ISLAMIC LAW OF TRANSACTION (LAW737)

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ISLAMIC LAW OF TRANSACTION (LAW737)

• PRESENTED BY
• SITI ANNUUR BINTI ALI
• NAJMIYAH BINTI MUHAMAD
• ZANARIAH BINTI ABU ZARIN

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• QUESTION 7
• One of the pre conditions imposed in contract is
  intention.
• a)Discuss the meaning of intention
• b)Identify the elements that formed a contract by
  taking Zahir and Batin intention into account

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INTRODUCTION

• There are five major legal maxims in Islam. One
  of them is matters are determined according
  intention.
• Under this kind of legal maxim, all the behaviors
  and attitudes of everyone are depends on their
  intentions.
• This is a comprehensive maxim that has
  implications that Islamic scholars have discussed
  in various areas, including devotional matters,
  commercial transactions and crimes.

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AUTHORITY

• 1) Al Quran
• Al-Imran 145
• And no human being can die save by God's leave,
  at a term pre-ordained. And if one desires the
  rewards of this world, We shall grant him
  thereof and if one desires the rewards of the
  life to come, We shall grant him thereof and We
  shall requite those who are grateful to Us.

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• 2)As-sunnah
• On the authority of Abu Hafs, Umar Ibn
  al-Khattab, who said I heard the Messenger of
  Allah
• The actions are Innama (only, certainty) tied
  to the intentions and every person will earn that
  which he intended. Therefore, he whose migration
  was for Allah and His Messenger s.a.w then his
  migration will be for Allah and His Messenger
  and he whose migration was to achieve some
  worldly gain or to take a woman in marriage, then
  his migration will be for that for which he
  migrated. 
• Sahih Al-Bukhari and Muslim

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DEFINITION

• Linguistically intention means An-Niyyah.
• Therefore ones Niyyah is to do something
• To describe the direction or the place that one
  intends to go to, or the meaning that one intends
  to deliver.
• To describe the hearts intending an action or
  planning to do an action.

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• In Islamic terminology, there is NO special
  meaning for the word An-Niyyah.
• Giving a special meaning to the word An-Niyyah in
  the Islamic Terminology has no proof.
• An-Niyyah is ones intention of the heart to
  perform an action.
• In other word, the meaning of intention,
  therefore, is the will directed towards the
  action.

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ContractsEffect is given to intention and
meaning and not words and Forms

• Any contracts refers to its meaning and purpose.
• The meaning of the rule is that the assumption
  lies in the akad, its meaning and purpose and not
  to forms and words.
• That means, in any valid contract in which there
  is a distinction between the intention and
  purpose of the covenant that is seen through
  words or what is remarked upon in the contract.

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• Ibn Rusyd explains in his al-Muqaddimat wa
  al-Mumhidat that the rule is recognized with the
  rules Where the laws are for the meanings.
• In other word, something in the contract takes
  approximate purposes and meanings of words in the
  contract and its goal and not forms of the word.
• Therefore the words in a contract must use a
  certain word or intention to become legitimate

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• An example, if there are two people who do a
  contract with word to give a good that has been
  provided with payment and has received a good
  before the price is fixed.
• The contract is a sale and purchase contract.
  This is because the final contract to buy or sell
  was intended by them and not as a meaningless
  verbal contract.

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Zahir intention batin intention

• To produce a contract, there must be an intention
  to contract on both sides.
• This intention is composed of two types of
  intention which are zahir intention and batin
  intention.
• Batin intention is a matter that is hidden in the
  hearts and can not be seen by naked eye.
• While zahir intention comes in form of words.
•  

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• The relationship between these two intentions is,
  zahir intention explain the existence of batin
  intention in the hearts
• With the two intentions, the contract is
  considered valid and give effect to all parties
  involved
• Therefore, all words spoken by a person who has
  no intention to deed, as spoken by a madman, or
  one who was asleep, did not give any effect and
  there is no contract that exist

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• However, sometimes zahir intention cannot give a
  good description or explanation of batin
  intention.
• In such situation, evidence must be based on
  several different circumstances which formed a
  contract, taking zahir and batin intention into
  account.

