STARE DECISIS ON LIABILITY ARISING OUT OF CONTRACTUAL ATTORNEY’S FEE IN CASES OF COMPROMISE OR ANY SETTLEMENT AND UNFOLLOWED MATTERS

21/03/2019

 

The Supreme Court of Appeals’ judgement on the extent of joint liability of the litigants not involving the contractual attorney’s fee in cases of compromise or any settlement and unfollowed matters was published on the Official Gazette numbered 30720 and dated 20.03.2019.

There is an uncertainty about whether in cases of compromise or any settlement and unfollowed matters the contractual attorney’s fee of the litigant would be involved in the extent of joint liability arising from attorney’s fee which is regulated in the Article 165 of Attorney’s Act (“Act”). The Supreme General Assembly on Civil Chambers, the 3^rd and 13^th Chamber decided that there is no differentiation as ‘legal attorney’s fee’ and ‘contractual attorney’s fee’ thus, if the agreement between the litigant and attorney was signed before the litigation ends via settlement or compromise, the extent of joint liability should include both legal attorney’s fee and contractual attorney’s fee. However as per the 4^th Chamber’s opinion, making the opposing party liable for the contractual attorney’s fee which is determined in an agreement between the litigant and his/her attorney is against the principle regarding relativity of contracts.

Within the scope of the Stare Decisis, it is stated that the contractual attorney’s fee is a right for the attorney due to the service that he/she provided and an obligation for the client. According to Supreme Court’s General Assembly on the Unification of Judgments, legal attorney’s fee aims to cover the legal expenses of the legitimate party who had to defend himself/herself before courts through an attorney.

Finally, Supreme Court’s General Assembly on the Unification of Judgments ruled that in cases of compromise or any settlement and unfollowed matters the contractual attorney’s fee shall not be involved in the extent of joint liability of parties arising out of the attorney’s fee which is regulated under the article 165 of the Act, because of following reasons;

1. Pursuant to “principle regarding relativity of contracts” a contract only results in the parties of it. In this regard, making the opposing party liable for the contractual attorney’s fee would be a breach of the freedom of contract and freedom of will which is protected within the framework of Constitution of Turkish Republic.
2. As per the principle on rule of law is directly related to legal security and certainty. Therefore, norms and the actions of the state must be foreseeable. However, it should not be expected from the persons to foresee that the opposing party shall be liable for the contractual attorney’s fee.
3. Attorney’s fee is an exchange to the legal service provided by the attorney and making the party who did not get any legal service from the attorney liable for the contractual attorney’s fee is not appropriate for the nature and aim of the attorney’s fee. 

You may reach the decision hereby.

If there is need of any other information about the article, please contact the below stated person.

NAZALI LAW info@nazali.av.tr

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