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The Role and Importance of Fault in Vehicle Depreciation 

September 17, 2025
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The Role and Importance of Fault in Vehicle Depreciation 

Entrance

Vehicle depreciation is one of the most debated and litigated issues following traffic accidents. When a vehicle is repaired after an accident, its market value decreases, resulting in economic loss for the owner. However, the critical question here is: What role does fault play in determining compensation for depreciation?

This article will examine the concept of vehicle depreciation, its legal basis, the scope of liability for damages, and especially the impact of the degree of fault on this liability . A comprehensive evaluation will be made in light of the Turkish Code of Obligations (TBK), the Highway Traffic Law (KTK), insurance legislation, and Supreme Court precedents.

1. The Concept of Vehicle Depreciation

1.1. Definition

Vehicle depreciation is the difference between a vehicle's pre-accident resale value and its post-repair value.

  • This difference stems from the decrease in value in the used car market caused by the "damage history" record (TRAMER, accident record, etc.) , even though the vehicle has been mechanically repaired

1.2. Legal Nature

Diminution in value material damage . Therefore, it falls directly of compensation law .

1.3. Purpose of Compensation

  • To restore the vehicle owner to the financial situation they would have been in if the accident hadn't happened.

  • To compensate for the difference in the vehicle's market value.

2. Legal Grounds

2.1. Turkish Code of Obligations (TBK)

  • Turkish Code of Obligations, Article 49: Tort liability.

  • Turkish Code of Obligations, Articles 50-52: Damage and causal link.

  • Turkish Code of Obligations, Article 112: Liability arising from breach of contract.

Vehicle depreciation is claimed under tort liability.

2.2. Highway Traffic Law (KTK)

  • Article 85 of the Traffic Law: Responsibility of the motor vehicle operator.

  • The vehicle owner and driver are liable for damages in proportion to their fault.

2.3. Compulsory Financial Liability Insurance (Traffic Insurance)

  • The insurer's liability is limited to the degree of fault of the driver and the operator.

  • Depreciation in value is also covered by insurance.

3. Conditions for Vehicle Depreciation Compensation

3.1. A Valid Traffic Accident

  • The accident must have happened on the highway.

  • The vehicle that caused the accident must be at fault.

3.2. Vehicle Damage Requiring Repair

  • The vehicle must have undergone repairs that would reduce its value, not just cosmetic scratches.

3.3. Defect

  • To be able to claim for diminished value, the other party must be at fault.

  • The degree of fault directly affects the amount of compensation.

3.4. Causal Link

  • The decrease in value must be directly attributable to the accident.

4. The Role of Fault

4.1. Total Defect

If the other party is found to be 100% at fault, the vehicle owner will be compensated for the full decrease in value.

4.2. Contributory Negligence

If the owner of the damaged vehicle is also partially at fault, a reduction in compensation will be applied in accordance with Article 52 of the Turkish Code of Obligations.

  • For example, if the other party is 70% at fault and the injured party is 30% at fault, then 70% of the depreciation in value will be compensated.

4.3. Absence of Defects

If there is no fault (e.g., force majeure, technical malfunction), no compensation will be given for the decrease in value.

5. Problems in Implementing Defect Detection

5.1. Expert Reports

  • Depreciation in value is usually determined by expert reports.

  • However, experts may have different assessments regarding the degree of fault.

5.2. Cross-Defect Cases

  • In chain-reaction accidents, determining fault can be difficult.

  • In this case, the courts determine fault through expert examination.

5.3. Objections of Insurance Companies

  • Insurance companies often refuse to claim compensation for depreciation or underestimate its value.

  • That's why lawsuits take so long.

6. Methods for Calculating Diminution in Value

6.1. Insurance Adjusters Regulation Formula

In Turkey, depreciation is calculated according to criteria determined by the Insurance Information and Supervision Center

  • The vehicle's age, mileage, the nature of the damage, and the condition of the parts are all taken into consideration.

6.2. Judicial Practice

  • Courts generally rely on expert reports.

  • However, calculations outside of the formula are also possible.

6.3. Defect Discount

The calculated depreciation is reduced according to the degree of defect.

7. Legal Basis of Fault

7.1. Turkish Code of Obligations (TBK)

  • Turkish Code of Obligations, Article 49: Anyone who causes harm to another through a culpable and unlawful act is obligated to compensate for that harm.

  • Turkish Code of Obligations, Article 52: If the injured party's own fault contributed to the damage, the judge may reduce the compensation.

➡️ These provisions clearly demonstrate the decisive role of fault in determining compensation for vehicle depreciation.

7.2. Highway Traffic Law (KTK)

  • Article 85 of the Turkish Traffic Law: The operator of a motor vehicle is liable for damages arising from the operation of the vehicle.

  • However, the fault of the driver or operator determines the scope of compensation.

7.3. Insurance Law

  • The General Terms and Conditions of Compulsory Motor Insurancestipulate that the depreciation in value will be covered by the insurance of the party at fault.

  • The insurance company is obligated to pay compensation in proportion to the insured's fault.

8. The Role of Experts and the Court in Determining Fault

8.1. Expert Examination

  • In traffic accidents, the degree of fault is usually by expert reports .

  • Experts determine the extent of fault based on the crime scene sketch, reports, witness statements, and technical examinations.

8.2. The Judge's Discretion

  • The expert report is not binding.

  • The judge reviews the report and requests additional reports if necessary.

