Jurisprudential-Legal Analysis of Custody Rights with Emphasis on Conceptual Paradox and the Theory of Modern True Composition
Pages 1-42
https://doi.org/10.22054/jplr.2026.89011.2972
Hojjatollah دهقانی
Abstract 1. Introduction The institution of custody is at the center of the intersection of parental rights, their duties, and the best interests of the child. The main issue of this research is the existence of a conceptual paradox in the legal nature of custody, which in legal provisions such as Article 1168 of the Iranian Civil Code is considered to be both a “right” and a “duty” of parents. This seemingly contradictory duality raises a fundamental question about how the authority arising from the right and the obligation arising from the duty can be combined in a single institution. This paradox creates interpretive tensions in judicial rulings and scholarly discourse. While parental authority suggests discretionary power, the duty component imposes mandatory care, creating potential conflicts. This study aims to analyze this dual nature through jurisprudential foundations and legal principles to propose a coherent theoretical framework for resolving custody disputes while prioritizing the child's welfare in Islamic and Iranian law. Research Question(s) The primary research question guiding this investigation is: How can the authority derived from a right and the obligation derived from a duty be coherently reconciled within the singular institution of custody (haḍānat), thereby resolving its inherent conceptual paradox? Subsidiary questions include: What is the original ontological nature of custody? How does this nature transform in the context of parental conflict? And what are the precise legal implications of such a transformation? 2. Literature Review In reviewing the research background, three classical approaches can be identified: right-based (with an emphasis on parental authority), duty-based (with a focus on the nature of guardianship), and classical hybrid (custody as a combination of both). Recent studies have also sought to explain this relationship by separating concepts such as custody and guardianship, or by presenting staged models (such as the transformation of custody from a right to a duty in the event of refusal). However, the existing theoretical gap is the inability of these perspectives to provide a coherent and non-contradictory framework that can simultaneously explain the original nature of the institution, how it is transformed during the dispute stage, and the legal effects of this transformation. This study seeks to fill this gap. 3. Methodology This research is conducted using a descriptive-analytical method and based on library research. The scope of the research is the sources of Imami jurisprudence and Iranian statutory law (especially civil law), and it systematically criticizes existing perspectives to argue for the proposed theory. 4. Results and Discussion The analysis yields a central finding: the inherent, original nature of custody is guardianship-based (wilāyi) and fundamentally duty-based. It is an obligation tied to the guardianship of the child. However, a critical distinction emerges in the context of parental conflict. In this second stage, the legislator intervenes to resolve the dispute by legally creating a "Right of Custody" (haqq al-haḍānah). This is not the core duty of care but an "entitlement" or "privilege" granted to the parent deemed more suitable. Therefore, what is renounceable is the "claim to undertake the duty" during conflict, not the performance of the duty itself, which retains its obligatory nature. This distinction is the key to resolving the paradox of right and duty in custody. In fact, in the normal stage, parents are obliged to care for the child; however, when both parents claim the right to fulfill this duty, the law grants one of them the privilege of undertaking the duty. This privilege constitutes a legal right established by the legislator to resolve the conflict. This leads to the proposed "Two-Stage Model of Real Combination": · Stage 1 (Normal Status): Custody operates as a custodial duty (taklīf wilāyi). The best interests of the child are the overriding consideration. At Stage 1 (Normal Status), the duty-based aspect of custody predominates. · Stage 2 (Conflict Status): Custody manifests as an administrative right/privilege (ḥaqq intifāʿi). The best interests of the child are the primary criterion for awarding this privilege. At Stage 2 (Conflict Status), the right-based aspect of custody becomes prominent as a mechanism for resolving the dispute. This model, on the one hand, avoids reductionism by not reducing custody to either a mere right or a mere duty and, on the other hand, preserves the internal coherence of the institution of custody by distinguishing its different stages. Its practical application in the judicial system contributes to greater clarity in legal reasoning and to reducing prolonged disputes. 5. Conclusion This study concludes that the conceptual paradox in custody law stems from a conflation of two distinct operational stages of a single institution. The proposed "New Theory of Real Combination" and its "Two-Stage Model" resolve this paradox by providing a coherent, non-reductionist framework. By separating the duty-based essence of custody from the right-based mechanism for resolving conflicts, the theory offers a powerful analytical tool. It not only explains the existing jurisprudential doctrine but also provides a clear foundation for judicial reasoning, legislative reform, and achieving greater coherence in family law systems facing similar conceptual challenges.
