Personal suretyship in a construction contract in return for a flat: its legal nature, validity conditions, handwriting requirement, spouse’s consent, maximum amount, time limit, and sample article text that can be included verbatim in the contract.

In construction contracts in return for flats, the contractor is almost always a limited or joint-stock company. If the company has no registered assets, the judgment obtained at the end of a years-long lawsuit remains on paper. The antidote to this is to hold the company’s main partner personally liable with their assets. However, writing “the main partner is a personal guarantor” in the contract means nothing by itself. Because, according to Article 603 of the Turkish Code of Obligations, provisions regarding the form, capacity, and spouse’s consent for suretyship also apply to contracts for personal guarantees given by real persons under a different name — meaning, even if its name is “guarantee,” it is subject to the suretyship regime. The result of this is: the guarantor must write the maximum amount for which they will be liable, the date, and that they have undertaken the obligation as a joint and several debtor in the contract in their own handwriting (Turkish Code of Obligations, Article 583). If one of these elements is missing, the guarantee is invalid — and in practice, it is accepted that this condition must be sought even if the contract is drawn up in the form of a notarized deed. Furthermore, any suretyship given by a real person automatically terminates after ten years from its establishment (Turkish Code of Obligations, Article 598). Good news: the partner or manager of the contractor company is not obliged to obtain their spouse’s consent for the guarantee given related to the company (Turkish Code of Obligations, Article 584/3).

1. Problem: If the company has no assets, the judgment is useless

In flat-for-land (or land share for flat) construction contracts, the contractor side almost always consists of a legal entity — mostly a limited company — in practice. Legal personality is a curtain that separates the personal assets of its partners from company debts. This curtain is necessary for the normal functioning of commercial life; however, in urban transformation, it leads to the following result for the landowner:

The company may have been established specifically for the project, with minimum capital .

Construction remains unfinished, a lawsuit is filed, and three to five years later, you receive a judgment in your favor .

When you initiate enforcement proceedings, it turns out that the company has no registered bank account, real estate, vehicle, or machinery .

The company has been liquidated, its name has changed, or its activities have been practically shifted to another company.

You are left with an uncollectible judgment and wasted years.

This risk is also clearly stated in the contractor selection guide of the Istanbul Builders Association (İNDER): since the contractor is mostly a legal entity, if a receivable right arises from the contract or construction, and the company has no bank account or movable/immovable property registered in its name, the collection of the receivable will not be possible, and the right to claim cannot be demanded from the owner of the contracting company. The guide’s solution proposal is also clear: if the main partner signs the contract as a personal guarantor and clauses to this effect are added, the main partner will be liable to the landowners with their personal assets .

The subject of this article is how this advice will be legally implemented. Because in practice, a significant portion of the sentences written in contracts, such as “the company partner … is a personal guarantor”, are invalid because they do not meet the formal requirements explained below — and this is only understood when enforcement proceedings are initiated, i.e., at the latest possible moment.

2. What legal institution is a “personal guarantor”?

In Turkish law, there is no single institution called a “personal guarantor”. The legal nature of a signature on a contract is determined by the content of the text, and four different possibilities may arise:

2.1. How is the distinction made?

The main criteria used in doctrine and judicial practice for distinguishing between suretyship and guarantee are as follows:

Ancillary intent: Is the undertaking structured as dependent on the principal debt, or independent from it?

Reference to the principal debt: If the text explicitly refers to the principal contract and the debt therein, it is interpreted in favor of suretyship.

Interest criterion: If the person providing the assurance has an independent interest in the transaction, it can be interpreted in favor of a guarantee. A company partner has an interest within their own company; this is a factor that strengthens the interpretation as a guarantee.

Suretyship in case of doubt: If the nature remains uncertain, an interpretation is made in favor of suretyship, which offers greater protection to the person providing the assurance.

Practical outcome: For the landowner, there is no point in pursuing this distinction. Regardless of how it is qualified, the assurance given by a natural person is subject to formal requirements. The correct strategy is not to debate the distinction, but to prepare a text that complies with the strictest formal requirements for suretyship in all circumstances. Thus, regardless of the qualification, the assurance remains valid.

