MOD-07 · COMMERCIAL LAW

Additional Damages Calculation

Calculation of the creditor's damage exceeding default interest under TCO Art. 122. Compensation of additional losses arising from delay, particularly in periods of high inflation, in cases where banks do not pay deposit interest, and in commercial relationships.

3 sub-modules Basis: TCO Art. 122 Court of Cassation case law

> SUB-MODULES

Additional damages subtopics

What are additional damages, how are they calculated and how does the Court of Cassation treat them in practice? Each on a separate page.

SPK-07-01

What Are Additional Damages?

The definition, legal basis, areas of application and elements of additional damages under TCO Art. 122.

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SPK-07-02

Additional Damages Calculation

How additional damages are calculated: comparisons of default interest, alternative return, deposit interest and inflation difference.

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SPK-07-03

Court of Cassation Decisions

Court of Cassation case law on additional damages, banking practice and recent decisions.

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> OVERVIEW

What are additional damages?

Additional damages are, under Article 122 of Turkish Code of Obligations No. 6098, the creditor's damage exceeding default interest. When the debtor falls into default, default interest is, as a rule, paid to the creditor. However, if the creditor has suffered damage exceeding default interest, the debtor must also compensate that damage unless it proves that it was not at fault.

Particularly in periods of high inflation, serious differences can arise between statutory default interest and the damage the creditor actually suffers. In this case, the creditor may file an additional damages action for the difference.

Legal Basis

Turkish Code of Obligations No. 6098 Art. 122, Art. 117 et seq. (default), TTK Art. 1530 and the relevant Court of Cassation case law.

> AREAS OF APPLICATION

In which areas are additional damages claimed?

BANKING

Banking

Claim for additional damages against a bank where deposit interest is unpaid or underpaid.

COMMERCIAL

Commercial Relationships

Additional loss suffered by a business due to delay in a commercial receivable. TTK Art. 1530 is a special provision.

LABOR LAW

Labor Claims

Inflation-driven additional loss suffered by the employee due to late payment of severance pay/notice pay.

EXPROPRIATION

Expropriation

Additional damages suffered by the owner where the expropriation price is paid late.

> FREQUENTLY ASKED QUESTIONS

FAQ on additional damages

What are additional damages?

Additional damages are, under TCO Art. 122, the creditor's damage exceeding default interest. If the creditor has suffered damage exceeding default interest, the debtor must also compensate that damage unless it proves that it was not at fault.

In which situations are additional damages claimed?

They are claimed in periods of high inflation, where the creditor misses alternative investment opportunities because the claim was not paid on time, where banks do not pay deposit interest, and for additional losses arising from delay in commercial relationships.

How are additional damages calculated?

Additional damages are calculated by deducting statutory default interest from the damage the creditor actually suffered during the period of default (such as alternative return, deposit interest, inflation difference, exchange rate difference). For details, see the calculation page.

Who bears the burden of proof for additional damages?

The burden of proof lies with the creditor as to the existence and amount of additional damages. The debtor, for its part, is released from additional damages if it proves that it was not at fault (TCO Art. 122 presumption of faultlessness).

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