Examination of the Legal Status of Contracts Containing Automatic Renewal Clauses in Iran: A Comparative Analysis with French and English Law

Document Type : Original Article

Authors

1 Assistant Professor, Faculty of Law, Islamic Azad University, Central Tehran Branch,, Islamic Azad University, Tehran. Iran.

2 PhD student in private law, Faculty of Law, Central Tehran Branch, Islamic Azad University, Tehran. Iran.

Abstract

In some contracts, a condition known as the contract extension condition is included due to contractual necessity. This condition allows the parties to avoid the need to renegotiate or conclude a new contract. However, this privilege is not immune to challenges and should be examined through a comparative study of the French and English legal systems. However, at times, the performance of an extended contract may encounter hardship or become impossible due to changes in contractual circumstances. In some instances, one party may exploit its superior position. These situations can serve as barriers to the implementation of the automatic contract extension clause. In both English and French law, various legal theories are employed, including "Change of Circumstances" (Rebus sic stantibus), "Frustration" and "Force-majeure" and the "Abuse of Right. In the comparative study conducted using an analytical-descriptive method and by referencing library sources in Iranian law, it is possible to adhere to general principles such as “La-Zarar” (no-harm rule) and " Osr VA Haraj " (rule of hardship), " Ghabne Hades " (sudden contractual lesion), and the prohibition of the abuse of rights offer solutions that are comparable to those found in the legal systems of England and France. These include the modification of extended contracts and, in certain cases, the cancellation of extension conditions and the non-implementation of extended contract.

