The Book of Selling and

Commercial Transactions

Chapter on Settlements

الصُّلْحِ

Glossary

Chapter on Settlements (Ṣulḥ) ⁸⁸⁸

It is permissible for someone [who is owed money] to cancel a portion of a debt or to donate to the opponent [the one who owes him or her money] some of the property in his or her hand, provided that the creditor does not make payment of the rest a condition for the donation or cancellation. ⁸⁸⁹ Likewise, neither party may deny the other party his or her rights for refusing to grant them that acquittal/donation; also, the creditor may not ⁸⁹⁰

وَمَنْ أَسْقَطَ بَعْضَ دَيْنِه أَوْ وَهَبَ غَرِيْمَهُ بَعْضَ الْعَيْنِ الَّتِيْ لَهُ فِيْ يَدِهِ، جَازَ مَا لَمْ يَجْعَلْ وَفَاءَ الْبَاقِيْ شَرْطًا فِي الْهِبَةِ وَالإِبْرَاءِ، أَوْ يَمْنَعْهُ حَقَّهُ إِلاَّ بِذٰلِكَ، أَوْ يَضَعَ بَعْضَ الْمُؤَجَّلِ؛ لِيُعَجِّلَ لَهُ الْبَاقِيْ.

888. A settlement (ṣulḥ) is an agreement between two disputant parties that ends their dispute. Reconciliation through settlements is prescribed by the Book of Allah and the Sunnah of His Messenger (SA), as well as by the consensus of the Muslim scholars.

Allah said:

{No good is there in much of their private conversation, except for those who enjoin charity or that which is right or conciliation [iṣlâḥ] between people…} (an-Nisâ’ 4: 114)

{لَّا خَيْرَ فِي كَثِيرٍ مِّن نَّجْوَاهُمْ إِلَّا مَنْ أَمَرَ بِصَدَقَةٍ أَوْ مَعْرُوفٍ أَوْ إِصْلَاحٍ بَيْنَ النَّاسِ.}

The Messenger of Allah (SA) said:

“Settlements (ṣulḥ) between Muslims are valid, except a settlement that will make haram what is halal or make halal what is haram. Muslims abide by their conditions, except a condition that will make haram what is halal or make halal what is haram.” (T – from ‘Amr ibn ‘Awf; T: ḥasan ṣaḥeeḥ)

الصُّلْحُ جَائِزٌ بين الْمُسْلِمِينَ إلا صُلْحًا حَرَّمَ حَلَالًا أو أَحَلَّ حَرَامًا وَالْمُسْلِمُونَ على شُرُوطِهِمْ إلا شَرْطًا حَرَّمَ حَلَالًا أو أَحَلَّ حَرَامًا.

In this chapter, the discussion focuses on settlements of financial disputes. Reconciliation is also addressed in the sections of jihad and family laws.

889. For example, if X owes Y $200, Y may clear X of 50% of that debt ($100), as long as Y does not do so on condition that X pays the remainder ($100) at that time or at a certain designated time. According to (a) + (-S), Y may stipulate such a condition.

890. For example, if Y claims that X owes him $200, X may not say, “I will admit to this only if you acquit me from half of it.”

cancel some of the delayed debt in return for the debtor paying the rest in advance. ⁸⁹¹

It is considered lawful to take gold in place of silver, and vice versa, if one takes it according to its price on that particular day ⁸⁹² and if the two parties finish the exchange in the same sitting.

وَيَجُوْزُ اقْتِضَاءُ الذَّهَبِ عَنِ الْوَرِقِ، وَالْوَرِقِ عَنِ الذَّهَبِ إِذَا أَخَذَهَا بِسِعْرِ يَوْمِهَا، وَتَقَابَضَا فِيْ الْمَجْلِسِ.

When someone becomes indebted to another, and the defendant does not know of [remember] it, they may [strive to] come to a settlement. liability. ⁸⁹³

وَمَنْ كَانَ لَهُ عَلَى غَيْرِهِ دَينٌ لاَ يَعْلَمُهُ الْمُدَّعَى عَلَيْهِ، فَصَالَحَهُ عَلَى شَيْءٍ، جَازَ.

If one of them is intentionally lying, then the settlement is invalid for him or her. ⁸⁹⁴

فَإِنْ كَانَ أَحَدُهُمَا يَعْلَمُ كَذِبَ نَفْسِهِ، فَالصُّلْحُ بَاطِلٌ فِيْ حَقِّهِ.

891. This is a subject of controversy, as in the previous scenario.

(A) + (+H, +M, +S): It is impermissible because it is the reverse of usury and resembles it in the commodification of time.

(a) + (-s, -t) : It is permissible, and it is not like usury because usury entails an increase in compensation in exchange for deferment, whereas here it is the opposite.

892. The day the payment is made, not the day of the initial transaction. What is due is the gold, so either it is returned or its value on the day of payment is given instead. This is based on the following hadith:

Ibn ‘Umar (RAHUMA) said: We used to sell camels in al-Baqee‘ for dirhams (silver coins) but accept dinars (gold coins) instead, and we would sell for dinars but accept dirhams instead. The Prophet (SA) said:

“There is nothing wrong with taking it based on the current price, so long as you do not separate with something still outstanding.” (A, D, N; Aḥmad Shâkir: S)

لَا بَأْسَ أَنْ تَأْخُذَهَا بِسِعْرِ يَوْمِهَا مَا لَمْ تَفْتَرِقَا وَبَيْنَكُمَا شَيْءٌ.

893. Due to the virtue of reconciliation through settlements, the majority (H, +M, +A) allowed the so called ṣulḥ ‘alâ inkâr, which means reconciliation despite negation. In this case, one party will agree to a settlement without admitting to the claim of the other party.
In modern times, companies may agree to a settlement without admitting wrongdoing. This will settle the civil suit and spare them from facing criminal charges, given the claimant cannot prove their wrongdoing.

If someone is owed something of unknown value by another person, they may [strive to] come to a settlement.

وَمَنْ كَانَ لَهُ حَقٌّ عَلَى رَجُلٍ لاَ يَعْلَمَانِ قَدْرَهُ، فَاصْطَلَحَا عَلَيْهِ، جَازَ

894. So the money the person acquires (or avoids paying) will not be considered halal for him or her, and the person will be guilty of the sin of wronging someone.

Chapter on Settlements

( Page : no 80)

The Book of Selling and

Commercial Transactions

الصُّلْحِ

Introduction

The Book of Purification

The Book of Prayer

The Book of Funerals

The Book of Fasting

The Book of Hajj and 'Umrah

Book of Zakat

The Book of Selling and Commercial Transactions

The Book of Bequests

The Book of Inheritance

The Book of Marriage

The Book of Divorce

The Book of Sadaq

The Book of Dhihar

The Book of Lian

The Book of Foods

The Book of Oaths

Book of Fatal and Non-Fatal Assault

The Book of Indemnities

The Book of Hudood

The Book of Jihad

The Book of the Judiciary

The Book of Testimonies

Appendix

Glossary

Chapter on Settlements