Comparative Study of Possibility of Punitive Damage Verdict issuance by Arbitration Institutions in the United States and Iranian Law

The main purpose of issuing punitive damage verdict is to make compensation for the loss inflicted on the plaintiff and to restore the plaintiff to the status quo ante. In Iranian law, the basic principle is to recover the damage and restore the plaintiff to the status quo ante, but the punitive damage is completely different. In other countries, including England and the US, in which punitive damage is accepted in a broad sense, the punitive damage is defined aside from any compensatory damages or nominal damages which are considered in issuing the verdict due to extreme misconduct of the defendant. As in the members of Romano-Germanic Legal System, in Iranian law punitive damage is not applied in private lawsuits. Despite this situation, and regarding international aspect, and in response to some measures taken by countries - the US, in particular - in sentencing Iran to punitive damage, the lawmaker, eventually, recognized punitive damage in considering civil lawsuits against foreign governments in 2011. A question, however, arises here is that  it is possible for arbitration institutions in common-law obedient countries to issue punitive damage verdict. In this paper, we discuss this issue and also possibility or non-possibility of execution by national courts of the punitive damage verdicts issued by arbitration institutions.