Category: Business Matters
Fatwa#: 39336
Asked Country: South Africa

Answered Date: Nov 07,2017

Title: Business partner incurring loss


السلام عليكم ورحمة اللة وبركاته 

Respected mufti saheb

My question goes as follows 

2 people decided to start a business with agreement to profit and loss. The one partner made a decision which involved the capital being lost and also a debt occuring. No one knew the existence of the other partner and now the creditor is demanding from the one partner. Does the other partner take part in the responsibility of the loss even though the fault was made by the other partner? The other partner did give decision rights to the one partner 



In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.

If two partners enter into a business and the business suffers a loss through the normal business decision made by the active partner, then both partners will share in the loss according to the proportion of their investments.[1]  

And Allah Ta’āla Knows Best

Saad Haque

Student Darul Iftaa
New Jersey, USA

Checked and Approved by,
Mufti Ebrahim Desai


[1] بدائع الصنائع في ترتيب الشرائع (6/ 62)

وَالْوَضِيعَةُ عَلَى قَدْرِ الْمَالَيْنِ مُتَسَاوِيًا وَمُتَفَاضِلًا؛ لِأَنَّ الْوَضِيعَةَ اسْمٌ لِجُزْءٍ هَالِكٍ مِنْ الْمَالِ فَيَتَقَدَّرُ بِقَدْرِ الْمَالِ،

الاختيار لتعليل المختار (3/ 16)

(وَإِذَا تَسَاوَيَا فِي الْمَالِ وَشَرَطَا التَّفَاوُتَ فِي الرِّبْحِ وَالْوَضِيعَةِ، فَالرِّبْحُ عَلَى مَا شَرَطَا وَالْوَضِيعَةُ عَلَى قَدْرِ الْمَالَيْنِ) قَالَ - صَلَّى اللَّهُ عَلَيْهِ وَسَلَّمَ -: «الرِّبْحُ عَلَى مَا شَرَطَا وَالْوَضِيعَةُ عَلَى قَدْرِ الْمَالَيْنِ» مِنْ غَيْرِ فَصْلٍ، وَلِأَنَّا جَوَّزْنَا اشْتِرَاطَ زِيَادَةِ الرِّبْحِ بِمُقَابَلَةِ الْعَمَلِ تَقْدِيرًا. أَمَّا زِيَادَةُ الْوَضِيعَةِ فَلَا وَجْهَ لَهَا، وَصَارَ كَمَا إِذَا شَرَطَا الْوَضِيعَةَ عَلَى الضَّارِبِ فَإِنَّهُ لَا يَصِحُّ كَذَلِكَ هُنَا.

An Introduction to Islamic Finance p. 37

DISCLAIMER - questions answers issues pertaining to Shar'ah. Thereafter, these questions and answers are placed for public view on for educational purposes. However, many of these answers are unique to a particular scenario and cannot be taken as a basis to establish a ruling in another situation or another environment. bears no responsibility with regards to these questions being used out of their intended context.
  • The Shar's ruling herein given is based specifically on the question posed and should be read in conjunction with the question.
  • bears no responsibility to any party who may or may not act on this answer and is being hereby exempted from loss or damage howsoever caused.
  • This answer may not be used as evidence in any Court of Law without prior written consent of
  • Any or all links provided in our emails, answers and articles are restricted to the specific material being cited. Such referencing should not be taken as an endorsement of other contents of that website.