equal. If two men purchase two commodities from one man, with one taking one commodity for a specified amount or for its allocated share of the price—on which there is a difference of opinion—and the other likewise taking the second commodity for a specified amount or for its allocated share of the price, on condition that each guarantees the other’s liability, this is impermissible because they are not joint owners of the commodities. Since they are not joint owners, the arrangement amounts to two separate transactions. The ruling concerning two separate transactions is clear: if a man sells another man a commodity, or part of one, and then, in a second transaction, sells another man a different commodity, or the remainder of the first, on condition that he guarantees the first purchaser’s liability, this is impermissible. It is a sale conditional upon a guarantee, which amounts to a guarantee for compensation.

Ibn Lubāba held that, within a single transaction, two men may each guarantee the other’s liability when they are purchasers, but not when they are sellers. The distinction, in his view, is that if the seller were to give the commodity he sold to the two men, each guaranteeing the other’s liability, to one of them in settlement of the full amount owed by him and his partner, this would be permissible. By contrast, if the purchaser were to give the price he paid to the two sellers, each guaranteeing the other’s liability, to one of them in settlement of what that seller owed under the stipulated guarantee, this would be impermissible. This is how he distinguished the two cases. What we have explained above is, Allah willing, the correct view: partnership is a legal concession, so arrangements are permissible within a partnership that would not be permissible between parties acting separately.

Section

There are two views concerning what brings a partnership into effect between the partners.

The first is that it takes effect through a verbal agreement, even if the funds each has set aside remain in his possession, with each bearing the risk of loss of his own funds. Thus, whatever either purchases with the funds he has set aside belongs to them both, even if his partner’s funds are lost while still in that partner’s possession, before he hands them over, and that partner therefore bears their loss. This is Ibn al-Qāsim’s position and his narration from Mālik in the Mudawwana, contrary to the view of another authority recorded there. This applies when the purchase with the funds set aside takes place before the loss of the funds set aside by his partner. If, however, he makes the purchase after his partner’s funds have been lost, without knowing of their loss, he has the choice between