Comparative Study of the Automatic Termination Clause in Iranian Law and the Contract Avoidance Mechanism under the United Nations Convention on Contracts for the International Sale of Goods

Document Type : Original Article

Authors
Soltani Mahmood Soltani 1
Mahdi Sheikh Mahmoodi 2
1 Master's degree student in Private Law, Islamic Azad University, Tonekabon Branch, Tonekabon, Iran
2 Assistant Professor, Department of Law, Islamic Azad University, Tonekabon Branch, Tonekabon, Iran (Corresponding Author)
10.22034/lc.2026.579449.1770
Abstract
This study provides a comparative analysis of the condition of automatic termination in Iranian law and the remedy of avoidance of contract under the United Nations Convention on Contracts for the International Sale of Goods. The main issue is to clarify the structural and functional differences between these two mechanisms of contractual termination. One is based on the ex ante intention of the parties and produces automatic legal effects upon the occurrence of a predetermined condition, while the other relies on an ex post assessment of fundamental breach and the exercise of the aggrieved party’s declaration of avoidance. The research aims to analyze the conceptual and functional dimensions of these two institutions, identify their legal foundations, and examine their effects within Iranian law and the CISG framework. A descriptive–analytical and comparative methodology is adopted, using library-based legal sources, international instruments, and doctrinal materials. Findings indicate that the condition of automatic termination in Iranian law is grounded in party autonomy and pre-designed contractual planning, resulting in automatic dissolution upon fulfillment of the condition. In contrast, avoidance under the CISG is based on fundamental breach, notification, and ex post control of termination. Iranian law emphasizes legal certainty and predictability, whereas the CISG prioritizes flexibility and case-by-case evaluation. Ultimately, although both mechanisms lead to contract termination, they reflect two distinct legal logics in managing contractual risk.


Keywords
Automatic Termination Clause
Contract Avoidance
United Nations Convention on Contracts for the International Sale of Goods
Fundamental Breach
Iranian Law
Subjects