3. Key rule: TCO art. 603 — changing its name doesn’t save it

This is the most important provision of this article:

TCO art. 603: “Provisions concerning the form of suretyship, the capacity to be a surety, and the consent of the spouse shall also apply to other contracts made under different names by natural persons concerning the provision of personal assurance.”

The purpose of this provision is to prevent creditors from avoiding and circumventing the protective provisions of suretyship. In practice, this means:

Regardless of the title used in the contract, such as “guarantor”, “personal surety provider”, “joint debtor”, or “undertaker of a third party’s act”, if the security is provided by a natural person, the provisions regarding the form, capacity, and spousal consent for suretyship shall apply.

Therefore, the defense “we provided a guarantee, not a suretyship, so the form requirement is not applicable” is generally ineffective for natural persons. 

Conversely, the provision, by its clear wording, is limited to guarantees given by natural persons; a guarantee given by a legal entity (e.g., a parent company) is not within this scope.

Limitation of the provision: The Grand General Assembly for Unification of Jurisprudence of the Court of Cassation, with its decision dated 20.04.2018, numbered E.2017/4, K.2018/5 (Official Gazette 16.10.2018), decided by majority vote that the regulation of Article 584 of the Turkish Code of Obligations (TCO) concerning spousal consent in suretyship, according to Article 603 of the TCO, does not need to be applied to “aval”. In other words, Article 603 does not cover every transaction that appears to be a personal guarantee; “aval”, which is specific to negotiable instruments law, has been excluded. This also explains why a promissory note/aval can be considered a separate layer of security in construction contracts in return for land share.

4. Validity condition 1: qualified written form and handwriting (TCO Art. 583)

TCC Art. 583 stipulates not an ordinary written form for suretyship, but a qualified written form. According to the article, the suretyship agreement is not valid unless it is made in writing and the maximum amount for which the surety will be liable and the date of the suretyship are specified. Furthermore, it is mandatory for the surety to specify the following three elements in their own handwriting in the agreement:

If any of these elements is missing, the guarantee is invalid. In judicial practice, surety texts that do not contain handwriting and are entirely pre-printed are considered invalid; and parts claimed to be handwritten are, when necessary, subjected to expert examination to determine if they are genuinely the product of the guarantor’s hand.

The other two paragraphs of the article are also often overlooked in practice:

Guarantee through a representative: Granting special authorization to act as guarantor on one’s own behalf and promising to guarantee for someone else are also subject to the same formal requirements. This means that if a guarantor is to be appointed via a power of attorney, the authorization in the power of attorney must also meet the handwritten requirement. Therefore, the guarantor personally signing is the only safe way.

Subsequent amendments: Subsequent changes to a surety agreement that increase the guarantor’s liability shall not take effect unless the form prescribed for surety is complied with. In every amendment to the contract, the suretyship clause must also be re-regulated in the same form.

5. Does drafting it in the form of a notarized deed eliminate the handwriting requirement?

This question is of particular importance for construction contracts in return for land share. This is because these contracts also involve the sale of real estate, so they are drawn up in an official form — in practice, as notarized deeds. The first thought that comes to mind is: “The notary already ascertains the will, so there’s no need for handwriting.”

Do not rely on this assumption. Although there is debate in doctrine, the accepted approach in judicial practice is that the handwritten requirement in TBK m.583 will also be sought even if the contract is drawn up by a notary. Similarly, the fact that the guarantor is a merchant or owner of a commercial enterprise does not change the outcome; the handwritten requirement must be fulfilled. In practice, there are decisions where guarantee statements added to rental agreements drawn up by a notary and not complying with TBK m.583 are deemed invalid.

Correct practice: While the contract is being drawn up by a notary, below the guarantee clause — continuing the printed text — it must be ensured that the guarantor personally, in their own handwriting, writes the maximum amount, the date, and their capacity as joint and several guarantor, and signs it. The notary public may not remind of this point on their own; instead of waiting for them to remind, the text should be prepared in advance and submitted to the notary in this manner. An example declaration text that can be used in section 13 below is provided.

