No guarantee of loss without negligence

30-3-2023 | IslamWeb

Question:

السلام عليكم I asked a previous question, apparently it was too long because I was asked to shorten it. Should all partners in a business share the loss if the partner managing the store made a mistake? Or should the partner who made the mistake solely pay for the loss?

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Answer:

All perfect praise be to Allah, The Lord of the Worlds. I testify that there is none worthy of worship except Allah, and that Muhammad, sallallaahu`alayhi wa sallam, is His slave and Messenger.

The work manager is considered a Wakeel (agent) for the rest (of the employees), and the basic principle in the agent is that he is entrusted, so he does not guarantee what he was entrusted with, except in case of transgression or negligence.

Therefore, we should look into what happened from his side, was it due to his negligence or transgression, so he alone guarantees the loss, or if what happened from his side was not due to his negligence or transgression, in which case he does not guarantee the loss alone, but it is in the capital money, and every partner assumes the loss in his capital money.

Ibn Qudaamah said: “The loss in the company is upon each partner according to his money; if their amount of money is equal [i.e. they contributed equal amounts], then the loss is divided amongst them in halves; if the money is one-thirds [for each partner], then the loss is one-third for each of them. I do not know any difference of opinion among the scholars on this issue.” [End of quote]

Allah knows best.