The Court Of Cassation's Shift In Its Approach To Med - Arb Claueses 02 March 2026

In today's legal landscape, where alternative dispute resolution mechanisms are increasingly prevalent, there has been a growing tendency in practice to incorporate both mediation and arbitration clauses into contracts. In particular, so-called "Med-Arb" clauses-providing for a tiered dispute resolution mechanism whereby the parties undertake to first resort to mediation and, failing a successful outcome, proceed to arbitration-are frequently preferred, especially in international commercial agreements, attorney fee agreements, and other institutional contractual instruments.
 

However, under Turkish law, the effect of such arrangements on the validity of an arbitration clause has long been a matter of controversy and has been subject to divergent assessments in the jurisprudence of the Court of Cassation. Indeed, in its decision dated 15 April 2025, rendered in the context of the same dispute, the 3rd Civil Chamber of the Court of Cassation concluded that the arbitration clause contained in a similar provision was invalid; this decision attracted considerable criticism. Subsequently, by its decision dated 15 January 2026, the same Chamber revised its position, thereby signaling a noteworthy shift in the Court of Cassation's approach to Med-Arb clauses.
 

Court of Cassation, 3rd Civil Chamber, Merits No. 2025/225, Decision No. 2025/2164, Decision dated 15 April 2025: Invalidity of the Arbitration Clause Due to the Mediation Precondition
 

In its decision dated 15 April 2025, the Chamber reproduced the tiered dispute resolution clause contained in the contract between the parties as follows:
 

"The contract dated 01 March 2022 executed between the parties provides as follows: 'Disputes arising out of this attorneyship agreement concluded between the parties and from the attorney's fee shall first be resolved through mediation. ... Should the mediation attempt fail to yield a result, the dispute shall be resolved by the Bar Arbitration Board. The Arbitration Rules of the Union of Turkish Bar Associations shall form an integral part of this agreement.' Indeed, for the resolution of the dispute, an application for mediation was initially filed, and the mediation process concluded unsuccessfully."
 

In the decision, the provisions of Law No. 6325 were examined in detail, and reference was made to the following regulations:
 

"Article 3 of the Mediation Law No. 6325 (the 'Law No. 6325') provides that 'The parties are free to apply to a mediator, to continue, conclude, or withdraw from the process,' thereby leaving the decision to initiate and pursue mediation to the parties' discretion. According to the second paragraph of the same article: 'The parties shall have equal rights both when applying to the mediator and throughout the entire process."
 

According to Article 18/A-(1), referenced by Article 3 of the Mediation Law No. 6325 on Mediation in Civil Disputes, "in cases where recourse to a mediator is recognized as a precondition for filing a lawsuit under the relevant legislation, the provisions regarding the mediation process shall apply, and this is likewise considered a procedural precondition under the Civil Procedure Code No. 6100 (CPC)." Moreover, Article 18/A-(18) of the same Law provides that "in cases where special legislation requires recourse to arbitration or another alternative dispute resolution method, or where an arbitration agreement exists, the provisions on mediation as a procedural precondition shall not apply." Additionally, Article 13 of the Law stipulates: "The parties may agree to apply to a mediator before filing a lawsuit or during the proceedings. The court may also inform and encourage the parties to resort to mediation..."

When the aforementioned statutory provisions are considered together, it becomes evident that mediation relates to substantive law, must be sought before filing a lawsuit in court, and, in certain cases, is even regulated as a procedural precondition for initiating legal action. For an arbitration clause to be valid, the parties' intention to arbitrate must be expressed clearly and unequivocally so as not to give rise to disputes or confusion. Accordingly, if the parties have agreed to first resort to a mediator, and the arbitration clause within the contract is not drafted with sufficient clarity and certainty-leaving room for doubt regarding its applicability-then the arbitration clause should be deemed invalid."

In this approach, the Court of Cassation regarded the mediation precondition as an element undermining the certainty of the parties' intent to arbitrate and held that the arbitration clause was invalid on the grounds that it was not "sufficiently clear and free from doubt in itself."
 

Court of Cassation, 3rd Civil Chamber, Merits No. 2025/5452, Decision No. 2026/129, Decision dated 15 January 2026: Explicit Acceptance of the Med-Then-Arb Clauses
 

In its decision dated 15 January 2026, the 3rd Civil Chamber of the Court of Cassation reproduced the same contractual provision as follows:
 

"The contract dated 01 March 2022 executed between the parties provides as follows: 'Disputes arising out of this attorneyship agreement concluded between the parties and from the attorney's fee shall first be resolved through mediation. The mediation costs shall be shared equally by the parties. Should the mediation attempt fail to yield a result, the dispute shall be resolved by the Bar Arbitration Board. The Arbitration Rules of the Union of Turkish Bar Associations shall form an integral part of this agreement.' In accordance with this clause, the parties initially resorted to mediation for the dispute arising from the attorneyship agreement and, upon failing to reach a resolution, proceeded to arbitration."
 

This time, the Chamber placed particular emphasis on Article 5(1) of Law No. 6325:
 

"Article 5(1) of Law No. 6325 provides that: "The parties, the mediator, or any third person participating in the mediation process may not submit the following statements or documents as evidence, nor may they testify regarding them, in the event that a legal action is filed or arbitration proceedings are initiated concerning the dispute." This provision demonstrates that, in the absence of an agreement following mediation, the legislator expressly permits recourse to arbitration, confirming that arbitration proceedings remain available after a mediation attempt. The statutory framework clarifies that if a dispute submitted to mediation is not fully or partially resolved, arbitration may be conducted regarding the unresolved issues. Similarly, Article 5(6) of the Mediation Ethical Rules provides that "(...) the mediator may, when necessary and appropriate, suggest to the parties that they consider resolving their dispute through arbitration, neutral evaluation, advisory services, or other alternative dispute resolution methods," thereby confirming that pursuing arbitration after mediation is both possible and consistent with ethical standards. The key consideration in this hybrid dispute resolution process is that the dispute must be suitable for both mediation and arbitration procedures."

As a result, the decision held that: "As explained above, since it is possible to first resort to mediation and, if no agreement is reached, subsequently proceed to arbitration as an alternative dispute resolution method (Med-Then-Arb), it is legally permissible in a concrete dispute suitable for arbitration to first attempt mediation on a conditional basis and, upon failure to reach an agreement, proceed to arbitration."

With this assessment, the Court of Cassation reversed its earlier, heavily criticized decision from the previous year and explicitly accepted the Med-Then-Arb model, ruling on the basis that a mediation precondition does not invalidate the arbitration agreement.

Conclusion
 

When the decisions of the 3rd Civil Chamber of the Court of Cassation dated 2025 and 2026 are considered together, it is evident that a new line of jurisprudence has emerged, indicating that the inclusion of a mediation precondition in contracts containing an arbitration clause does not invalidate the arbitration agreement.
 

This approach reflects a more flexible interpretive stance that strengthens contractual freedom and allows for the combined use of alternative dispute resolution mechanisms.
 

In contract drafting, it remains crucial that mediation and arbitration provisions are drafted clearly, systematically, and without ambiguity to prevent future disputes regarding jurisdiction and validity.

References:
 

1- Court of Cassation, 3rd Civil Chamber, Merits No. 2025/225, Decision No. 2025/2164, Decision dated 15 April 2025.
2- Court of Cassation, 3rd Civil Chamber, Merits No. 2025/5452, Decision No. 2026/129, Decision dated 15 January 2026.