Filing a Lawsuit for Determining Rent Amount in Turkey

The lawsuit for determining the rent amount is a type of lawsuit that must be filed in accordance with certain procedural rules. In this section, we will discuss the aspects related to filing the lawsuit.

1 – Competent and Authorized Court

In the Turkish legal system, the competent and authorized court for lawsuits for determining the rent amount is determined as follows:

• Competent Court: Lawsuits for determining the rent amount fall within the jurisdiction of Civil Courts of Peace (In Turkish: Sulh Hukuk Mahkemesi)
• Authorized Court: The lawsuit can be filed in the court of the place where the rented property is located or in the court of the place where the defendant resides.

Point to note: If a different court has been designated as competent by a jurisdiction agreement, the lawsuit can also be filed in this court. However, in cases where the tenant has consumer status, the jurisdiction rules in favor of the consumer are applied.

2 – Time Limit for Filing a Lawsuit

Article 345 of the Turkish Code of Obligations introduces important regulations regarding the time of filing a lawsuit for determining the rent amount.

The basic rules regarding the time limit for filing a lawsuit are as follows:

• A lawsuit for determining the rent amount can be filed at any time.
• However, for the rent amount that will be valid from the new rental period, the lawsuit must be filed at least 30 days before the start of the new period.
• If the landlord has given written notice to the tenant within this 30-day period, they can file a lawsuit until the end of the following new rental period.

In a Court of Cassation decision, it was ruled that “(…) in lawsuits for determining the rent amount, the date from which the determined rent amount will be applied depends on the date the lawsuit was filed and the timing of the landlord’s notification to the tenant (…)”, emphasizing the importance of the timing of filing the lawsuit.

3 – Preparation of the Lawsuit Petition

The lawsuit for determining the rent amount is filed with a properly prepared lawsuit petition.

The basic elements that should be included in the lawsuit petition are:

• Name, surname, and addresses of the plaintiff and defendant
• Subject of the lawsuit and the requested rent amount
• Date and content of the lease agreement subject to the lawsuit
• Material and legal reasons on which the lawsuit is based
• What the evidence consists of
• Conclusion of the request

Point to note: The rent amount requested in the lawsuit petition should be stated clearly. Since correction and amount increase are not possible in rent determination lawsuits, it is important to carefully determine the requested amount.

 

4 – Fees and Expenses

When filing a lawsuit for determining the rent amount in Turkey, certain fees and expenses need to be paid.

The basic fees and expenses are:

• Application fee
• Proportional fee (calculated based on the difference between the requested rent amount and the current rent amount)
• Advance fee
• Postal expenses
• Expert fee (if an expert examination is conducted during the trial)

Point to note: Fees and expenses are calculated based on the amounts at the date the lawsuit is filed. As these amounts can be updated annually, it is important to learn the current amounts before filing the lawsuit.

While the judicial process in lawsuits for determining rent amount is subject to the general judicial principles of the Turkish legal system, it has some unique characteristics.

1 – Collection of Evidence

In lawsuits for determining the rent amount, the collection of evidence to support the claims of the parties is of great importance.

The main elements considered in the process of collecting evidence are:

• Lease agreement and additional protocols
• Rent payment documents
• Documents showing the characteristics and condition of the rented property
• Comparable lease agreements and amounts
• Economic and social characteristics of the area where the property is located

Point to note: Although the principle of freedom of evidence applies in Turkish law, written evidence carries more weight in rent determination lawsuits. In particular, documenting comparable rent amounts in writing is an important factor that can influence the court’s decision.

2 – Expert Examination

In lawsuits for determining the rent amount, an expert examination is usually mandatory. The expert examination includes the following stages:

• Appointment of expert specialists by the court
• On-site inspection of the rented property by the experts
• Research and evaluation of comparable rent amounts
• Analysis of the property’s characteristics and environmental factors
• Preparation of a detailed report and submission to the court

In a Court of Cassation decision, it was ruled that “(…) in lawsuits for determining the rent amount, for the expert report to be taken as a basis for the judgment, the report must be suitable for scrutiny, reasoned, and of a nature that meets the claims of the parties (…)”, emphasizing the qualities of the expert report.

3 – Research of Comparable Rent Amounts

The research of comparable rent amounts is a critical stage in lawsuits for determining the rent amount. While this research is usually conducted by experts, parties can also present their own comparables.

