Conditions of Preliminary Injunction:
Considering the Article 389 of the Code of Civil Procedure and the decisions of the Court of Appeal (Yargıtay), it can be concluded that, in order for a court to grant a preliminary injunction relief decision under Turkish Laws, there must be a possibility which makes it materially difficult or impossible to acquire a certain right due to the changes in current conditions or there must be concern for the occurrence of an inconvenient situation or possibility for significant damage due to the absence of such preliminary injunction.
In that respect, in order to obtain a preliminary injunction to prevent encashment of the performance bond, following conditions must be met;
i. Preliminary injunction relief should be compelling for the protection of the disputed rights or goods,
ii. There must be a danger of loss of right for the requesting party, if such measure is not taken or it is delayed,
iii. Prove with conclusive evidence that encashment of performance bond constitutes abuse of right.
In the event that above stated conditions occur collectively, court may grant a preliminary injunction.
Procedure of Preliminary Injunction
a) Authorized Court:
Preliminary injunction may be requested prior to or after filing a lawsuit on the merits of the case. Article 390 of the Civil Procedure Code states that if the preliminary injunction is requested after filing the lawsuit, the authorized court shall be the court in which the lawsuit was filed. If the preliminary injunction relief is requested prior to the filing of the lawsuit, the authorized court shall be the court where the preliminary injunction relief is more likely to be granted at smaller expense and relatively quicker or the court which is authorized to hear the lawsuit on the merits of the case.
b) Obligation to Make a Security Deposit Payment:
Another issue that should be addressed with regard to preliminary injunction requests is the obligation of the requesting party to make a security deposit payment, amount of which is to be determined by the relevant court, to compensate the possible damages to be incurred by the other party and third parties as a result of such preliminary injunction relief decision. Although such amount is not specified under the relevant legislation, in practice, approximately 15% of the dispute value is requested as security deposit.
c) Obligation to File Lawsuit on the Merits Upon Preliminary Injunction:
The most important issue with regard to a preliminary injunction relief request is the obligation to file the lawsuit on the merits of the case within two weeks after obtaining such preliminary injunction. In accordance with the Article 397 of the Code of Civil Procedure, in case a lawsuit is not filed within two weeks after obtaining the preliminary injunction relief, such decision shall be terminated automatically.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.