Consequential Damages in United States and Iranian Law

Document Type : Academicm and Research

Author

Associate Professor, Department of Private Law, Faculty of Law, University of Qom, Qom, Iran.

10.22091/csiw.2025.12053.2621

Abstract

 
One type of damages resulting from the breach of contract in American law is consequential damages, also known as special damages and indirect damages, as opposed to compensatory or direct damages. The term has been used in the American legal literature, in judicial judgments, and in important American documents and laws, such as the Uniform Commercial Code, but the meaning of this damages and its compensability is very doubtful. It is argued that the authors' attempt to explain this concept has failed, and thus, some great American jurists have suggested that the usage of the term should be stopped. However, the choice of American law as the subject of this study is due to the widespread use of the term consequential damages in US law, especially in legal texts, and hence, to find a relatively reliable basis for studying this concept. The term consequential damages does not appear in Iranian Regulations but it is used in legal literature and some concepts and terms with the same function are seen in Iranian laws. Recognition of this concept is especially important in cases where US law governs the relationship between the contracting parties and also where an exclusion clause for consequential damages is included in the contract. Due to the fact that this term is not existed in Iranian Laws, a great part of this study is devoted to recognition of the term in US Law and it endeavors to find and compare concepts and terms with similar function in Iranian law.

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References

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Comparative Studies on Islamic and Western Law
Volume 12, Issue 3 - Serial Number 45
September 2025
Pages 229-254

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