Another debate: TCC Art. 7. According to Article 7 of the Turkish Commercial Code, those who jointly incur debt due to a commercial transaction are jointly and severally liable, unless otherwise stipulated by law or contract; this rule also applies in the case of surety for commercial debts, both in the relationship between the principal debtor and the surety, and among the sureties themselves. One view argues that, in commercial transactions, TCC Art. 7, as a special provision, overrides the handwritten requirement of TCO Art. 583. However, this view is debatable, and relying on it to bypass the handwritten requirement means risking the entire guarantee. The safe scope of application for TCC Art. 7 is not to eliminate the handwritten requirement, but rather to reinforce joint and several liability.

6. Validity Condition 2: spouse’s consent and the exception granted to the contractor’s partner (TCO Art. 584)

According to TCO Art. 584, one spouse may act as a surety only with the written consent of the other, unless a court has issued a separation order or a legal right to live separately has arisen. This consent must be given before or at the latest at the time the contract is concluded. Consent obtained subsequently generally does not cure the deficiency.

Furthermore, according to the second paragraph, for subsequent amendments to the contract that lead to an increase in the amount of liability, the conversion of an ordinary suretyship into a joint and several suretyship, or a significant reduction in the guarantees beneficial to the surety, the spouse’s consent is required again.

6.1. Important Exception for the Contractor’s Partner

TBK art. 584/3 (Added by Law No. 6455): “The spouse’s consent is not required for guarantees given by the owner of a commercial enterprise registered in the trade registry or by a partner or manager of a commercial company in relation to the enterprise or company, guarantees given by tradesmen or artisans registered in the tradesmen and artisans registry in relation to their professional activities, (…).”

If the person providing the guarantee in a revenue-share construction contract is a partner or manager of the contractor company, and the guarantee is given in relation to the company’s business, it falls within this exception, and the spouse’s written consent is not required. This is a practical convenience for the landowner: one of the most common reasons for a guarantee to be invalidated is eliminated in this case.

However, the limits of the exception should be noted:

The person providing the guarantee must genuinely be a partner or manager. This status at the date of the contract must be documented with the trade registry gazette and current registry record, and these documents must be appended to the contract.

The guarantee must be related to the enterprise or company. A revenue-share construction contract is the core business of the contractor company; this condition normally does not pose a problem — however, it is important that the connection is documented in the file.

Even if the partnership status subsequently ends, the guarantee continues; the decisive factor is the status at the time of the contract. Conversely, if the guarantor has withdrawn from the partnership and a subsequent amendment is made that increases liability, it should be separately assessed whether the exception still applies to that amendment.

The exception only concerns spousal consent. It does not remove the handwritten and maximum amount requirements. This is the most common misconception in practice.

Non-partner guarantor: Sometimes, it is desired for the guarantor to be the spouse, sibling, or a relative of a partner, rather than a partner of the company. Since this person does not hold the title of partner/manager, they cannot benefit from the exception; if married, their spouse’s written consent must be obtained and the consent must be given before or at the latest at the time the contract is established. It is recommended that this consent be attached to the contract as a signed declaration.

7. Validity condition 3: maximum amount — how is it determined in a flat-for-land contract?

This is the most difficult and error-prone aspect of personal suretyship in flat-for-land construction contracts. The reason is this: the contractor’s primary obligation is not monetary, but to create a work — they will construct and deliver a building. However, the guarantor undertakes not to construct the building, but the financial consequences of non-performance. Therefore, the maximum amount must be determined as a ceiling in Turkish Lira.

7.1. Which items should be taken into account when determining the ceiling?

The items that can be claimed from the guarantor may include:

Delay compensation / current market rental fees (cumulatively increases if the project is extended),

Amounts of penal clause agreed upon in the contract,

Costs of incomplete and defective workmanship,

In the event of contract termination, the replacement cost required to complete the work,

Litigation expenses, attorney’s fees, and collection costs.

