Malik related to me from Zayd ibn Aslam that his father
said, "Abdullah and Ubaydullah, the sons of Umar ibn al-Khattab
went out with the army to Iraq. On the way home, they
passed by Abu Musa al-Ashari who was the amir of Basra. He
greeted them and made them welcome, and told them that if
there was anything he could do to help them, he would do
it. Then he said, 'There is some of the property of Allah
which I want to send to the amir al-muminin, so I will
lend it to you, and you can buy wares from Iraq and sell
them in Madina. Then give the principal to the amir al-muminin,
and you keep the profit.' They said that they would like
to do it, and so he gave them the money and wrote to Umar
ibn al-Khattab to take the money from them. When they came
to sell they made a profit, and when they paid the
principal to Umar he asked, 'Did he lend everyone in the
army the like of what he lent you?' They said, 'No.' Umar
ibn al-Khattab said, 'He made you the loan, because you
are the sons of the amir al-muminin, so pay the principal
and the profit.' Abdullah was silent. Ubaydullah said,
'You do not need to do this, amir al-muminin. Had the
principal decreased or been destroyed, we would have
guaranteed it.' Umar said, 'Pay it.' Abdullah was silent,
and Ubaydullah repeated it. A man who was sitting with
Umar said, 'Amir al-muminin, better that you make it a
qirad. 'Umar said, 'I have made it qirad.' Umar then took
the principal and half of the profit, and Abdullah and
Ubaydullah, the sons of Umar ibn al-Khattab took half of
the profit."
Malik related to me from al-Ala ibn Abd ar-Rahman from
his father from his father that Uthman ibn Affan gave him
some money as qirad to use provided the profit was shared
between them.
Malik said, "The recognised and permitted form of qirad
is that a man take capital from an associate to use. He
does not guarantee it and in travelling pays out of the
capital for food and clothes and what he makes good use
of, according to the amount of capital. That is, when he
travels to do the work and the capital can support it. If
he remains with his people, he does not have expenses or
clothing from the capital."
Malik said, "There is no harm in the two parties in a
qirad helping each other by way of a favour when it is
acceptable to them both."
Malik said, "There is no harm in the investor of the
capital buying some of the goods from the agent in the
qirad if that is acceptable and without conditions."
Malik spoke about an investor making a qirad loan to a
man and his slave, to be used by both. He said, "That is
permitted, and there is no harm in it because the profit
is property for his slave, and the profit is not for the
master until he takes it from him. It is like the rest of
his earnings."
Malik said, "When a man owes money to another man and
he asks him to let it stay with him as a quirad, that is
disapproved of until the creditor receives his property.
Then he can make it a qirad loan or keep it. That is
because the debtor may be in a tight situation, and want
to delay it to increase it for him."
Malik spoke about an investor who made a qirad loan to
a man, and some of the principal was lost before he used
it, and then he used it and made a profit. The agent
wanted to make the principal the remainder of the money
after what was lost from it. Malik said, "His statement is
not accepted, and the principal is made up to its original
amount from his profit. Then they divide what remains
after the principal has been repaid according to the
conditions of the qirad."
Malik said, "Qirad loan is only good in gold or silver
coin and it is never permitted in any kind of wares or
goods or articles."
Malik said, "There are certain transactions which if a
long span of time passes after the transaction takes
place, its revocation becomes unacceptable. As for usury,
there is never anything except its rejection whether it is
a little or a lot. What is permitted in other than it is
not permitted in it because Allah, the Blessed and the
Exalted, said in His Book, 'If you repent, you have your
capital back, not wronging and not wronged. ' "
Yahya said that Malik spoke about an investor who made
a qirad loan and stipulated to the agent that only certain
goods should be bought with his money or he forbade
certain goods which he named to be bought. He said, "There
is no harm in an investor making a condition on an agent
in qirad not to buy a certain kind of animal or goods
which he specifies. It is disapproved of for an investor
to make as a condition on an agent in qirad that he only
buy certain goods unless the goods which he orders him to
buy are in plentiful supply and do not fail either in
winter or summer. There is no harm in that case."
