A Reappraisal of the Place of Arsh (compensation) in Lease Contract

If one of the exchanged things in a contract is defective, the injured party has the option of defect and can cancel the contract or claim arsh (the compensation for the difference between a defective and sound thing) instead. While when the object being leased is defective, the lessee holds no right to claim arsh according to the Iranian Civil Law. Whereas apparently the Civil Law, specifically article 456, grants the right for claiming arsh to the lessor when the payment is tangible property and is defective. This kind of approach to Civil Law is inferred from non-famous jurists’ view which, considering jurisprudential sources and the nature of arsh, seems weak and is not a suitable source for legislation. Arsh, in fact, is peculiar to sale contract and generalizing it to other contracts, including lease, is not allowed. Therefore, it is necessary to amend the article 478 of Civil Law regarding lease contract, and to revise the article 456 of Civil Law.