12. The Book of Partnership

Partnership (sharikah) is of two kinds: a partnership of joint ownership and a partnership formed by contract.

1. Partnership of joint ownership occurs when two men inherit or jointly purchase a piece of property. Neither of them may dispose of the other’s share without his consent, and with respect to that share each is treated as a stranger.

2. The second kind is the contractual partnership, which appears in four forms: mufāwaḍah, ‘inān, the partnership of craftsmen (ṣanāʾiʿ), and the partnership of reputation (wujūh).

a) The mufāwaḍah partnership is where two men make purchases and are equal in their capital, their dealings, and their liabilities. It is valid only between two free, sane, adult Muslims; it is invalid between a free man and a slave, a minor and an adult, or a Muslim and a non-Muslim. This partnership is founded on mutual agency and mutual suretyship.

Everything either partner buys enters into the partnership, except food and clothing for his family. Any debt one of them incurs in exchange for something that can legitimately be shared is guaranteed by the other. If one partner inherits or is given property that cannot lawfully enter a partnership and it comes into his possession, the mufāwaḍah is void and the arrangement reverts to an ‘inān partnership.

A partnership may be concluded only with dirhams (silver coins), dinars (gold coins), and fulūs (copper coins).