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Court Of Cassation Rules Courts Should Examine Merits of the Case Unless All Requests are Subject to Mandatory Mediation

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Dispute Resolution
General

Recent Development

As of January 1, 2019, applying for mediation before filing a lawsuit has become a prerequisite for commercial cases involving a monetary claim. Legal doctrine accepts that for cases where the parties asserted multiple requests, each request should be evaluated separately and that it is a prerequisite for the parties to apply to mediation before filing a lawsuit regarding requests subject to mandatory mediation. However, in its decision dated February 17, 2020 with File No. 2020/197 and Decision No. 2020/1578 (“Decision“), the 11th Civil Chamber of the Court of Cassation issued a contradictory decision.  The Court of Cassation ruled that in cases where there are multiple primary requests, if there are requests that are subject and not subject to prerequisite mandatory mediation, the case may be examined based on the merits even if the parties did not apply to the mediator for the requests necessitating mediation.

Generally Accepted Opinion and the Content of the Decision

After mediation became a prerequisite for commercial cases, practitioners discussed how to assess the prerequisite if a case involves several requests which include requests that are both subject and not subject to mandatory mediation.

The Department of Mediation of Ministry of Justice published a book titled “Mediation in Commercial Disputes” and addressed this topic, by noting that in a case with several requests, each primary request constitutes an independent case and should therefore be evaluated separately in terms of their prerequisites. According to the Department of Mediation, if one of the requests is in nature of a commercial lawsuit with a monetary claim, then the provisions regarding prerequisite of mediation will be applied only for this request, and not for other primary requests that are not subject to mandatory mediation. The Union of Turkish Bar Associations’ Guidebook on Counselling in Mediation Process, a Prerequisite for Commercial Disputes, also supports the Department of Mediation’s assertion. In practice, courts of first instance generally issue decisions based on this interpretation.

The dispute subject to the Decision is regarding the determination of whether a valid partnership had been established and the collection of money for establishing the partnership in question. The court of first instance dismissed the case on procedural grounds due to the parties’ failure to apply to mediation, which is a prerequisite. The regional court of appeal also dismissed the plaintiff’s appeal on the same ground. However, the 11th Civil Chamber of the Court of Cassation ruled contrary to the generally accepted opinion in practice and reversed the regional court of appeal’s decision: The Court of Cassation decided that as the monetary claim, which is subject to mandatory mediation, was filed along with a claim not subject to mandatory mediation, the monetary claim would also not be subject to mediation as a prerequisite.

Conclusion

The 11th Civil Chamber of the Court of Cassation ruled that in cases with several requests, the court should examine all requests without considering the prerequisite of mediation, unless all of the claims are subject to mandatory mediation.

The Decision’s effect on the practice is yet to be seen, however, considering the fact that the Decision is not binding, if, before filing a lawsuit, parties do not apply to mediation for their requests subject to mandatory mediation, this may constitute a ground for dismissal for their other primary requests as well.