Private Law
kheyrollah hormozi
Abstract
The Civil Procedure Code has very briefly mentioned the submission of a declaration in Article 156 and in the section on incidental and security matters, but has not said anything about its nature and effects. Although it has not considered the submission of a declaration to have any significant effect ...
Read More
The Civil Procedure Code has very briefly mentioned the submission of a declaration in Article 156 and in the section on incidental and security matters, but has not said anything about its nature and effects. Although it has not considered the submission of a declaration to have any significant effect and has considered its submission to be an almost arbitrary matter, in the proceedings every action must have specific and determined effects. The former Civil Procedure Code had mentioned the submission of a declaration in Articles 709 and 710 in Chapter 10, which was entitled Damages and Compulsion to Perform an Obligation. It seems that the title of Chapter 10 of the former Civil Procedure Code was adapted from the title of Chapter 5 of the French Civil Code before the recent amendments, Damages and Benefits Resulting from Non-Performance of an Obligation. in French Civil Code considered the claim of a claim and an obligation as a condition for claiming damages . Therefore studying the nature and effects of the declaration requires studying the claim and obligation in French law. For this reason declaration in Iranian law and the claim of obligation in French law will be compared.
Private Law
Mirghasem Jafarzadeh; reza arabzadeh
Abstract
The assessment of the inventive step, a cornerstone of patent law, remains a complex challenge across legal systems. This study examines the role of secondary considerations in evaluating non-obviousness under U.S. jurisprudence, aiming to provide insights for improving Iran’s patent system. While ...
Read More
The assessment of the inventive step, a cornerstone of patent law, remains a complex challenge across legal systems. This study examines the role of secondary considerations in evaluating non-obviousness under U.S. jurisprudence, aiming to provide insights for improving Iran’s patent system. While primary considerations are central to initial patent examinations, secondary considerations play a critical role in litigation and validity challenges. The research highlights how U.S. courts have developed and applied these criteria to address ambiguities in patentability, particularly as technological advancements render traditional evaluations insufficient.The inventive step requirement, codified in Iran’s 1386 Patents, Industrial Designs and Trademarks Law and the 1403 Industrial Property Protection Law, is similarly emphasized in global frameworks such as the U.S. (35 U.S.C. §103), the European Patent Convention (Article 56), and China’s Patent Law (Article 22). However, evolving technologies and incremental innovations complicate the assessment of non-obviousness. Iran’s legal system, lacking robust doctrinal guidance, faces administrative and judicial inconsistencies in applying this criterion. By analyzing U.S. jurisprudence—renowned for its rich case law—this study identifies actionable secondary considerations to enhance Iran’s patent evaluation framework.Primary vs. Secondary ConsiderationsPrimary considerations involve ex-ante assessments by patent offices, focusing on whether a hypothetical skilled Person would find the invention obvious. Secondary considerations, however, are ex post facto factors used in litigation to corroborate non-obviousness. Examples include:U.S. courts began recognizing secondary considerations in the 19th century. Key cases include:Smith v. Goodyear Dental Vulcanite Co. (1876): The Supreme Court upheld a dental prosthesis patent, implicitly acknowledging commercial success as evidence of non-obviousness.Graham v. John Deere Co. (1966): Established a four-factor test for obviousness, explicitly endorsing secondary considerations like commercial success and long-felt need.KSR International Co. v. Teleflex Inc. (2007): Clarified that the “obvious to try” standard does not negate non-obviousness if prior art lacks guidance for predictable success.The AIPLA’s Model Patent Jury Instructions (2005) further systematized nine secondary factors, reinforcing their judicial acceptance.The most important secondary considerations:Obvious to Try TestUnder this criterion, courts assess whether foreseeable experiments lead to an invention. In other words, if the result of an experiment appears obvious, the applicant cannot claim a patent on the grounds that he has introduced a new product. In