Chapter -7 Sahih, Fasid and Batil Contracts The Muslim jurists classify contracts into sahih (valid), bdatil (void) and fasid (voidable or irregular) contracts with regard to their legal validity. A sahih contract is that whose as/ (nature and essence) and wasf (accessory circumstances or attributes) are in accordance with law. Thus, a contract will be deemed valid when: e@ — its elements are complete; e conditions relating to elements have been met; and e itis free from external prohibited attributes. Thus, if any of the elements is missing or a condition is not met or the Lawgiver has prohibited it due to some attribute attached to it, the contract is baril or fasid. A contract will, therefore, be bail or fasid if the acceptance is missing or it does not correspond with the offer or one of the parties does not possess legal capacity or the subject matter is non- existent or it cannot be delivered or the contract contains an element of riba (interest) or gharar (indeterminacy). Thus, the contract is bafil as an element is missing or a condition has not been fulfilled or an attribute opposes the command of the Lawsgiver and each of these results in the same effect according to the majority, i.e., the contract is batil.!Islamic Law of Contract and Business Transactions 78 The Hanatis divided contracts into three kinds: sahih, fasid and bdtil. Valid or sahth contract The sahth contract is said to be concluded when all its element are found, the conditions of each element have been met and it also possesses such attributes of extrinsic nature which the law takes notice of. There is no disagreement among the Hanafis and other jurists regarding this meaning of the sahth contract.” It has been mentioned earlier that according to majority there are three elements of contract namely, the Sighah (form) offer and acceptance; the subject-matter and contracting parties. The Lawgiver has assigned further conditions to these elements. The sighah requires conformity between offer and acceptance, their issuance in the same session, existence of the jab till the issuance of gabiil. It also requires that a party to the contract must be sane, pubert. And that the subject -matter must be legal, in existence, deliverable and known. If the elements are present and the conditions are met the contract comes into existence in the eyes of the Lawgiver. However, it cannot be called sahih or which is legally enforceable (mun ‘aqid) unless it is free from external prohibited attributes like ribd,and gharar. If a contract contains any such attributes the Hanafis consider such a contract as fasid. The Hanafis define the sahih contract as that which is legal in its as! as well as wasf. The asi here stands for the elements and conditions and the wasf for the external attributes, or accessory circumstances or non-essential quality of contract. According to Hanafi jurists a contract, which contains the condition of ribd, is not a void contract because riba occurs either in a loan contract or in a sale transaction, which are basically permissible. It is the vitiating condition of riba, which invalidates such a contract. Thus, it is valid by virtue of the validity of loan or sale, but not by virtue of invalidating accessory attribute of riba. Such a contract, according to Hanafi jurists will719 Sahih, Fasid and Batil Contracts not be declared void; instead it is an irregular contract that can be made lawful by removing the invalidating condition of riba? Similarly, a contract that contains an element of uncertainty, indeterminacy or want of knowledge is not a void contract. The example of indeterminacy is where a seller tells a buyer, “I sell you one sheep out of these three sheep”, or where a sale takes place without fixing the price of object. In both the cases the sale is fasid, i.e., irregular according to Hanafi jurists which can be regularised by removing the cause of irregularity, ie., by identifying the sheep and fixing the price.* The hukm of sahth contract A sahih contract is assigned all its effects that Lawgiver has determined for it. These effects come into being on conclusion of the contract if it is enforced (ndfidh) and after the removal of the cause of suspension if it is mawgiif or suspended contract? Kinds of Valid Contract A sahih contract, as we have said, is one, which is legal both as regards its asi and the wasf. Such a contract must give rise to the effects assigned to it by the Lawgiver. Some jurists maintain, however, that there are sahih contract the effects of which can be delayed till the happening of a future event. Such contracts are called mawqif contracts, i.e., held up in suspense. This is the opinion of the Hanafis, Malikis, and some Hanbalis. The Shafi‘ts and some Hanbalis do not admit delay in the effects of the contracts. According to them a sahih contract must give rise to its effects immediately, i.e., it must be ndfidh (operative). Mawqif or suspended contracts thus have no existence according to these jurists. Thus, a mawqif contract is a kind of valid contract. It is a contract, which is not immediately enforceable. Dr. Sanhiri regards it a voidable contract.® e@ ©The ndfidh (operative or immediate contract):Islamic Law of Contract and Business Transactions 80 The ndfidh contract is that in which: a the elements are found; a the conditions are met; othe external attributes are legal; and the contract is not dependent upon ratification. © The Mawgiif contract is that in which: a the elements are found; conditions are met; a wasfis legal; but a the effects are dependent upon ratification. This contract, as we have noted, is not acceptable to the Shafi'is and some Hanbalis. Causes of suspension The cause due to which the effects of a sahih contract are suspended may be summarized as under: (a) Defective capacity: Contracts of minor pos: discretion (sab? mumayyaz) or the one under interdiction (hajr) due to safah (weakness of intellect) or ‘atah (lunacy or partial insanity) b) Lack of proper authority:Contracts in which a person acts on behalf of another without proper authority are suspended. These are the contracts of a fudiili, i.e, one who is neither guardian nor agent nor the owner or contracts of an agent who transgresses the limits prescribed by the principal. ©) Right of third party:If the owner sells the mortgaged property, it will be subject to the ratification of the mortgagee. The cases of marad al mawt (death illness) ghasb usurpation are also treated the same way. We may analyse the above causes in little more detail. (a) Contracts suspended due to defective capacity: The sab7 mumayyaz can be permitted to undertake certain kinds of81 Sahih, Fasid and Batil Contracts transactions. Those, which are purely harmful, cannot be permitted. Those, which result in benefit only, are allowed. However, a transaction by such a minor in which there is a likelihood of both benefit and harm are valid subject to ratification. The ratification may be accorded by the guardian after the transaction and before the minor attains puberty or by the minor himself after majority in case the guardian did not reject the contract before attaining majority. The Aukm of such a contract is that before ratification there are no effects and ownership is not transferred in goods or price. Once ratification is granted it acts retrospectively and the effects come into operation from the date of the contract. In case ratification is refused the contract becomes void. (b) Suspension due to lack of proper authority: The rules relating to the fudiilt have already been studied and are applicable here. The contracts of the fudilt are sahth but mawgif. If such contracts are ratified by one who possesses the authority then the effects come into operation. Refusal to ratify shall make the contracts of the fudiil7 void. In case the fudiilt has delivered the property, the akkam of ghayb, (usurption) shall operate against him, ie., he shall return the property or become liable for compensation. Ratification of course shall operate from the time of the contract. ©) Suspension due to right of third parties: There are cases where a person has the capacity and authority to act, Le., he is the owner of the subject matter, but the rights of third parties are linked to it. The contract, thus, is suspended and needs to be ratified by such third party.’ Thus, if A, a mortgager decides to sell his property mortgaged with B from whom he has borrowed money, the right of B is likely to be endangered. B can claim that his loan be repaid first. This contract shall, therefore be suspended. In case B decided to forgo his claim upon the property he may ratify the contract, which shall be declared. In case he refuses to do so the contract