The Role of Risk Assumption in the Legal Framework of Mistake Regarding the Subject Matter of a Contract
Pages 43-88
https://doi.org/10.22054/jplr.2026.91176.2994
Iraj Babaei, Somaye Abbasi
Abstract 1. Introduction
Every contract is based on a set of assumptions and mental perceptions of the parties regarding reality; perceptions that serve as the motive and foundation for the decision to conclude an agreement. These beliefs, which can be mutual or unilateral, concern various dimensions of the contract, including the subject matter, the identity of the counterparty, the purpose, and the governing regulations. Occasionally, these perceptions do not align with reality, creating difficulties in contractual relations that have led to the formation of the complex topic of "mistake" in contract law. In the Iranian legal system, the rules governing mistake are primarily justified based on the impairment of intention and consent. However, it appears that this foundation alone cannot adequately cover all dimensions and complexities of the issue, particularly in modern commercial relations. Managing uncertainty and allocating risk between the parties is an important function of a contract. Analyzing the doctrine of mistake without considering how the parties have allocated the risk of discrepancy between reality and their perceptions would be incomplete. When parties transact in an environment of uncertainty with awareness of their imperfect information, or when they expressly assume the potential consequences of an error, their perceptions are formed not on certainty but on the basis of probabilities. In such a scenario, the discovery that their perceptions were mistaken is the realization of a risk they had previously assumed.
2. Literature Review
Legal logic and the necessity of transactional stability dictate that if a party has assumed the risk of mistake, either expressly (e.g., through exemption clauses) or impliedly (by implication of custom, the nature of the transaction, or acting in a state of doubt), they cannot annul the contract by invoking the doctrine of mistake. This logic has led leading legal systems, such as those of the United States and France, as well as international documents like the UNIDROIT Principles and the Principles of European Contract Law (PECL), to recognize the "non-assumption of risk" as a fundamental condition for invoking mistake. In Iranian law, however, this condition has not been explicitly stated under its specific title in statutory texts and doctrine. Despite the fundamental importance of this topic, no comprehensive research has yet been conducted on the feasibility of applying the rule of risk assumption to contractual mistakes within the context of Iranian law. The innovative aspect of the present research lies in addressing these neglected considerations regarding risk assumption, which can reveal new and different dimensions of the debate on mistake in legal literature.
3. Materials and Methods
The present research employed a descriptive–analytical method. It also relied on library sources to collect the data and present the discussion.
4. Results and Discussion
The research findings indicate that, contrary to initial assumptions, the Iranian legal system is not alien to the concept of risk assumption in contractual mistakes. Rather, this concept is actively present through traditional and indigenous institutions such as the "waiver of options" (isqāt-al-khiyārāt) and the "rule of action/assumption of risk" (qā'idah al-iqdām). The primary challenge arises when the broad application of this theory sometimes requires entering into a transaction with a degree of ignorance and uncertainty regarding the subject matter, which initially appears to conflict with the rule of "prohibition of gharar." This conflict, particularly concerning mistakes about the fundamental conditions for the validity of a contract (such as economic value and deliverability), can lead to the invalidation of rational and efficient commercial contracts. For example, if a marine salvage expert purchases a stranded ship at a very low price, fully aware of the risk that refloating it might be impossible, and subsequently fails in the salvage operation, their invocation of the lack of deliverability and the subsequent nullity of the sale lacks economic justification. This is because the expert buyer assumed the risk of their perception being mistaken, and this risk was reflected in the contract price.
