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Islamic Contract Law:

Mal

,

Manfa‘ah

and Rent in

Ijarah


Under the Hanbali school, mal is not limited to a physical object. A lawful and valuable benefit (manfa‘ah) can also be regarded as mal.

Example: Renting a House

Suppose Ahmad owns a house and rents it to Ali for RM1,000 per month.

  • The house itself is mal belonging to Ahmad, the lessor.
  • Ahmad still owns the physical house even after renting it out.
  • The benefit of using and living in the house (manfa‘ah) is also recognised as mal.
  • During the rental period, Ali, the lessee, receives the right to use that manfa‘ah.
  • The RM1,000 paid by Ali is the rent (ujrah).
  • The rent money is also mal, but it is the mal paid by the lessee to the lessor.

In Simple Form

Lessor / Landlord

  • Owns the house → mal
  • Gives the manfa‘ah → right to use the house
  • Receives the rent (ujrah) → mal

Lessee / Tenant

  • Does not own the house itself
  • Receives the manfa‘ah → recognised as mal
  • Pays the rent (ujrah) → mal

Simple Sentence to Remember

In an ijarah contract, the lessor keeps ownership of the physical property (mal), while the lessee receives the manfa‘ah, which is also recognised as mal under the Hanbali view, in exchange for paying rent (ujrah).



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Islamic Contract Law:

Mal

According to the Hanbali School

Hanbali Definition of

Mal

According to Ibn Qudamah, mal refers to:

Anything that provides a benefit and whose use is permitted by Shariah under normal circumstances.

For something to be considered mal, it should therefore have two main features:

1. It Must Have a Beneficial Nature

  • The property must provide some form of benefit or usefulness.
  • The benefit may come from the physical object itself or from the right to use it.

Examples:

  • A house provides shelter.
  • A car provides transportation.
  • Land may be used for farming.
  • Renting a house gives the tenant the benefit of using the property.

Usufruct (

Manfa‘ah

)

  • The Hanbali definition can include usufruct (manfa‘ah).
  • Manfa‘ah means the benefit or right to use something even though the person does not own the object itself.

Example:

  • A person rents an apartment.
  • The tenant does not own the apartment.
  • However, the tenant has the right to live in and use it during the rental period.
  • This benefit is considered manfa‘ah.


2. It Must Be Permissible by Shariah

  • The benefit obtained from the property must be lawful or permissible under Shariah.
  • If something is normally prohibited by Shariah, it is not treated as mal in the same way under this definition.

Examples:

  • A house, food, clothing, and a vehicle have lawful benefits and can be considered mal.
  • Wine is normally prohibited for Muslims and therefore does not qualify as recognised property under this definition.


Necessity (

Darurah

)

  • The definition refers to what is permissible under normal circumstances.
  • An item does not become recognised as ordinary lawful property merely because it may be temporarily allowed in a situation of necessity (darurah).
  • Darurah refers to an exceptional situation where something normally prohibited may be allowed because of serious necessity.

Example:

  • If a normally prohibited substance becomes necessary to protect a person’s life and no lawful alternative exists, its use may be temporarily allowed because of necessity.
  • This exception does not make the substance generally permissible property.


Effect of the Shariah Requirement

  • Requiring property to be Shariah-permissible makes the Hanbali definition narrower.
  • Something may have economic value in society, but if its use is prohibited by Shariah, it may not receive the same recognition as mal.

Example from the Hanbali View

  • The classical example given is wine.
  • Because wine is not regarded as lawful property for a Muslim under this definition, its destruction would not be treated in the same way as the destruction of recognised lawful property.
  • Therefore, the text explains that compensation would not be required in the example of a Muslim destroying wine belonging to a non-Muslim.


Simple Summary

Under the Hanbali school, something is generally considered mal when:

  • It provides a benefit → the property must be useful.
  • Its benefit is permissible by Shariah → the use of the property must normally be lawful.
  • Benefits such as usufruct (manfa‘ah) can be included → not only physical objects, but also recognised rights of use may have property value.
  • Necessity (darurah) is an exception → temporary permission in an emergency does not make something normally prohibited into ordinary lawful property.


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Islamic Contract Law: Definition of

Mal

in Hanafi Schools


Hanafi Definition of

Mal

According to Hanafi scholars, mal means:

Something that people normally desire to own and that can be stored for use when needed.

