Theory of Efficient Breach of Contract

Pages 5-28

https://doi.org/10.22034/jpl.2025.732002

Mohammad Hadi Rostami, Seyyed Mostafa Mohaghegh Damad

Abstract Breach of contract is economically efficient only when the cost of contract enforcement for the obligor surpasses the resulting benefits, thus the obligor accepts payment to the obligee for the damages, placing him at a position of contract in force to avoid further damages to himself. The preconditions for efficiency in breach of contract requires the sum of damages be less than the real imposed damages and in financial assessment of the damage the personal value of the contract is not calculated in favor of the creditor, sufficing to a criterion only. Some legal criticisms are: neglecting ethical values, reducing planning capacity, elimination of profit for the seller of precious goods, and contradiction with the principle of freedom.
The legal and economic definition of efficient breach of contract, reviewing pertinent criticisms and a comparative study with the Western legal system are among the major achievements of this paper.
Apparently, despite all problems Iran’s legal system has to challenge with to have the theory accepted, thanks to its many advantages efforts should be maintained to pave the ground for translation of this theory into action in Iran. Some solutions to that end, are the following: reinforcing legal system in full compensation for the damages, admitting Pareto efficiency rule, giving priority to social benefits over individual gains, including some economically efficient concepts as prerequisites for realization of economic justice, admitting the theory in view of ethical values, proving its lack of contradiction with specific performance of the contract.

A Comparative Study of Coma and General Anesthesia and Brain Death in Iran’s Jurisprudence and Law

Pages 29-48

https://doi.org/10.22034/jpl.2025.732218

Hamed Hasaninia, morteza chitsazian

Abstract In this paper, we have first tried to define coma and then compare it with general anesthesia and brain death by resorting to the opinions of the jurists and latest medical findings. Unlike common belief, coma is not a disease; rather, it is a prolonged state of unconsciousness that results from damage to the person’s brain. In this paper, we will investigate the nature of coma and compare and contrast it with similar states of unconsciousness in the science of jurisprudence and law. The most important outcome of this study and the aforesaid comparison and contrast will emerge in the answer to the following question: What state of life is “the person in coma” in? There is an in-depth relation between humans’ life and death on one side and jurisprudence and law on the other side, in the sense that some rules are only applicable to death and the dead person while on the contrary, there are rules that are applicable to the person as long as he is alive and become inapplicable with the passing away of the person. Therefore, a precise examination of the concepts of life and death will be inevitable toward realizing the purpose of this paper.

A Comparative Study of Mortgage Contract and Its Establishment in Iranian and American Legal Systems

Pages 49-79

https://doi.org/10.22034/jpl.2025.732219

Farideh Shokri

Abstract According to Iranian legal system, despite the existence of fixed debt in an obligation, pledgee and its waiver, the mortgage contract shall be enforceable and the right of pledgee shall be established on the mortgaged object. This is done without any difference between the two stages of creation and establishment of the right of pledge. Even in the case of immovable mortgage it is obligatory to register the document. On the other hand, in Iranian legal system the principle of transferability of the mortgage – however briefly – has been officially recognized so that conclusion of a mortgage contract and the establishment of the right of pledgee is no obstacle to future transfer of mortgage or pertinent rights by the mortgagor in case it does not violate the rights of the pledgee. The rule of this principle, without special stipulations on establishment of the rights mentioned in the contract such as obligation to register the mortgage, will sometimes raise consequences such as dispute in discerning priority, reference to the superficial contracts containing the date of priority and consequently violating the rights of pledgee as well as legal dispute in courts and probably penal procedures. Whereas in many legal systems across the world, the US legal system for instance, there is a distinction between the two stages of concluding the mortgage contract or a pledge and stipulations for the establishment of the rights of mortgage for either side. In these legal systems, a distinction has been made between movable and immovable mortgage and establishment of the right of pledgee on each case requires finishing certain formalities otherwise, the right of the pledgee will be incomplete and the priority will be with the other party finishing the procedure. The question raised in this paper is this: Is it possible to make a distinction between the two stages in Iranian legal system with respect to the existing jurisprudential laws and the enforceable legal texts?