8.3. Technical Aspects of the Defect

  • Technical factors such as speeding, running red lights, lane changes, and following distance are taken into consideration.

  • In a vehicle depreciation lawsuit, clearly determining fault directly affects the amount of compensation.

9. Liability of Insurance Companies

9.1. Scope of Coverage

  • Motor insurance covers damages proportional to the driver's fault.

  • This damage covers not only repair costs but also the decrease in value

9.2. Reasons for Refusal of Insurance Claim

  • Insurance companies often refuse to pay out for the following reasons:

    • Objection to the fault percentage,

    • Understating the loss of value,

    • The age or mileage of the vehicle,

    • A history of previous accidents.

9.3. Recourse to Judicial Review

  • If the insurance claim is rejected, the vehicle owner can file a lawsuit directly.

  • The court may hold the insurance company, the driver, and the operator jointly and severally liable.

10. Examples of Contributory Negligence

10.1. Not Wearing a Seatbelt

  • Although not directly related to vehicle depreciation, it is a reason for a reduction in the total compensation.

10.2. Speeding Violation

  • Exceeding the speed limit at the time of the accident increases the fault rate.

  • If the owner of the damaged vehicle acts quickly, the compensation for the decrease in value will be reduced.

10.3. Red Light and Intersection Violations

  • In intersection accidents, it is common for both parties to be at fault.

  • In this case, both parties will compensate for the decrease in value in proportion to their respective faults.

10.4. Parking Ban Violation

  • A vehicle parked despite the prohibition will be considered at fault in a collision.

  • In a claim for diminished value, this defect results in a reduction.

10.5. Lane Change

  • In lane violation accidents, fault may be shared.

  • Contributory negligence is directly reflected in the depreciation calculation.

11. The Causal Link Between Defects and Loss of Value

  • A direct causal link must be established between the defect and the loss of value .

  • For example, if the vehicle has been involved in another accident in the past, the depreciation in value resulting from the new accident will only based on the impact of that most recent accident .

  • The Supreme Court, taking into account past damage records, states that the decrease in value resulting from previous damages cannot be attributed to the new accident.

14. The Effect of Defects in Practice on Vehicle Depreciation Calculation

14.1. Expert Reports and Fault Rate

  • In Turkey , the Insurance Information and Monitoring Center (SBM) formulas are used as the basis for calculating vehicle depreciation

  • However, the final calculated value is paid by the insurance companies, taking into account the fault ratio of the parties

For example:

  • Vehicle depreciation = 50,000 TL

  • The other party's fault rate = 60%

  • The insurance company will pay 30,000 TL.

14.2. Calculation in Cases of Cross-Defects

  • In accidents where both vehicles are at fault, each party is held liable in proportion to their own degree of fault.

  • In this case, the decrease in value for both parties is calculated mutually and offset.

14.3. Implementation of Judicial Decisions

  • The Supreme Court explicitly states that contributory negligence constitutes a necessary reason for reduction in compensation for diminished value

  • Courts render judgments based on the degree of fault determined by expert reports.

15. Lawyers' Defense Strategies in Disputes

15.1. Objection to the Fault Rate

  • The traffic expert reports are challenged in relation to the determined fault percentage against the client.

  • A new expert report may be requested.

15.2. Effect of Previous Damages

  • The impact of previous damage to the vehicle on its depreciation should be limited.

  • The lawyer can argue that only the loss resulting from the most recent accident should be compensated.

15.3. Defense Against the Insurance Company

  • Insurance companies' low payout offers can be rejected.

  • Technical reports can be used to challenge expert reports.

15.4. Contributory Negligence Defense

  • In cases where the other party is also at fault, a reduction in compensation may be requested on behalf of the client.

15.5. Interest and Court Costs

  • In compensation claims for diminished value, lawyers must ensure the best possible outcome for their clients by accurately specifying the interest commencement date and litigation costs.

16. Reform and Legislative Proposals

16.1. Standardization in Defect Detection

  • Fault percentages are still subject to expert opinion.

  • More objective criteria should be introduced to ensure consistency.

16.2. Updating the Criteria for Calculating Diminution in Value

  • Current calculation formulas do not fully reflect current market conditions.

  • Factors such as vehicle age, brand value, and the used car market should be considered in more detail.

16.3. Supervision of Insurance Companies

  • Insurance companies' arbitrary refusal or underpayment practices must be brought under control.

  • The powers of the Insurance Arbitration Commission should be expanded.

16.4. Expediting the Judicial Process

  • Vehicle depreciation lawsuits can drag on for years.

  • The process should be shortened through specialized courts or expedited trial procedures.

16.5. Codification of Supreme Court Case Law

  • The established rulings of the Supreme Court should be codified at the legal level, eliminating ambiguities in their application.

17. Conclusion

Vehicle depreciation is one of the most significant financial consequences of traffic accidents. Even with thorough repairs, a vehicle will lose value in the used car market after an accident.

At this point faultis the most critical factor in determining compensation.

  • If the fault lies entirely with the other party, the damages will be fully compensated.

  • If there is contributory negligence, the compensation is reduced in proportion to the degree of negligence, in accordance with Article 52 of the Turkish Code of Obligations.

  • If no fault is found, the claim for diminished value will be rejected.

In conclusion, accurate determination of faultis a decisive factor in both insurance payments and court decisions. For a fair and predictable legal system, objective, swift, and transparent fault determination is of paramount importance.

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