Pfizer v. Apotex (2007), the Federal Circuit upheld the validity of amlodipine besylate, noting that prior art did not suggest its superiority over alternatives. Conversely, in Pharmastem Therapeutics v. Viacell (2007), obviousness was affirmed despite unexpected success, as methods for stem cell preservation were deemed routine.Teaching Away/Unexpected SuccessThis criterion means that innovations that conflict with the teachings of the prior art are considered non-obvious. United States v. Adams (1966) validated a battery design despite prior warnings against its components. Similarly, McGinley v. Franklin Sports (2001) upheld a baseball training device, as prior art discouraged its design approach.Commercial SuccessThe success of a product or process in the marketplace can be seen as evidence of an inventive step. However, it is important to note that courts distinguish market success resulting from innovation from marketing skills. In Traitel Marble Co. v. Hungerford Brass (1927), the widespread adoption of a concrete-layering technique validated its inventiveness. However, Merck v. Teva (2005) rejected commercial success for an osteoporosis drug, attributing sales to regulatory exclusivity rather than novelty.Failure of OthersRepeated unsuccessful attempts by competitors strengthen non-obviousness claims. Edison Electric Light Co. v. United States Electric Lighting Co. (1892) upheld Edison’s lightbulb patent, emphasizing years of failed experiments by rivals. Similarly, Wach v. Coe (1935) validated a maritime invention after global engineering failures.Long-Felt NeedPersistent unmet industry demands signal non-obviousness. Rodman Chemical Co. v. Deeds (1919) upheld a carbonation method after decades of material waste in packaging. Kelley v. Coe (1938) validated a rock-drilling device, criticizing the Patent Office for underestimating the invention’s significance despite 30 years of industry demand.Copying by othersImitation by competitors, especially after failed independent efforts, indicates non-obviousness. Dow Chemical Co. v. American Cyanamid (1987) and Vandenberg v. Dairy Equipment (1984) linked copying to the invention’s technical merit.Challenges and LimitationsSecondary considerations are not standalone proofs but corroborative tools. Courts dismiss them if primary evidence overwhelmingly indicates obviousness. For instance, in Richardson-Vicks v. Upjohn (1997), combining ibuprofen and pseudoephedrine was deemed obvious despite commercial success, as prior art suggested such combinations. Similarly, SSP Agricultural Equipment v. Orchard-Rite (1979) rejected secondary factors where the invention’s obviousness was unequivocal.
Private Law
javad niknejad
Abstract
Joint-stock companies may be dissolved for various reasons, as specified in the 1968 Act Amending a Part of the Commercial Code. The authority for dissolution may rest with the extraordinary general assembly of the company or with a body designated by the legislature. Upon dissolution and the appointment ...
Read More
Joint-stock companies may be dissolved for various reasons, as specified in the 1968 Act Amending a Part of the Commercial Code. The authority for dissolution may rest with the extraordinary general assembly of the company or with a body designated by the legislature. Upon dissolution and the appointment of one or more liquidators, the company enters the liquidation phase, during which its debts must be settled, claims collected, and, ultimately, any remaining assets distributed among its shareholders. A question of considerable legal importance arises: if a person or persons with standing successfully obtain a judicial ruling from a competent court declaring the decision to dissolve the company null and void—given that such a judgment is declaratory in nature—what effect does this ruling have on the transactions the company in liquidation has entered into with third parties concerning its assets during the liquidation period and prior to the issuance of the final court decision declaring the dissolution null and void? In response to this question, it must be noted that neither judicial practice has yet had the opportunity to address it, nor have legal scholars—particularly those specializing in commercial law—dealt with this issue. However, upon closer legal analysis, two distinct approaches may be identified. One approach is the traditional one, in line with existing solutions in civil law and Shi'a jurisprudence. Under this approach, upon issuance of a judicial ruling declaring the dissolution void—and considering the retroactive and absolute nature of nullity, and that nullity yields no legal effect—it