The research findings indicate that the widespread acceptance of aleatory and risk-based contracts in Islamic jurisprudence and statutory law (such as insurance, ju'ālah, and partnership contracts) indicates that gharar is a "customary" concept influenced by economic necessities. Not every risk or instance of ignorance constitutes gharar. Prohibited gharar is a risk that custom deems intolerable and gambling-like (a zero-sum game). However, if entering a transaction with ignorance is based on skill, expertise, commercial calculations, and value creation, and uncertainty is considered an inherent part of the economic essence of the transaction, the nature of the act shifts to a "reasonable risky investment" (a positive-sum game) that the legal system must recognize as valid.
5. Conclusion
In conclusion, it can be stated that within the framework of the current regulations of the Iranian legal system, and relying on the rule of iqdām, the waiver of options, and most importantly, a precise and customary interpretation of the concept of gharar, the rule of "assumption of risk of mistake" can be applied and justified. To ensure the stability and security of transactional relations, it is recommended that, based on distinguishing "invalidating gharar" from "legitimate risk" in cases such as mistake in economic value or deliverability, if it is established that the parties consciously assumed uncertainty in a rational context and based on expertise, the matter should be excluded from the scope of invalidating gharar and the realm of mistake. Nevertheless, it is appropriate for the Iranian legislature, in alignment with leading legal systems, to explicitly stipulate the "non-assumption of risk" as a statutory condition for invoking mistake.
Reduction of Price in Contract Law in Light of the 2016 French Legal Reforms: A Comparative Analysis with Iranian Law
Pages 89-136
https://doi.org/10.22054/jplr.2026.92027.3000
Mostafa Harati
Abstract 1. Introduction The evolution of contract law in recent decades, particularly in European legal systems, reflects a transition from the traditional dual framework of remedies based on either termination of the contract or compensation for damages toward more flexible, economically efficient, and pragmatic solutions. The 2016 reform of the French Civil Code, which is considered one of the most significant transformations of French private law in the last century, clearly illustrates this development. At the heart of this reform stands the remedy of price reduction (réduction du prix), introduced under Article 1223 of the French Civil Code as an autonomous and general remedy for situations involving defective or incomplete performance of contractual obligations. Before this reform, mechanisms functionally similar to price reduction existed only in a fragmented and limited manner, mainly in certain specific contracts, especially contracts of sale. This legislative innovation raises important theoretical and practical questions. What is the exact position of price reduction within the general system of contractual remedies? How should its legal nature be characterized? How does it relate to fundamental principles of contract law, such as preservation of the contract, good faith in performance, and the balance of reciprocal obligations? Finally, to what extent can this institution serve as a model for other legal systems, including Iranian law? 2. Objective The principal aim of this research is to provide a comprehensive and systematic analysis of the institution of price reduction under Article 1223 of the French Civil Code after the 2016 reform and to examine its conceptual foundations, conditions of application, and legal effects within the general theory of contracts. In pursuit of this main objective, the study also follows several subsidiary aims. First, it seeks to clarify the position of price reduction alongside other contractual remedies such as specific performance, termination, and contractual liability. Second, it aims to analyse the legal structure of Article 1223, with particular emphasis on the concept of incomplete performance, the requirement of formal notice (mise en demeure), and the principle of proportionality. Third, it evaluates the compensatory and economic role of this remedy in preserving the balance of reciprocal obligations. Fourth, it undertakes a comparative analysis between the French mechanism of price reduction and the corresponding institutions in Iranian law, particularly arsh, breach of description, and tabʿīḍ-e ṣafqeh. Fifth, it identifies the potential within Islamic jurisprudence and legislation that may support the development of a more coherent mechanism for price adjustment in Iranian contract law. 3. Research Method This study is based on doctrinal legal analysis combined with a structured comparative approach. In the first stage, the theoretical and conceptual