Malik spoke about an investor who loaned qirad money
and stipulated that something of the profit should be his
alone without the agent sharing in it. He said, "That is
not good, even if it is only one dirham unless he
stipulates that half the profit is his and half the profit
is the agent's or a third or a fourth or whatever. When he
names a percentage, whether great or small, everything
specified by that is halal. This is the qirad of the
muslims."
He said, "It is also not good if the investor
stipulates that one dirham or more of the profit is purely
his, with out the agent sharing it and then what remains
of the profit is to be divided in half between them. That
is not the qirad of the Muslims."
Yahya said that Malik said, "The person who puts up the
principal must not stipulate that he has something of the
profit alone without the agent sharing in it, nor must the
agent stipulate that he has something of the profit alone
without the investor sharing. In qirad, there is no sale,
no rent, no work, no advance, and no convenience which one
party specifies to himself without the other party sharing
unless one party allows it to the other unconditionally as
a favour and that is alright to both. Neither of the
parties should make a condition over the other which
increases him in gold or silver or food over the other
party."
He said, "If any of that enters the qirad, it becomes
hire, and hire is only good with known and fixed terms.
The agent should not stipulate when he takes the principal
that he repay or commission anyone with the goods, nor
that he take any of them for himself. When there is a
profit, and it is time to separate the capital, then they
divide the profit according to the terms of the contract.
If the principal does not increase or there is a loss, the
agent does not have to make up for what he spent on
himself or for the loss. That falls to the investor from
the principal. Qirad is permitted upon whatever terms the
investor and the agent make a mutual agreement, of half
the profit, or a third or a fourth or whatever."
Malik said, "It is not permitted for the agent to
stipulate that he use the qirad money for a certain number
of years and that it not be taken from him during that
time."
He said, "It is not good for the investor to stipulate
that the qirad money should not be returned for a certain
number of years which are specified, because the qirad is
not for a term. The investor loans it to an agent to use
for him. If it seems proper to either of them to abandon
the project and the money is coin, and nothing has been
bought with it, it can be abandoned, and the investor
takes his money back. If it seems proper to the investor
to take the qirad loan back after goods have been
purchased with it, he cannot do so until the buyer has
sold the goods and they have become money. If it seems
proper to the agent to return the loan, and it has been
turned to goods he cannot do so until he has sold them. He
returns the loan in cash as he took it."
Malik said, "It is not good for the investor to
stipulate that the agent pay any zakat due from his
portion of the profit in particular, because the investor
by stipulating that, stipulates fixed increase for himself
from the profit because the portion of zakat he would be
liable for by his portion of the profit, is removed from
him.
"It is not permitted for the investor to stipulate to
the agent to only buy from so-and-so, referring to a
specific man. That is not permitted because by doing so he
would become his hireling for a wage."
Malik spoke about an investor in qirad who stipulated a
guarantee for an amount of money from the agent, "The
investor is not permitted to stipulate conditions about
his principal other than the conditions on which qirad is
based or according to the precedent of the sunna of the
Muslims. If the principal is increased by the condition of
guarantee, the investor has increased his share of the
profit because of the position of the guarantee. But the
profit is only to be divided according to what it would
have been had the loan been given without the guarantee.
If the principal is destroyed, I do not think that the
agent has a guarantee held against him because the
stipulation of guarantees in qirad is null and void."
Malik spoke about an investor who gave qirad money to a
man and the man stipulated that he would only buy palms or
animals with it because he sought to eat the dates or the
offspring of the animals and he kept them for some time to
use for himself. He said, "That is not permitted. It is
not the sunna of the Muslims in qirad unless he buys it
and then sells it as other goods are sold."
Malik said, "There is no harm in the agent stipulating
on the investor a slave to help him provided that the
slave stands to gain along with him out of the investment,
and when the slave only helps him with the investment, not
with anything else."
Yahya said that Malik said, "No one should make a qirad
loan except in coin, because the loan must not be in
wares, since loaning wares can only be worked in one of
two ways: Either the owner of the wares says to the
borrower, 'Take these wares and sell them. Buy and sell
with the capital realized according to qirad.' The
investor stipulates increase for himself from the sale of
his goods and what relieves him of expenses in selling it.
