– not with gold dust, ingots, or unrefined silver. There is, however, a report from Malik permitting qarad with such silver lumps and even with jewelry, yet the earlier view is the settled doctrine of his school.
Likewise, a qarad may not be concluded with any asset that, when the contract is dissolved, must be reduced to its market value—such as foodstuffs, condiments, or any other type of merchandise, whether livestock or otherwise. If the two parties nevertheless enter into a qarad with merchandise, the agreement must be revoked before the goods are disposed of. Should trading already have taken place, the working partner is entitled to a customary fee for selling the merchandise and collecting its price; after that, they may commence a proper qarad on whatever profit is subsequently earned.
A qarad may not be based on a debt owed by the working partner until the owner first receives the sum in hand. The same ruling applies if he appoints a third party to collect that debt and then treats it as a qarad between them—it remains invalid. It is disliked for the capital owner to say to the agent, “Collect my money from that man and trade with it,” because he thereby gains an extra benefit—having his debt retrieved for him.
The capital owner may not appropriate any portion of the profit or other advantage beyond his stipulated share, nor may he stipulate, within the terms of the qarad, that the agent undertake separate consignments for him.
The agent is a trustee; his statement is accepted regarding loss, destruction, or deficiency of the capital unless he is proven to be lying. Concerning his claim to have returned the capital to its owner, Malik rules that if he received it in the presence of witnesses, his mere claim is not accepted; but if no witnesses were present at the outset, his statement is accepted in full, provided he swears an oath.
If the owner stipulates that the agent must guarantee the capital, the contract is invalid; once the goods have already been transacted, it reverts to an ordinary qarad, without the added condition.
When the agent trades with the capital while residing in his own town, he is not entitled to any living or clothing expenses from the fund. Such expenses are due only if he is a stranger who has remained in that town solely on account of the investment.