framework of Article 1223 is examined through the study of major French doctrinal writings, preparatory legislative documents related to the 2016 reform, and leading scholarly analyses in the field of the law of obligations. The works of prominent French scholars of contract law, together with scholarly commentaries on the reform, provide the doctrinal basis for understanding the rationale, legal nature, and operation of this modern remedy. In the second stage, the place of price reduction within the hierarchy or system of contractual remedies is analyzed through comparison with other mechanisms such as specific performance, termination, and damages. This analysis aims to determine how price reduction functions as an intermediate remedy, allowing the contractual relationship to be preserved while correcting the economic imbalance caused by defective performance. 4. Results and Discussion The analytical findings of this research show that Article 1223 of the French Civil Code establishes price reduction as an independent contractual remedy specifically designed for cases of incomplete performance. Unlike termination, which results in the dissolution of the contractual relationship, price reduction enables the creditor to accept the imperfect performance and simultaneously adjust the price in order to restore the economic balance of the contract. The functioning of this remedy is based on three fundamental conditions. The first is the existence of incomplete performance, meaning that the debtor has performed the obligation but not in full conformity with the quantity, quality, characteristics, or specifications agreed upon by the parties. The second is the formal notice given by the creditor (mise en demeure), through which proper performance is demanded and the debtor is given an opportunity to cure the defect or deficiency. The third is proportionality, meaning that the reduction in price must correspond to the loss of value resulting from the defective or incomplete performance. From an economic perspective, this remedy plays an important role in modern contractual practice. In complex or long-term contracts, termination may impose significant transaction costs and disrupt ongoing economic relations. Price reduction offers a more balanced solution because it preserves the contract while correcting the financial imbalance created by imperfect performance. The comparative analysis also reveals a meaningful structural difference between French and Iranian law. In French law, price reduction is conceived as a general remedy applicable to all reciprocal contracts. In Iranian law, by contrast, similar mechanisms exist only in specific contractual contexts. The clearest example is arsh, which applies in cases of defects in the object of sale. Other institutions, such as breach of description and tabʿīḍ-e ṣafqeh, address certain aspects of contractual imbalance, but they do not create a comprehensive and general mechanism for contractual price adjustment in response to incomplete performance. Innovation and Contribution of the Research The main contribution of this research appears in three essential respects. First, the study goes beyond a simple descriptive reading of Article 1223 and offers a deeper theoretical analysis of the role of price reduction within the broader framework of contractual remedies. By situating this institution within the contexts of economic efficiency and contractual equilibrium, the research emphasizes its significance in contemporary contract law. Second, the study establishes a structured comparative framework linking the French concept of price reduction with the dispersed institutions of Iranian law. This comparative approach demonstrates how the French experience may serve as a source of inspiration for the development of a more coherent doctrinal framework in Iranian law concerning incomplete performance and contractual adjustment. 5. Conclusion In conclusion, Article 1223 of the French Civil Code offers an innovative mechanism that successfully balances contractual stability, economic efficiency, and corrective justice. By enabling the creditor to reduce the contract price in response to incomplete performance, this remedy preserves the contractual relationship while restoring the equilibrium of reciprocal obligations. Although Iranian law contains several mechanisms that partially perform similar functions, these institutions remain limited in scope and lack a unified theoretical framework. The comparative analysis carried out in this research suggests that the French model of price reduction may provide valuable inspiration for the development of a more systematic approach to contractual adjustment in Iranian law. Such a development could enhance both the doctrinal coherence and the practical efficiency of contractual remedies in addressing the realities of modern economic transactions.