For something to be considered mal, it generally needs to fulfil two main conditions.

1. Desirability

  • The item should be something that people want, value, or wish to own.
  • It should provide some recognised benefit or usefulness.

Examples:

  • Money
  • Gold
  • Clothes
  • Houses
  • Cars

These are generally desirable because people value and want to possess them.

2. Storability

  • The item should be capable of being kept or stored for future use.
  • It should be available when a person needs it later.

Examples:

  • Money can be saved for future expenses.
  • Gold can be kept and sold later.
  • Rice can be stored and used when needed.


Limitations of the Hanafi Definition

Although this definition is clear, it has some weaknesses.

A. Desirability is Subjective

  • Different people may desire different things.
  • An item may still have value even if people do not normally wish to own it.
  • Therefore, desirability alone may not be a reliable way to determine whether something is mal.

Example:

  • A fire extinguisher may not be something a person normally desires for enjoyment.
  • However, it is useful, valuable, and important in an emergency.
  • This shows that something can still have property value even if it is not normally desired.

B. Some Valuable Things Cannot Be Stored for Long

  • Certain items are valuable even though they cannot be kept for a long period.
  • A strict requirement of storability may wrongly exclude them from the concept of mal.

Examples:

  • Fresh fruits
  • Fresh vegetables
  • Other perishable food

These items are still valuable property even though they may spoil quickly.

C. Non-Physical Benefits May Be Excluded

  • The storability condition may also exclude non-corporeal property, which refers to benefits or rights that are not physical objects.
  • One important example is usufruct (manfa‘ah).

Usufruct (

Manfa‘ah

)

  • Manfa‘ah means the benefit or right to use something without owning the actual property itself.

Example:

  • A person rents a house for one year.
  • The tenant does not own the house.
  • However, the tenant has the right to live in and use the house during the rental period.
  • This right of use is known as manfa‘ah.


Simple Summary

Under the Hanafi view, mal generally requires:

  • Desirability → people normally want or value it.
  • Storability → it can be kept for future use.

However, the definition may be too narrow because it can exclude:

  • Useful things that people may not normally desire, such as a fire extinguisher.
  • Valuable items that cannot be stored for long, such as fresh fruits and vegetables.
  • Non-physical rights and benefits, such as usufruct (manfa‘ah).


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Islamic Contract Law: Definition of Mal in Hanafi and Schools Hanafi Definition of Mal According to Hanafi scholars, mal means: Something that people normally desire to own and that can be stored for use when needed. For something to be considered mal, it generally needs to fulfil two main conditions. 1. Desirability * The item should be something that people want, value, or wish to own. * It should provide some recognised benefit or usefulness. Examples: * Money * Gold * Clothes * Houses * Cars These are generally desirable because people value and want to possess them. 2. Storability * The item should be capable of being kept or stored for future use. * It should be available when a person needs it later. Examples: * Money can be saved for future expenses. * Gold can be kept and sold later. * Rice can be stored and used when needed. ⸻ Limitations of the Hanafi Definition Although this definition is clear, it has some weaknesses. A. Desirability is Subjective * Different people may desire different things. * An item may still have value even if people do not normally wish to own it. * Therefore, desirability alone may not be a reliable way to determine whether something is mal. Example: * A fire extinguisher may not be something a person normally desires for enjoyment. * However, it is useful, valuable, and important in an emergency. * This shows that something can still have property value even if it is not normally desired. B. Some Valuable Things Cannot Be Stored for Long * Certain items are valuable even though they cannot be kept for a long period. * A strict requirement of storability may wrongly exclude them from the concept of mal. Examples: * Fresh fruits * Fresh vegetables * Other perishable food These items are still valuable property even though they may spoil quickly. C. Non-Physical Benefits May Be Excluded * The storability condition may also exclude non-corporeal property, which refers to benefits or rights that are not physical objects. * One important example is usufruct (manfa‘ah). Usufruct (Manfa‘ah) * Manfa‘ah means the benefit or right to use something without owning the actual property itself. Example: * A person rents a house for one year. * The tenant does not own the house. * However, the tenant has the right to live in and use the house during the rental period. * This right of use is known as manfa‘ah. ⸻ Simple Summary Under the Hanafi view, mal generally requires: * Desirability → people normally want or value it. * Storability → it can be kept for future use. However, the definition may be too narrow because it can exclude: * Useful things that people may not normally desire, such as a fire extinguisher. * Valuable items that cannot be stored for long, such as fresh fruits and vegetables. * Non-physical rights and benefits, such as usufruct (manfa‘ah).