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• 1st element
• Act never planned at all. It can be illustrated
  in two forms
• 1)A contract made by an insane/sleep person
• 2)It also happen if the act not in accordance
  with the contract, such as A is unaware with what
  she has mentioned in the contract
• Under this circumstances, the contract is
  considered as null and void and no effects
  towards contracting parties
• However, Muslim jurists are in dispute in

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• 1)Action done by an intoxicated person
• Jumhur
• -Valid contract
• -Such contract has effect to the person
• -Punishment toward him for drinking voluntarily
• Second view
• -Distinguish between cause of intoxication
• -If willingness follow the jumhur view
• -If force/medication not valid / not enforceable
• Third view
• -Not binding at all

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• 2)Action done by intention
• Hanafi
• -The action is already constitute a contract
• - Act is done by his own choice
• -Even though it is a mistake, it can be
  remembered at particular time
• Other view
• -not binding
• -contracting parties is not liable
• -not on his own choice

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• Surah al-Ahzab 335
• And you would not be at fault for any mistake
  you make, in this respect, except, in, what your
  hearts may premeditate, after the prohibition
  has been issued. And God is Forgiving, of
  whatever you said before the prohibition was
  issued, Merciful, to you in this respect.

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• On the authority of Ibn Abbas that the messenger
  of Allah said
• "Allah has pardoned for me my people for their
  mistakes and their forgetfulness and for what
  they have done under duress.

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• 2nd element
• Contract was done voluntarily by his choice and
  he himself understand the action taken but he is
  not willing and does not consent to the contract
  either it is done by force or colloqium language
  kiddingly or to show off
• 1)Action by kidding
• Hanbali and majority of Maliki
• -They considered this type of contract as not
  valid
• -Null and void except in 5 types of contract

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• -in which these contract are binding even it is
  made kiddingly.
• -5 serious matters cannot be taken kiddingly,
  once done it is binding
• -marriage, divorce,ruju,taking oath and taking
  leave of slave
• ShafiI
• -binding contract
• -it is done on voluntarily basis
• -cannot use kidding as an excuse to escape from
  the liability in the contract

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• 2)Action done by force
• Hanafi
• -Valid
• -but fasid (voidable)
• However, in 5 serious matters, the contract still
  enforceable even by force.
• Others view
• -considered as null and void
• -not binding
• -not effective

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• 3rd element
• Unusual way of contract or abnormal performance
  way of contract
• Eg A tends to sell the goods but
• pronounced as hibah.
• Hanafi
• -valid (sahih) contract based on intention of
  contracting parties
• Hanbali and ShafiI
• -valid
• -except for the marriage contract
• -where the used must be precise

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• 4th element
• Act of contract is straightforward but has a
  hidden agenda
• Eg Selling grapes for making liquor wine
• Nikah muhallil or cina buta
• Shafii
• -this type of contract is valid
• -because we only judge from the appearance, what
  we can see and not inside it
• Others
• -null and void
• -in Islamic Law intention is very important

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• According to this opinion
• - contract made with bad intention is considered
  invalid although the contract is made with right
  way and implementation.
• - Because in ascertaining the validity of a
  contract the implied intention, either
  favourable or not must be taken into account

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• Al-Nisa 412
• 'Bequests which cause injury' are those that
  entail depriving deserving kin of their
  legitimate rights. Similarly, the debt which
  causes injury is the fake debt which one falsely
  admits to owing, and any other device to which
  one resorts merely in order to deprive the
  rightful heirs of their shares in inheritance.

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conclusion

• Schools of fiqh differed on the issue of
  determining the basis of contract validity. Some
  emphasizes on its legal form while others stress
  on its substance and the intention of contracting
  parties.
• Shafii found it is impractical to determine the
  validity of contracts by means of intention, as
  it is difficult and sometimes impossible to
  identify the intention of the contractors.

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• While Malikis and Hambalis emphasize that
  validity of a contract must be based on the real
  intention or the substance of the contract.
• Apparently, the scholars of fiqh only differ in
  terms of basing the validity of a contract.
  However they never differed on the issue of
  basing the permissibility of a contact on its
  substance or the contractors niyyah.