Scope and Requirements for Granting Disgorgement in Tortious and Contractual Liability in Anglo-American Common Law: Reflections on Iranian Law
Pages 137-180
https://doi.org/10.22054/jplr.2026.92235.3007
Hamid Reza Oloumi Yazdi, Mohammad Hadi Javaherkalam, Shobeir Azadbakht
Abstract 1. Introduction
“Disgorgement damages” has been introduced to the legal community as one of the non-compensatory remedies for damages under the Anglo‑American common law system. This remedy refers to the deprivation, in whole or in part, of the benefits obtained by the wrongdoer through the violation of the legal or contractual rights of the entitled party, and subsequently, the return of those benefits to the right‑holder. The novelty of this remedy has consistently generated numerous questions among common‑law scholars. Its concept, its position among other forms of damages, its contractual or non‑contractual foundations, as well as issues concerning calculation and payment, are among the questions that have occupied both doctrinal scholarship and judicial practice. In a previous work, we examined in detail the concept, status, and advantages of this remedy; therefore, this study proceeds on the assumption that the phase of identifying disgorgement of profits has already been addressed.
Nevertheless, merely proposing the recognition of disgorgement damages, without a precise explanation of its scope, conditions of application, and constitutive elements, cannot meet the theoretical and practical needs of the legal system. The central issue is, in fact, determining in which domain of civil liability (whether tortious or contractual) this remedy may properly be adopted and applied. Can it be accepted, without qualification, across all types of contracts and in all instances of non‑contractual obligations? Or do the particularities of each domain require a careful and purposeful distinction?
On the other hand, a further foundational question arises: under what conditions may the right‑holder be permitted to benefit from disgorgement damages? Is the mere establishment of the conventional elements of civil liability (namely, harm, wrongful act, and causal link between the two) sufficient for the application of this
remedy? Or must additional or distinct elements and conditions be considered alongside these conventional requirements?
2. Literature Review
In recent years, Iranian legal scholars, influenced by common law doctrine (from the United States, England, Australia, and Canada) and recognizing the advantages of disgorgement of profits derived from rights violations, have produced commendable works on this subject for the legal community (Babaei & Azadbakht, 2025: pp. 1-58; Babaei & Azadbakht, 2026: pp. 1-33; Nematollahi & Seyyed Ali Routhe, 2020: pp. 31-55; Rezaei, 2024: pp. 155-176). Nevertheless, these works have addressed only the concept, foundations, and feasibility of accepting disgorgement of damages. A thorough analysis of the scope of this remedy and the conditions for claiming it has largely remained unexplored. This study examines, in detail and through a close analysis of U.S. and English law, the contexts in which disgorgement of profits may be applied and the conditions for claiming it.
3. Methodology
Adopting a descriptive–analytical approach, the present study examines the conditions and elements required for claiming disgorgement within the framework of tortious and contractual liability in Anglo-American common law.
4. Results and Discussion
The remedy of “disgorgement damages,” as one of the emerging yet effective methods of compensation, has garnered increasing
acceptance in contemporary legal systems and has gradually established an independent position within the framework of civil remedies. Unlike traditional methods of compensation, which primarily focus on redressing the harm suffered by the injured party, this institution seeks to establish a fair balance between the parties by divesting the wrongdoer of any illicit profits obtained and thereby preventing unjust enrichment. From this perspective, disgorgement of profits is not only a compensatory tool but also possesses a deterrent function.
An examination of this institution reveals that, both theoretically and practically, disgorgement of profits is compatible with various branches of civil liability, including tortious and contractual obligations. In the realm of contractual liability, the primary basis for justifying the obligation to disgorge profits can be found in the concept of the obligee’s “legitimate expectation.” This expectation, in essence, entitles the contracting party to be assured that the obligor will not gain an economic advantage through the breach of contractual commitments. Within this framework, disgorgement of profits serves as a mechanism to preserve contractual equilibrium and prevent the reduction of contractual obligations to a mere economic calculation by the obligor.
In the domain of tortious liability, although the general principle is to compensate for the harm incurred through compensatory damages and to restore the injured party’s situation as much as possible, there are circumstances where these methods may be insufficient to fully satisfy the right‑holder’s claim. In such cases, the disgorgement of profits can function as a supplementary remedy, acting in conjunction with other compensation methods. This is particularly
relevant in scenarios where the wrongdoer has obtained significant benefits without causing calculable harm; in such instances, relying solely on compensatory damages might perpetuate an unjust situation and could even incentivize rights-violating behaviors.