Islamic Contract Law: Definition of

Mal

in Hanafi Schools

Hanafi Definition of

Mal

According to Hanafi scholars, mal means:

Something that people normally desire to own and that can be stored for use when needed.

For something to be considered mal, it generally needs to fulfil two main conditions.

1. Desirability

  • The item should be something that people want, value, or wish to own.
  • It should provide some recognised benefit or usefulness.

Examples:

  • Money
  • Gold
  • Clothes
  • Houses
  • Cars

These are generally desirable because people value and want to possess them.

2. Storability

  • The item should be capable of being kept or stored for future use.
  • It should be available when a person needs it later.

Examples:

  • Money can be saved for future expenses.
  • Gold can be kept and sold later.
  • Rice can be stored and used when needed.


Limitations of the Hanafi Definition

Although this definition is clear, it has some weaknesses.

A. Desirability is Subjective

  • Different people may desire different things.
  • An item may still have value even if people do not normally wish to own it.
  • Therefore, desirability alone may not be a reliable way to determine whether something is mal.

Example:

  • A fire extinguisher may not be something a person normally desires for enjoyment.
  • However, it is useful, valuable, and important in an emergency.
  • This shows that something can still have property value even if it is not normally desired.

B. Some Valuable Things Cannot Be Stored for Long

  • Certain items are valuable even though they cannot be kept for a long period.
  • A strict requirement of storability may wrongly exclude them from the concept of mal.

Examples:

  • Fresh fruits
  • Fresh vegetables
  • Other perishable food

These items are still valuable property even though they may spoil quickly.

C. Non-Physical Benefits May Be Excluded

  • The storability condition may also exclude non-corporeal property, which refers to benefits or rights that are not physical objects.
  • One important example is usufruct (manfa‘ah).

Usufruct (

Manfa‘ah

)

  • Manfa‘ah means the benefit or right to use something without owning the actual property itself.

Example:

  • A person rents a house for one year.
  • The tenant does not own the house.
  • However, the tenant has the right to live in and use the house during the rental period.
  • This right of use is known as manfa‘ah.


Simple Summary

Under the Hanafi view, mal generally requires:

  • Desirability → people normally want or value it.
  • Storability → it can be kept for future use.

However, the definition may be too narrow because it can exclude:

  • Useful things that people may not normally desire, such as a fire extinguisher.
  • Valuable items that cannot be stored for long, such as fresh fruits and vegetables.
  • Non-physical rights and benefits, such as usufruct (manfa‘ah).


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​Islamic Contract – Bay’ al-Murābahah, Bay’ al-Istisnā‘ and Bay’ al-Salam

Islamic Contract – Bay’ al-Murābahah, Bay’ al-Istisnā‘ and Bay’ al-Salam
PART I — BAY’ AL-MURĀBAHAH (MARKUP SALE)
1. Definition of Murābahah
Literal Meaning
The word murābahah is derived from the Arabic root word:
ribh
which means:
profit.


Technical Definition
Technically, Bay’ al-Murābahah refers to:
a sale contract in which the seller discloses to the purchaser:
  • the acquisition cost; and
  • the profit markup.
The sale price is therefore:
cost price + disclosed profit.


Example
A trader purchases a laptop for:
  • RM4,000.
The trader informs the customer:
  • cost price = RM4,000;
  • profit = RM500.
Selling Price
4,000 + 500 = 4,500

Result
✅ Valid murābahah sale.


2. Legality of Murābahah
The legality of murābahah is based on:
  • the Qur’ān;
  • ijmā‘ (consensus);
  • qiyās (analogy).
Allah says:
“Allah has permitted trade and prohibited ribā.”
(Qur’ān, 2:275)
Murābahah is also accepted because:
  • it is a genuine sale contract;
  • profit is earned through trade, not ribā.


3. Types of Murābahah
A. Ordinary Murābahah
The seller:
  • purchases goods independently;
  • later sells them at disclosed cost plus profit.


Example
A trader buys furniture for:
  • RM10,000.
The trader later sells it for:
  • RM12,000.
Profit
12,000 - 10,000 = 2{,}000

Result
✅ Ordinary murābahah.


