BAYERO UNUVERSITY KANO

SCHOOL OF POST GRADUATE STUDIES

FUCULTY OF LAW
DEPARTMENT OF ISLAMIC LAW

ISLAMIC CONTRACTS (PRICIPLES, ELEMENTS AND TYPES)

BY:
ABUBAKAR UMAR MUHAMMAD
SPS/21/MLL/00059

COURSE FACILITATOR:
DR. ALIIYU MUSTAPHA
DATE: 05/11/2023

1
 ABSTRACT
contracts are present in all aspects of our daily existence. when buying or
selling, you are initiating a contract. the terms and conditions of your
work in the light of islamic sharia are stated in these peppers.

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INTRODUCTION
Islam as a comprehensive system provides guidelines for human
behaviour throughout life. It does that through a set of beliefs. These
beliefs organise the relationship between the individual and Allah, the
individual and other human beings, as well as the individual and the
environment.
Regulating Contracts is among the most important aspects of human life.
contracts, involves the initiation, transfer, modification, or termination, of
a right, as a part of its guidance, Islam renders clear guidelines towards
the economic behavior of human beings.
Thus, this paper comes to enlighten on the concept, principle, elements,
and types of Islamic contracts.

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DEFINITION OF CONTRACT (AL-AQD)
Al-Aqd literally: is the opposite of "al-hal" which means
disentanglement: and its plural is "Al-Uqud".
According to jurists, it has two meanings:
The first is: the offer issued by one of the contracting parties is linked to
the acceptance of the other in a way that proves its effect on the subject of
the contract, and the two parties must agree, and that is by matching the
acceptance with the offer. This specific meaning of the contract is
common among Hanafi jurists, and it is the common usage among jurists
in general, except when indicated otherwise.
The other meaning is: every act that includes the initiation, transfer,
modification, or termination, of a right, whether issued by a single
individual or more. This is the prevalent definition of contract among
Maliki, Shafi’i and Hanbali jurists1.
FEATURES OF ISLAMIC CONTRACTS
The basic and most important features of Islamic finance are its freedom
from Riba, Gharar, Maysir and avoidance of trade in unlawful goods and
services. Further, the features also include the principle of justice and
equity.
PROHIBITION OF RIBA
The word Riba is simply translated into English as usury or interest.
There are many verses in the Quran and a number of Ahadith
commanding the strict prohibition of Riba.
In the Quran Allah says:
“Those who eat Riba (usury) will not stand (on the Day of
Resurrection) except like the standing of a person beaten by Shaitan
(Satan) leading him to insanity. That is because they say: “Trading is
only like Riba (usury),” whereas Allah has permitted trading and
forbidden Riba (usury). So whosoever receives an admonition from
his Lord and stops eating Riba (usury) shall not be punished for the
past; his case is for Allah (to judge); but whoever returns [to Riba
(usury)], such are the dwellers of the Fire - they will abide therein.

1. izzuddeen Muhammad khoja and abdussattar abu gudda, nazariyyat

al'aqd fil fiqh al-Islamy, (1993) 13.
4
Allah will destroy Riba (usury) and will give increase for Sadaqat
(deeds of charity, alms, etc.) And Allah likes not the disbelievers,
sinners. Truly those who believe, and do deeds of righteousness, and
perform As- Salat (Iqamat-as-Salat), and give Zakat they will have
their reward with their Lord. On them shall be no fear, nor shall they
grieve. O you who believe! Be afraid of Allah and give up what
remains (due to you) from Riba (usury) (from now onward), if you
are (really) believers. And if you do not do it, then take a notice of
war from Allah and His Messenger but if you repent, you shall have
your capital sums. Deal not unjustly (by asking more than your
capital sums), and you shall not be dealt with unjustly (by receiving
less than your capital sums)...”-(Al Quran 2:275 to 279).
Trading in interest and violating the law of prohibition of Riba is referred
as a major sin. In various Ahadith the Prophet (Peace be upon Him)
elaborated and made clear the definition of Riba. Here is a Hadith for
reference: “The selling of gold for gold is Riba except if the exchange is
from hand to hand and equal in amount, and similarly, the selling of
wheat for wheat is Riba unless it is from hand to hand and equal in
amount, and the selling of barley for barley is Riba, unless it is from hand
to hand and equal in amount, and the selling of dates for dates is Riba,
unless it is from hand to hand and equal in amount” (Bukhari Volume 3,
Book 34, Number 382). Riba in its simplest terms is any excess or
premium charged on money lent. The excess can be in terms of quality or
quantity or in terms of a tangible thing or intangible benefit or is
stipulated at the time of contract or while determining the period of delay
for satisfaction or during the period of delay or the stipulation is in
writing or is part of customary practice.
PROHIBITION OF GHARAR
The word Gharar simply refers to lack of knowledge or uncertainty.
Prophet Muhammad (Peace be upon Him) prohibited business and
transactions that involve Gharar. In a Hadith the Prophet Muhammad
(Peace be upon Him) said: “Whoever sells a defective commodity
without disclosing it remains in Allah’s wrath”. There are many examples
of Gharar-based transactions like the sale of the offspring in the womb of
a pregnant animal, sale of fish in water and birds in the sky. The reason
behind the prohibition of these transactions is that the ability of the seller
to deliver these items is uncertain.

