IslamQA.org Logo

madhab

Shafi'i Fiqh

Ruling on Paying Salary to Non-Working Partner from Company`s Profits

A fuselage was purchased to be turned into a restaurant based on a contract of partnership and employment. The first party is responsible for bringing this fuselage to a certain location while the second shall do whatever is needed to equip this restaurant to the fullest. In order to safeguard the financial rights of the first party, one point of the contract stipulated the following: "The second party shall pay (1000 JDs), at the minimum, to the first party from the monthly revenues and for each month, except during forced closures and in the incidence of storms and inactivity resulting from force majeure." After asking about this, we were told that it is unlawful to determine this percentage at a certain sum for this is usury (Riba). Therefore, it was suggested to adjust the above point into one of the following alternatives: First, the second party shall pay a monthly salary (1000 JDs) to the first party, although the latter party won`t be working on the project. Second, the second party shall pay (1000-1500 JDs), at minimum, to the first party from the monthly profits. In light of this, is determining a percentage from the profits, as indicated above, unlawful according to Sharia?

Shafi'i Fiqh

Ruling of Sharia on Changing Contract`s Formulation

Is it permissible to change the form of portfolio management from profit-sharing Mudarbah contract into a contract of agency investment in return for 1.5 % of capital per year without the consent of the client? Is it permissible to take a known fee as a percentage of capital against managing the portfolio`s funds through agency investment contract? 

Search
Related QA

Pin It on Pinterest