Fiqh of Transactions #17 – Partnership and Companies Continued

In order to proceed, so we will continue to read here, we read only two lines, we talked about Shackleton and Angelica to do, we read the lines of our target for Diane Angelica to do character analysis fullerene partnerships are cut through to his credit partnership. And then the sex ed one modaraba. And yet for huduma Melania trophy, where steadycam, theater mudaraba or profit sharing one gives a sum of money for the other to trade with. And the two parties share its profit. And that is the one that we're talking about. Here. It's capital from one side, labor from one side, it's agreed upon by all of them.

While the man representing his power, profit has to be divided in according to the mutual agreement, the loss is on the capital only Damodara the labor does not lose anything. But he lost

his effort or her effort.

So

so it's an applause for the labor that they lost their effort. You know, I've been working on this for three months now. And then, you know, we lost the like, $20,000, I lost my $20,000 he lost your three words, three months of work. So the labor will not be responsible for

when is the laborer responsible for a loss? sciatica is based on what gallon?

As we said before, what can the man it's agency and guaranteed ship, we represent each other, I guarantee you and you guarantee me, and we represent each other. In working is mean or or what you have to look at Amanda or Aria, meaning Amanda, Joaquin is me an advocate is a trustee. This is a trust, a trust, versus taking something for your own interest, not my in your own interest, then you're responsible to give it back to me, you borrow my car, I don't care what happened to it, you're responsible to give me back my car, I leave my car with you. You are a trustee now. You're only responsible if you can make negligence or transgression. If you do something wrong, that's

transgression. If you do, you don't do something right, or something required, that is negligence. So if you commit negligence or transgression, you're responsible

shanika is like this. That's what I get among each other is the partners are all trusted by one another. They're all trustees of one another. So unless some one of them commits negligence or transgression, that he's not responsible, the loss will be the loss of the company, not the loss of that individual, the loss of the company, all of them will share in the loss, including that individual if he's one of the partners.

But the majority of the labor here

you know, will lose if he commits transgression or negligence, he will lose be responsible be liable if he commits transgression, or negligence

then the sheikh said we're done with the modaraba right we're done I guess.

Then the sheikh said was dedicated up then way any study caffeine max if any of you have done email and mobile remember sanathana sheshe who was the oven when I came out? Oh, no soda no credit product when I

was out female Lucy wheel Nevada

Sierra Nevada magic Anna Amar

den, which is labor partnership, but then means what that means buddies, but then means buddy, have them plural of button means buddies. It is called Santa crafts. It's called our man labor. You know, so I know. If you say buddies partnership, it's not going to make a lot of sense. So maybe we should say labor partnership, labor partnership. So here, he says partners share profits in legally permitted work such as crafts, mowing, fishing, and the like, in which they all participate. Have the logarithm so the rates are more solid and I became partners in what we would receive in terms of war captives or booty humara

be kept, you know, the word captive said the time when they were kept as slaves, or ransom for money or goods on the day of the Battle of bed. Saudi then brought to prisoners. But our Mar and I did not bring anybody, anything or anybody. So they basically

go through this read my appendix on slavery and stuff. But they basically they were fighting on the day, that they're fighting, fighting courage. And they, if you capture someone that becomes your slave,

and the war booty is divided. So they made a company among themselves, Ahmad's kind of dilemma so they said, we'll join forces here and whatever it is that we capture Hearn

will divided among ourselves. So sad the book came was to

captives and Ahmad and you know, our motto there are modern apollomon so they're softer Kinder

you know, gentle,

they didn't get anybody

Machado was a warrior saw this bottom cut is a is the hero of the sea. So, so sad capture two and these are two from Christ, you know his relatives anyway.

So, capture two and more and

so did not capture any. So they divided

the ransom of those two among themselves.

But then the honeyberries and the

majority in fact, it's only the Japanese Japanese Oh, he said that there are strictest in terms of partnership. So the Japanese do not accept any partnerships except to these two that are agreed upon by Nana and modaraba, the fullerene partnership and the profit sharing partnership, these are the two ones that the FAA is accept.

