Contract adjustment due to economic fluctuations

The principle of the necessity of contracts (Pacta Sunt Servanda) has been considered and respected by lawyers in all legal systems and national laws of countries. As contracts and agreements indicate, legal and economic relations between individuals of the contract and as the main purpose of the contract is to create rights and obligations for the parties to the contract. sometimes some factors such as inflation, recession, sanctions and in general, economic fluctuations beyond the will of the parties, affect these contracts and cause differences between the parties. The occurrence of these events leads to a fundamental change in the circumstances and conditions of the contracts which makes the implementation of the contract for the obligor with excessive difficulty or unconventional losses. In such a situation, it is necessary to modify the contracts. Based on this need and by considering the increasing expansion of trade exchanges and concluding continuous contracts and inevitable economic developments, the present article investigates the impact of economic fluctuations on these contracts and the possibility of compensating for the imbalance created by resorting to contract modification. Based on the result of the study, it can be concluded that there is a modification of potential contract, but it is impossible by the principles of Feqh due to the proposed shortcomings. However, based on Article 3 of the Code of Civil Procedure and by using legal principles relying on the principle of interpretation of the will of the parties, the principle of good faith and fairness, and judicial procedure; it is possible for the courts to modify and revise the contract.