The Termination of Incomplete Contracts

An incomplete contract is one that has not been concluded completely and has not been effective. Iranian civil Act does not have any general principle about the status, rules, and effects of incomplete contracts and ordains some vague regulations on certain instances of these contracts. The incomplete contract has a “waiting period” to be accomplished and effective. Because of the ambiguity of the Civil Act, it is requisite to inquire about the relationship between parties and other legal rules in this period. The possibility of termination of incomplete contracts during the waiting period is one of the aspects of these contracts investigated by this article. The main question of the article is whether parties to the incomplete contract may terminate the contract during the waiting period. The authors answer that the right of termination is specific to valid and binding contracts, whether absolutely valid or potentially valid ones (a common term in the Islamic jurisprudence), and since an incomplete contract has potential validity, the terminator party can exercise his right of termination. Thus, for termination, there is no need to wait until the contract is completed. In this regard, the authors have presented a general principle and then, under the principle, examine the prominent instances of incomplete contracts.