So they do not accept to do credit. And that's not accepted by the Americans either they don't accept up then have done which is labor partnership, it is basically labor and labor there is no capital here, it's labor and labor. These people did not contribute capital

who ever captured by the way this is weak, but if we accept it from a historical perspective of our modern sovereign

authority, it is weak in itself, but if we accept it from a historical perspective,

they based on many rulings on it. So,

labor and labor and labor and labor is permissible, let us say in this particular example, we sat there and embroider and a tailor came together or two theatres came together, each one of them contributed some capital, whether it is currency or property, let us say they did not contribute any capital, just to theatres came with their skin, you know, two laborers came with their escape into this partnership did not contribute any capital, they said, We will take work and you know, or we will do anything else

that did not approve of

basically, partnership to go out and chop wood, because what is it is permissible for all people. So, they said that, it cannot be that form of partnership, the medical exam, the honeyberries also approved of this partnership,

but they said there has to be crafts.

Not basically partnership in a

cultivation of mobile.

Mobile means permissible here, but it does not mean permissible. It means co owned by everybody. public property, you know, everybody's entitled to it. If you go out and chop wood from the forest, no one will tell you, you know, at least during their time that everybody could do this or if you mow the lawn or mow the grass and then collected and sell it to, you know, farmers or to cattle

owners or something of that nature. That grass is not owned by anyone. Can we have a partnership like this? We work together, whatever it is that we more whatever it is that we would that we gather, we'll sell it divide the profit between us

mannequins and combat is yes.

Had herpes No, have is agreed with Americans and honeyberries. If we're tailors and we come and work together, then that would be fine. Not when we go and cultivate something that is public property.

What if we are not both theatres? One does you know what one is a theater and one isn't our embroider? Who can we come together and make a partnership that somebody said yes, in fact, Asana is basically having the same sun our graph is not a condition, you can have your own craft, I can have my craft, we start a business partnership, and everybody does their thing. And we divide the profit among ourselves, based on

based on whatever agreement we make among ourselves. So this is called dedicated up then. And it is labor and labor. There is no capital involved here. This is permissible, according to

this is permissible, according to the Hanafi asthmatic, he's at home buddies.

Can we set puppies with one second contingency?

Then the sheikh said

and he stopped and now it stopped talking about the types of shakeout now

that the time for we can agree on a time for the partnership, because when is it when is it that we,

I will come to this when I when I talk about the vision of the Prophet, but the ship here that Mark mentioned that my father, and my father is a very interesting type of partnership.

You know, what the fleet means that occasion?

So you delegate your affairs, we talked about the station of the fleet, you know, unnecessary, dedicated efforts or lost, sort of witness delegation. So this is basically mutual delegation. It's full authority partnership, some forms of it, some forms of it are just

really, really sort of risky. It is full authority partnership, you and I everything that we own, everything that we earn, every liability we incur, we will share it

will share wheelchair. Certainly it amendments FA said if that is not bottom, I don't know any button in the donation. If that is not invalid. I don't know anything invalid in this domain.

But keep in mind.

Some other scholars allow this partnership, the canopies and Maliki's allow the embellies allowed it in. But each each method has their own conditions, which was the combat is allowed. This partnership particularly the latter generations is controversial among the area generations, the latter generations allow this partnership without one thing.

socialists certainly are so like intrigued by this partnership.

Right?

It can't get any more socialist than this.

So but the honeyberries allow this partnership with a with a caveat or contingency. It does not include Kasbah Nether, or, you know, liability, greater liability for rare earnings. So if you inherit money, it is yours. That's rare. If you find lockup, if you find the treasure, it's yours. If you hurt someone and you're responsible for the indemnity compensation for the wound,

it's on you not on me and not on both of us aside from a Nether which is rare, but what is now there and what is not an ad it gets into like so much complications here.

With this type of partnership, like so, you either open it or you know, somebody but but also in this exception of another of the rare earnings and the rare liabilities can be basis for disputation or contention. So either make it actually

Salut and accepted or rejected

the need for something like this?

It could be two brothers, two cousins, it could be two friends that just decided that, you know, I'll have your back you have my back where cover you where we're gonna share everything

must be like,

share everything

well spouses can get into this would be

the contractual agreement.