Keywords

Main Subjects


 
Abbasi, E, (2007), The meaning and concept of good faith in contracts, International Legal Research Journal, Vol. 2 .(In Persian)
Accident theory, judicial session, dated 04/05/2018, the issue of non-fulfillment of obligations in terms of external obstacles and unforeseen events. Available at: B2n.ir/q35378 ، https://www.neshast.org/Home/GetPublicJSessionTranscript/  (In Persian)
Asghari aghmashhadi, F, Mohammadi, S, Mustafavi, Z ( 2014), Conditions for the realization of Ghaban, Journal of Islamic Law & Jurisprudence Researches. (In Persian )
Akbarineh, P, ( 2012), Prohibition of abuse of objective rights in civil law, Jurisprudence And The Essentials of Islamic Law, Vol 12,13. (In Persian)
Akhund Khorasani, (1996) Kefayyah al-Asul, Al-Al-Bait Institute Publication, Qom,  second edition. (In Arabic)
Andrew C. Voorhees , ( 2016),»The Enforceability of "Evergreen Clauses«", availableat: www.weltman.com/(In English)
Ansari, M, (1995), Faraid al-Osul, Dar al-Itsam publication, Qom. ( In Arabic)
 Askari, S, Ehtashami, H; (2017), Comparison of the theory of contract sterility with the theories of the Cairo authority, changes in circumstances and the difficulty of implementing the contract, Journal of Studies in Islamic Law & Jurisprudence, vol. 41. (In Persian)
Azizi, P, Almasi, , Afsharnia, T, (2020), Ethical review and evaluation of contract modification in Iranian law and Imami jurisprudence, Ethical Researches, Vol. 4. (In Persian)
BERKMAN SOLUTIONS, »3 Keys to Managing Evergreen Contracts«  , availableat:  www.berkmansolutions.com, (In English)
Darooi, A (2020), The Nature and Validity of the Obligation to Extend the Contract, Journal of Studies in Islamic Law & Jurisprudence, Vol. 22. (In Persian)
 Ebrahimi Torkaman, A.(2020). The Authority of Loss Occurring in the Lease Contract, The Quarterly Journal of figh, Vol 1.Judicial decisions available at: https://ara.jri.ac.ir. (In Persian)
Esmaeeli, M (2001). The effect of changing conditions Issue on the contract in the view of comparative study. The Rahnemoon Journal, Vol 1. (In Persian)
Fazel Movahdi Lankarani, M, (2006), Idah al-Kafayeh, Qom, Nouh Publishing Institute, vol. 4. (In Persian)
Haji Nouri, Gh,( 2014), The return of moderation to the theory of abuse of rights, Journal of Islamic Law & Jurisprudence Researches, Vol. 11. (In Persian)
Jafari Langroudi , M (2009), Expanded on Legal Terminology, Tehran, Ganj Danesh Library, vol. 3. (In Persian)
Jafari Langroudi , M (2021), Commentary on Civil Code , Tehran, Ganj Danesh Library. (In Persian)
Jalali, M and Araei, H, (2010), Comparative study of the doctrine of fundamental change of circumstances in Iranian law and international law, Journal of Comparative Law, Mofid University, No. 82. (In Persian)
Javadi Amooli, A, ( 2010), https://www.eshia.ir/Feqh/Archive/text/javadi/feqh/89/891004 . (In Persian)
Josserand, L, (1905), De l'abus des droits, Arthur Rousseau, paris librairie nouvelle de droit et de jurisprudence. ( In French)
Karimi,A, (2002), Imposed conditions from the point of view of the general rules of contracts, Journal  of Legal Research, Shahre Danesh, Vol. 1. (In Persian)
Katouzian, N, (2004), civil rights and general rules of contracts, Tehran, publishing company in collaboration with Bahman Barna, vol. 3. (In Persian)
Kovač, M, Vandenberghe, A (2015). "Regulation of Automatic Renewal Clauses: A Behavioural Law and Economics Approach". Journal of Consumer Policy. 38 (3): 287–313(In English)
Khomeini, R, (1994),  Al-Darr's innovations in the rule of negation of harm, International affairs department the institute for compilation and publication of Imam Khomeini's works, Qom, ( In Arabic).
Khoyyini, Gh (2002), Jurisprudential analysis of the theory of "change of circumstances in contracts, Matin research Journal, Vol. 13. (In Persian)
Mafi, H, Ramshi, M, Bagheri, A, (2015), Effect of the implementation of contractual obligations in the 1980 Convention on the International Sale of Goods, Journal of  Private Law Research, 3rd year, vol 10. (In Persian)
  Mohaghegh Damad ,M, (1406 A.H)., Rules of Jurisprudence, Tehran, Islamic Sciences Publishing Center, Vol 2. (In Persian)
Mousavi Bojnordi, H, (1999), Al-Qhavaede al-Fiqhiyyah, Qom, Al-Hadi Publishing House, vol. 5. (In Arabic)
Mustafawi,M (2006), Al-Ghavaede Maa’at Ghavaede al-Fiqhiyyah Meaning, Evidences and Cases, Qom, Al-Nashar al-Islami Foundation of the Jama’ah Al-Madrasin of Qom Al-Mushrafah, Volume 1. (In Arabic)
Mustafawi, M (2006), Al-Ghavaede Maa’at Ghavaede al-Fiqhiyyah Meaning, Evidences and Cases, Qom, Al-Nashar al-Islami Foundation of the Jama’ah Al-Madrasin of Qom Al-Mushrafah, Volume 2. (In Arabic)
Oral , Tugce ,(2019) »Exemption from liability according to the art. 79 of the Convention on International Sale of Goods (CISG)«: Juridical Tribune, Volume 9. (In English)
Peter Berger, Klaus , Behn ,Daniel (2019-2020), »Force Majeure and Hardship in the Age of Corona: A Historical and Comparative Study«, McGill Journal of Dispute Resolution ,Revue de règlement des différends de McGill, Volume 6, Number 4. (In English)
Protection and Compliance under the Illinois Automatic Contract Renewal Act« , availableat: www.rockfuscoconnelly.com. (In English)
Qasimzadeh, M, (2008), principles of contracts and obligations, Tehran, Justice Publications Institute. (In Persian)
Rahpeik, S, (2004), Prohibiting the abuse of rights in legal theories and Quranic concepts, Journal of Islamic Studies, vol. 62. (In Persian)
Rimke, Joern, (2000), »Force majeure and hardship: application in International Trade practice with specific regard to the CISG and UNIDROIT principle of International Commercial contracts«, Kluwer. (In English)
Sadeghi Moghadam, M, (2001), Comparative study of the influence of circumstances on the contract and solution of Iranian law, legal magazine, publication of the International Legal Services Office of the Islamic Republic of Iran, vol. 25. (In Persian)
 Safai, H, (2004), civil rights and general rules of contracts, Tehran, Mizan publication, vol. 2. (In Persian)
 Safaei, H, Lamay,Z,(2014), The jurisprudential rule of "Botlano Koolo Aghden Betaazorelvafa Bemazmooneh " and its application in dowry with an approach according to Imam Khomeini (pbuh), Matin Research Journal, Vol. 64. (In Persian)
Safai, H , Javaherkalam, M (2022), Conditions and effects of the Force Majeure in the 2016 amendments to the French Civil Code, and use it to eliminate the shortcomings of the Iranian legal system, - Journal of Private Law Research, Vol. 39. (In Persian)
Seyyed Hosseini, S (2017), Imam Khomeini's (PBUH) innovations in the rule of harmlessness and its similarity with the abuse of rights in civil responsibility, Matin research Journal, Vol. 74. (In Persian)
Sharifi, E, Safari, N, (2013), Comparison of the theory of hardship and force majeure in the principles of commercial contract law, the principles of European contract law and Iranian law, Comparative law Research Quarterly, Vol. 4. (In Persian)
Shabani, M, Bagheri, A, (2017), Jurisprudential review of the legitimacy and consequences of embezzlement, Journal of Fiqh and Usul, Vol. 112 (In Persian).
Shabani, O, (2011), Investigation of the impossibility of contract execution in Iranian jurisprudence and law, Islamic jurisprudence and law research journal, vol. 6. (In Persian)
Sobhani, J, ( 2015),  https://www.eshia.ir/Feqh/Archive/text/sobhani/feqh/93/940205. (In Persian)
Tabatabai Qami, T, (2002), Al-Anwar al-Bahiyyah fi al-Ghavaede al-Fiqhiyyah, Qom, Mahalati (Mofid), vol.1. (In Arabic)
Toosi, M, ( n.d) , Al-Khalaf, Alnashrol Eslami. (In Arabic)
Vienna Convention on the Law of Treaties 1969. (In English)
 Yazdanian, A, (2007), Adjustment of contractual obligations based on the principles and rules governing Islamic jurisprudence, Journal of  Philosophy and kalam, vol. 92. (In Persian)
Zhou, F (2021), La force majeure en matière contractuelle:étude comparée des droits chinois, français et allemande, Université Paris. (In French)