In practice, the ceiling is generally determined based on either the total market value of independent sections belonging to landowners at the contract date or the total construction cost. Basing this value on an SPK-licensed appraisal report obtained before the contract facilitates both the reasonableness of the ceiling and its proof when necessary.

7.2. Inflation problem and fair solution

Frequently overlooked risk: The law requires the maximum amount to be certain. A fixed TL ceiling written today might fall significantly below its real value in the fifth year of the project — the guarantee exists on paper but is economically hollowed out. Conversely, linking the ceiling to an index or a variable formula carries the risk of creating a dispute regarding the condition that “the maximum amount must be certain.”

Practical and defensible approach: To determine the ceiling not based on the project’s current value, but as a high nominal figure based on foreseeable maximum risk. The ceiling is an upper limit, not the amount to be paid; keeping it high does not increase the guarantor’s actual debt, it merely prevents the guarantee from being hollowed out in future years. If indexing is to be done, a specific nominal upper limit must also be written in addition to the indexed formula.

7.3. Subsidiarity of Suretyship: The Principal Contract Must Be Valid

Since suretyship gives rise to an accessory obligation (dependent on the principal debt), if the principal contract is invalid, the guarantee also becomes void. If the construction contract in return for land share has not been drawn up in the official form, the guarantee clause, no matter how carefully written, may lose its legal basis. Therefore, before establishing a guarantee structure, it must be ensured that the contract is made in the form of a notarized deed and registered in the land registry.

8. Time Limit: The Ten-Year Rule and Risk Exceeding the Project (TCO Art. 598)

Pursuant to TCO Art. 598, all types of suretyship given by a natural person automatically terminate upon the lapse of ten years from the establishment of the related contract. Even if the suretyship has been given for a period longer than ten years, the surety can only be pursued until the ten-year period expires, unless it has been extended or a new suretyship has been given. Whether the suretyship is ordinary or joint and several does not alter this outcome.

The extension procedure is also strict: the suretyship period can be extended for a new period of a maximum of ten years, provided that it is made at the earliest one year before the suretyship expires, with the surety’s written declaration in accordance with the form of the suretyship contract. This means that the handwritten elements must be fulfilled again in the extension declaration.

Why is it critical? In urban transformation projects, the timeline works as follows: contract → permit (6–9 months) → construction (12–30 months) → occupancy permit (3–6 months). When possible delays, zoning problems, and litigation processes are added, the delivery can extend to seven to eight years. Furthermore, after delivery, the liability for defects related to the work contract continues; for immovable structures, this period is five years from delivery (longer periods may apply in case of gross negligence by the contractor). Result: the guarantee may expire automatically precisely in the years when the defect lawsuit would be filed.

Solution: The contract should state that the guarantor undertakes to make a declaration of extension in accordance with Article 583 of the TCO, upon the written request of the landowners, during the period one year before the expiry of the guarantee, and that non-compliance with this undertaking will result in a separate penal clause. Additionally, the ninth year should be marked on the calendar as a reminder. Remember: an extension takes effect not with the guarantor’s unilateral declaration, but with the creditor’s acceptance as well.

9. Simple or joint and several? The effect of TCC Art. 7

Therefore, the presence of the term “joint and several” in the text is not merely a preference, but a mandatory element that must be handwritten according to Article 583 of the Turkish Code of Obligations (TCO).

Furthermore, since the construction contract in return for a share of the land is considered a commercial deed from the contractor’s perspective, the presumption of joint and several liability under Article 7 of the Turkish Commercial Code (TCC) also comes into play: those who undertake a joint debt due to a commercial transaction are jointly and severally liable unless otherwise stipulated by law or contract. This is a ground supporting joint and several liability; however, as explained above, it should not be used as a justification for omitting the handwritten clause.

Do not overlook the second sentence of TCC Article 7: The same provision states that default interest cannot be charged to the guarantor(s) without notifying them that the commitment or payment has not been made. Therefore, if the contractor defaults, a separate notary public notice should also be sent to the guarantor. In practice, interest claims are often lost because this is neglected.

