The Principle of Good Faith in Turkish Construction Law: The Cornerstone of Contracts

However, written rules cannot always foresee the unexpected situations that life presents. At this juncture, the "principle of good faith," regulated in Article 2 of the Turkish Civil Code, comes into play, standing out as a fundamental principle that ensures justice and equity in contractual relationships.

What is the Principle of Good Faith and Why is it Important?

In its simplest definition, the principle of good faith is the obligation of contracting parties to act as honest, upright, and reasonable individuals when exercising their rights and fulfilling their obligations. This principle emphasizes that parties must trust each other, not mislead one another, and consider mutual interests. In projects that span years, like construction, establishing an unwavering relationship of trust between the parties is vital for the project's success. The principle of good faith forms the legal basis for this trust relationship.

Our Civil Code addresses this principle in two main dimensions: First, it commands the parties to "act in good faith." Second, it prohibits the use of a right in a manner that would create a clear injustice. This is known as the "prohibition of abuse of rights" and it prevents the law from being used to create unfairness by hiding behind formal rules. The law does not concretely define what good faith is, leaving this task to the judges, who will evaluate the specific circumstances of each case.

Applications of the Principle of Good Faith in Construction Law

The principle of good faith plays a key role in resolving many issues encountered in construction law. Let's look at some common examples:

1. Termination of the Contract and its Effects: If the contractor fails to complete the construction on time due to their fault, the landowner can terminate the contract. As a rule, this termination nullifies the contract retroactively. However, if a significant portion of the construction (e.g., 90%) has been completed, deeming the contract entirely invalid would be contrary to the principle of good faith. In such cases, a judge may decide, in the interest of justice, that the termination should only have prospective effect. This ensures the contractor is compensated for the work done so far, while the landowner is compensated for damages arising from the delay.

2. Formal Defects and Abuse of Rights: Construction contracts involving the transfer of real estate ownership (e.g., construction agreements in return for land share) must be made in an official form (at a notary or land registry). A contract that does not comply with this requirement is normally void. However, if the parties have substantially performed their obligations despite this void contract (e.g., the buyer has paid, the seller has delivered the apartment), it would be considered an abuse of rights for one party to later evade their responsibilities by claiming "the contract was formally invalid anyway," and this would not be protected by law.

3. The Status of Non-Compliant Structures: The situation of a construction built without a license or contrary to the project is complex. However, if the structure can be brought into legal compliance with some modifications, it may be against the principle of good faith for the landowner to terminate the contract directly without allowing an opportunity to rectify the situation. In such cases, the judiciary may grant the contractor the authority and a reasonable period to remedy the non-compliance.

4. Eroded Trust and the Future of the Contract: A party's continuous breach of contract can fundamentally erode the other party's trust. For example, if a landowner enters into an agreement with another contractor despite an existing contract, or if a contractor intentionally makes constructions that deviate from the project, the trust relationship is damaged. When trust is irreparably broken, the parties cannot be expected to continue the contract, and this may constitute a just cause for termination.

Conclusion: The Role of Good Faith in Establishing Justice

As can be seen, the principle of good faith reveals that construction contracts are not just written documents but also require a relationship of trust and loyalty between the parties. This principle fills legal gaps, prevents strict rules from leading to unjust outcomes, and gives judges the flexibility to find equitable solutions. In construction disputes, evaluating the parties' conduct within the framework of the good faith principle is decisive for reaching a fair conclusion. Therefore, if you encounter any problem related to a construction contract, it is crucial to seek support from an expert law firm to protect your rights and ensure the process is managed fairly.