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The Partnership of Beneficial Owner (Rabb al-Mal) with Managing Trustee (Mudarib) in Business

Author

Listed:
  • Dr. Hayel Abdul Hafeez Dawood

    (Associate Professor at the School of Sharia, Department of Jurisprudence and its Foundations, University of Jordan, Jordan Author-Orchid id: https://orcid.org/0000-0002-4658-3059)

Abstract

Passive partnership contract (mudarabah) occupies a prominent place in the jurisprudence of Islamic financial transactions, and Islamic jurisprudence has surrounded it with provisions, controls and conditions that guarantee its performance of its role. If some of these terms and conditions are violated, this may lead to invalidation of the mudarabah or its being corrupted. Among the conditions stipulated by jurists for the validity of Passive partnership contract is that the beneficial owner not to interfere in performance of its contract except in a manner that guarantees adherence to the controls and restrictions agreed upon by the owner of the money with the managing trustee, including that the owner of the money delivers the capital to the mudarib. This study aims to explain the rule of stipulating that the money owner be involved in performing the work, himself or his representative, as well as the rule of his participation in the work without stipulating that in the contract. The study concluded that it is permissible for the owner of the money or his representative to work with the mudarib, and that this does not affect the validity of the contract unless it leads to restricting the work and preventing the mudarib from disposing of Passive partnership contract.

Suggested Citation

  • Dr. Hayel Abdul Hafeez Dawood, 2020. "The Partnership of Beneficial Owner (Rabb al-Mal) with Managing Trustee (Mudarib) in Business," Journal of Social Sciences (COES&RJ-JSS), , vol. 9(4), pages 1397-1430, October.
    • Handle: RePEc:jso:coejss:v:9:y:2020:i:4:p:1397-1430
    DOI: 10.25255/jss.2020.9.4.1397.1430
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