This was an appeal from a judgment of the abolished Maritime Specialised Court (2006/300-2008/273).

The plaintiff insurer filed a claim against the defendants, Demir Finansal Kiralama AŞ, the owner of the vessel The Doğruyollar IV, and Doğru Yol Gemisi İşletmeciliği AŞ, the vessel's operator, for damages arising from the loss of cargo during carriage. The insurer had provided coverage for a shipment of lead concentrate carried on the vessel, and paid USD 634,125.32 in compensation after the vessel sank on 1 February 1998. The plaintiff alleged that the sinking resulted from excessive cargo load and the vessel's unseaworthiness, arguing that the carrier was responsible for delivering the cargo safely. Furthermore, the plaintiff contended that the defendants misrepresented the existence of liability insurance, which was a fundamental element of the contract, and sought to hold both defendants jointly liable under art 17.2 of the Financial Leasing Law (No 3226 FLL).

The first defendant, Demir Finansal Kiralama AŞ, argued that it was not responsible for the loss, citing arts 7 and 17 of the FLL. The second defendant, Doğru Yol Gemisi İst AŞ, denied liability, asserting that the vessel possessed all required seaworthiness certifications, that the cargo was not overloaded, and that the carrier was not liable for losses resulting from perils of the sea. The second defendant also claimed that the vessel was covered by liability insurance and that, in any event, the shipowner's liability was limited to the vessel's value.

The Commercial Court of First Instance found that the vessel was seaworthy, was not overloaded, and had been navigated with due care. The Court held that the cargo was properly stowed but shifted due to stormy sea conditions of force 6-7 on the Beaufort scale, causing the vessel to sink. Based on art 1063.7 of the abolished Turkish Commercial Code (No 6762 TCC) [based on art 4.2.m of the Hague Rules and the Hague-Visby Rules], which exempts the carrier from liability for losses arising from inherent defects in the cargo, the Court ruled that the shipowner was not liable for the loss. Additionally, the Court applied art 948 of the TCC [based on art 1 of the LLMC 1924], concluding that since the vessel had sunk, the shipowner bore no liability as its responsibility was limited to the vessel’s value. The Court also dismissed the claim against Demir Finansal Kiralama AŞ, holding that as the lessor, it could not be sued under the FLL.

The plaintiff appealed to the Supreme Court of Appeal, arguing that the vessel sank in conditions that did not constitute force majeure and that the primary cause was cargo shifting, as confirmed by expert reports.

The Supreme Court of Appeal ruled in favour of the plaintiff, finding that the trial Court failed to sufficiently examine whether the vessel's holds were properly prepared to secure the specific cargo type. The Court instructed that further investigation was necessary regarding the presence and adequacy of wooden partitioning in the cargo holds, which should have prevented shifting. The Court also held that a new expert assessment was required, involving an ocean-going master experienced in transporting bulk lead-zinc concentrate.

On remand, the trial Court reconsidered the case and accepted new expert reports. The revised findings stated that the vessel was seaworthy at the commencement of the voyage and had been equipped with wooden partitions using planks from the previous voyage and newly purchased timber. However, due to the vessel's structural characteristics and exposure to force 6-7 winds, the shifting cargo broke through the partitions, contributing to the sinking. The Court held that the shipowner was not liable under art 1062.2 of the TCC [based on art 4.2.a of the Hague Rules and the Hague-Visby Rules], which exempts the carrier from liability for loss or damage arising from the act, neglect, or default of the master or crew in the navigation or management of the ship. The Court reasoned that the vessel had initially been seaworthy and only became unseaworthy due to subsequent unforeseen conditions. It also reaffirmed that Demir Finansal Kiralama AŞ was not liable, as it was merely the lessor.

The plaintiff appeal to the Supreme Court of Appeal.

Held: Appeal upheld.

The Supreme Court of Appeal found that the expert findings relied on assumptions and failed to consider whether the partitions were structurally sufficient for the specific cargo type under normal conditions. The Court ruled that a new expert opinion was required to assess whether the vessel's cargo holds had been adequately prepared to prevent shifting. The Court also found that the trial Court failed to rule on the plaintiff's fraud allegation regarding the misrepresentation of liability insurance, despite this issue having been raised in the initial proceedings.

The Supreme Court of Appeal overturned the trial Court's ruling in favour of the plaintiff, ordering a retrial to address the adequacy of the cargo securing arrangements and the liability insurance misrepresentation claim.