10. What does the guarantee cover, and what extent of liability does it entail? (TCO Art. 589)

The guarantor is liable up to the maximum amount specified in the guarantee agreement. Provided that this ceiling is not exceeded, liability generally covers the following:

The principal debt itself and the legal consequences of the debtor’s fault or default,

Enforcement costs and litigation expenses incurred against the debtor (provided that the guarantor was given prior notice and the opportunity to avoid these costs),

Accrued interest and ancillary claims covered by the contract.

In return, the guarantor can raise the defenses possessed by the principal debtor against the creditor (e.g., invalidity of the contract, performance, set-off, statute of limitations). The statute of limitations for the guarantee debt is also generally tied to the principal debt. A guarantor who makes payment succeeds to the rights of the creditor to the extent of the payment made and can seek recourse from the principal debtor.

An important clause to be written in the contract: The mere mention of only the contractor company’s name in the building permit, tax office, chamber of commerce, and other public institutions, does not eliminate the guarantor’s liability. Explicitly stating this point in the contract prevents future “my name is not in the official records” defense.

11. What does personal guarantee provide in practice?

The true value of a personal guarantee often emerges long before the collection stage, not during it. A main partner who knows they cannot hide behind the company views delay and site stoppage as a much more expensive option.

12. What the landowner must do to avoid losing the guarantee

The provisions of suretyship impose certain obligations not only on the guarantor but also on the creditor. Neglecting these can lead to the subsequent loss of a valid guarantee:

Protect other collaterals. The creditor is obliged to protect pledges and other securities that were in place during the suretyship or were subsequently obtained directly from the principal debtor. For example, unnecessarily releasing a construction guarantee mortgage obtained from the contractor, or failing to follow up on a letter of guarantee that was not renewed in time, may result in the surety being released from liability to that extent.

Register your claim in case of bankruptcy and concordat. In the event of the contractor’s bankruptcy or a concordat grace period, the creditor must duly register their claim; if this is neglected, the surety’s liability may decrease accordingly.

Notify the guarantor of default. According to Article 7 of the TCC (Turkish Commercial Code), default interest cannot be charged to the surety without notifying them that payment or the commitment has not been fulfilled.

Repeat the form for every amendment that increases liability. In amendments such as extensions of time, changes in sharing ratios, or additional work, the guarantee clause must be re-executed with handwritten elements.

Set the ninth-year alarm. Mark the ten-year expiration period on the calendar and obtain the extension declaration in due time.

13. Sample contract clause and handwritten declaration text

The following texts are sample provisions prepared to be adapted according to the specific project. Every contract is unique; it must be reviewed by a lawyer before use.

13.1. Guarantorship clause to be included in the contract (sample)

ARTICLE __ — PERSONAL GUARANTEE (JOINT AND SEVERAL SURETYSHIP)

__.1. The partner/manager of the contractor company, [Ad Soyad, T.C. kimlik no, adres], has signed this contract as a party in the capacity of a personal guarantor (joint and several surety). The guarantor is responsible to the landowners, with their personal assets and jointly and severally, for all principal and accessory obligations arising from this contract for the contractor — including the timely, contract-compliant, technical specification-compliant, and licensed project-compliant, defect-free, and complete completion of construction, obtaining the occupancy permit (iskân), and delivery of condominium titles — that may arise in case of non-performance, specifically for delay compensation, penalty clause, cost of incomplete and defective workmanship, replacement cost required for the completion of the work, interest, litigation and enforcement expenses, and attorney’s fees, limited to the maximum amount specified below.

__.2. The maximum amount for which the Guarantor is responsible is [rakam ve yazıyla] Turkish Liras. This amount is an upper limit and also covers the demands of the land owners below this amount.

__.3. The Guarantor accepts that the termination of their partnership or management status in the contractor company, the transfer of their shares, the change of the company’s title, change of type, merger, demerger, liquidation or bankruptcy will not affect their liability arising from this guarantee.

__.4. According to the explicit acceptance of the parties, the mere inclusion of the contractor company’s name in the building permit, construction supervision agreement, tax office, chamber of commerce, and other public institution records shall not eliminate or limit the guarantor’s liability arising from this contract.