A Legal Analysis of the Effects of Abstract Payment Obligations

Pages 80-98

https://doi.org/10.22034/jpl.2025.735819

Fatemeh Behnam, Alireza Alipanah

Abstract Unilateral undertakings constitute a juridical act of a unilateral nature which, upon its formation, immediately gives rise to a binding obligation incumbent upon the issuer (the applicant/opening party). Until such time as the issuer effects payment of the amount of the credit to the beneficiary, the issuer acquires no enforceable right vis‑à‑vis the beneficiary.
The issuer’s obligations toward the beneficiary include: the duty to examine the documents; the duty to exercise due care and to act in good faith; the duty to notify the beneficiary of any discrepancies or non‑conformities; and the duty to pay the credit.
Upon payment of the credit amount, the issuer acquires certain rights against the beneficiary, including rights arising from the breach of warranties as to the genuineness, accuracy, and authenticity of the documents and from the absence of fraud, on the one hand; and, on the other hand, rights deriving from subrogation following payment.
The beneficiary, prior to receipt of the credit amount, bears no obligation toward the issuer or any secondary (confirming or nominated) bank. Evidently, upon presentation of the documents and receipt of payment, the aforementioned obligations become established upon the beneficiary.

Examining the theory of the validity of the construction condition from the perspective of imami jurisprudence and Iranian law

Pages 99-120

https://doi.org/10.22034/jpl.2026.2075251.1011

fatemeh esmaeili

Abstract Before the contract is one of the conditions on which jurists have disagreed. Famous jurists do not consider these conditions to be mandatory. On the other hand, many jurists believe in the legitimacy of this condition. In addition to the theoretical jurisprudential reasons for the invalidity of the construction condition, they cite other jurisprudential reasons to prove their theory, which of course are not without problems. Therefore, in jurisprudential texts, we do not find a definitive theory on the validity or invalidity of the construction condition. Iranian law, based on Article 1128 of the Civil Code, considers the above conditions to be mandatory. The most important legal reason for proving the necessity of the construction condition is the clarification of the validity of the construction condition in marriage and its extension to other contracts. The jurists have explicitly accepted the construction condition in marriage. According to jurists, when a foundation condition in marriage is valid despite its existing sensitivities, it should undoubtedly be binding in other aspects of contracts as well.In this article, we will first outline the jurisprudential texts of the theory of the validity of the construction condition and cite their evidence and critique, and then we will discuss the legal arguments for this theory and critique some of them, and we will try to prove this theory. Finally, we will refer to the jurisprudential document of the above article

Breach of Contractual Duty of Disclosure in Iranian, English, and French Law

Pages 121-154

https://doi.org/10.22034/jpl.2026.2079383.1023

Seyyed Hasan Hosseini Moghaddam, Ali Habibi

Abstract Undoubtedly, access to information related to goods and services constitutes one of the fundamental rights of the consumer. In today's world, where goods have become increasingly complex due to the significant growth of industry and technology, it is no longer possible to properly identify the characteristics, disadvantages, or method of use of a product through traditional means. This transformation has disrupted the informational balance between the contracting parties, leaving one party—typically the consumer—in an unequal position with regard to knowledge.Under such circumstances, to restore this balance, it becomes necessary to impose a duty of disclosure upon the informed party, namely the seller or the producer. For this reason, a theory known as "the duty to provide information in contracts" has emerged in legal literature. According to this theory, the party possessing greater knowledge and information regarding the subject matter of the contract is obliged to share that knowledge with the uninformed party. This duty responds to the needs of today's consumer-oriented society, in which the buyer must be informed of essential information concerning the goods or services.In Iranian law, this duty has not been explicitly and independently recognized; however, by examining certain existing laws and principles, traces of such a duty may be inferred. In English law, there is likewise no general duty of disclosure, but custom or trade usage may serve as an important basis for the formation of such an obligation. In contrast, the new French Civil Code explicitly addresses this matter and attaches such importance to the provision of material information that its omission may lead to the annulment of the contract. In the French legal system, this duty is not only binding but also constitutes a mandatory obligation (ordre public) that cannot be waived even by agreement of the parties.Breach of this duty by the informed party may entail significant legal consequences, the most important of which are the relative nullity of the contract (pursuant to Article 1131 of the French Civil Code) and the imposition of damages as a sanction against the breaching party. These sanctions differ across the legal systems of Iran and England. Moreover, in Iranian law, depending on the circumstances, such breach may lead to the nullity of the contract (due to mistake as to the subject matter) or its rescission based on the right to rescind for latent defect and fraudulent misrepresentation. In English law, likewise, assuming the existence of fraudulent misrepresentation, it may render the contract voidable. For this reason, in most legal systems, disclosure to the consumer has been recognized as a fundamental obligation of the supplier, encompassing such matters as the method of using the goods, warnings concerning risks, hidden defects, and even the provision of necessary advice.

