Examination of Recoverable Damages in Unauthorized Sales in the Legal Systems of Iran and Egypt

Abstract

In the legal system of Iran, there is no precise ruling regarding the recoverable damages when the buyer is unaware that the sold item belongs to someone else. The legislator, merely following the opinions of Imamiyyah jurists, has affirmed the possibility of claiming damages without defining the scope and limits of the ignorant buyer's claims from the seller in the event of the invalidity of the sale. This issue has become a challenge in the current economic conditions, considering the inflation rate index and the change in the real value of the price, which, in most cases, is money. Legal scholars have also considered this, meaning the exchange of goods for money in the definition of a sale. The issue has become a point of contention in judicial practice, legal scholars' opinions, and religious decrees. In an unauthorized sale, if the original owner rejects the transaction and takes possession of the sold item, the buyer can demand not only the return of the price but also compensation for other damages from the seller, provided that they were unaware of the unauthorized nature of the transaction at the time (Articles 262, 263, 324, 325, and 312 of the Civil Code). The law is not explicit about what recoverable damages from the seller are and what constitutes them. It only refers to the buyer's right to claim damages in Articles 263 and 391 without specifying the type, amount, or manner of recoverable damages, leaving the matter unaddressed. In contrast, the Egyptian Civil Code, drawing from the theory of relative nullity of contracts, has precisely clarified this issue.