__.5. In every subsequent amendment to this contract that increases the guarantor’s liability, the guarantee declaration shall be re-issued in accordance with the form stipulated in Article 583 of the Turkish Code of Obligations. The Guarantor undertakes to provide this declaration upon the written request of the land owners.

__.6. The Guarantor, knowing that the guarantee will automatically terminate upon the lapse of ten years from its establishment in accordance with Article 598 of the Turkish Code of Obligations, undertakes to make a declaration of extension for a new period of maximum ten years in accordance with the form stipulated in Article 583 of the same Law, upon the written request of the land owners at least one year prior to the expiration of the aforementioned period. In case of breach of this undertaking, the guarantor agrees to pay the land owners a penalty of [tutar] TL.

13.2. Declaration to be written by the Guarantor in their own handwriting (example)

The text below must be written immediately below the guarantee clause, not in print, but in the guarantor’s own handwriting and signed. Even if the contract is prepared in the form of a notarized deed, this declaration must be taken exactly as it is.

“I accept, declare, and undertake that I am personally liable as a joint and several guarantor for the debts arising from this contract, up to a maximum amount of [rakam ve yazıyla] Turkish Lira.
Date: __/__/____ (day/month/year, in handwriting)
Name Surname: ____________________
Signature: ____________________”

Five rules regarding this declaration: (1) The amount, date, and the phrase “joint and several guarantor” must be in the guarantor’s own handwriting — merely signing a printed text is not sufficient. (2) The amount must be written both in figures and in words. (3) The date must be complete (day/month/year). (4) The guarantor must write the declaration personally; if done through an agent, the power of attorney must also meet the same formal requirements — therefore, guarantees by proxy should be avoided. (5) If the guarantor is not a partner/manager and is married, the spouse’s written consent must be obtained before or at the latest at the time of the contract’s establishment.

Recommended combination: Bank guarantee letter (with staggered refunds) + construction guarantee mortgage on shares transferred to the contractor + personal guarantee of the main partner + and, if possible, a mortgage on a property belonging to the guarantor. These four layers are not alternatives but complementary to each other: even if one fails in terms of form, the others remain valid.

14. 12 most common mistakes in practice

Simply writing “company partner … is a personal guarantor” in the contract; omitting the elements of maximum amount, date, and joint and several liability.

Printing these elements as a template and not obtaining the guarantor’s handwriting.

Relying on the assumption that “it was done at a notary, that’s sufficient”.

Not specifying the maximum amount or using vague expressions such as “unlimitedly liable for all debts arising from the contract”.<

Setting the maximum amount too low, leading to the security becoming economically worthless years later.

Not documenting the guarantor’s status as a partner/manager and not including the trade registry record as an annex to the contract.

For a non-partner guarantor, not obtaining spousal consent or obtaining consent after the contract.

Establishing the guarantee by power of attorney; not checking if the power of attorney meets the formal requirements.

Not renewing the guarantee declaration in subsequent amendments.

Not following the ten-year period and not obtaining the extension declaration.

When the contractor defaults, not sending a separate warning letter to the guarantor (loss of interest).

Unnecessarily releasing other existing securities (mortgage, letter of guarantee), leading to the guarantor being released from liability to that extent.

Frequently Asked Questions

Is it sufficient to write “personal guarantor” in the contract?

No. According to Article 603 of the Turkish Code of Obligations (TBK), the provisions regarding the form, capacity, and spousal consent of suretyship also apply to contracts made under another name for the provision of personal security by real persons. Therefore, the security provider must state in their own handwriting the maximum amount for which they are liable, the date, and that they undertake liability jointly and severally. If these elements are missing, the security is invalid.

If the contract was drawn up by a notary, is the handwritten requirement still sought?

The approach accepted in judicial practice is that the handwritten requirement will still be sought even if the contract was drawn up by a notary. The fact that the guarantor is a merchant also does not change the outcome. Therefore, when a construction contract in return for land share is being drawn up by a notary, the guarantor’s declaration should not be neglected to be obtained in handwriting.