may be concluded that any sale contract concluded by the company during liquidation is null and void. However, adopting this approach is not only inconsistent with the spirit of commercial law and the 1968 Amendment—which aims to protect third parties—but also gives rise to numerous legal anomalies. Among them: in the event of nullity of the contract with the third party, to whom may such party turn to claim compensation or, where applicable, restitution of the paid consideration? If the answer is that the third party must refer to the company in liquidation, it must be said that, following the issuance of the aforementioned judgment, there is no longer a company in liquidation to which the third party may turn for remedy. If the answer is the reconstituted company, such reasoning defeats the purpose; and if the company is obligated to compensate the third party contracting with the company in liquidation, then what is the utility or benefit of the nullity in question for the company? If the answer is that the liquidators of the company during liquidation are liable to the third party, it must be noted that, due to the representative nature of their role, such recourse faces legal impediments. If the correct answer is that the third party has no recourse whatsoever, then such a result conflicts with the principle of la darar (no harm). The second approach holds that given the third party contracted with the company in good faith—and in view of the overarching commercial law framework that prioritizes the protection of bona fide third parties, as well as the doctrine of appearance—the company may not rely on the judgment of nullity to claim invalidity of contracts concluded by the liquidators during liquidation with third parties. The nullity of the dissolution is not enforceable against third parties. Non-opposability is a legal status under which a legal institution—whether a legal act or fact—is invalid and without effect vis-à-vis the principal parties, yet remains valid and effective toward third parties. The author’s hypothesis is that a judicial declaration of nullity of the dissolution decision is not enforceable against bona fide third parties who have entered into contracts with the company. This is supported by an inductive analysis of the Commercial Code and the 1968 Amendment, including Article 270, the doctrine of appearance, the rule against organizational objections, the principles governing commercial law, and so forth. It can thus be concluded that, in principle, the nullity of the company and the acts and decisions of its corporate organs cannot be asserted against third parties. This theory is also consistent with Islamic legal principles such as la darar (no harm), iqdam (voluntary assumption of risk), and ghurur (detrimental reliance). The legal status of non-opposability of nullity against third parties is also economically efficient.
International Trading
seyed mohammadjavad hosseini; Ebrahim Abdipourfard
Abstract
This study undertakes a comparative analysis of notices in international sale of goods contracts, contrasting the structured framework of the United Nations Convention on Contracts for the International Sale of Goods (CISG, 1980) with the diverse, context-dependent rules of Iranian law. Notices, defined ...
Read More
This study undertakes a comparative analysis of notices in international sale of goods contracts, contrasting the structured framework of the United Nations Convention on Contracts for the International Sale of Goods (CISG, 1980) with the diverse, context-dependent rules of Iranian law. Notices, defined as formalized communications conveying intent, rights, or obligations, are fundamental to regulating contractual relationships across the formation, performance, and termination phases. Employing a descriptive-analytical methodology and library-based resources, this research examines the CISG’s dual approach—applying the receipt theory for contract formation (Article 24) and the dispatch theory for performance (Article 27)—and compares it with the fragmented framework of Iranian law. The findings highlight the CISG’s cohesive and predictable system, which fosters efficiency in global trade, while Iranian law’s lack of uniformity creates challenges in international transactions, particularly given Iran’s non-accession to the CISG. The study proposes a regulatory framework to align Iranian law with international standards, enhancing its compatibility with global commercial practices.Under the CISG, notices encompass declarations, requests, warnings, or other communications and are critical at every contractual stage. The CISG adopts a dual approach to