B. Murābahah to the Purchase Orderer (MPO)
The customer:
  • requests the seller or Islamic bank to purchase specific goods;
  • promises to buy them later at markup price.
This structure is widely used in:
  • Islamic banking.


Case Study: MPO
A customer requests an Islamic bank to purchase:
  • machinery worth RM500,000.
The bank purchases machinery.
The bank then sells machinery to customer for:
  • RM600,000 payable over 5 years.
Profit
600{,}000 - 500{,}000 = 100{,}000
600{,}000 - 500{,}000 = 100{,}000
Result
✅ Murābahah to purchase orderer.


Difference Between Ordinary Murābahah and MPO
Ordinary Murābahah
  • Seller purchases goods without prior customer promise.
  • Direct commercial trading.
MPO
  • Customer first places purchase order.
  • Commonly used by Islamic banks.
  • Financing-oriented structure.


4. Basic Rules and Conditions of Murābahah
1. Cost Price Must Be Disclosed
The buyer must know:
  • acquisition cost.


2. Profit Must Be Disclosed
The seller must disclose:
  • markup/profit portion.


3. Asset Must Be Sharī‘ah-Compliant
Examples:
✅ vehicles
✅ machinery
Invalid:
❌ wine
❌ pork


4. Murābahah Must Not Lead to Ribā
Ribawi items cannot be structured improperly through murābahah.


Example: Gold Sale
Gold may be sold through murābahah if:
  • Sharī‘ah conditions of ribawi exchange are observed.


5. Pricing in Murābahah
Islamic law permits:
  • higher deferred prices compared to spot prices.
This is because:
“time takes a portion of the price.”


Example
Cash Price
RM100,000
Deferred Price (5 years)
RM120,000
Additional Amount
120{,}000 - 100{,}000 = 20{,}000
120{,}000 - 100{,}000 = 20{,}000
Result
✅ Permissible deferred murābahah pricing.


6. Application of Murābahah in Islamic Finance
Murābahah is widely used for:
  • home financing;
  • vehicle financing;
  • trade financing;
  • personal financing.


Example
Islamic bank purchases:
  • car for RM90,000.
The bank sells to customer for:
  • RM110,000 payable by instalments.
Result
✅ Islamic vehicle financing through murābahah.




PART II — BAY’ AL-ISTISNĀ‘ (MANUFACTURING SALE)
1. Definition of Istisnā‘
Literal Meaning
Istisnā‘ means:
requesting manufacture.


Technical Definition
Istisnā‘ refers to:
a contract to manufacture or construct specified assets for future delivery at agreed price.


Example
A company commissions:
  • construction of factory machinery.
Result
✅ Istisnā‘ contract.


2. Legality of Istisnā‘
The legality of istisnā‘ is based on:
  • Sunnah;
  • ijmā‘;
  • qiyās;
  • istiḥsān.
The Prophet (SAW):
  • requested manufacture of a ring.
This supports permissibility of manufacturing contracts.


3. Types of Istisnā‘
A. Ordinary Istisnā‘
Two parties only:
  • purchaser;
  • manufacturer.


Example
A homeowner appoints contractor to build house for:
  • RM400,000.
Result
✅ Ordinary istisnā‘.


B. Parallel Istisnā‘
Two independent istisnā‘ contracts involving:
  • customer;
  • Islamic bank;
  • manufacturer.


Example
First Contract
Bank sells factory project to customer for:
  • RM20 million.
Second Contract
Bank appoints contractor for:
  • RM17 million.
Profit
20{,}000{,}000 - 17{,}000{,}000 = 3{,}000{,}000
20{,}000{,}000 - 17{,}000{,}000 = 3{,}000{,}000
Result
✅ Parallel istisnā‘.


4. Basic Rules and Conditions of Istisnā‘
1. Asset Must Be Clearly Specified
Specifications must include:
  • type;
  • quality;
  • quantity.


2. Asset Must Be Manufacturable
Examples:
✅ houses
✅ aircraft
✅ machinery


3. Materials Supplied by Manufacturer
If purchaser supplies materials:
  • contract may become ijārah instead.


4. Delivery Date Must Be Specified
BNM:
  • mandatory delivery date.


5. Place of Delivery
Required if transport/logistics involved.


6. Price
Price:
  • may be upfront;
  • progressive;
  • deferred.
Unlike salam:
  • full upfront payment not required.


7. Possession
Ownership transfers upon:
  • actual possession (qabd haqīqī); or
  • constructive possession (qabd hukmī).


