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dc.contributor.authorAksoy, H. C.en_US
dc.contributor.authorSchafer, Hans-Bernden_US
dc.date.accessioned2016-02-08T09:45:35Z
dc.date.available2016-02-08T09:45:35Z
dc.date.issued2012en_US
dc.identifier.issn0929-1261
dc.identifier.urihttp://hdl.handle.net/11693/21387
dc.description.abstractWe argue that the proposed introduction of the doctrine of economic impossibility in Article 137 of the reform draft of the Turkish Code of Obligations is in line with economic considerations and facilitates business transactions. This new rule gives courts the explicit power to terminate a contract and relieve the party, which owes specific performance of its obligation, without imposing any duty to pay expectation damages to the other party. We argue that a court's decision to terminate a contract under economic impossibility should be based on three tests. First, a low-probability-event occurs between contract formation and performance. Second, this event causes an excessive increase in the costs of specific performance. Third, the concept of an excessive increase should take into due consideration the other party's interest in specific performance. The reform draft includes explicitly the first two tests, but not the third test. We also show under which conditions an excessive performance difficulty should not lead to termination of the contract but rather to an adjustment of the agreed price. We argue that the rule of economic impossibility, if diligently adjudicated, saves the parties transactions costs in comparison to a rule under which the law insists on specific performance or damage payments. We also argue that a specific rule of economic impossibility leads to better and more business-oriented solutions to the underlying problems than the alternative, which is to solve such problems under the broad and unspecific cover of the "good faith" or the "Clausula Rebus Sic Stantibus" doctrine. © 2010 Springer Science+Business Media, LLC.en_US
dc.language.isoEnglishen_US
dc.source.titleEuropean Journal of Law and Economicsen_US
dc.relation.isversionofhttps://doi.org/10.1007/s10657-010-9170-2en_US
dc.subjectContract lawen_US
dc.subjectExcessive performance difficultyen_US
dc.subjectImpossibilityen_US
dc.subjectImpracticabilityen_US
dc.titleEconomic impossibility in Turkish contract law from the perspective of law and economicsen_US
dc.typeArticleen_US
dc.departmentDepartment of Lawen_US
dc.citation.spage105en_US
dc.citation.epage126en_US
dc.citation.volumeNumber34en_US
dc.citation.issueNumber1en_US
dc.identifier.doi10.1007/s10657-010-9170-2en_US
dc.publisherSpringer New York LLCen_US


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