Author: Duygu Öner Ayçiçek
Introduction
Under Turkish law, parties may agree on the settlement of disputes that have arisen or may arise, regarding the rights that they can freely dispose of, by arbitration. However, disputes which are not subject to the will of parties, such as the disputes relating to in rem rights of immovables, bankruptcy law, family law are considered to be non-arbitrable.
In the decision of the Court of Cassation General Assembly (“CCGA”) dated 21.12.2021, numbered 2019/574 E. 2021/1710 K., these principles were discussed within the framework of the general bankruptcy procedures and bankruptcy proceedings regulated in the Execution and Bankruptcy Law numbered 2004 (“EBL”). The Court discussed whether a bankruptcy case can be examined before the courts despite the existence of an arbitration clause. This Newsletter article examines the relevant decision
Dispute Subject to the Decision
The dispute arose from a construction agreement in return for a land share. The employer initiated a general bankruptcy proceeding against the contractor with the allegation that the contractor failed to complete and deliver the construction within the prescribed time. The contractor objected to the execution proceeding, and a bankruptcy case was filed by the employer for the annulment of the objection. The defendant contractor insisted on resolving the dispute through arbitration, stating that there was an arbitration clause in the contract signed between the parties.
