THE EXTENT TO WHICH COMPANIES' RIGHT TO CLAIM COMPENSATION FOR CONSEQUENTIAL DAMAGE IS PROVEN
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Abstract
Purpose: Damages incurred by the aggrieved party result in two main implications: the direct implication incurred by the principal aggrieved, and secondly: the consequential damages incurred by third parties associated with the principal aggrieved. The general rule is that; whether the aggrieved party is a natural or a juridical person, the latter has the right of recourse against the culprit and claim indemnification.
However, when referring to the provisions of the Jordanian Civil Code and decisions of varying degrees’ courts, we find many judicial principles that imply establishing the right to indemnification against consequential damage incurred by natural person; but not juridical persons in general, and corporations in particular.
In fact, denying corporations the right to indemnification against consequential damages is incompatible with the principles of justice, that indemnity all lawful persons the right to litigate, and to achieve equality between natural persons and corporations in all rights, except for those intrinsic to the individual human.
Methodology: The researcher has adopted a descriptive approach to illustrate the legal meaning of corporations and consequential damages, as well as an analytical approach by analyzing some legal provisions that can be utilized to grant corporations the right to indemnification against consequential damages
Significance :The importance of the study appears in its subject, which is based on establishing the right of corporations to claim indemnification for consequential damages. This especially important since the Jordanian legislator categorized the types of lawful persons who enjoy legal protection when they incur certain damages into two types: natural persons - the human - and the juridical person; such as corporations, ministries, associations and others.
Establishing the right of corporations is based on a legal logic that aims at serving equality between natural persons and corporations in all rights, except for such rights intrinsic to natural persons. However, upon addressing the right to indemnification for consequential damages, the Jordanian legislator had made it exclusive to natural persons, as apparent in the judiciary’s tendency when applying Article 267 of the Jordanian Civil Code, although it is possible to expand the interpretation of this article to include corporations when claiming indemnification for consequential damages.
Problem: The research problem emerges upon attempting to demonstrate the importance of the juridical personality of corporations. Such juridical personality plays an essential role in conferring rights, imposition of liability, and preserving right to claim indemnification for the damages they incur, including consequential damages that affect their financial liability, whether such damages are material or immaterial. The problem arises when we attempt to answer the following questions:
- What are the limits of indemnification against consequential damages?
- Do corporations have juridical personality?
- How applicable are the provisions under article 267 of the Civil Code, and how established is the right of corporations to claim indemnification against consequential damages?
- To what extent are corporations indemnified against the loss of opportunity; as a form of consequential damages?
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