation also support this approach. Meanwhile, the decisions by the Turkish Court of Cassation generally tend to interpret arbitration agreements restrictively. The decision this study analyzes shows the Court of Cassation to have ruled that a new contract was established between the parties with respect to a distributorship relationship, which the parties continued after the expiry date that had been initially included in the contract. The Court of Cassation concluded that the disputes arising from this contract should be resolved before the state courts, as the parties intention to submit disputes arising from this new contract to arbitration could not be ascertained. The study hereby argues that this decision of the Court of Cassation is open to criticism in light of the trends in international arbitration.

 This article deals with a specific problem regarding the interpretation and scope of arbitration agreements. Following the expiration of the term in a contract pertaining to a continuous legal relationship, parties sometimes continue their relationship within the framework of the same or similar rights and obligations without entering into a further agreement explicitly. In such a case, the problem arises of whether the arbitration clause regarding the first contract covers disputes arising out of the legal relationship that continues beyond the initially agreed-upon term. In order to answer this question, what the de facto continuation of the legal relationship between the parties means should first be determined in terms of law of obligations. Have the parties implicitly extended the term of the contract between them, or have they implicitly established a new contract with the same content? With respect to this controversial issue, the author argues that the will of the parties as a rule is in favor of the first alternative. Secondly, answering the question requires an interpretation of the arbitration agreement to determine its scope. The interpretation of arbitration agreements is ultimately governed by the general principles of contract interpretation. According to the view advocated in this study, arbitration agreements should be interpreted broadly and in line with the trends in international arbitration. The explanatory notes by the legislator regarding arbitration legislation also support this approach. Meanwhile, the decisions by the Turkish Court of Cassation generally tend to interpret arbitration agreements restrictively. The decision this study analyzes shows the Court of Cassation to have ruled that a new contract was established between the parties with respect to a distributorship relationship, which the parties continued after the expiry date that had been initially included in the contract. The Court of Cassation concluded that the disputes arising from this contract should be resolved before the state courts, as the parties intention to submit disputes arising from this new contract to arbitration could not be ascertained. The study hereby argues that this decision of the Court of Cassation is open to criticism in light of the trends in international arbitration.

 This article deals with a specific problem regarding the interpretation and scope of arbitration agreements. Following the expiration of the term in a contract pertaining to a continuous legal relationship, parties sometimes continue their relationship within the framework of the same or similar rights and obligations without entering into a further agreement explicitly. In such a case, the problem arises of whether the arbitration clause regarding the first contract covers disputes arising out of the legal relationship that continues beyond the initially agreed-upon term. In order to answer this question, what the de facto continuation of the legal relationship between the parties means should first be determined in terms of law of obligations. Have the parties implicitly extended the term of the contract between them, or have they implicitly established a new contract with the same content? With respect to this controversial issue, the author argues that the will of the parties as a rule is in favor of the first alternative. Secondly, answering the question requires an interpretation of the arbitration agreement to determine its scope. The interpretation of arbitration agreements is ultimately governed by the general principles of contract interpretation. According to the view advocated in this study, arbitration agreements should be interpreted broadly and in line with the trends in international arbitration. The explanatory notes by the legislator regarding arbitration legislation also support this approach. Meanwhile, the decisions by the Turkish Court of Cassation generally tend to interpret arbitration agreements restrictively. The decision this study analyzes shows the Court of Cassation to have ruled that a new contract was established between the parties with respect to a distributorship relationship, which the parties continued after the expiry date that had been initially included in the contract. The Court of Cassation concluded that the disputes arising from this contract should be resolved before the state courts, as the parties intention to submit disputes arising from this new contract to arbitration could not be ascertained. The study hereby argues that this decision of the Court of Cassation is open to criticism in light of the trends in international arbitration.