Jurisprudential and Legal Study of the Concepts of Right and Decree

Volume 1, Issue 1, Winter 2030, Pages 5-38

https://doi.org/10.22034/jpl.2024.720220

Seyed Alireza Foroughi

Abstract Right in Islamic jurisprudence entails two meanings: First, right in its general sense, means property and decree and in its specific sense it means right. The examples for this denotation of right are the right of fatherhood, right of guardianship for the ruler, right of administratorship, right of custody and the like. Although these are interpreted as right in the literature of the jurisprudents, they are all examples of decree. Second, right in its particular sense is vis-à-vis property and decree. Therefore, it has been said that the jurisprudents who put right in front of property and decree, they mean a type of religiously obligatory decree, which is also called religious decree or the decree of the Legislator. However, in cases we consider decree in its general sense, either obligatory or enacted, it is clear that right (like property) is a type of enacted decree. Therefore, decree in its general sense is attributable to its particular meaning (second meaning).
On this basis, when right is compared and contrasted with decree, the denotative meaning of the two is involved and when in jurisprudence, jurists talk about the effects and consequences of right, like the capacity to waiver, and transfer, they mean that right possesses these effects as an enacted decree and its independent rational validity. On the contrary, the obligatory decree lacks such characteristics.
This paper is an attempt to study the relationship between obligatory decree and enacted decree, and as well as the viewpoints of theoreticians at law and the independent viewpoints. Attempts also have been made to discuss the criteria for distinguishing right from decree and the procedure and criteria for judgment when doubt is raised about right and decree. In case of the absence of criteria, what shall be the basis for performance?

A Study of the Procedures for Liquidating Bankrupt Banks (A Comparative Study of American and Iranian Legal Codes)

Volume 1, تابستان 1403, Winter 2030, Pages 47-74

https://doi.org/10.22034/jpl.2024.720993

Khadijeh Shirvani, Mohammad Isai Tafreshi

Abstract It was after the 1929 Great Recession in the United States that the world economy suffered heavy losses and Iranian officials began paying attention to the bankruptcy of the banks and its highly negative impacts on the national economy. Consequently, the lawmakers came to the conclusion that rules and regulations on bankruptcy of the commercial corporations are not sufficient for verifying bankruptcy of the banks – which are considered commercial corporations in kind. On this basis, the United States has tried to consider certain rules and regulations for bankruptcy of banks, thanks to their role in national economy and their differences from the commercial corporations. The bankruptcy code for banks and financial institutions in the United States is called Resolution Regime. It is the government’s legal framework that resolves a failed bank in an orderly way to prevent the collapse of financial markets and the country’s financial system, to continue key services by the banks and to prevent the burden of bankruptcy on the government and taxpayers.  In Iranian law, the bankruptcy regime of the banks is not a hundred percent apart from the bankruptcy of the corporations. In case of the bankruptcy of a bank, the Trade Law rules and regulations on bankruptcy will be considered as general rules and other monetary and banking rules and regulations will be particular ones. In case of the silence of the particular laws, the general rules and regulations will be applicable in case of the bankruptcy of the banks. In U.S. law, liquidation is the last step to deal with a bankrupt bank, while in Iranian law - since there is no substitute method for liquidation - the bankrupt bank starts liquidation immediately after receiving the order of bankruptcy.

Theory of Extinction of Original Obligations by Signing Commercial Papers

Volume 1, Issue 1, Winter 2030, Pages 113-129

https://doi.org/10.22034/jpl.2024.720235

Somayeh Ahmadi Majdabadi Farahani, Alireza Alipanah

Abstract The issuance and delivery of commercial papers do not mean fulfilment of payments or extinction of previous obligations; rather, it is with the hand-over of the commercial papers that both obligations under the commercial papers are met and the original obligations become extinct. Although commercial papers bear obligation per se, until before payments for commercial papers are made, the criterion for action will be original obligations.
There is, of course, difference of opinion among jurists on this rule, while it has been confirmed in the majority of the legal systems. However, there is another theory stipulating that issuing a commercial paper and handing it over to the creditor suffices for extinction of original obligations. The proponents of this theory believe in the "substitution of commercial papers". Although they accept the fact that a commercial paper means 'commitment to pay' not 'payment per se', they believe that the obligation coming from the commercial paper shall be replaced with the original obligation, suggesting that somehow a shift of obligation takes place.