Anyway. So that's the partnership and then we're starting to talk about assignment

rulings on sharing Profit and Loss report.

Karla Masato, the man, the profit in all these types of partnership is divided according to the terms agreed upon, and the loss is sustained in proportion to the capital, we were done with this, we said the exception here is what when it is only capital and capital, capital and capital, then the loss, the profit would have to be in proportion to the capital, not as agreed upon, because it is capital, no labor is involved here. Okay.

And then he said what I do, and usually

when I say in wyan,

and it is not permissible to specify a defined sum of money as the profit of one of them, or to a point to him or her the profit of a particular thing. So, I think the profits of the trousers, you take the profit of the shirts, we know, the profit has to be a percentage of the total,

you know, you're part of the profit has to be a percentage of the total. Not that, you know, I'll get the first $100 No, I would get 10% of my capital, no, I will get the profit of the trousers, you get the profit of the shirts, no percentage of the total. Why? Because we have to guarantee equity here,

equity, and we have to make sure that there the profit will be shared. And we will have to make sure that no profit without liability.

Then the sheikh said would help him from Lusaka moussaka, delicato, to borrow the Ottoman Arabia.

The ruling regarding watering for parts of the crop and the regarding sharecropping is the same, we'll talk about what the entrepreneurship the loss is first subtracted from the profit before the profit is distributed, the loss is first subtracted from the profit,

what is the term of the company

there is no term they did not talk about a term for the company.

But in mudaraba, for instance, or engender

directly that vision has to be after Candide from the the word Candide meaning all the assets of the company turning into currency. That's not bad man, meaning became currency. So 10 D, which is all the capital of the company became currency, then after this from deed, all the capital of the company became currency, then we figure out what is the profit and divide the profit. Because you could be involved in business you as a moderator, you could take, you know, I can give you $100,000, you go by this, you go by that you make profit from here, you lose here and so on. You can say every time I make profit, I will share the profit. And every time I lose, the losses aren't on you. That

doesn't make sense. But after we recoup the capital, that is

Petrosian, then there is no profit before recouping the capital after we recoup the capital. If there is more than the capital, I gave you $100,000.

After three months, now, all the capital became currency, it's 100 than $1,000. We made $1,000 profit, you could have made $10,000 on a particular transaction, but you also lost nine on another one. So So at the end of the day, we will have to recoup the capital and then we have to divide the profit. But that doesn't work in contemporary companies, because sometimes you never recoup the capital. You never you never

Never becomes currency all of it.

So that is why it is important than contemporary companies that we agree on a term term, you know that we will make that division every year. It's anyone.

So, what if, what if we come at the end of the year and most of the capital of the company or the assets of the company are in the form of property, not currency? What do we do? That is that is when the contemporary scholars that say Yo fee, they said secularism equal from David Hockney, which means valuation,

we turn it into currency by valuation, like we presume its currency by valuation. So we estimate the what is what is owned by the company, and then we decide whether the company made profit or not, and then we divide the profit on such basis.

But then, it is important here that we agree on a term, otherwise we will be difficult,

then

the labor is not liable except for that they will lose their effort, that at the end of the day, the land labor will lose it effort, the labor will become liable, as I said of the transgress or neglect, then they become liable for the transgression or negligent negligence. Then the chief said, when I said he had emailed me on a cllr acquisition in a repair business, a partner has no right to sell for a deferred payment or to take any of the profits without the permission of the other.

Certainly don't take part of the profits without the permission of the other. But can we divide the profit before Can we give like portions of the profit on monthly basis to the contributors? portion portions of the profit on monthly basis to the contributors before we actually figure out what the profit is? Well, the classical scholars did not really agree to this, they did not agree, you know, address this contemporary scholars because of the need, they said give him Yes, yes, given that, when we

sort out the profit at the end of the term of the company, then everybody would agree to return the extra profit that the that the cast. So given that, that this is going to be basically a matter of convenience, but everybody agrees that what matters at the end of the day is the end of the term of the company. When we do our valuation, we will figure out who is entitled to what, if you are entitled to some profit, we'll give it to you. But if you took if you cash more than you actually your your capital or your contribution made, then you will have to return this money. That's how your feasible

partner has no right to sell for a deferred payment because they consider this to be in basically

a loss or they consider this to be suboptimal or suboptimal transaction, you don't sell for deferred payment unless by agreement unless they agree on this. Unless they agree that you know you're you could do whatever you want. We're we're partners we'll do we will do whatever we want. But if

I said that his father in law and who he

joined into a modaraba with someone and he made a condition that he would not

basically take it

in see or sell it or invest in that capital wrapped in livestock. Anything that's a living, you know, or

a CSL with different payment. So you can make conditions for Ramadan.