5. Application of Istisnā‘ in Islamic Finance
Istisnā‘ is widely used for:
  • construction financing;
  • infrastructure projects;
  • manufacturing industries;
  • ṣukūk structures.


Example
Islamic bank finances:
  • apartment construction through parallel istisnā‘.
Result
✅ Sharī‘ah-compliant project financing.




PART III — BAY’ AL-SALAM (FORWARD SALE)
1. Definition of Salam
Literal Meaning
Salam means:
advance payment.


Technical Definition
Salam refers to:
a sale contract in which the buyer pays full price upfront for commodities delivered later.


Example
A buyer pays:
  • RM50,000 today
    for:
  • future rice delivery.
Result
✅ Salam contract.


2. Legality of Salam
Salam is permitted based on:
  • Qur’ān;
  • Sunnah;
  • ijmā‘.
The Prophet (SAW) said:
“Whoever pays money in advance for something should pay it for a specified measure or specified weight for delivery on a specified date.”


Wisdom of Salam
Salam supports:
  • farmers;
  • producers;
  • commodity financing.


3. Difference Between Salam and Istisnā‘
Salam
  • Fungible commodities.
  • Full upfront payment compulsory.
Istisnā‘
  • Manufactured assets.
  • Flexible payment.


4. Types of Salam
A. Ordinary Salam
Two parties only:
  • buyer;
  • seller.


B. Parallel Salam
Two separate salam contracts involving:
  • bank;
  • supplier;
  • buyer.


Example
First Salam
Bank purchases wheat for:
  • RM400,000.
Second Salam
Bank sells wheat for:
  • RM480,000.
Profit
480{,}000 - 400{,}000 = 80{,}000
480{,}000 - 400{,}000 = 80{,}000


5. Basic Rules and Conditions of Salam
A. Price (
Ra’s al-Māl
)
  • Must be fully prepaid.
  • Must be clearly known.


B. Commodity (
Muslam Fīh
)
Commodity must:
  • be fungible;
  • measurable;
  • clearly specified;
  • Sharī‘ah-compliant.


C. Delivery Date and Place
  • Delivery date must be fixed.
  • Delivery place specified where necessary.


D. No Sale Before Possession
Buyer:
  • cannot sell salam commodity before possession.


6. Application of Salam in Islamic Finance
Salam is used for:
  • short-term financing;
  • agricultural financing;
  • commodity financing;
  • microfinancing;
  • ṣukūk structures.


Example
Islamic bank finances:
  • rice farmer through salam.
The bank:
  • prepays purchase price.
The farmer:
  • delivers crops later.
Result
✅ Sharī‘ah-compliant agricultural financing.


Overall Important Principle
Murābahah
➡️ Cost-plus sale.
Istisnā‘
➡️ Manufacturing/construction contract.
Salam
➡️ Forward commodity sale with upfront payment.
All three contracts:
  • support real economic activity;
  • avoid ribā;
  • facilitate Sharī‘ah-compliant financing and trade.


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​Islamic Contract Law – Key Terms for “Contract” in Arabic (Notes with Examples)


1. Overview
  • In Islamic jurisprudence, three main Arabic terms are used to describe “contract”:
    • Mīthāq (ميثاق)
    • ʿAhd (عهد)
    • ʿAqd (عقد)
👉 Each term has:
  • A different scope and level of obligation


2. Mīthāq (Covenant with High Sanctity)
Meaning
  • A solemn and highly binding covenant
  • Stronger than an ordinary contract


Nature
  • Involves:
    • Deep moral and spiritual commitment


Examples
  • Marriage contract
    • Considered:
      • A sacred covenant
  • Covenant between Allah and mankind
    • Obligation to:
      • Obey divine commands


👉 Key Idea:
  • Not just legal
  • Also:
    • Spiritual and moral obligation


3. ʿAhd (Promise / Undertaking)
Meaning
  • A promise or commitment
  • Can be:
    • Unilateral
    • Or involve mutual understanding


Nature
  • Creates:
    • Moral and sometimes legal obligation


Examples
  • A promise:
    • To repay a debt
  • A pledge:
    • To perform a duty