Is the spouse’s consent required when the contractor’s partner acts as guarantor?

As a rule, no. Pursuant to Article 584/3 of the Turkish Code of Obligations (TBK), spousal consent is not required for guarantees given by a partner or manager of a commercial company in relation to the company. However, if the guarantor is not a partner or manager (e.g., a relative of the partner) and is married, the spouse’s written consent must be obtained before or at the latest at the time of the contract’s establishment. This exception pertains only to spousal consent; it does not eliminate the handwritten and maximum amount requirements.

What should I write as the maximum amount?

A specific upper limit in Turkish Lira must be stated. When determining it, delay compensation, penalty clauses, costs of incomplete and defective workmanship, replacement costs required to complete the work, and litigation and enforcement expenses should be considered together. In practice, the total fair market value of the independent sections belonging to the land owners on the contract date or the total construction cost is taken as a basis. The ceiling is an upper limit, not the amount to be paid; setting it too low leads to the economic depletion of the security over the years.

Is the guarantee unlimited in duration?

No. According to Article 598 of the Turkish Code of Obligations (TBK), any suretyship provided by a real person automatically terminates after ten years from the establishment of the contract. Whether the suretyship is ordinary or joint and several does not change this outcome. The period can be extended for a new maximum ten-year period with a written declaration in accordance with the form of the suretyship, provided that it is made at least one year before its earliest expiration. It is essential to follow this schedule in long-term projects.

Does suretyship terminate if the partner transfers their shares?

As a rule, no. The liability arising from the suretyship is based on the personal guarantee commitment given, not on the status of partnership. Nevertheless, to avoid any doubt, it must be explicitly stated in the contract that the liability will continue in cases of share transfer, change of title or type, merger, demerger, liquidation, and bankruptcy.

Why is the difference between ordinary suretyship and joint and several suretyship important?

In ordinary suretyship, the creditor must first apply to the principal debtor and demonstrate that the enforcement proceedings were unsuccessful; whereas in joint and several suretyship, if the principal debtor defaults, the guarantor can be approached directly. The security sought by the landowner is a joint and several one, and it is mandatory for this statement to be written by hand, as per Article 583 of the Turkish Code of Obligations (TBK).

If the contractor defaults, do I also need to issue a warning to the guarantor?

Yes. According to Article 7 of the Turkish Commercial Code (TTK), default interest cannot be accrued without notifying the guarantor(s) that the commitment or payment has not been made. Therefore, a copy of the warning notice sent to the contractor must also be served to the guarantor.

Is it better to get a mortgage instead of a suretyship?

The two are not alternatives to each other, but rather complementary. Personal suretyship provides access to all of the guarantor’s assets, but the individual can dispose of their assets; whereas a mortgage provides in rem security over a specific immovable property and maintains the possibility of enforcement even if ownership changes. If possible, both should be obtained together.

What should I do if the contractor does not accept suretyship?

This is a warning sign that should be evaluated on its own. A main partner who refuses to stand behind their company’s commitment suggests leaving all project risks to the landowners. In this case, either other layers such as a bank guarantee letter and a construction collateral mortgage need to be significantly strengthened, or the choice of contractor needs to be re-evaluated.

If the guarantor makes a payment, can they seek recourse from the contractor?

Yes. The guarantor who makes the payment succeeds to the rights of the creditor to the extent of the payment made and can seek recourse from the principal debtor. This is not a disadvantage for the landowner; the outcome does not change as the claim has been collected.

Why is expert legal support necessary?

Personal suretyship is an area where a difference of millions of liras can arise from a single paragraph being written correctly or incorrectly. Moreover, if written incorrectly, it is often discovered years later, at the enforcement stage — at a point when there is no possibility of remedy. Therefore, the suretyship clause should be drafted with special care, separately from the rest of the construction contract in return for flats.