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Gharar, in practice, relates to issues such as pricing, delivery, quantity
and quality of assets that are transaction-based and could affect the
degree or quality of consent of the parties to a contract. This lack of
knowledge may rise from misrepresentation, mistake, fraud, duress, or
terms beyond the knowledge and control of one of the parties to the
contract.
PROHIBITION OF MAYSIR
Gambling games of chance or speculation are forbidden. Gambling is a
zero-sum game which creates no additional value to the society.
UNLAWFUL GOODS AND SERVICES
Apart from being Riba and Gharar free, Islamic finance business keeps a
distance from trading in unlawful goods and services that are prohibited
and are clearly mentioned in the Quran and Hadith. Some of the notable
prohibited goods and services include non-Halal foods such as pork,
animals that are not slaughtered according to Islamic principles,
intoxicating drinks, pornography, tobacco-related products and weapons.
JUSTICE AND EQUITY BASED
The application of Islamic guidelines in contract is not just for cleaning
the financial system from interest and Gharar, rather it is to establish
justice in finance for which Riba and Gharar have been prohibited.
Islamic finance tries to promote social justice and equity in human
society. Justice in business or partnership requires that both the parties
should contribute cash, assets or work and bear or share the risk in
business. On the basis of contribution and risk bearing or sharing, the
profit and loss are distributed to the parties. With regard to trade, the
Shariah provides the rulings to protect the consumers from producers or
sellers in the event of the latter manipulating prices, and protect the
producers or sellers from consumers should the latter refrain from paying
or default in their payment without a valid reason. In this manner,
establishment of justice and equity becomes the additional feature of
Islamic law of contract.2
Pillars of the Contract
There are two points of view in determining the pillars of the contract,
based on the definition of the pillar. According to the majority, the pillar

[Link] guides to islamic banking & finance: principles and practices.

(2014) 25-28.
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is what the existence of a thing depends on, even if it is not a part of it.
The pillar of the contract according to them is the statement of the
contract, the two parties of the contract, and the subject of the contract,
because it is inconceivable that the contract exists without them.
According to the Hanafis, the pillar is what depends on the existence of a
thing and it is a part of it. For them, the pillar of the contract is only the
statement, which is the offer and acceptance, because the statement truly
expresses the agreement of the two parties, which is the meaning of the
contract3.
The following is an explanation of the pillars from a broader
perspective:
1. Statement of the contract (sighah)
Jurists paid close attention to the wording, because there must be
evidence of the will of the contracting parties to establish the contract.
This statement is the offer and acceptance in contracts that require an
agreement of two parties, and the offer only in contracts that do not
depend on the acceptance of the other party.
What is meant by offer and acceptance are two opposite phrases that
indicate agreement between the two parties. The Hanafi school of thought
believes that the offer is what was initially issued by one of them, and
acceptance is what was issued secondly by the other, with satisfaction of
it. As for the majority, the offer is what was issued by the person from
whom ownership is obtained, whether it was issued first or second.
Acceptance is what was issued by the person to whom the ownership
becomes, even if it was issued first4.
Conditions of statement.
Three conditions are required for the offer and acceptance:
i. Clarity of the offer and acceptance: Both the offer and acceptance must
be unambiguously indicative of the intent of the contracting parties: by
knowing with certainty from the wording used for the offer and
acceptance that the contracting parties intended a specific contract. If that
is not clear from the wording, the intents and meanings will matter, not
the words and premises, such as a sales contract with the word gift,