👉 Key Idea:
  • Focus on:
    • Trust and responsibility


4. ʿAqd (Contract in Commercial Sense)
Meaning
  • Literally:
    • “To tie”, “to bind”, “to join”


Nature
  • A binding agreement between two parties
  • Based on:
    • Offer and acceptance


Examples
  • Sale contract (buying goods)
  • Lease agreement
  • Partnership contract


👉 Key Idea:
  • Most suitable term for:
    • Modern commercial contracts


5. Key Differences (Simple Comparison)
  • Mīthāq
    • Sacred covenant
    • Strongest obligation
 
  • ʿAhd
    • Promise or undertaking
    • Moral + possible legal effect
 
  • ʿAqd
    • Formal contract
    • Legal and commercial focus


6. Key Insight
  • Islamic law recognises:
    • Different levels of obligation:
      • Spiritual
      • Moral
      • Legal
👉 These are reflected in:
  • The three terms above


Final Summary
  • Mīthāq
    • Sacred covenant
  • ʿAhd
    • Promise or commitment
  • ʿAqd
    • Legal contract


One-Line Understanding
  • Islamic contract terminology ranges from:
    👉 “Sacred covenant → promise → legal contract.”




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​Islamic Contract Law – Covenant vs Promise vs Undertaking (Clear Comparison)


1. Covenant (Mīthāq)
Meaning
  • A solemn and highly binding agreement
  • Stronger than an ordinary promise


Nature
  • Involves:
    • Moral + spiritual + legal obligation
  • Often:
    • Sacred in nature


Examples
  • Marriage contract
  • Covenant between Allah and mankind


👉 Key idea:
  • Highest level of commitment


2. Promise (ʿAhd)
Meaning
  • A commitment made by one party
  • Can be:
    • Unilateral


Nature
  • Primarily:
    • Moral obligation
  • May become:
    • Legally binding in some cases


Examples
  • “I will repay you next week”
  • Pledge to donate money


👉 Key idea:
  • Based on:
    • Trust and honesty


3. Undertaking
Meaning
  • A formal promise or assurance
  • Often used in:
    • Legal and commercial context


Nature
  • More structured than a simple promise
  • Can be:
    • Legally enforceable


Examples
  • Bank undertaking to pay
  • Written commitment in a contract


👉 Key idea:
  • A serious, formal promise with legal effect


4. Key Differences (Simple)
  • Covenant
    • Strongest
    • Sacred + moral + legal


  • Promise
    • Less formal
    • Mainly moral


  • Undertaking
    • Formal promise
    • Legal/commercial context


5. Key Insight
  • These terms reflect:
    • Different levels of obligation
👉 From:
  • Spiritual → moral → legal


Final Summary
  • Covenant = sacred and binding agreement
  • Promise = personal commitment
  • Undertaking = formal legal promise


One-Line Understanding
  • Covenant > Undertaking > Promise in terms of strength and seriousness of obligation

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​Islamic Contract Law – Why No General Theory of Contract in Classical Jurisprudence


1. Key Observation
  • Classical Islamic jurists:
    • Defined specific contracts (sale, lease, partnership)
  • But did NOT:
    • Provide a general definition of “contract”


👉 Reason:
  • Islamic contract law developed:
    • Practically, not theoretically


2. Explanation by Mustafa al-Zarqa
  • Modern legal systems:
    • Start with:
      • General principles
    • Then apply them to:
      • Specific cases


  • Islamic law:
    • Takes the opposite approach


3. Methodology of Islamic Law
A. Case-Based Development
  • Focus on:
    • Specific transactions first


Examples
  • Sale (bayʿ)
  • Lease (ijārah)
  • Partnership (mushārakah)


👉 Each contract:
  • Has its own:
    • Rules
    • Conditions


B. Principles Developed Later
  • General rules:
    • Derived gradually
  • As:
    • New situations arose


👉 Not:
  • Pre-designed or abstract


4. Contrast with Modern Legal Systems
Modern Law
  • Starts with:
    • Definitions (e.g., “contract”)
  • Builds:
    • Systematic theory


Islamic Law
  • Starts with:
    • Practical rulings
  • Builds:
    • Principles over time


5. Key Insight
  • Islamic contract law is:
    • Bottom-up approach
👉 Instead of:
  • Top-down theoretical system


6. Resulting Structure
  • No single “contract theory” initially
  • But:
    • A comprehensive system exists in practice


