Explaining the Concept of Fundamental Breach & Fundamental Non-Performance of Contract (In the 1980 ICISG & Other International Documents and A Comparison with Iranian Law)

Abstract

Numerous provisions are connected to notion of the breach of contract in International Convention on International Sale of Goods (ICISG) among which are right to cancel of seller and buyer, right of buyer to request substitute goods, transferring transactional guarantee and predictable breach. The aforementioned concept is one of most important and challenging concepts in said Convention. Other international documents have used fundamental non-performance of contract instead of that concept. The present article aims to answer this question that whether fundamental breach of contract and fundamental non-performance of contract are a single concept or are two distinct concepts, and if they are two different concepts, what are their similarities and distinctions? In order to answer this question, these two concepts are studied and analyzed in terms of definition, elements and effects. In end, we will examine whether these concepts or similar cases are mentioned in Iranian civil law, and if not, to what extent are Iranian legal entities closely associated with these concepts? The Through this study it is determined that despite difference in definition, elements and effects of these two concepts, there is no substantive and basic difference between them. Furthermore, however concept of a breach is not seen in Iranian civil law, mechanism embedded in law of Iran (options) is close to mechanism of ICISG. In addition, external instances of termination under Iranian civil law are far less than external instances of termination under International Sale Convention.