The following aspects are considered in researching comparable rent amounts:

• Rent amounts of other properties with similar characteristics to the rented property
• General rent level in the area where the property is located
• Purpose of use of the property (residential, workplace, etc.)
• Physical characteristics and condition of the property
• Socio-economic structure and development level of the area

Point to note: Turkish courts apply an “old tenant discount” in determining comparable rent amounts. This discount is usually between 10-20% and provides an advantage due to the tenant’s long-term occupancy of the same property.

Factors Considered in Determining Rent Amount in Turkish Law

In lawsuits for determining the rent amount, various factors are taken into consideration by the courts when determining a fair and current rent amount. These factors stem from the relevant provisions of the Turkish Code of Obligations and established Court of Cassation jurisprudence.

1 – CPI Rate

One of the most fundamental factors in determining the rent amount in Turkey is the Consumer Price Index (CPI) rate.

The effect of the CPI rate on the rent amount manifests as follows:

• Within the first five years of the lease agreement, the rent increase cannot exceed the CPI rate of the previous rental year.
• Even after five years, the CPI rate continues to be an important reference point in determining the rent amount.

Point to note: The CPI rate is announced by the Turkish Statistical Institute (TUIK) every month. In rent determination lawsuits, the most current twelve-month CPI average at the date of filing the lawsuit is taken into account.

2 – Condition of the Rented Property

The physical and environmental characteristics of the rented property play an important role in determining the rent amount.

The following factors are taken into account when evaluating the condition of the rented property:

• Age and general condition of the property
• Purpose of use (residential, workplace, etc.)
• Location and environmental features
• Renovations and improvements made
• Size and usable area of the property

3 – Principle of Equity

In the Turkish legal system, the principle of equity plays an important role in determining the rent amount. This principle ensures that the interests of the parties are considered in a balanced manner.

The following factors are taken into account when applying the principle of equity:

• Economic situation of the tenant
• Needs of the landlord
• Duration of use of the property
• Nature of the relationship between the parties
• Market conditions and economic indicators

In a Court of Cassation decision, it was ruled that “(…) in determining the rent amount, an assessment should be made within the framework of the principle of equity, taking into account the economic and social situations of the parties and the characteristics of the rented property (…)”, emphasizing the importance of the principle of equity.

The court decision given as a result of a lawsuit for determining the rent amount has an important legal consequence that directly affects the rental relationship between the parties. In this section, we will focus on the implementation and consequences of the court decision.

1 – Time of Application of the Decision

Article 345 of the Turkish Code of Obligations regulates the time of application of the decision given as a result of a rent determination lawsuit.

The basic rules regarding the time of application of the decision are as follows:

• If the lawsuit is filed at least 30 days before the start of the new rental period, the decision is applied from the beginning of the new rental period.
• If the landlord has given written notice that there will be a rent increase 30 days before the new period and the lawsuit is filed by the end of the new period, the decision is again applied from the beginning of the new period.
• If these conditions are not met, the decision is applied from the beginning of the next rental period.

Point to note: The time of application of the decision is critical in terms of preventing potential rental income loss for the landlord. Therefore, attention should be paid to the time limits before filing a lawsuit.

2 – Issue of Retroactive Application

In the Turkish legal system, the issue of retroactive application of rent determination lawsuit decisions is controversial.

The following points stand out regarding retroactive application:

• As a general rule, rent determination decisions are applied prospectively.
• However, if the landlord sends a proper notice before filing the lawsuit, it may be possible for the court decision to be applied from the date of the notice.
• The Court of Cassation’s jurisprudence on this issue may change over time.

In a Court of Cassation decision, it was ruled that “(…) in rent determination lawsuits, the retroactive application of the determined rent amount is only possible if the landlord sends a proper notice and it is proven that this notice has been served (…)”, specifying the conditions for retroactive application.

3 – Appeal of the Decision

Parties can appeal against the decision given as a result of a lawsuit for determining the rent amount.

The following points are important in the appeal process:

• An appeal can be made against the decision of the court of first instance.
• Under certain conditions, the decision of the appeal court can be taken to the Court of Cassation.
• The review of the appeal is carried out by the Court of Cassation.

Point to note: A three-tier judicial system has been implemented in Turkey since 2016. Therefore, in rent determination lawsuits, it is necessary to first apply for appeal, and then, if the necessary conditions are met, to go to the Court of Cassation.

The points to be considered in the appeal process are as follows:

• The appeal period is two weeks from the notification of the decision.
• The reasons for appeal should be clearly stated in the appeal petition.
• The appeal review is usually done on file, but the Court of Cassation can hold a hearing if deemed necessary.

