Section

An offer and an acceptance are required, although some hold that acceptance by conduct alone is sufficient. The qualifications of both parties are the same as for an agent and his principal.

If the agent, with the owner’s permission, gives the capital to another agent so that they may share in the work and the profit, that is impermissible according to the sounder view; without such permission the contract is invalid outright. Should the second agent transact, his dealings are those of a usurper. If he buys on credit, and we adopt the newer position of the school, the profit goes to the first agent according to the sounder view, and he must pay the second a wage, though another opinion assigns the profit to the second. If, however, he buys with the very capital of the qirad, the transaction is void.

It is permissible for one owner to enter into a qirad with two agents—whether their shares are equal or unequal—and for two owners to appoint a single agent. After the agent has received his stipulated portion, the remaining profit is divided between the owners in proportion to their respective capital contributions.

When a qirad is invalid, the agent’s transactions nevertheless stand, the profit belongs to the owner, and the agent is entitled to a wage equivalent to his work—unless the owner said, “I enter into qirad with you and the entire profit is mine,” in which case the agent receives nothing, according to the sounder view.

The agent must act with due caution: he may not expose the capital to appreciable loss, nor may he buy on deferred payment without permission. He may sell for other goods, and he may rescind a purchase because of a defect when that is to the parties’ advantage; if keeping the item is preferable, then he may not rescind, according to the sounder view. The owner likewise has the right to rescind, and if they differ, whatever best serves their common interest is followed.

The agent may not transact with the owner himself, may not buy anything for the qirad at a price higher than the capital, nor may he purchase a slave who would automatically be manumitted upon the owner—or, according to the sounder opinion, even the owner’s wife—without explicit permission. If he nevertheless does so, ownership does not pass to the owner but to the agent, provided the purchase was on credit.

He must not travel with the capital without leave, and he may not spend from it on his own maintenance while resident—and, on the preferred view, not even while travelling. He is expected to perform customary tasks such as folding cloth and weighing light goods like gold or musk, but not heavy merchandise and the like; for work he is not obliged to carry out himself, he may hire labor at the owner’s expense.

The preferred opinion is that the agent acquires his share of the profit only when it is actually divided, not merely when profit appears. The fruit of trees, offspring of livestock, the earnings of slaves, and a marriage dower obtained through the qirad capital all accrue to the owner, although another view treats them as qirad property.

Any loss resulting from a fall in prices is set off against profit as far as possible and covered by it. The same applies if part of the capital is destroyed through calamity, seizure, or theft after the agent has begun trading, according to the sounder view; but if it perishes before he starts to trade, the loss is charged to the capital itself, again according to the sounder view.