2M Law Office provides support to landowners in the fields of urban transformation law, condominium law, and real estate law regarding the following matters:

Preliminary financial and record review of contractor candidates and partners acting as guarantors,

Drafting the construction contract in return for land share and the guarantor clause, managing notary processes, and land registry annotation,

Ensuring the handwritten declaration is obtained in accordance with Article 583 of the Turkish Code of Obligations and evaluating the necessity of spousal consent on a case-by-case basis,

Calculation of the maximum amount according to project risks and its defensible determination,

Letter of guarantee, construction security mortgage, and establishment of a mortgage structure on the guarantor’s immovable property,

Monitoring of the ten-year period and proper obtaining of the extension declaration,

In the event of default, a warning letter, determination of evidence, precautionary attachment, and interim injunction procedures,

Enforcement proceedings against the guarantor and conducting claims/compensation lawsuits,

Lawsuits for termination of contract, cancellation and registration of title deeds, delay compensation, penal clause, and costs of incomplete/defective workmanship.

Our office, based in Tuzla, operates in the regions of Tuzla, Pendik, Kartal, Maltepe, Ataşehir, Ümraniye, Sancaktepe, Sultanbeyli, Kadıköy, and Üsküdar, as well as Kocaeli, Gebze, Darıca, and Çayırova, under the service titles of urban transformation lawyer, Istanbul urban transformation lawyer, Tuzla urban transformation lawyer, flat-for-land construction contract lawyer, land share construction contract lawyer, construction law lawyer, and real estate law lawyer.

Conclusion

Personal guarantee in a flat-for-land construction contract is the strongest, yet most easily lost, assurance in the landowner’s hands. It is strong because it brings the real person behind the company, along with their house, land, and bank account, into the equation. It is easily lost because its validity depends on a single handwritten declaration.

In summary, the three-sentence rule is as follows: (1) Regardless of what you call it, the assurance given by the real person is subject to the suretyship regime. (2) The maximum amount, date, and the phrase “joint and several” must be written in the guarantor’s own handwriting — even if done at a notary public. (3) Mark the ten-year period on your calendar.

To have the suretyship clause of your contract reviewed before signing, you can contact 2M Hukuk Law Office along with the documents related to your project (contract draft, contractor’s offer, commercial registry records, and existing contract, if any).

Main sources consulted

Turkish Code of Obligations No. 6098 — especially Article 128 (undertaking the act of a third person), Article 162 et al. (joint and several liability), Articles 581–583 (suretyship and its form), Article 584 (spouse’s consent), Article 586 (ordinary/joint and several suretyship), Article 589 (scope of liability), Articles 591–592 (defenses and creditor’s obligations), Article 596 (subrogation), Article 598 (termination) and Article 603

Turkish Commercial Code No. 6102, Article 7 (presumption of joint and several liability in commercial matters and notification requirement)

Turkish Civil Code No. 4721, Article 881 et al. (immovable pledge/mortgage)

Supreme Court Grand General Assembly on Unification of Jurisprudence, April 20, 2018, Docket No. 2017/4, Decision No. 2018/5 (Official Gazette October 16, 2018)

İNDER, Guide to Choosing a Contractor in Urban Transformation Areas with Questions and Answers (suretyship heading)

Supreme Court Grand General Assembly on Unification of Jurisprudence, May 16, 2025, Docket No. 2024/1, Decision No. 2025/2 (Official Gazette July 18, 2025, No. 32959) — regarding the importance of annotating the contract in the land registry

Legal Disclaimer: This article has been prepared for general informational purposes only and does not constitute legal advice or attorney services. The sample contract clause and declaration text included in this article are provided as templates to be adapted to specific cases, and may not produce the intended legal outcome if used as is; they must be reviewed by an attorney before use. Regarding issues such as the distinction between a suretyship (kefalet) and a guarantee (garanti) contract, and the application of the formal requirements in Article 583 of the Turkish Code of Obligations (TBK) to officially executed contracts and commercial transactions, there are differing views in doctrine and judicial decisions; the assessments in this article simplify these discussions. Legislation and case law are constantly changing. The citations of the judicial decisions mentioned in this article must be confirmed with their full text via the UYAP / Court of Cassation Decision Search system before being used in any petition, opinion, or publication. Always consult an attorney before taking any action related to your specific case.