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Period of Delivery and Presumption of Loss In Contracts Of Carriage And Logistics

Period of Delivery and Presumption of Loss In Contracts Of Carriage And Logistics

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In Turkish Law, contracts of transport are regulated in the fourth book of the Turkish Commercial Code No. 6012 ["TCC"] under the name "Transport Affairs". In this article, the period of delivery, which is one of the key aspects of transport contracts, and the presumption of loss, namely the legal consequence of non-compliance with this period, will be discussed briefly.

The period of delivery is regulated under art. 873 of TCC. According to the article, the delivery period is decided by the contracting parties. In case the parties neglect to determine the period, then the carrier is obliged to deliver the goods within a reasonable period. When determining this reasonable period, different variables such as the specificities of the contract, type of goods being transported, qualities of the vehicle, and determination of the route, shall be taken into consideration.

Non-compliance with the delivery period may bear two results, delay in delivery or the presumption of loss. It is vital to grasp the difference between these two legal consequences, as they produce different legal effects. In cases of delay in delivery, the carrier is responsible for the damage caused by the delay.

In the meantime, according to art. 874 of TCC, if the delivery is not completed within 20 [twenty] days of the delivery period, the goods in question are presumed lost. Loss of goods is defined as the condition where delivery is not possible. The goods are presumed lost, not only in situations of physical damage but also in situations where the goods lose their economic value. Glass items broken, goods confiscated by competent authorities, or delivery to the wrong person with no chance of retrieval are examples of loss of goods in the scope of this article.

The 20 day period is extended to 30 days in case there is a cross-border transport. Convention on the Contract for the International Carriage of Goods by Road [“CMR”] regulates different times for the presumption of loss. As stated in art. 20 of CMR, the presumption of loss comes into effect 30 days after the delivery period. According to the same article, if the delivery time has not been determined, the fact that the goods are not delivered within sixty days of the receipt of the cargo by the carrier will constitute a presumption that the goods are lost.

In the event of loss, TCC grants the beneficiary several options. First, the beneficiary’s right to compensation comes into effect. Along with the compensation, art. 874/2 of TCC allows the beneficiary to ask for a notification in case the goods are found. This request for notification must be done at the time of receiving the payment for the compensation. The situation in question gives rise to the absolute liability of the carrier. In other words, even if the carrier is not at fault for the loss of goods, they are obliged to compensate the damage of the beneficiary.

If the goods are found, the beneficiary may notify the carrier within 30 days that they want the goods to be delivered to them by paying the compensation back. Furthermore, the beneficiary is obliged to pay the transport rates. However, according to art. 874/3 of TCC, the beneficiary may ask for compensation if they were injured by the presumption of loss.

If the item is found after payment of compensation; the beneficiary may not want to be informed, or they may not use their right to demand the delivery of the goods despite being informed, in such cases, the carrier gains the right of free disposal on the goods, as is stated in art. 874/4 of TCC.

As a result, the determination of the transportation period in the transportation contracts is of great importance in determining whether the transportation is made on time or not and in calculating compensation claims for delayed deliveries. For this reason, the parties must actively contribute to the designation of delivery time, otherwise, the reasonable time practice will be implemented.

By Nihat Ozbek, Partner, and Baris Ulker, Senior Associate, Guleryuz & Partners

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