2. Idid
4
. Ahmad Usman, manhaj al'islam fii al-Mu'amalat al-Maliyya, 22-23.
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associated with a price. And the wording does not always mean the
statement, so it can be established with something else, as explanation
will follow.
ii. The congruency of offer and acceptance on what must be agreed
upon: If the acceptance does not include all the details of the offer by
fulfilling some of what the offeror has obligated - half of the offered
merchandise, for example - then the contract will not be concluded
without a new, agreeing offer.
iii. Connection of acceptance to the offer: And this condition, although
the jurists agreed on it, they differed as to what is meant by connection.
The Shafi’is said: What is meant by this is that acceptance occurs
immediately after the offer, so if foreign words mediate between them,
communication will not be achieved and the contract will be invalidated.
This is because acceptance is a response to the obligation and
commitment of the offer, so it must be its immediate, so if it is delayed,
the meeting is no longer there.
The Hanafis, Malikis, and Hanbalis held that communication is achieved
by the unity of contractual session, and what is meant by the unity of
contractual session is not the fact that the contracting parties are in one
place, but rather what is meant by it, is the time during which the
contracting parties are engaged in contracting, even if the distance
between them is great, such as the contracting parties by message or
telephone. This is if there is no foreign separation between the offer and
acceptance, which is considered an invalidation of the offer, such as the
offeror retracting his offer before acceptance, or the acceptor turning
away from this offer by being busy with something other than the
contract. If none of that happens, the acceptance is valid and the contract
is concluded.
It must be noted that the connection of acceptance with the offer is a
condition in all contracts except three: The Will, the Bequest, and the
Agency.
In a Will, the offer occurs during the life of the testator, while acceptance
occurs after his death and has no effect if it occurs during the life of the
testator, because it is only binding upon death.
Likewise, acceptance in a Bequest, which is making someone else a
guardian of his children to take care of their affairs after his death, does
not have to be in the council of the offer, rather it is valid to be in another,

8
whether it occurs during the life of the testator or after his death, but if he
accepts it during his lifetime, he will not be a guardian until after his
death.
The Agency is based on expansion and ease, so it is valid to accept it in
another council5.
The Statement is achieved by one of the following:
A- Speech: The jurists agreed that speech is the first way to highlight the
wording of the contract abroad, and therefore every contract is concluded
with it, whatever its type, whenever the contracting party is capable of it,
and in any language as long as the two contracting parties understand it.
B - Writing: The contract is concluded in writing on the condition that it
is clear and that its copy remains after it is completed, and that each of the
contracting parties reads what the other has written and understands it. If
one of the parties to the sale wrote the word of offer: I sold you this thing
for such and such, and the other said: I accept, and the writing was clear,
and he read it. Both contracting parties understood it, the sale is then
concluded as if they had uttered these two phrases. However, if the
writing was not clear, such as if it was written on water or in the air, or it
remained, but one of them did not read what the other wrote, or he read it
and did not understand it, then the contract is not concluded.
Also, writing is valid in any language as long as it is understandable, and
it is not a condition for contracting parties to be unable to speak,
according to what is most likely. Rather, it is valid even if they are able to
do so, and this ruling applies to contracts with the exception of marriage
in the event that the two parties meet in one place, unless they are unable
to speak. Because the marriage contract, for its validity, requires the
presence of witnesses and their hearing the parties' words, and this is not
possible in writing. Because the basis of the marriage contract is publicity
and not confidentiality. However, if the contracting parties are not
gathered in one place, then it is absolutely valid to conclude the contract
in writing, whether the contract is a marriage or something else. If the
book reaches the other contracting party and is accepted in the book-
reading session, the contract is concluded, but in marriage it is stipulated
that its acceptance be in front of two witnesses to whom the book is read.
There is an affirmation and then with audible words to them.