However, the application of the disgorgement remedy is subject to specific rules and conditions and cannot be applied absolutely or without restriction. Among the essential prerequisites for this remedy are: the violation of the legal or contractual right of the entitled party, the wrongdoer’s acquisition of economic benefit as a result of this violation, and the suffering of harm by the entitled party. Furthermore, establishing the wrongful act by the violator, the inadequacy of other compensatory measures, and ultimately, confirming the causal link between the violation of the right and the benefit obtained by the violator, are among the necessary elements for claiming and adjudicating the disgorgement of profits.
5. Conclusion
The sum of these considerations indicates that the remedy of disgorgement damages, when its conditions of application and its place alongside other civil remedies are precisely delineated, can be considered an effective institution for achieving justice, preventing unjust enrichment, and strengthening the deterrent function of civil liability. This is an institution that, with due regard to its governing principles and foundations, has the potential for development and institutionalization within the framework of Iranian law as well.
Compelling the Obligor to Perform and Invoking Contractual Liability in Continuous Obligations under Iranian and French Law
Pages 181-216
https://doi.org/10.22054/jplr.2026.92611.3008
Noura Ehsangar, Alireza Yazdanian
Abstract Introduction Time has always been one of the most significant factors in the analysis of contractual relationships and the determination of the status of contractual performance. According to the traditional analysis of contract law, prior to the maturity of an obligation, neither breach of contract nor the possibility of invoking contractual remedies is generally recognized. This approach, reflected in Iranian law under Article 226 of the Civil Code and in French law through the doctrine of mise en demeure and Article 1231 of the French Civil Code, is primarily based on the model of instantaneous obligations. However, the development of modern contractual relationships, particularly in construction contracts, participation in construction agreements, pre-sale contracts, and continuous service contracts, shows that not all obligations can be analyzed according to the model of instantaneous obligations. In many of these relationships, the fulfillment of the contractual objective depends upon the continuous performance of the obligation over time, and interruption of performance may, even before the final maturity date, seriously endanger the possibility of contractual performance. Research Question(s) In this context, several important questions arise. Must a continuous obligation necessarily arise within a continuous contract, or may a continuous obligation also exist within an instantaneous contract? Furthermore, in the event of interruption of the performance of a continuous obligation, may the obligee seek specific performance or damages before the final maturity date, or does the principle that an obligation is not yet due prevent the application of contractual remedies until the final due date? 2. Literature Review Despite the theoretical and practical significance of this issue, much of the existing scholarship in Iranian and French law has focused primarily on the conceptual analysis of continuous contracts or the doctrine of demand, while the independent examination of breach of continuous obligations prior to the final maturity date has received comparatively little attention. In common law literature, a related issue has been discussed under the concepts of Anticipatory Breach and Anticipatory Repudiation, reflecting the challenges faced by the traditional temporal analysis of contractual liability in continuous contractual relationships. 3. Methodology This research adopts a descriptive-analytical methodology with a comparative approach in Iranian and French law. In the descriptive section, the concepts of continuous contracts, continuous obligations, instantaneous obligations, and the role of time in contractual performance are examined through the analysis of Iranian and French legal doctrine. In the analytical section, the study evaluates the provisions of the Iranian Civil Code, the French Civil Code, and doctrinal opinions in order to explain the possibility of recognizing an actual breach of continuous obligations before the final maturity date. 4. Results and Discussion The primary objective of this study is to examine the possibility of recognizing the breach of continuous obligations prior to the final maturity date and to analyze its legal consequences under Iranian and French law. The study seeks to show that, in continuous obligations, breach of obligation cannot be confined solely to the final due date and that interruption or disruption in the process of performance may, in certain circumstances, constitute a contractual breach even before the final maturity date. The findings of this research indicate that there is no complete overlap between “continuous contracts” and “continuous obligations.” A contract may be instantaneous in