Damages in Lieu of Performance in German and Iranian Law

Abstract

"Damages in lieu of performance" is one of the three types of damages for breach of contract provided by the German Civil Code. The main objective of this research is to examine this remedy in German law. Specifically, this study addresses the question of how, in a legal system that upholds the principle of contractual necessity and considers specific performance as the primary remedy for a breach of contract, damages can substitute for the actual fulfillment of the obligation. While the term "damages in lieu of performance" is not explicitly used in Iranian laws, certain instances of this type of damage have been explored in legal literature. By comparing these two concepts within the German and Iranian legal systems, it becomes evident that the German Civil Code provides precise and effective rules governing damages in lieu of performance, thereby offering a solid foundation for the comparative adaptation of such rules in Iranian law.

Keywords

• breach of contract
• damages
• remedies
• compensatory damages