DEFECTIVE WORKS IN CONSTRUCTION, MAINTENANCE AND REPAIR CONTRACTS

In contracts for work concerning construction, maintenance, and/or repair—the contractor is under an obligation to complete and deliver the undertaking to the employer in accordance with the terms and specifications of the contract. Prior to the acceptance of the work, the employer is required to inspect and audit its conformity with the contractual requirements.

If the manufactured works fail to possess the ordinary characteristics or the specific qualities stipulated in the contract, such works shall be deemed 'defective.' If a defect is discernible through a simple inspection by the employer, it is classified as a patent defect; whereas, if it emerges through subsequent use or detailed testing after delivery, it is classified as a latent defect.

Regarding the employer's rights, the contractor’s liability, and warranty periods, the provisions of the contract shall primarily prevail. In the absence of such provisions in the contract, the provisions of the Turkish Code of Obligations No. 6098 ('TCO') shall apply. It is also possible that, during the execution of the work, it becomes clearly apparent that the work will be defective or in breach of the contract due to the contractor’s fault. According to the TCO, in such cases, the employer may issue a formal notice to the contractor, granting a reasonable period to rectify the defect or breach, with the warning that otherwise the repair or the completion of the work shall be entrusted to a third party at the contractor's expense.

Pursuant to the TCO, the employer is obliged to notify the contractor of any patent defects within a reasonable period following delivery. Furthermore, the employer must notify the contractor of any latent defects immediately upon their discovery. Failure to comply with these notification requirements shall result in the work being deemed accepted in its defective state.

An employer who has duly issued a notice of defect following delivery is entitled to exercise one of their alternative remedies pursuant to Article 475 of the TCO. According to the aforementioned article, the employer's alternative remedies consist of: rescission of the contract, a discount on the contract price, or a request for the rectification of the defect. However, if the defect in question has arisen from the instructions provided by the employer or other causes attributable to the employer despite the contractor's prior warning, the employer shall be precluded from exercising their rights arising from the defectiveness of the work.

In accordance with the legislation and the precedents of the Court of Cassation, the existence of at least one of the prescribed conditions is required to exercise the right of rescission. Within this framework, for the employer to rescind the contract, the defects in the work must be so significant that the work is unusable for the employer, or the acceptance of the work cannot be reasonably expected from the employer under the principles of equity, or the work must fail to possess the qualities explicitly agreed upon in the contract.

In cases where the defects are not of such significance as to justify the rejection of the work, the employer may opt for one of the other alternative remedies. However, it should be emphasized that under the TCO, the right to request the rectification of the defect is subject to the condition that such repair does not involve excessive costs. The employer’s right to claim separate damages from the contractor due to the defect is reserved.

LEGAL NOTICE: The content published on this blog page is intended solely for general informational purposes. Nothing contained herein shall be construed as legal advice or the provision of legal consultancy services.