terms of its legal effects while simultaneously creating obligations of a continuous nature. Therefore, what is decisive in analyzing the status of breach is not merely the classification of the contract itself, but rather the nature of the obligation and the manner in which it is performed over time. In continuous obligations, continuity of performance constitutes part of the substance of the obligation, and consequently, interruption or disruption of performance may itself amount to an actual breach prior to the final maturity date. The study further shows that a distinction must be drawn between “delay in the performance of the final obligation” and “interruption of the continuous performance process.” In instantaneous obligations, breach generally occurs upon the final due date; however, in continuous obligations, the process of breach may begin before maturity and continue progressively over time. For instance, in construction contracts, suspension of construction operations, even before the final delivery date, may seriously jeopardize the contractual purpose and inflict actual loss upon the obligee. The examination of French law indicates that although the traditional analysis of contractual liability has been based on the necessity of maturity and mise en demeure, modern doctrinal developments, particularly following the 2016 reform of the French Civil Code, have provided a basis for greater attention to the economic function of contracts and responses to disruptions in the continuous performance of obligations. Likewise, under Iranian law, it is possible to justify recognition of an actual breach in continuous obligations through reliance on general principles of contract law, including the binding force of contracts, good faith in contractual performance, prevention of harm, and interpretation of contracts according to the parties’ common intention. 5. Conclusion The findings of this research indicate that Article 226 of the Iranian Civil Code should not be interpreted in a manner that precludes any legal response to disruptions in the performance of continuous obligations until the final maturity date. In cases of unjustified interruption of continuous performance, the obligee should, where appropriate, be entitled to seek specific performance, claim damages, and, in certain cases, terminate the contract. Such an approach, while being more consistent with the economic realities of continuous contracts, may strengthen the protective function of contract law and prevent substantial losses to the obligee.
Legal Framework for Preventing and Resolving Decision-Making Deadlocks in Joint Ventures, with Particular Emphasis on the Protection of Minority Partners
Pages 217-271
https://doi.org/10.22054/jplr.2026.92802.3010
Seyed Nasrollah Ebrahimi, Gholamreza Moghaddam Rashidi
Abstract Introduction Joint venture arrangements emerged in response to the need to pool capital and capabilities, as well as to ensure an appropriate allocation of risk. As one of the most significant legal and economic instruments for the implementation of large-scale and complex projects, particularly in capital-intensive and multi-stakeholder sectors such as energy infrastructure and oil and gas, joint venture contracts play a fundamental role in achieving the core objectives of such collaborations, namely risk-sharing, consolidation of financial and technical resources, and synergy of the parties’ interests. Joint venture agreements are complex agreements that are necessary to regulate the conduct of partners and coordinate joint activities. However, failure to reach the required decision-making threshold in partnership agreements, as a structural and foreseeable risk, is often inadequately identified, analyzed, and managed. In many instances, contract drafters limit themselves to specifying a voting percentage or majority threshold, while neglecting to address the practical consequences of failure to attain such a threshold and to provide alternative decision-making mechanisms. Practical experience in partnership arrangements shows that inability to meet the decision-making threshold is among the most frequent and highest-risk challenges in the performance of these agreements. This situation may arise from conflicting interests among the partners, the absence or deliberate non-participation of certain parties, an imbalanced allocation of voting power, or even strategic abuse of veto rights. In many cases, the result is a decision-making deadlock, delays in project implementation, cost overruns, erosion of mutual trust, and ultimately the emergence of extensive legal disputes. Such outcomes seriously call into question the rationale of the partnership agreement and, where no appropriate deadlock-resolution mechanism is provided, may lead to the collapse of the joint venture. The existing research gap in this field lies in the absence of a unified theoretical framework for the management of deadlock in joint ventures. In addition, the lack of a systematic contractual model for the prevention and resolution of deadlocks, the lack of integration of governance and exit mechanisms, the limited availability of comparative legal analysis in Persian-language literature, and the absence of legal-economic analysis of deadlock represent further gaps that this study seeks to address. Research Question(s) The study seeks to answer the question of how the risk of decision-making deadlock in joint ventures can be managed through the design of appropriate governance and contractual structures, in a manner that preserves the balance between efficiency and the protection of minority partners’ rights. 