notice effectiveness: the receipt theory mandates that formation-related notices reach the addressee to take effect (Article 24), while the dispatch theory shifts the risk of delay or non-delivery to the addressee for performance-related notices sent through appropriate means (Article 27). This dual framework balances certainty during contract formation with operational efficiency during performance, accommodating the dynamic needs of international trade. The CISG permits oral, written, or electronic notices under the principle of informality (Article 11), allowing flexibility unless the parties agree on specific forms or trade usages that dictate otherwise. Electronic notices are recognized if the recipient consents, aligning with modern commercial practices as supported by the United Nations Convention on the Use of Electronic Communications in International Contracts (2005). Effective notices require timely dispatch, precise content, and appropriate communication methods. For instance, notices addressing non-conformity (Article 39) or contract termination (Article 26) must be specific and sent within a reasonable timeframe to preserve rights or trigger obligations, such as liability for damages (Article 74). The CISG distinguishes notice revocability: formation notices can be revoked before receipt, while performance notices are effective upon dispatch. The burden of proof also varies—senders must prove dispatch and receipt for formation notices but only dispatch for performance notices. Judicial interpretations emphasize clarity, specificity, and timeliness, ensuring notices are legally enforceable.In contrast, Iranian law, grounded in Islamic jurisprudence and the Civil Code, lacks a unified approach to notices, with rules varying by legal act—contracts, unilateral acts, or statutory requirements. In contracts, Article 191 emphasizes the expression of intent, with some jurists endorsing the dispatch theory, where sending an acceptance (e.g., mailing a letter) forms the contract, and subsequent delays do not affect validity. For unilateral acts like termination, Article 449 permits termination without notice, contrasting with the CISG’s requirement for explicit notification (Article 26). Iranian law’s notice formalities are inconsistent: some cases require no notice (e.g., termination), others mandate notice without prescribed forms (e.g., damages under Article 226), and some demand strict written declarations, as seen in the Landlord and Tenant Act of 1977 or the Pre-Sale of Buildings Act. Certain provisions adopt the receipt theory, requiring addressee awareness, such as agent dismissal (Article 680). Notices can also alter legal relationships, shifting a possessor’s status from fiduciary to wrongful (Article 171, Civil Procedure Code). While this flexibility suits domestic contexts, it creates ambiguity in international trade, where predictability is essential. Recent legislation, such as the 2024 Law on Mandatory Registration of Real Estate Transactions, signals a shift toward formal notices, suggesting gradual alignment with global norms.The CISG’s structured rules on notice timing, content, and methods provide a robust model for international trade, while Iranian law’s variability undermines predictability in cross-border transactions. The CISG’s informality, tempered by contractual or customary requirements, partially aligns with Iranian law’s lack of mandatory forms, but Iran’s inconsistent application of dispatch, receipt, or no-notice theories hinders its global efficacy. To address this, the study proposes: “In international sale contracts, notices must be written unless otherwise agreed. Formation notices are effective upon receipt; performance notices upon dispatch by appropriate means. The addressee bears delay or non-delivery risks during performance, unless otherwise stipulated.” This regulation ensures clarity, preserves contractual freedom, and aligns with the CISG’s risk allocation, facilitating Iran’s integration into global trade.In conclusion, the CISG’s balanced framework enhances international commerce, while Iranian law’s lack of uniformity limits its effectiveness. The proposed regulation offers a pathway to strengthen Iran’s legal system, fostering coherence and commercial efficacy in global transactions
Private Law
Laya Joneydi; Sajjad Ghasemi
Abstract
Based on the general principles of contract law, including the necessity of performing obligations and the binding force of contracts, the parties are assumed to fulfill their commitments only if they carry out all contractual obligations and conditions according to the agreed quantity and quality. Consequently, ...