5
Idid
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C - Signing: The sign can either be from someone who is able to speak or
from someone who is incapable of speaking, such as a mute person, for
example. The incapable person either has the ability to write, or is not
good at it. There are three cases in which the ruling differs.
The first case: If he is one of those who are able to speak, then the
contract is not concluded with him according to the majority of jurists,
because the basic principle in expressing the will is through speech and
one does not resort to anything else except in the case of inability.
However, the Malikis disagree with this and state that the understood
signal is considered in contracts, because what is intended is to express
the intent by what it indicates, and the understood signal can indicates
that, but they made an exception from that to the marriage contract,
saying: It is not concluded by pointing in that case because of its danger
and the consequences it entails.
Perhaps what the Malikis hold is the most correct, because an
understandable sign is one of the means of expressing the will.
The second case: If he is mute and unable to write, then his contract is
concluded on the condition that his sign is understood. If it is not
understood, it is considered slurred.
The third case: If he is an incapacitated person who is good at writing,
then the majority believes that his contract cannot be concluded with it
because he refrained from writing, which is more meaningful than
signalling. Since the book is known to everyone who reads, unlike the
sign, which is not known to everyone, so the writing is stronger than the
sign.
When the evidence comes together, the strongest is presented.
The Malikis disagreed with this, since the intelligible sign in both of
them is used to conclude a contract with someone other than a mute. It is
more appropriate for the mute, even if he is good at writing, which is the
more correct view, because the intelligible sign - as we said - indicates
consent.
D- Actions: There is no disagreement among jurists that marriage is not
concluded by actions indicating consent. Al-Shafi’i attached divorce,
khul'i, and return to marriage, to marriage, so he did not permit them
except in words, and so as Will, it is not conceivable to contract them in
action.

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As for the rest of the contracts, the jurists have three opinions regarding
them:
The first: It should not be concluded with acions at all due to the lack of
their strong significance for contracting, because the basic principle in
contracts is that they should be with words due to the clarity of their
meaning, because people express their purposes with them, and it is not
changed to something else except in cases of need, such as pointing for a
mute person or writing because it takes the place of speech, and of
opinion is imam Shafi'I, and Ahmad in a narration from him.
Second: It can be based on actions on things that people are familiar with,
whether lowly or valuable, because after getting acquainted with them
and people becoming accustomed to them, they become an apparent tool
in expressing their will. like using a bus, and the purchase of newspapers,
magazines, and items with fixed prices. For the conclusion of the
contract, it is not necessary for the transaction to be from both sides,
rather it is sufficient for it to be from one side. If the seller takes the price
and does not give the thing sold, or the buyer takes the thing sold and
does not give the price, the sale is valid and binding, even if it the price
changed. This is what the Hanafis said.
Third: It is binding on actions absolutely as long as the action has a clear
meaning, whether it was performed according to custom or not, whether
it was vile or noble, and whether the action was from both sides or from
one side, except that it is not binding if it is from one side until there is a
seizure from the other side, then it is binding. This is what the Malikis
said, and it is the apparent view of Ahmad ibn Hanbal. The basis for this
opinion is that the legislator did not assign contracts a special premise on
which they are based, but rather made the mutual consent a basis for
establishing them, and consent is a speculative matter that only appears to
us. As indicated by this, everything that indicates the existence of consent
is considered in the eyes of the law, and clear actions are no less
significant than others.
Looking at these opinions in the light of sharia's objectives that they came
to achieve people’s interests without causing them embarrassment and
hardship, we find that the worthy of consideration is this third opinion,

11
because it is compatible with practical life because of the ease and
tolerance it contains6.
2. The two contracting parties
It is not possible to imagine the existence of a contract without the
contracting party issuing from him, and this can only be a human being,
and not every human being is fit to be a contracting person. Rather, the
matter is different according to the observed reality. There are some
people whose expressions are not suitable for anything at all, and there
are those whose expressions are absolutely correct, and also there are
those who are a middle ground between the two types, so his expression
can be suitable for one type of behavior but not another. Therefore, there
must be something other than humanity that makes a person fit to be a
contractor. This thing is expressed by (legal) capacity.
Then, the mere presence of capacity does not make the contract effective
and produce effects. Rather, there must be another quality on which the
contract’s effectiveness depends, and this quality is called custodianship.
Therefore, for the contract to exist and its effects to occur, there must be a
contracting party with capacity and authority.
Capacity: is a person's ability to acquire rights, assume obligations, and
undertake actions. There are two types:
Obligatory capacity: It is the person’s ability to acquire rights and bear
obligations. It is divided into incomplete obligatory capacity and
complete obligatory capacity.
Capacity to perform: This is the person’s ability to carry out actions in a
manner that is legally reliable. It is also divided into incomplete capacity
to perform and complete capacity to perform.
Custodianship: is a legitimate authority that enables the person in whose
possession it is established to establish contracts and actions, implement
them, and arrange their legal effects on them.
Custodianship is either by originality, that is, by ownership, it is a
person’s contract on his own behalf that he is the owner of the contract