In the Turkish legal system, decisions given as a result of lawsuits for determining the rent amount directly affect the rental relationship between the parties. The time of application of the decision, the issue of retroactive application, and the appeal process are particularly important points to be considered in these lawsuits. It is of great importance for the parties to be informed about the consequences of the decision and legal remedies in order to effectively exercise their rights.

Relationship of Rent Determination Lawsuit with Other Lawsuits in Turkish Law

The lawsuit for determining the rent amount is closely related to other types of lawsuits concerning rental relationships in the Turkish legal system. In this section, we will examine the connection and differences between the rent determination lawsuit and other lawsuits.

1 – Differences from Rent Adaptation Lawsuit

While the lawsuit for determining the rent amount and the rent adaptation lawsuit serve similar purposes, they differ in terms of legal basis and application.

The main differences between the rent determination lawsuit and the rent adaptation lawsuit are as follows:

• Legal Basis: While the rent determination lawsuit is based on Articles 344 and 345 of the Turkish Code of Obligations (TCO), the rent adaptation lawsuit is based on the “excessive difficulty in performance” provision in Article 138 of the TCO.
• Application Conditions: The rent determination lawsuit requires a 5-year period condition or the absence of a provision in the contract, while the adaptation lawsuit requires the existence of unforeseen extraordinary circumstances.
• Consequences: The determination lawsuit usually has a prospective effect, while the adaptation lawsuit can modify the existing contract.
• Court’s Discretion: In the adaptation lawsuit, the court’s discretion is broader and not subject to CPI limitations.

Point to note: Turkish courts generally do not consider situations such as economic crisis or high inflation as sufficient reasons for a rent adaptation lawsuit. Therefore, the party wishing to file an adaptation lawsuit needs to prove the existence of a truly unforeseen and extraordinary situation.

2 – Relationship with Eviction Lawsuit

The lawsuit for determining the rent amount can be closely related to the eviction lawsuit in some cases.

The relationship between the rent determination lawsuit and the eviction lawsuit can manifest as follows:

• Non-payment of Rent: Failure to pay the newly determined rent amount can constitute grounds for eviction.
• Consolidation of Lawsuits: Sometimes the landlord can assert both rent determination and eviction requests in the same lawsuit.
• Rejection of Rent Increase: The tenant’s refusal to accept the new rent amount determined by the court can be grounds for eviction under Article 352 of the TCO.

In a Court of Cassation decision, it was ruled that “(…) the tenant’s refusal to accept the rent amount determined as a result of the rent determination lawsuit gives the landlord the right to file an eviction lawsuit. However, for this right to be exercised, the newly determined rent amount must be properly notified to the tenant, and the tenant must refuse to pay this amount (…)”, emphasizing the relationship between the rent determination lawsuit and the eviction lawsuit.

Points to be considered for filing an eviction lawsuit:

• The new rent amount determined as a result of the rent determination lawsuit should be notified to the tenant in writing.
• The tenant should be given one month to pay the new rent amount or vacate the property.
• An eviction lawsuit can be filed if the tenant refuses to pay or does not make payment within this period.

Conclusion and Evaluation

In the Turkish legal system, the lawsuit for determining the rent amount is an important legal mechanism aimed at maintaining the economic balance between the tenant and the landlord. This type of lawsuit is designed to adapt to changing economic conditions and fairly balance the interests of the parties.

The main features of rent determination lawsuits can be summarized as follows:

• It can be filed in case of a five-year period condition or absence of a provision in the contract.
• Factors such as CPI rate, condition of the rented property, comparable rent amounts, and the principle of equity are taken into account.
• The court decision usually has a prospective effect.
• The time of application of the decision depends on the date of filing the lawsuit or the time of notification by the landlord.

In Turkey, rent determination lawsuits become even more important, especially during periods of high inflation. These lawsuits protect landlords’ property rights while ensuring that tenants are protected from excessive rent increases.

However, due to the complex structure and legal subtleties of rent determination lawsuits, it is of great importance to seek professional legal assistance in this process. If you are experiencing a rent determination dispute in Turkey or are facing such a lawsuit, we recommend that you seek support from expert lawyers in the field.

Our law firm has extensive experience in the field of rental law and provides comprehensive legal support to our clients in rent determination lawsuits. If you need legal assistance in this matter, you can visit our office or contact us.