Or else he says, 'Barter with these goods and sell. When
you are through, buy for me the like of my goods which I
gave you. If there is increase, it is between you and me.
'It may happen that the investor gives the goods to the
agent at a time in which they are in demand and expensive,
and then the agent returns them while they are cheap and
he might have bought them for only a third of the original
price or even less than that. The agent then has a profit
of half the amount by which the price of the wares has
decreased as his portion of the profit. Or he might take
the wares at a time when their price is low, and make use
of them until he has a lot of money. Then those wares
become expensive and their price rises when he returns
them, so he buys them for all that he has so that all his
work and concern have been in vain. This is an uncertain
transaction and is not good. If, however, that is not
known until it has happened, then the wage an agent in
qirad would be paid for selling that, is looked at and he
is given it for his concern. Then the money is qirad from
the day the money became cash and collected as coin and it
is returned as a qirad like that."
Yahya said that Malik spoke about a man who made a
qirad loan to a man and he bought wares with it and
transported them to a commercial centre. It was not
profitable to sell them and the agent feared a loss if he
sold them, so he hired transport to take them to another
city, and he sold them there and made a loss, and the cost
of the hire was greater than the principal.
Malik said, "If the agent can pay the cost of the hire
from what the capital realized, his way is that. Whatever
portion of the hire is not covered by the principal, the
agent must pay it. The investor is not answerable for any
of it. That is because the investor only ordered him to
trade with the principal. The investor is not answerable
for other than the principal. Had the investor been
liable, it would have been an additional loss to him on
top of the principal which he invested. The agent cannot
put that on to the investor."
Yahya said that Malik spoke about an investor who made
a qirad loan to a man, who used it and made a profit. Then
the man bought with all the profit a slave-girl and he had
intercourse with her and she became pregnant by him, and
so the capital decreased. Malik said, "If he has money,
the price of the slave-girl is taken from his property,
and the capital is restored by it. If there is something
left over after the money is paid, it is divided between
them according to the first qirad. If he cannot pay it,
the slave-girl is sold so that the capital is restored
from her price."
Malik spoke about an investor who made a qirad loan to
a man, and the agent spent more than the amount of the
qirad loan when buying goods with it and paid the increase
from his own money. Malik said, "The investor has a choice
if the goods are sold for a profit or loss or if they are
not sold. If he wishes to take the goods, he takes them
and pays the agent back what he put in for them. If the
agent refuses, the investor is a partner for his share of
the price in increase and decrease according to what the
agent paid extra for them from himself."
Malik spoke about an agent who took qirad money from a
man and then gave it to another man to use as a qirad
without the consent of the investor. He said, "The agent
is responsible for the property. If it is decreased, he is
responsible for the loss. If there is profit, the investor
has his stipulation of the profit, and then the agent has
his stipulation of what remains of the money."
Malik spoke about an agent who exceeded and borrowed
some of what he had of qirad in money and he bought goods
for himself with it. Malik said, "If he has a profit, the
profit is divided according to the condition between them
in the qirad. If he has a loss, he is responsible for the
loss."
Malik said about an investor who paid qirad money to a
man, and the agent borrowed some of the cash and bought
goods for himself with it, "The investor of the capital
has a choice. If he wishes, he shares with him in the
goods according to the qirad, and if he wishes, he frees
himself of them, and takes all of the principal back from
the agent. That is what is done with some one who
oversteps."
Yahya said that Malik spoke about an investor who made
a qirad loan to a man.
He said, "When the investment is large, the travelling
expenses of the agent are taken from it. He can use it to
eat and clothe himself in an acceptable fashion according
to the size of the investment. If it saves him trouble, he
can take a wage from some of the capital, if it is large,
and he cannot support himself. There are certain jobs
which an agent or his like are not responsible for,
amongst them are collecting debts, transporting the goods,
loading up and so forth. He can hire from the capital
someone to do that for him. The agent should not spend
from the capital nor clothe himself from it while he
resides with his family. It is only permitted for him to
have expenses when he travels for the investment. The
expenses are taken from the capital. If he is only trading
with the property in the city in which he resides, he has
no expenses from the capital and no clothing."
