Making the mudhaarib (working partner) liable for losses
Question
Is it permissible to make it a condition in a mudhaarabah that the mudhaarib (working partner) will also be liable for losses?
Answer
No, this is an invalid condition. The basis of a mudhaarabah is that the mudhaarib will receive a stipulated percentage of the profit and will not share in the losses if any are incurred. Any loss that is incurred in a mudhaarabah will first be paid from the profits if any. It is only once the profits are depleted that the losses be taken out from the capital.
And Allah Ta'ala (الله تعالى) knows best.
References (Arabic / Urdu sources)
(وما هلك من مال المضاربة يصرف إلى الربح) لأنه تبع (فإن زاد الهالك على الربح لم يضمن) ولو فاسدة من عمله لأنه أمين (الدر المختار 5/656)
- Answered by
- Mufti Zakaria Makada
- Checked & approved by
- Mufti Ebrahim Salejee (Isipingo Beach)
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