Section Six
Guarantee
Al-Kafālah
According to the terminology, kafālah is: when a person takes the responsibility (i.e. makes the promise) either to make someone who owes something pay to the rightful creditor what he is due to pay him, which is called a ‘personal guarantee’ (kafālat an-Nafs), or takes the responsibility (i.e. makes the promise) to pay the financial obligation that is due from that person to the rightful creditor when the former fails to pay it, which is called a ‘financial guarantee’ (kafālat al-Māl). The person making the promise is called the ‘guarantor’ (kafīl) and the person that the guarantor promised to make pay or on whose behalf he will pay is called ‘guaranteed debtor’ (makfūl).
1178. The guarantee/bail is a contract that takes place between the guarantor and the rightful creditor, even if without the acceptance of the debtor; the conditions that must be met in the guarantor are all qualifying conditions required in other contracts, including no indictment for bankruptcy, except for personal guarantees when no financial payment is involved. The same applies to the creditor. However, since the debtor's acceptance is not conditional, nothing is conditional in the debtor.
1179. Just as a guarantee becomes established through a contract, it becomes established also through making it conditional in a binding contract, as for a mortgage.
1180. The guarantee is not valid unless the following conditions are met:
1- The thing for which a guarantee is given must be something that is acceptable under the Shari’ah for the creditor to hold over the debtor, so if the reason for the guarantee is debt resulting from payment for alcoholic beverage or interest, for example, or its reason is to bring the debtor to an unjust ruler to imprison him or to give false witness, the guarantee is not valid.
2- The subject of the guarantee – in personal guarantees – must be one that calls for the presence of the one who owes it or his proxy, in order to pay it off to the rightful creditor.
3- The guarantor – in personal guarantees – must be capable of bringing the debtor, but it is sufficient in this not to know that he will not be able to bring him. But if the guarantor thought that he had the ability to bring him then discovers that he was in fact incapable of doing so in the outset, the guarantee becomes invalidated from the time of discovering this, not from when it was established.
1181. It is allowed that the guarantor is an organisation, including banks. It is also allowed that the guarantor takes something/money from the debtor for acting as his guarantor.
1182. It is allowed that the guarantor is guaranteed by a second person, and the second by a third, which is called ‘terāmī al-Kefālāt’ (passing along the guarantees). It is also allowed that the guarantor guarantees more than one person.
1183. A guarantee is a binding contract that is not invalidated except by agreed relief from it (iqālah), or by giving the choice to the guarantor, or by being cancelled by one of the following:
1- Carrying out the promise involved, which means bringing the debtor.
2- Freeing of the debtor of the debt due from him, either by paying it, or relieving him from it.
3- The transfer of the right from the creditor to someone else, through a sale, a mutual agreement, a transfer (hawālah) or others.
4- The death of the debtor or the cancellation of the ability to bring him to pay due to the loss of his sanity through insanity, being unconscious or the like. That said, if the guarantee was established on the condition that the guarantor must pay the debt when bringing the debtor is not possible, in this case it does not become invalidated.
5- The death of the guarantor, since his heirs do not take over the responsibility that the deceased took on during his life.
6- The creditor’s cancellation of his right in the guarantee.
Section Six
Guarantee
Al-Kafālah
According to the terminology, kafālah is: when a person takes the responsibility (i.e. makes the promise) either to make someone who owes something pay to the rightful creditor what he is due to pay him, which is called a ‘personal guarantee’ (kafālat an-Nafs), or takes the responsibility (i.e. makes the promise) to pay the financial obligation that is due from that person to the rightful creditor when the former fails to pay it, which is called a ‘financial guarantee’ (kafālat al-Māl). The person making the promise is called the ‘guarantor’ (kafīl) and the person that the guarantor promised to make pay or on whose behalf he will pay is called ‘guaranteed debtor’ (makfūl).
1178. The guarantee/bail is a contract that takes place between the guarantor and the rightful creditor, even if without the acceptance of the debtor; the conditions that must be met in the guarantor are all qualifying conditions required in other contracts, including no indictment for bankruptcy, except for personal guarantees when no financial payment is involved. The same applies to the creditor. However, since the debtor's acceptance is not conditional, nothing is conditional in the debtor.
1179. Just as a guarantee becomes established through a contract, it becomes established also through making it conditional in a binding contract, as for a mortgage.
1180. The guarantee is not valid unless the following conditions are met:
1- The thing for which a guarantee is given must be something that is acceptable under the Shari’ah for the creditor to hold over the debtor, so if the reason for the guarantee is debt resulting from payment for alcoholic beverage or interest, for example, or its reason is to bring the debtor to an unjust ruler to imprison him or to give false witness, the guarantee is not valid.
2- The subject of the guarantee – in personal guarantees – must be one that calls for the presence of the one who owes it or his proxy, in order to pay it off to the rightful creditor.
3- The guarantor – in personal guarantees – must be capable of bringing the debtor, but it is sufficient in this not to know that he will not be able to bring him. But if the guarantor thought that he had the ability to bring him then discovers that he was in fact incapable of doing so in the outset, the guarantee becomes invalidated from the time of discovering this, not from when it was established.
1181. It is allowed that the guarantor is an organisation, including banks. It is also allowed that the guarantor takes something/money from the debtor for acting as his guarantor.
1182. It is allowed that the guarantor is guaranteed by a second person, and the second by a third, which is called ‘terāmī al-Kefālāt’ (passing along the guarantees). It is also allowed that the guarantor guarantees more than one person.
1183. A guarantee is a binding contract that is not invalidated except by agreed relief from it (iqālah), or by giving the choice to the guarantor, or by being cancelled by one of the following:
1- Carrying out the promise involved, which means bringing the debtor.
2- Freeing of the debtor of the debt due from him, either by paying it, or relieving him from it.
3- The transfer of the right from the creditor to someone else, through a sale, a mutual agreement, a transfer (hawālah) or others.
4- The death of the debtor or the cancellation of the ability to bring him to pay due to the loss of his sanity through insanity, being unconscious or the like. That said, if the guarantee was established on the condition that the guarantor must pay the debt when bringing the debtor is not possible, in this case it does not become invalidated.
5- The death of the guarantor, since his heirs do not take over the responsibility that the deceased took on during his life.
6- The creditor’s cancellation of his right in the guarantee.