6
. Ismail sisse, muzakkiratu masadir al-Iltizam, (Islamic university in
niger), 21-23.
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and the person concerned with it. The owner of the thing has personal
authority in contracting over it.
Either Custodianship on behalf of others, and this is approved by Sharia
law, such as the father’s Custodianship over the child, or it is approved by
proxy from the father, grandfather, or judge, which is Custodianship.
Or it can be approved by the power of attorney of the person concerned,
in which case, agency, is the person appointing another person to act as
his own in what he owns of permissible and known disposal that is
subject to representation. It is a condition of Custodianship that the
custodian be sane, trustworthy, and capable of the actions that fall within
his Custodianship. It is required for the agent to be competent to contract,
and that the subject of the agency be known to the agent, with the
exception of a slight ignorance that does not lead to a dispute, and that the
subject of the agency be one of the legally permissible actions, and that it
be something that accepts representation, that is, not a personal or
unrepresentative matter such as prayer and testimony.
The principle in contracts is that there are multiple contracting parties, so
one contracting party does not undertake the contract for both sides by
combining personal Custodianship with Custodianship on behalf of
others. This has exceptions, including the father buying his son’s property
for himself and vice versa, and the contract of the chosen custodian for
himself over the orphan’s money if it is of apparent benefit to the orphan.
3. the Subject matter of the contract
The thing that the contract is upon and takes effect on it, and it is the
thing upon which the contract is made, because the bound is by it and
there is no obligation without it.
Not everything is fit to be a contract subject, as something may happen
(legally or customarily) that makes it unfit to be so. Jurists have discussed
the general conditions that must be observed in the contract subject, and
they have also isolated some contracts with special conditions.
The contract may be in kind, such as sale, personal guarantee, mortgage,
or deposit. It may be a benefit, such as rent or loan. It may be a debt, such
as a transfer or debt guarantee (hawala). It may be work, such as agency
or mudarabah.
Conditions of subject matter of the contract

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1. The contract must be lawful: it is not permissible, for example, to sell
what is not property in the eyes of Sharia law, such as dead animals and
blood, nor to sell something that is not of value(ghair mutaqawwam),
which is not permissible to benefit anyone according to Sharia law, such
as wine and pigs. This condition is a matter of agreement among Jurists in
both exchange contracts and donation contracts. If it is lost, the contract is
void.
2. The contracting party must be able to deliver at the time of contracting:
It is not valid to contract on something that is not possible to deliver, such
as a stray animal, fish in water, or a usurped substance.
This condition is agreed upon by Jurists in exchange contracts. The
contract is not concluded if the contracted item is unable to be delivered,
even if it is owned by the contracting party. It is also required in donation
contracts according to the majority of jurists, unlike the Malikis, for
whom it is permissible for the non-delivery at the time of contracting to
be the subject of donation contracts, because the offeror is a
philanthropist and benefactor, and the offeree is not harmed by failure to
implement it.
3. The subject matter must be known to both parties: it is not valid to
contract with an unknown person, such as selling one of two houses and
guaranteeing part of someone's debt, and this condition is subject to
agreement between jurists in exchange contracts. It is also required in
donation contract Such as waqf, gift, and mortgage according to the
Shafi’is and Hanbalis, in contrast to the Hanafis and Malikis, who
permitted donation when the object is unknown, because the intention
behind that is charity, and no dispute results from that.
4. It must be present at the time of the contract, or expected to be present
in the future as required by the nature of the contract: contracts of sale,
gift, and mortgage refer to an item, and the loan and lease both refer to a
benefit that does not definitely exist at the time of the contract, but rather
exists little by little.
The jurists have agreed that a non-existent thing whose existence is
impossible is not suitable to be the subject of a contract, whether it is an
asset or a benefit, just as if a person contracts with a doctor to treat a
patient who has died, then the dead person is not suitable to be the subject
of treatment, or a person contracts with a worker to harvest his crops that
burned.