2. Literature Review With respect to Persian-language scholarship, although the domestic literature on decision-making deadlock in joint ventures remains limited, a considerable body of research has examined the closely related institution of the Economic Interest Grouping (EIG). Oloumi Yazdi, in Legal Challenges to the Formation of Economic Interest Groupings,¹ and Mirzahosseini, Oloumi Yazdi, and Masoudi, in A Comparative Study of Economic Interest Groupings in Iranian Law and Similar Contractual Arrangements, have analyzed the relationship between the EIG and legal institutions such as joint ventures, consortia, civil partnerships, and profit-sharing partnerships. In addition, Withdrawal of Partners from Economic Interest Groupings from the Perspective of Islamic Jurisprudence and Iranian Law by the same authors, together with the studies of Isaei Tafreshi and Kabiri Shahabad on the establishment and governance of Economic Interest Groupings, constitute the principal Persian-language sources on this subject. Collectively, these studies indicate that, although the EIG is not legally identical to a joint venture, it can, as a contractual cooperative institution, provide a suitable domestic model for examining the need for the design of decision-making mechanisms, deadlock prevention, minority protection, and exit arrangements. One source relevant to the present study is the article by Pasban and Ghorbani Zolikhai entitled Rights, Obligations, and Liabilities of Partners in Joint Venture Agreements with Emphasis on Economic Interest Groupings. Unlike some general studies addressing the legal nature of joint ventures, this article specifically examines the legal position of the parties, their rights and obligations, liabilities toward one another and third parties, and the relationship between joint ventures and Economic Interest Groupings under Iranian law. Its relevance to the present study lies in demonstrating that decision-making deadlock is not merely a procedural issue concerning voting mechanisms but is closely connected to the allocation of partners’ rights, obligations, and liabilities. The study therefore reinforces the importance of clearly defining these matters in joint venture agreements, since failure to do so may create uncertainty not only in the decision-making process but also in determining the responsibility of the partner or partners contributing to the occurrence or continuation of a deadlock. 3. Methodology This research has been conducted using a descriptive-analytical method with a mixed approach, based on doctrinal analysis and the examination of sample contracts, and the data were collected through library-based research. 4. Results and Discussion The proposed hypothesis is that the combination of multi-level decision-making and deadlock-resolution mechanisms with contractual exit mechanisms can constitute the most efficient solution for managing deadlock in joint ventures. The proposed model of this research is a multi-tier framework for deadlock resolution. At the first level, drawing on the theoretical literature on incomplete contracts and control rights, deadlock is examined as a natural consequence of the asymmetric distribution of bargaining power. The findings indicate that reliance solely on a voting mechanism or a deadlock resolution mechanism is not an appropriate solution. Accordingly, issues should be classified in advance according to different decision-making thresholds in order to reduce the likelihood of deadlock and help protect the rights of minority partners. Similarly, a range of mechanisms should be used to resolve deadlocks. 5. Conclusion At the first stage, contractual prevention is achieved through the careful design of the voting mechanism and the incorporation of alternative contractual techniques that automatically facilitate the resolution of deadlock. Reliance on previous resolutions and the implementation of the minimum undisputed scope of the partners’ agreement fall within this stage. The second stage comprises internal governance mechanisms such as a casting vote or referral to senior managers. The third stage includes third-party intervention or neutral mechanisms, including expert determination, mediation, arbitration, and drawing lots. Finally, the fourth stage encompasses exit mechanisms and reallocation of property rights. The practical application of this model in joint venture contracts is that it can serve as a checklist for contract design and the allocation and gradual modification of control rights, mitigate the risk of operational stoppage and harm to investment, limit dispute costs, and ensure operational continuity of strategic projects; in other words, it moves from ex post dispute resolution towards ex ante and preventive governance.
