NEWSLETTER-2017

273 LAW OF OBLIGATIONS Article 445/2 of the TCO recognizes the authority of the judge to limit extensive non-competition clauses in terms of scope or time: “The judge may limit the extensive non-competition clause in terms of scope and time by freely evaluating all the circums- tances and the conditions, and by taking into consideration the opposing deed that may be undertaken by the employer, in a just manner.” The Court of Cassation is of the opinion that the non-competition clause shall not be valid so long as it is not limited in terms of place and type of work, and limitations should be determined according to the characteristics of the work, and even to the features of the em- ployee. Nevertheless, in this context, application of Article 445/2 of the TCO of the Court of Cassation demonstrates inconsistency. Below, decisions of the Court of Cassation in relation to this authority of the judge to limit non-competition clauses will be examined. Practice of the Court of Cassation Regarding Agreements that were terminated during the Term of Code numbered 818 Firstly, it is vital to indicate that according to the established case- law of the Court of Cassation, Article 349 of the Code of Obligations numbered 818 is applied to the non-competition clauses in the employ- ment agreements that were terminated before the TCO’s entry into force. Pursuant to this provision, in a dispute before the Court of Cas- sation, the Court deemed invalid a non-competition clause stipulating that the employee cannot be involved in any kind of work or activity in the area of business of the company in three designated areas for a time period of two years after the termination of the contract, as the limita- tion of geographical area that incorporates a significantly large area could result in the financial destruction of the employee 4 . Although dissenting votes in the aforementioned decision indicate that the judge can uphold the agreement by exercising his judicial discretion by ap- plying the provisions of Code of Obligations numbered 818, the Court of Cassation’s application in this respect appears to be consistent. 4 Court of Cassation 11. HD. , T. 16.3.2017, E. 2016/2751, K. 2017/1589 , http:// www.kazanci.com.tr/ (Access Date: 23.11.2017).