👉 Built from:
  • Numerous specific contract rules


7. Modern Development
  • Later scholars:
    • Tried to:
      • Formulate a general theory of contract
👉 Based on:
  • Principles such as:
    • Consent
    • Fulfilment of obligations
    • Lawfulness


Final Summary
  • Classical jurists:
    • Focused on specific contracts, not abstract theory
  • Islamic law developed:
    • From detailed cases to general principles
  • This differs from:
    • Modern legal systems which start with theory


One-Line Understanding
  • Islamic contract law developed:
    👉 “From practical cases to general principles, not from theory to application.”

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Islamic Contract Law – Al-Zarqā’s Explanation of Methodology (Notes)



1. Core Idea by Mustafa al-Zarqa


  • There is a fundamental difference between:
  • Modern legal systems
  • Islamic law



2. Modern Legal Method (Top-Down Approach)


  • Starts with:
  • General principles and theories
  • Then:
  • Applies them to:
  • Specific cases




Example


  • Define:
  • “Contract”
  • Then derive:
  • Rules on offer, acceptance, consideration




👉 Structure:


  • Theory → Rules → Cases




3. Islamic Legal Method (Bottom-Up Approach)


  • Starts with:
  • Detailed practical issues
  • Then:
  • Develops general principles gradually




Example


  • Rules first developed for:
  • Sale (bayʿ)
  • Lease (ijārah)
  • Partnership
  • Later:
  • General principles extracted


👉 Structure:


  • Cases → Rules → Principles


4. Role of the Majallat al-Ahkam al-Adliyyah (Mejelle)


  • Reflects this Islamic method:
  • Begins with:
  • Specific legal rulings
  • Then introduces:
  • General legal maxims



👉 Shows:


  • Principles were:
  • Derived from practice, not imposed beforehand


5. Key Insight


  • Islamic law:
  • Is:
  • Practical and experience-based
  • Modern law:
  • Is:
  • Systematic and theory-driven


6. Why This Matters in Contract Law


  • Explains why:
  • Classical jurists:
  • Did NOT define “contract” abstractly
  • Instead:
  • Focused on:
  • Individual contract types


Final Summary


  • Modern law
  • Starts with:
  • General theory
  • Islamic law
  • Starts with:
  • Real-life cases
  • Then develops:
  • General principles


One-Line Understanding


  • Islamic law develops:
    👉 “From practical cases to general principles, not from abstract theory to application.”
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Islamic Contract Law – Summary (Definition of Contract from Arabic Terms Onwards)​

1. Key Arabic Terms for “Contract”
  • Mīthāq (Covenant)
    • A highly solemn and sacred agreement
    • Example:
      • Marriage
      • Covenant with Allah


  • ʿAhd (Promise / Undertaking)
    • A commitment or promise
    • May be:
      • Moral or sometimes legal


  • ʿAqd (Contract)
    • A binding agreement between two parties
    • Most suitable term for:
      • Modern commercial contracts


2. Technical Definition of Contract (ʿAqd)
  • Defined by scholars such as:
    • Al-Jurjani
    • Muhammad Abu Zahrah


Core Definition
  • A contract is:
    • A linkage between offer and acceptance
    • Made in a lawful manner
    • Producing legal effects on one or both parties


3. Key Characteristics of a Contract
  • Requires:
    • At least two parties
  • Based on:
    • Mutual consent (tarāḍī)
  • Must be:
    • Free from:
      • Coercion or duress
  • Must involve:
    • Lawful subject matter


4. Essential Pillars of a Contract
Majority View
  • Ṣīghah (offer & acceptance)
  • Contracting parties
  • Subject matter


Hanafi View
  • Ṣīghah is:
    • The main essential pillar


5. Role of Ṣīghah (Offer & Acceptance)
  • Most important component
  • Represents:
    • Declaration of consent


6. Legal Effect of Contract
  • A valid contract:
    • Creates:
      • Rights and obligations


Example
  • Sale:
    • Buyer must pay
    • Seller must deliver


7. Key Insight
  • Islamic contract law focuses on:
    • Consent + lawfulness + legal effect


Final One-Line Definition
👉 A contract (ʿaqd) is a lawful agreement between two parties, formed through offer and acceptance, which creates binding legal rights and obligations.

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