Malik spoke about an investor who paid qirad money to a
man, and the agent went out with it and with his own
capital. He said, "The expenses come from the qirad and
from his own capital according to their proportions."
Yahya said that Malik spoke about an agent who had
qirad money with him and he spent from it and clothed
himself. He said, "He cannot give away any of it, and
neither a beggar nor anyone else is to be given any of it
and he does not pay anyone compensation from it. If he
meets some people, and they bring out food and he brings
out food, I hope that that will be permitted to him if he
does not intend to bestow something on them. If he intends
that or what is like that without the permission of the
investor, he must get the sanction of the investor for it.
If he sanctions it, there is no harm. If he refuses to
sanction it, he must repay it with like if he has
something which is suitable as compensation."
Yahya said that Malik said, "The generally agreed on
way of doing things among us about an investor who pays
qirad money to an agent to buy goods, and the agent then
sells the goods for a price to be paid later, and has a
profit in the transaction, then the agent dies before he
has received payment, is that if his heirs want to take
that money, they have their father's stipulated portion
from the profit. That is theirs if they are trustworthy to
take the payment. If they dislike to collect it from the
debtor and they refer him to the investor, they are not
obliged to collect it and there is nothing against them
and nothing for them by their surrendering it to the
investor. If they do collect it, they have a share of it
and expenses like their father had. They are in the
position of their father. If they are not trustworthy to
do so, they can bring someone reliable and trustworthy to
collect the money. If he collects all the capital and all
the profit, they are in the position of their father."
Malik spoke about an investor who paid qirad money to a
man provided that he used it and was responsible for any
delayed payment for which he sold it. He said, "This is
obligatory on the agent. If he sells it for delayed
payment, he is responsible for it."
Yahya said that Malik spoke about an investor who gave
qirad money to a man, and then the man sought a loan from
the investor or the investor borrowed money from the
agent, or the investor left goods with the agent to sell
for him, or the investor gave the agent dinars to buy
goods with. Malik said, "There is no harm if the investor
leaves his goods with him knowing that if the agent did
not have his money and he had asked a similar thing of
him, he would have still done it because of the
brotherhood between them or because it would have been no
bother to him and that had the agent refused that, he
would not have removed his capital from him. Or if the
agent had borrowed from the investor or carried his goods
for him and he knew that if the investor had not had his
capital with him, he would have still done the same for
him, and had he refused that to him, he would not have
returned his capital to him. If that is true between both
of them and it is in the way of a favour between them and
it is not a condition in the terms of the qirad, it is
permitted and there is no harm in it. If a condition comes
into it, or it is feared that the agent is only doing it
for the investor in order to safeguard the capital in his
possession, or the investor is only doing it because the
agent has taken his capital and will not return it to him,
that is not permitted in qirad and it is part of what the
people of knowledge forbid.' "
Yahya said that Malik spoke about a man who loaned
another man money and then the debtor asked him to leave
it with him as a qirad. Malik said, "I do not like that
unless he takes his money back from him, and then pays it
to him as a qirad if he wishes or if he wishes keep it."
Malik spoke about an investor who paid a man qirad
money and the man told him that it was collected with him
and asked him to write it for him as a loan. He said, "I
do not like that unless he takes his money from him and
then lends it to him or keeps it as he wishes. That is
only out of fear that he has lost some of it, and wants to
defer it so that he can make up what has been lost of it.
That is disapproved of and is not permitted and it is not
good."
Yahya said that Malik spoke about an investor paying
qirad money to an agent who made a profit and then wanted
to take his share of the profit and the investor was away.
He said, "He should not take any of it unless the investor
is present. If he takes something from it, he is
responsible for it until it is accounted for in the
division of the capital."
Malik said, "It is not permitted for the parties
involved in a qirad to account and divide property which
is away from them until the capital is present, and the
investor is given the principal in full. Then they divide
the profit into their agreed portions."
Malik spoke about a man taking qirad money, and buying
goods with it while he had a debt. His creditors sought
and found him while he was in a city away from the
investor, and he had profitable merchandise whose good
quality was clear. They wanted him to sell the merchandise
for them so that they could take his share of the profit.
