Moral damage to a legal entity Legal framework and compensation possibilities

Abstract

Abstract: Compensating a legal entity for moral damages is a controversial issue between Islamic jurisprudence and the judiciary. This issue relates to determining the extent to which the person in question is entitled to compensation for intangible damages, as they are essentially a legal entity represented by a group of natural persons. The traditional view in this area is that moral damages are personal damages that pertain only to natural persons. However, legal developments have cast a shadow over this issue, with the recent view being that moral damages incurred by a legal entity with regard to its reputation, financial standing, or social status are considered. In this regard, it is noteworthy that the Iraqi legislator adopted a flexible approach in Article (205), whereby it mentioned the circumstances of intangible damages, for example, without limiting them to natural persons only. The same applies to French law, which recognized the right to compensation for all damages incurred by persons in Article (1240), without specifying its scope. In contrast, the English legislator limited the scope of compensation for this type of damage only if it resulted in a material impact (financial loss).