14
They also agreed that if the subject of the contract is a benefit, it is not
required to be present at the time of the contract, but rather it is required
that it must be possible to realize it in the future, because the nature of the
contract does not require the existence of its subject at the time of
contracting, since the benefit is non-existent and it exists little by little
and it is not conceivable that it will exist all at once.
They differed if the contract included a financial asset, Is it required that
the subject matter must be present in all contracts? or is that a condition
in some of them? or is the consideration on having a free-harm contract,
whether it is present or not.
The Hanafis, along with the Shafi’is, stipulate that it must be present in
all contracts, with no difference between a contract of exchange and a
contract of donation. According to them, it is not permissible to sell a
non-existent property, give it away, or mortgage it, and likewise what is
not certain of its existence, such as a pregnancy in its mother’s womb due
to the possibility that it will be born dead.
The Malikis stipulate this only in exchange contracts. As for donation
contracts, such as gifts and waqfs, it is valid for the property to be non-
existent. If the fruit produced by trees is donated, it is valid. Despite their
stipulation of the existence of the property in exchange contracts, they
permitted the sale of the non-existent property in vegetables that appear
little by little, such as cucumbers and watermelon. Eggplants and the like,
due to the necessity that they do not appear all at once. If they were
prohibited from being sold until all of them were present, people would
be in difficulty.
The Hanbalis, especially Ibn Taymiyyah and his student Ibn al-Qayyim,
do not stipulate the presence of the object in any contract, so they permit
the sale of an existing property as long as it is free of uncertainty,
meaning that it is possible to deliver it.
The source of the disagreement between jurists is the difference in
understanding the hadith forbidding the sale of non-existent goods, and
the hadith forbidding uncertainty. The Hanbalis say: The prohibition on
selling non-existent goods is not for its own sake, but rather because of
the uncertainty it contains, so the prohibition is continuous with it, which
is the inability to deliver. If the non-existent item can exist independently
and is able to deliver it, then the contract is valid for him due to the

15
absence of gharar. Therefore, it is not valid to sell the asset that he is
unable to deliver, such as a stray camel and the like.
While others see that the hadith forbidding the sale of non-existent goods
is clear in its meaning, so it is not permissible to sell non-existent goods
at all, as the Hanafis and Shafi’is said, or it is not permissible to sell the
non-existent product in exchanges except for necessity, as Imam Malik
said in the sale of vegetables and fruits, and the hadith forbidding the sale
of uncertainty is contained in the existing thing that He is cannot be able
to deliver it like a straying camel7.
Types of Contract
Islamic commercial contracts can be classified based on the following
criteria:
i. Its nature;
ii. Its circumstances; and
iii. Its legal consequences.
❖ With respect to their nature, commercial contracts can be classified
into:
i. Unilateral (‘aqd infiradi);
Unilateral contracts refer to contracts initiated and concluded by one
party for the benefit of another party with no consideration. A unilateral
contract is basically gratuitous in nature and may not require the consent
of the offeree. Examples of unilateral contracts include contract of
bequest (Al Wasiyyah) & contract of commission (Al Ju’alah), contract of
gift (Hiba), contract of endowment (Waqf) and contract of guarantee – (Al
Daman).
A unilateral contract is a binding contract that is conditional on the
offeree performing the contract. For example, in a Ju’alah contract an
individual (offeror) may hire a real estate agent (offeree) to find them a
house for which the offeror will pay the offeree a commission. The agent
is not legally bound to find the house for the offeror. In fact, the agent
may fail to find a house for the offeror. However, the agent must perform
the contract, by finding the house, for the agent to claim the commission.