It's called restricted

modaraba.

You make conditions for the modem, or you could say that the modem here is $100,000 Do whatever you want, in whichever business sell to whomever you please wherever you want. And in this case, that would be acceptable as well and he can sell with different payments or cash, whatever whatever they deem to be appropriate for the business.

And now, let's finish moussaka massage because it is basically the same

thing like, like sciatica is these are different forms of sciatica. These are different forms jerrica sacrum Allah said Baba moussaka, mazara watering in exchange for a share of the produce and sharecropping, the juicer moussaka equal each other the whole summer beaches in summary mocean module one, the one last thing that I wanted to say about this recap is that most the static has architecture is in classical

architecture as meaning non binding contract, we can pull out whenever we want in contemporary effect, it becomes a problem if anyone can pull out and dissolve the sciatica when they want. So in stock companies, for instance, you can pull out you will have to sell your stocks.

You can terminate the sciatica

you will have to sell your stocks.

And so, so, according to the medic, he's according to many Maliki's the shanika as aka the nasm. According to the vast majority, the shake hands aka the jazz non binding contract. Any partner can pull out whenever they want unless it causes data. Because law is an overriding principle, there is no harm or reciprocation of harm. But the Maliki's felt that it is, it often causes data that we should make the default of the static part of the lesson, it's a binding contract. And then if you want to pull out, then we will have to agree on the terms of pulling out it's not like you could terminate the tronic anytime you want. And in contemporary times, you know you just can't consider

it would be very hard to consider it a non binding contract.

She accepted us it was a coffee culture in LA who summer which is in summerhaven Shan Nadelmann, watering or moussaka, in exchange for our share of the produce is permissible with old trees that bear fruit. This is in return for a known percentage of the entire amount of fruits gathered.

It is a percentage. So you hit Why is it called watering, by the way, because it's not only watering you take care of the I have an orchard, apple orchard, whenever I have

these palm trees. And then and then you take care of it. Why did they call it watering because in in the in those lands, the most pious and burdensome effort involved is watering, you know to bring you know to water. But that does not mean it's just watering is taking care of the orchard. So you take care of the orchard. And then you take a percentage of the produce take care of the orchard, you take a percentage of the produce, that percentage of the produce has to be shared means what it means is percentage of the produce, not a fixed amount, not a predetermined amount and not the percentage of a particular produce. I can't tell you here this is the this has grapes and dates and

apples. I mean if that ever happens

and you take the profit of the apples, I take the profit of the dates, that doesn't work.

It has to be the whole profit or you take the profit of these 10 acres. I take the profit of these 40 acres that doesn't work has to be all the profit then we divided you know each one takes a percentage of the total profit for the for the equity and to prevent you know in equity and to make sure that there the profit is being shared by the partners because that is an important principle.

Then the chick said when was that off and out of the bridges in Monza on Canada, Bethlehem in Houma, Amina de Monaco live near hamara the alum on Hama Hama rasulillah. Salam Allah Hi.

Mina Hamza, in what summer, what he loves in the middle Hamad Hammadi sharecropping, which is mazara on a piece of land is done in return for part of the crop with their one or both of them contributed the seeds

of love nama narrated the profits are seldom concluded the contract with the people of hiver that they would be permitted to utilize the land on the condition that half of the producer fruits or visitation would be their share. Another generation ads that they the people have highborn should also invest their money in farming it

okay.