Read More
Based on the general principles of contract law, including the necessity of performing obligations and the binding force of contracts, the parties are assumed to fulfill their commitments only if they carry out all contractual obligations and conditions according to the agreed quantity and quality. Consequently, any defects, flaws, or incompleteness in the contract grant the other party the right to invoke the remedies for breach of obligation. Regarding the obligee's right to invoke breach remedies, there are two approaches within legal systems. In the classical approach, all contractual obligations and conditions have equal importance, allowing the obligee to use the failure to fulfill certain minor and ancillary conditions as grounds for terminating the contract or resorting to other remedies. In the newer approach, exemplified by the 2016 amendments to the French Civil Code, the obligee's right to rely on breach remedies is determined in proportion to the scope and impact of the breach. For instance, resorting to specific performance is conditioned on the good faith of the obligee and the avoidance of imposing excessive costs on the obligor, or contract termination is only available in the case of a serious and significant breach. This approach ties the obligee's right to invoke breach remedies to factors such as circumstances, the intent of the parties, the seriousness of the obligor's breach, and its effect on the obligee's expected interests.One area where the moderation of the obligee’s right to use breach remedies has been considered is the assumption of substantial performance by the obligor. Substantial performance exists when the main part of the contract, which secures the obligee's primary benefits from the contract, is executed in good faith by the obligor, and the incompleteness of the contract is solely due to minor deficiencies in the work or minor non-conformities of the delivered goods or services with the terms of the contract, provided that two other important conditions are also met. First, the deficiencies or incompleteness of the contract do not affect the expected interests of the obligee, and second, these deficiencies can be reasonably compensated by paying an amount of money as damages or reducing the contract price. The theory of substantial performance, as proposed in common law, constitutes an exception to the principle of the necessity of fully executing contracts. This theory posits that with the substantial performance of the contract, that part of the contract is executed, and there remains the possibility of claiming damages or reducing the contract price for the deficiencies, thereby moderating the primary remedy for breach of obligation in common law, namely contract termination. This theory aligns with the moderation of breach remedies in civil law systems; in such systems, under relatively similar conditions to substantial performance, the possibility of resorting to the primary remedies for breach of obligations, which involve the obligation to specific performance of the contract and then the right to terminate, is limited. In previous studies, efforts have been made to moderate the traditional structure of breach remedies in Iranian law, such as the possibility of preliminary termination or the prevention of abuse of rights; however, this research seeks to answer the question of whether, within the framework of Iranian law, it is also possible to acknowledge the moderation of the obligee's powers when resorting to breach remedies in cases of substantial performance of the contract or whether it must be believed that any level of breach of obligation completely gives freedom to the obligee to utilize remedies. In this regard, while discussing the theoretical foundations, practical aspects and the interests of the obligee should be considered alongside the imperative of not harming the obligor in good faith. To answer these questions, a preliminary discussion regarding the principle of the necessity of complete contract execution has been conducted, followed by exceptions and the moderation of the obligee's right in comparative law. Finally, the foundations of the two approaches—non-acceptance of the theory of essential performance and acceptance of it for final arbitration—have been analyzed.This research, using a descriptive-analytical and comparative law method, analyzes the feasibility of its acceptance in the Iranian legal system. The conclusion is that, based on the principle of good faith and the analysis of the parties' intentions, such an approach can be accepted in Iranian law
Private Law
Seyyed Ali Kahangi Shahreza; Zahra Rokhsarizade; mohsen sadeghi,
Abstract
The principle of independence versus unity of management and ownership in commercial enterprises represents a foundational debate in corporate governance, reflecting divergent legal philosophies and institutional practices across jurisdictions. This study conducts a comparative legal analysis of Iranian ...
Read More
The principle of independence versus unity of management and ownership in commercial enterprises represents a foundational debate in corporate governance, reflecting divergent legal philosophies and institutional practices across jurisdictions. This study conducts a comparative legal analysis of Iranian and U.S. corporate law to evaluate the efficacy, structural challenges, and normative implications of these competing paradigms. By adopting a qualitative, analytical-doctrinal methodology, the research examines the historical evolution, conceptual frameworks, and practical outcomes of corporate governance models in both systems, with a focus on their alignment with global governance standards and dynamic capital market demands.In Iran, corporate governance remains entrenched in the Continental European model, emphasizing the unity of management and ownership. This approach, historically influenced by