The Nature and Conditions for Transfer of Professional Soccer Players

Volume 1, Issue 3, Winter 2030, Pages 98-128

https://doi.org/10.22034/jpl.2024.722987

Seyed Hamid Reza Mousavipour

Abstract The transfer contract of professional soccer player is the most important contract in this sport. According to this contract, the player is committed to play for a certain club within a certain period of time for a specified sum of money. Conclusion and termination of this contract are subject to special international and domestic rules and regulations that are quite distinctive from other contracts. Like a person’s hiring contract, this contract is a binding obligation that will be enforceable after signing of the two parties. The contract parties are the professional player and the sports club that must possess capacity to sign a contract. This contract is of binding obligation, thus it shall be only null and void with the consent of the parties or upon a justifiable excuse. Meanwhile, the contract parties should act based on bona fide. In this research work, we will first review the nature of contracts in Iranian law and then proceed with studying conditions for validity of the contract according to the international and domestic rules and regulations.

An Analysis of Dissolving Condition based on Evidence of Conditional Sale in Iranian Law and Imamiyah Jurisprudence

Volume 1, تابستان 1403, Winter 2030, Pages 5-23

https://doi.org/10.22034/jpl.2024.720554

Alireza Abin

Abstract A broad interpretation of the dissolving condition indicates that it is a condition realization of which revokes undertaking(s) between the obligor and the obligee and cancels the contract or other similar legal instruments from the beginning (with a retroactive effect). There is no express legal text on the rule of dissolving condition in domestic standing laws. This has given birth to diversified reasoning by the legal experts. Moreover, in legal terms, the approach followed by Imamiyah jurists vis-à-vis this legal institution is not identical so that some consider it problematic  based on such evidences as principle of definitiveness of conditions, inconsistency of dissolving condition with requirement of nature of condition and lack of legality of evidences on conditions. On the contrary, some believe in the soundness of the institution of dissolving condition based on the legality of the evidences on conditions. This paper is devoted to analysis of consequent opinions and approaches of experts to finally put forth its selected viewpoint on feasibility of soundness and use of such institution in Iranian law and Imamiyah jurisprudence and prove legal soundness of its application on attachment of Articles 232 and 233 of Civil Law to Articles 10 and 975 of the same law. However, it seems that the generality of evidences on conditions prove legality of conditions in creating or destroying the legal effects.

Fundamentals of "Principle of Unconditionality of Commercial Paper Obligations" in Iran's Jurisprudence and Law

Volume 1, تابستان 1403, Winter 2030, Pages 106-128

https://doi.org/10.22034/jpl.2024.720999

Farzaneh Karimi, Akram Safiri

Abstract The role commercial papers play in transactions and economic relations is this that they are appropriate substitutes for cash in payments. Along with easy, fast and safe transfer and turn-over, they guarantee the rights of the owner as well. Realization of this will be possible when obligations of the signatories of the papers are expressed absolutely and clearly, not conditioned to anything else. The prerequisites calling for unconditionality of commercial papers are considered among the fundamentals of this principle, which we have studied in this paper in two sections of "legal requirements" (the need for using commercial papers instead of cash, the need for meeting speed, ease and security in carrying and transfer of commercial papers and the need for protecting the rights of the commercial paper owners) and "jurisprudential requirements" (exigency of protecting property and preventing disruption in economic system).

Islamic Judicial System and Diversity of Courts

Volume 1, تابستان 1403, Winter 2030, Pages 75-105

https://doi.org/10.22034/jpl.2024.720996

Mohammad Ja’fari Harandi

Abstract The world today, compared to the past, has undergone several changes. Many of the yesteryear man's usual issues are done quite in a different manner. The procedure of Islamic judgement and arbitration is a part of jurisprudence that has not undergone the necessary changes yet. The question of this paper is: what are the needs to change Islamic juridical procedures and judicial system? Taking into account the religious principles, particularly legitimacy of the judge as well as distinction between arbitration on the divine rights and the people's rights based on jurisprudence, and also, arguing that social rights are distinct from the divine rights, attempts have been made in this research to propose some changes in the juridical procedures which include: setting up of different courts congruent with the nature of the forwarded cases such as individual personal rights, society's rights, and divine rights. The judges dealing with the first two groups of rights are to be elected by the people, while the judges handling the cases related to the divine rights and pertaining issues are to be appointed by the ruler of the Islamic state.

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