Malik said, "None of the profit of the qirad is taken
until the investor is present. He takes his principal and
then the profit is divided mutually between them."
Malik spoke about an investor who put qirad money with
an agent and he used it and had a profit. Then the
principal was set aside and the profit divided. He took
his share and added the share of the investor to his
principal in the presence of witnesses he had called.
Malik said, "It is not permitted to divide the profit
unless the investor is present. If he has taken something
here turns it until the investor has received the
principal in full. Then what remains is divided into their
respective portions."
Malik spoke about an investor who put qirad money with
an agent. The agent used it and then came to the investor
and said, "This is your portion of the profit, and I have
taken the like of it for myself, and I have retained your
principal in full." Malik said, "I do not like that,
unless all the capital is present, the principal is there
and he knows that it is complete and he receives it. Then
they divide the profit between them. He returns the
principal to him if he wishes, or he keeps it. The
presence of the principal is necessary out of fear that
the agent might have lost some of it, and so may want it
not to be removed from him and to keep it in his hand."
Yahya said that Malik spoke about an investor who put
qirad money with an agent who bought goods with it, and
the investor told him to sell them. The agent said that he
did not see any way to sell at that time and they
quarrelled about it. He said, "One does not look at the
statement of either of them. The people of experience and
insight concerning such goods are asked about these goods.
If they can see anyway of selling them they are sold for
them. If they think it is time to wait, they should wait."
Malik spoke about a man who took qirad money from an
investor and used it and when the investor asked him for
his money, he said that he had it in full. When he held
him to his settlement he admitted that "Such-and-such of
it was lost with me," and he named an amount of money. "I
told you that so that you would leave it with me." Malik
said, "He does not benefit by denying it after he had
confirmed that he had it all . He is answerable by his
confession against himself unless he produces evidence
about the loss of that property which confirms his
statement. If he does not produce an acceptable reason he
is answerable by his confession, and his denial does not
avail him."
Malik said, "Similarly, had he said, 'I have had
such-and-such a profit from the capital,' and then the
owner of the capital asked him to pay him the principal
and his profit, and he said that he had not had any profit
in it and had said that only so it might be left in his
possession, it does not benefit him. He is taken to
account for what he affirmed unless he brings acceptable
proof of his word, so that the first statement is not
binding on him."
Malik spoke about an investor who put qirad money with
an agent who made a profit with it. The agent said, "I
took the qirad from you provided that I would have
two-thirds." The owner of the capital says, "I gave you a
qirad provided that you had a third." Malik said, "The
word is the word of the agent, and he must take an oath on
that if what he says resembles the known practice of qirad
or is close to it. If he brings a matter which is
unacceptable and people do not make qirads like that, he
is not believed, and it is judged to be according to how a
qirad like it would normally be."
Malik spoke about a man who gave a man one hundred
dinars as a qirad. He bought goods with it and then went
to pay the one hundred dinars to the owner of the goods
and found that they had been stolen. The investor says,
"Sell the goods. If there is anything over, it is mine. If
there is a loss, it is against you because you lost it."
The agent says, "Rather you must fulfil what the seller is
owed. I bought them with your capital which you gave me."
Malik said, "The agent is obliged to pay the price to the
seller and the investor is told, 'If you wish, pay the
hundred dinars to the agent and the goods are between you.
The qirad is according to what the first hundred was based
on. If you wish, you are free of the goods.' If the
hundred dinars are paid to the agent, it is a qirad
according to the conditions of the first qirad. If he
refuses, the goods belong to the agent and he must pay
their price."
Malik spoke about two people in a qirad who settled up
and the agent still had some of the goods which he used -
threadbare cloth or a waterskin or the like of that. Malik
said, "Any of that which is insignificant is of no
importance and belongs to the agent. I have not heard
anyone give a decision calling for the return of that.
Anything which has a price is returned. If it is something
which has value like an animal, camel, coarse cloth or the
like of that which fetches a price, I think that he should
return what he has remaining of such things unless the
owner overlooks it."