7
. Idid
16
ii. Bilateral (‘aqd thuna’i);
A Bilateral contract is a binding contract between two parties whereby
one party (offeror) makes the offer while the other party (offeree) accepts
the offer. Both parties to a bilateral contract must have the intention to
create legal relations, i.e. there should be a meeting of the minds. Besides,
the offer and acceptance with respect to the contract must relate to the
same subject matter.
For example, in a contract of sale (Al bay’) the offeror makes the offer to
sell his car for USD. 10,000.00 while the buyer (offeree) accepts the offer
to purchase the car at USD. 10,000.00.
The difference between unilateral and bilateral contract solely depends on
what the offeree ought to do to accept the offer and bind the offeror to a
contract. In a unilateral contract the offeree must perform the offer in
order to bind the offeror. Conversely, in a bilateral contract the offeree
must only promise to perform the offer in order to bind the offeror. In
the al bay’ contract above, the offeree must promise to buy the car under
the terms stated by the offeror in order to bind the offeror in a bilateral
contract. Thus, a bilateral contract is a promise for a promise. The
bilateral contract comes to existence once the promises are exchanged.
Other examples of bilateral contracts include, contract of agency (Al-
Wakalah) and contract of partnership (Al Shirkah).
iii. Quasi contracts (shibh al-‘aqd)
Naturally, a quasi-contract is not a contract, but rather an arrangement or
obligation created by the Shari’ah giving rise to obligations similar to
that of a contract. Thus, a quasi-contract is enforceable by
the Shari’ah principle of maintaining and restoring the rights of others.
For example, if someone sends you money by mistake you have an
obligation, under the Shari’ah, to refund the money despite the fact that
the obligation has no affinity to any contract.
❖ Classification with respect to legal consequences considers the
legality or validity of the contract. Hence, commercial contracts
can be classified into:
i. Valid (Sahih)
A valid contract is one that fulfils the essential Shari’ah requirements of a
valid contract. Suffice to say that, when a valid contract one that is

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compliance to the essential Shari’ah requirements. The legal consequence
of a valid contract is that it is enforceable in a Shari’ah court.
ii. Invalid (Fasid)
An invalid contract is a valid contract that is tainted by the presence of
vitiating factors or attributes. The presence of vitiating factors renders the
invalid contract unenforceable. However, a contract that is invalidated by
conditions (shurut) can be fixed by remedying the conditions.
iii. Void (Batil)
A void contract is one that is defective both in substance and description
and therefore non-compliant to the Shari’ah. The presence of defective
attributes makes a contract void ab initio-illegal from the inception and
irreparable. For example, a contract to trade liquor or hard drugs
is batil under the Shari’ah.
iv. Binding (Lazim)
A contract is said to be binding when it is sound in both substance and
description. A binding contract can either be revocable or irrevocable. For
example, the contract of marriage is irrevocable except by a Talaq by the
husband. Bilateral contracts may be revoked, before or during execution,
by mutual agreement (iqalah) or due to special conditions (faskh) such as
impossibility (istihalah) to perform the contract, death of either party,
destruction of the subject matter or expiry of the period and so on.
v. Enforceable (Nafidh)
An enforceable contract is a binding contract that gives the parties the
ability to enforce their respective rights arising from the contract.
vi. Withheld (Mawquf)
A Mawquf, is a contract that is sound in both substance and description
but the seller has no title to the subject matter of the contract.
A Mawquf contract is “withheld” pending voluntary ratification by the
rightful owner on behalf of the fuduli (the seller with no title)8.
CONCLUSION
In this humble Pepper we have learned about the concept of Islamic
contract and divergent of views in delineating the concept. And also

8. Mansuri, T. Islamic Law of Contract, pg. 20

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distinguishing features and principles that govern Islamic contract, as
well the pillars and elements of it with their conditions and divergent of
views in some of them.
Allah the almighty says: "there is not an animal (that lives) on the earth,
or a being that flies on its wings, but (forms part of) communities like
you. Nothing have we omitted from the book,and their lord in the
end".(Quran: 6:38).
REFRENCES
1. izzuddeen Muhammad khoja and abdussattar abu gudda, nazariyyat
al'aqd fil fiqh al-Islamy, (1993) 13.
2. marifas guides to islamic banking & finance: principles and practices.
(2014) 25-28.
3. Ahmad Usman, manhaj al'islam fii al-Mu'amalat al-Maliyya, 22-23.
4.
Ismail sisse, muzakkiratu masadir al-Iltizam, (Islamic university in
niger), 21-23.
[Link], T. Islamic Law of Contract, pg. 20
[Link]
contracts-mudhakkir

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