So

Then the chicks Eduardo Mohammed Ahmed Ahmed gerada. The armory, the laborers must do all the work known by custom to be essential for the job. The laborers must do all the work known by custom to be essential for the job. So the difference between mazara and moussaka is simple mazara mazara is craps moussaka, is trees. So if you're taking care of the trees, you're not sowing the seeds of the trees, you're just taking care of the trees you're doing. That's why it's called watering, but it's taking care of the trees but mazara you're doing everything you know. Now, another difference between moussaka and mazara moussaka watering and massager cropping is that with sharecropping,

there is disagreement. disagreement who contributes the seeds is at the

end, at the end of the day, it's not really that important because they can agree on the profit, they can agree on, you know, the percentage of the profit, so you contribute or contribute, here, you have an epidemic, that not really does not

use any definitive language, in terms of who contributes the seeds, did not use any definitive language that the latter combat is they use definitive language, or somewhat, they still disagree, or it's a very controversial issue, you can even say the authorized position and such, because in in, in Montana,

or in short commentary, or that it is

the landlord has, basically contribute the seeds in childhood. that booty supports the position that the that it could be, it does not have to be the landlord, it could be the farmer, or it could be the labor who contributes to the seeds. At the end of the day, we will agree on the percentage. If you are the labor and you contribute it to the seeds, you could get 60% instead of 40% or 50% or 30%. We'll agree on the percentage.

Then the GX seven This is the final thing and this is somebody peculiarity and you know, so

it's somebody gifts here. What are definitely larger than that by muralidhar masala Vina, Jazakallah cassava, by analogy, it is permissible for someone to hand over his or her writing animal or an or to another, to work with it, and then divide the earnings between them.

But it's not limited to writing animals, certainly it could be a car but is also not limited to hi give you fabric.

The authorized position in the harmony method is that the capital of the capital of the company has to be currency, it cannot even be armed as it cannot be which property that's not currency. But here and here, you know, the capital of the company has to be currency. But we said that the medic he said could be property.

But the Americans do not agree with this position. So the homebodies came back and

brought up a position that is pretty interesting here, which is that if you have property, but that property yields profits, it's not just any property, it is a property that could yield profit that could be used can be used to yield profit such as what if you have material fabric, and you go to a theater and tell the theater make garments off of this and whatever we sell whatever, you know, whatever we sell will be between us will divide this for the 60 you know or 6040 that is how many ways allowable. You can go to someone and tell them here is my car.

You know, whatever lease this, whatever profit you're making, you could

drive it.

Whatever profit you make, it will be between us 5050 6040 and so on. This is just like the dub. In this case it would be permissible. Now the ham baddies came here and made another exception that is interesting or at least the weaker position in the middle. they disagreed over this particular

driver. If this driver told you no I will not take 60 for the because

I know how much money I'll make. I will take I will take

I'll take 30% of the profit and $30 every day

30% of the profits $30 every day. I'll drive this car for you take $30 and 30% of the

profit,

the weaker position and the method is,

is okay.

But the authorized position in the method is No.

But the weaker position and method is pretty interesting, because that is what they all are trying to say no to, you know you like, because that could result in stock.

Because all the repair that we could make all the profit that could make is the $30. And he took it, and now the fact that we're agreeing on a percentage is pointless.

But, but, but the point that I wanted to say is that there is sort of whenever there is a pressing need, you will find that there is the is unsettled, that there is pressure coming from, because there is a need in the market, a popular need, if there is a popular need for a particular transaction, you will find that there will be cracks here and there in the theory in the

behind that to accommodate this need. And

and that's why the contemporary scholars, they said that, as long as the two contracts are separate,

we could agree on salary and a percentage of the profit, if we're agreeing that the two contracts are separate from each other.

Now can demo Zara, the in sharecropping or watering the trees can he asked for a

certain amount of money, the same rules will apply? Can he asked for, you know, I will take a daily wage, your salary, like $30 a day, and then at the end of it, I will take 30%

of the profit. The same applies here.

And what we can say is

make two different countries and make the labor

sort out the different jobs that he will perform, and give him the $30 for part of the work

and give him the percentage for a different part of the work in this way, you're having two different contracts. And the subject matter of the two contracts is different. So in this way you could be you could be fine.

Doing this.

