Pilot Decision from the Constitutional Court: Violation of the Right to Property in Claims for Inflation Loss

In its decision dated 8 July 2025 and numbered 2024/41763 (“Decision”), the Constitutional Court of Turkey (“TCC”) ruled that a violation of the right to property occurs when receivables between private legal persons lose their real value due to inflation. As a pilot decision, this ruling has the potential to bring about significant changes in claims concerning inflation-related losses arising from the late payment of receivables.

The application concerned a case in which the awarded amount was paid with legal interest, yet its real value was eroded by inflation. A subsequent lawsuit claiming additional (consequential) damages was dismissed on the grounds that inflation alone was not deemed sufficient to establish loss. The TCC evaluated the complaint under the right to an effective remedy, safeguarded by Article 40 of the Constitution, in connection with the right to property under Article 35. The Court held that statutory interest regulations are not even theoretically capable of compensating for the loss in value; there exists a legislative gap regarding inflation compensation, and legislative action is required to address this deficiency.

Who May Be Affected by the Decision?

This decision directly concerns all private legal persons who believe their receivables have lost real value due to inflation -especially those whose consequential damage claims have been dismissed or are at risk of dismissal – and who therefore allege a violation of their right to property.

Legislative Process Expected

The decision identified a legal gap in the regulation of inflation-related loss of value and called on The Grand National Assembly of Turkiye (TGNA) to introduce legislation enabling the compensation of damages in similar situations. Accordingly, the Court has postponed the examination of similar applications for six months starting from the date of publication in the Official Gazette (29 September 2025). Thus, similar cases will be suspended by the TCC until 29 March 2026.

This pilot decision marks a significant turning point in addressing inflation-induced loss of value for receivables collected late in private legal relations. Given its pilot nature, it is expected that lower courts and the Court of Cassation will develop new assessment criteria for inflation compensation claims, accelerating the evolution of judicial precedent. Moreover, the decision highlights the need to revisit evidentiary standards in consequential damage lawsuits.

Looking ahead, the decision is expected to influence litigation strategies in the business sector concerning delayed receivables and to accelerate the legislative process for a new “inflation compensation model.” It will be essential to analyze in detail the implications of this decision for pending cases, finalised rulings issued prior to the decision, and new or upcoming lawsuits.

For further analysis and tailored litigation strategies, feel free to contact our team.