French commercial law, mandates that directors hold equity stakes in the company, theoretically aligning their interests with shareholders. However, the study identifies critical structural flaws in this model, including concentrated ownership patterns, opaque informational practices, and inadequate accountability mechanisms. These issues exacerbate agency costs, entrench majority shareholder dominance, and marginalize minority stakeholders. Legal provisions requiring directors to hold qualifying shares, intended to incentivize responsible management, paradoxically restrict access to external expertise and create barriers to professional governance. Furthermore, Iran’s regulatory framework lacks robust safeguards against conflicts of interest, enabling managerial opportunism and undermining investor confidence.By contrast, the U.S. corporate governance system, epitomizing the Anglo-American model, institutionalizes the separation of ownership and control through precise regulatory mechanisms and market-driven accountability. Post-Enron reforms, particularly the Sarbanes-Oxley Act (2002), redefined governance standards by mandating independent director majorities on boards, enhancing audit committee autonomy, and enforcing rigorous disclosure requirements. Stock exchange regulations, such as those by the NYSE and NASDAQ, further operationalize independence by disqualifying directors with material financial or familial ties to the company. These measures mitigate agency problems, promote transparency, and align managerial actions with shareholder welfare. The U.S. system’s adaptability to financial crises—evidenced by iterative reforms after the 2008 global crisis and COVID-19 pandemic—highlights its resilience and capacity to balance stakeholder interests through iterative, evidence-based policymaking.The study underscores the theoretical underpinnings of these models. Proponents of managerial independence argue that it curtails majority shareholder expropriation, reduces informational asymmetry, and fosters equitable decision-making through impartial oversight. Independent directors, devoid of material ties to the company, are posited to prioritize organizational welfare over factional interests, thereby enhancing board efficacy and financial reporting quality. Conversely, advocates for the unity of ownership and management contend that shared equity stakes align incentives, reduce agency costs, and ensure managerial accountability to residual claimants. However, empirical evidence from Iran reveals that concentrated ownership often perpetuates “tunneling” practices, where controlling shareholders divert resources at the expense of minority investors, while regulatory gaps enable earnings manipulation and suboptimal capital allocation.The research further analyzes the systemic consequences of each paradigm. In Iran, the fusion of ownership and control stifles market dynamism by deterring external investment and professional management. Restrictions on non-shareholder directors limit access to specialized expertise, hindering strategic innovation and operational efficiency. Conversely, the U.S. emphasis on independent governance, while not without critiques of over-regulation and boardroom inefficiency, correlates with higher investor confidence, liquidity, and market resilience. The study identifies critical disparities in disclosure practices: U.S. mandates for real-time financial reporting and auditor independence contrast sharply with Iran’s fragmented and often retrospective disclosures, which impede stakeholder oversight.The study concludes with prescriptive recommendations for Iran’s corporate governance reform. Foremost, it advocates institutional separation of management from ownership by abolishing mandatory director shareholding requirements, thereby attracting professional managers and diversifying board expertise. Enhancing transparency through standardized, real-time financial disclosures and independent auditing mechanisms is deemed essential to reducing informational asymmetry. Integrating independent directors into board structures—particularly in audit and nomination committees—would mitigate conflicts of interest and align Iranian practices with global benchmarks. Additionally, fostering shareholder activism through enhanced minority rights and derivative action provisions could counterbalance majority dominance. Legislative reforms should prioritize adopting a principles-based governance framework, akin to the U.S. Model Business Corporation Act, to ensure flexibility and adaptability to market evolution.In parallel, the study acknowledges contextual challenges. Iran’s economic sanctions, political economy constraints, and underdeveloped capital markets necessitate phased reforms. Hybrid models, blending localized practices with incremental adoption of Anglo-American norms, may offer pragmatic pathways. For instance, the gradual introduction of independent directors in listed companies, coupled with training programs to build governance literacy, could ease transition costs. Strengthening regulatory bodies like the Tehran Stock Exchange to enforce compliance and penalize governance violations is critical to institutionalizing accountability.Ultimately, this comparative analysis illuminates the dialectic between legal tradition and economic pragmatism in corporate governance. While Iran’s historical preference for unity reflects civil law influences and centralized economic planning, globalization and capital market integration demand convergence toward transparency and accountability. The U.S. experience demonstrates that regulatory rigor, coupled with market discipline, can reconcile shareholder primacy with broader stakeholder welfare. For Iran, systemic reform is not merely a legal imperative but a strategic necessity to attract investment, enhance competitiveness, and participate meaningfully in the global economy.