 Bu çalışmada tahkim anlaşmalarının yorumu ve kapsamına ilişkin özel bir ihtimal değerlendirilmektedir. Tarafların tahkim şartı içeren, sürekli borç ilişkisi niteliğindeki bir sözleşmenin süresinin dolması ardından, başkaca açık irade beyanında bulanarak bir anlaşma yapmadan aralarındaki ilişkiyi, aynı veya benzer hak ve yükümlülükler çerçevesinde fiilen devam ettirmesiyle sıklıkla karşılaşılabilir. Böyle bir durumda belirli süre sona erdikten sonraki dönemde çıkan uyuşmazlıkların tahkim yoluyla çözülmesi gerektiği söylenebilir mi? Bu soruya yanıt verebilmek için ilk olarak tarafların aralarındaki hukuki ilişkiyi fiilen devam ettirmelerinin borçlar hukuku bakımından ne anlama geldiği tespit edilmelidir. Taraflar örtülü olarak aralarındaki sözleşmenin süresini mi uzatmışlardır; yoksa örtülü olarak aynı içerikte yeni bir sözleşme mi kurmuşlardır? Tartışmalı olan bu konu bakımından bu çalışmada taraf iradelerinin kural olarak ilk ihtimal yönünde olduğu savunulmaktadır. Sorunun yanıtlanması ikinci olarak, tahkim anlaşmasının yorumlanması suretiyle kapsamının belirlenmesini gerektirir. Tahkim anlaşmalarının yorumu son tahlilde sözleşmelerin yorumuna ilişkin genel ilkeler çerçevesinde yapılır. Bu çalışmada savunulan görüşe göre, tahkim anlaşmalarının milletlerarası tahkim uygulamalarıyla bağdaşan şekilde, geniş yorumlanması gerekir. Türk kanun koyucusunun MTK ve HMKnın gerekçelerinde kullandığı ifadeler de bu yaklaşımı desteklemektedir. Yargıtay kararlarında ise genel olarak tahkim anlaşmalarını dar yorumlama eğilimi görülmektedir. Bu çalışmada incelenen bir kararında Yargıtay, taraflar arasında belirli süre sonunda fiilen devam ettirilen bir distribütörlük ilişkisi bakımından, taraflar arasında yeni bir sözleşme kurulduğu, bu sözleşmeden doğan uyuşmazlıkların önceki yazılı sözleşmede bulunan tahkim şartı kapsamında olduğuna dair taraf iradesi tespit edilemediğinden, uyuşmazlığın devlet mahkemeleri önünde çözülmesi gerektiğine hükmetmiştir. Yargıtayın bu kararı bu çalışmada savunulan görüş ve yukarıdaki açıklamalar ışığında eleştiriye açıktır.

Article Details

Is an Arbitration Agreement in a Fixed Term Contract Enforceable in the Event of the De Facto Continuation of the Relationship at the End of the Term? Critique of a Recent Decision by the 11th Civil Chamber of the Court of Cassation

Authors:

Işık Önay

Publisher:

Istanbul University

Main Topics:

Çevre ve Kaynaklar Hukuku (Diğer)

Journal:

Public and Private International Law Bulletin Vol.43 Issue 2, pp.491-516

Document Type:

Article

Publication Date:

12/2023

Document Language:

Turkish

Document ID (Org No.):

2001311466

pISSN:

2651-5377

International arbitration

Scope of arbitration agreement

Interpretation of arbitration agreement

Tacit renewal/prolongation

Term extension

NovationMilletlerarası tahkim

Tahkim Anlaşmasının Kapsamı

Tahkim Anlaşmasının Yorumu

Örtülü süre uzatımı

Sözleşmenin yenilenmesi

Issues

Article Details

Authors: Işık Önay

Publisher: Istanbul University

Main Topics: Çevre ve Kaynaklar Hukuku (Diğer)

Journal: Public and Private International Law Bulletin Vol.43 Issue 2, pp.491-516

Document Type: Article

Publication Date: 12/2023

Document Language: Turkish

Document ID (Org No.): 2001311466

pISSN: 2651-5377

Issues

Authors:

Işık Önay

Publisher:

Istanbul University

Main Topics:

Çevre ve Kaynaklar Hukuku (Diğer)

Journal:

Public and Private International Law Bulletin Vol.43 Issue 2, pp.491-516

Document Type:

Article

Publication Date:

12/2023

Document Language:

Turkish

Document ID (Org No.):

2001311466

pISSN:

2651-5377