Now there is

there are many different types of

companies that

in our modern times, contemporary times, remember different types of companies, there are tech companies, there are joint Liability Companies or mutual Liability Companies, there's limited liability companies.

But at the end of the day, what you need to remember because these are different from these companies, aren't they they're different. So at the end of the day, what you need to remember is these principles

and these foundations

you want to remember that landed a payment on the admin there is no profit without liability. Make sure that you apply this you make sure that she that partnership means equitable distribution of profit and you cannot make conditions that will deprive some people of the profits. So if we say for instance, preferred stocks, they get their profit first before everybody else. Well, that doesn't work in Islamic fit. You know, and and that sort of framework.

You make sure that there is a lot Amanda said man, there is no guaranteed capital. So if we have any form of partnership, where the capital will be guaranteed no whenever there is guaranteed capital, guaranteed capital is called loan in Islam.

That is the only guaranteed capital that is part of this loan loan you can't make profit off of loans in Islam.

He makes sure that there is no ambiguity there is no Johanna. Whereas whether the data is about the capital or the data is about the profit the data is about the subject matter of the contract, the labor that is involved and so on. You try to remove the ambiguity as much as you can, otherwise you will fall into her

and you make sure that rip has divided after recouping the capital

to the

Did you know to avoid inequity and to avoid Also,

if you make sure

that you apply these principles, likely the company will be fine. Now, we don't, you know, those companies are there is no political will and Muslim countries and even if one country wanted to do it, they may, they may not be able to do it on their own. There is a global community sort of, and the Muslim non Muslim country has enough muscle power to basically impose their own sort of framework or regulations

or guidelines. Therefore, it requires, it requires political will. And it requires cooperation between countries

to come up with models that are applicable, that can be shared, and it would have enough momentum among the Muslim countries that are coming together to basically apply those principles. Meanwhile,

the efforts, the efforts

that are

efforts of organizations like I owe fee, mathematically, the assemblies to do the patchwork that we think is like running inside the train, you will never get to the station before the train gets to the station. And that patchwork may sound like you're running inside the train going back and forth, back and forth. But you're still on the train, it's just like, you know,

so the train is basically the global system. And you're running inside the train. But that's fine. Because if you sit down and you relax, you lose everything is just keep on running inside the train, maybe you will have preferred seating, maybe you'll have a sitting next to the exit. So when the train crashes, you could like jump out,

maybe you could get into the first like the

wagon of the train, so that once the train arrives at the station, you could get out or something of that nature.

If you cannot blame people who are trying to run inside the train, if you're just sitting there, because it's not like you jumped out of the train, you're still on the train, you're just sitting there and you're comfortable. And that's all that's always the dilemma of the scholars who try to be who say, you know, classical, traditional and everything.

And so they come up with

a set of rules that no one is applying, it should not gonna work.

And

some of the scholars who try to find ways to apply the principles as much as we can, but oftentimes, we will have to squeeze them, we will have to modify them.

In order for them to fit both groups of scholars, some of them are well meaning and some of them are not well meaning in both groups, you will find some who are sincere, that is their conviction, their conviction is I'm not going to compromise. You know, we're just going to wait until we can do what's right. For can do it right, we're just not going to do it. Not gonna compromise. Those toddlers, some of them are well meaning and some of them are not

the scholars who say when we will have to, you know,

keep our feet in the water, we'll have to just fit, we'll have to try to figure out ways so that we can apply our principles as much as we can, within the constraints of the globe to that system, the International sort of global system, those colors, some of them are well meaning some are not. So, it is not which side you're on.

It is the motivation behind it is whether you are actually seeking the pleasure of Allah subhanaw taala by this or not. And you could be on this side or that side, seeking the pleasure of Allah or seeking self interest or some other game and that's of interest does not necessarily have to be financial, monetary is of interest. It could be any self interest. It could be also you know, if you if your traditional, like he will we're holding on to traditional understanding and understanding classical understanding. It could be also

repeated reputation could be people's recognition of your strictness or your

sort of compromising stances or the that is official

Also, so if interest is not just limited to monetary gains or

so, you know the bottom line is if loss if you have a class to define whether your conviction leads you to that side or the side. If you have a class inshallah you will be fine

when I show