Contracts In Islamic Jurisprudence

The Qur’an holds contracts in a very high regard. The Qur’an even uses contract as a metaphor for our relationship with Allah, referring to the great bargain man obtains in entering a contract with Allah which will render him a huge profit.

The Qur’an contains some details of contract law. This is further testimony to the importance of contracts. The Qur’an contains laws and legal detail that forms the basis of the Sharia.

The legal structure of Islamic law comes from the legal precedents of the early community and from the jurisprudential analyses of the legal scholars through a process called ‘ijtihâd’. This word comes from the same root as jihâd, which means “struggle” in general. ‘Ijtihâd’ means the struggle of the individual scholar to understand the law.

In Islam, the law is analogous to the “natural law” of the physical sciences, something to be discovered rather than invented. The natural law is whatever it is, whatever Allah has ordained it to be.

So in Islam, the word ‘Sharî’ah’ (Sharia) which is usually translated as Islamic law, literally means “the path to the well.” Like the path to the well, like the natural laws of physics, Islamic law in whatever form is a legal guide and criterion for mankind.  The struggle of the scholars to understand is the jurisprudence of Islam, called the ‘Fiqh’. The books of jurisprudence written by these scholars contain their conclusions as to what Allah wants us to do, after looking at the Qur’an and the practices of the Prophet Muhammad ﷺ. This is after considering what is equitable and what is in the public interest.

The overall view of human relations in Islam is contractual. Within the broad scope of the law as to what is permitted and what is prohibited, all else is determined by contract among ourselves, by mutual agreement. The adoption of democratic formalisms that has been improperly shoved upon Muslims will not relieve the Muslim world of its economic stagnation. It is only a comeback of the civil society institutions that were prevalent in the Muslim world during its glory era from the seventh to the sixteenth centuries when Islam was the pre-eminent civilization from Spain to India that will free the Muslim world from its current position of defeat.

In that era when Muslims soared to great heights, economic infrastructure was generally built not by the state, but by civil society institutions like the ‘awqâf’ (charitable endowments). The economic recovery of the Muslim world will require free markets, just governments and well-defined and protected systems of private property. It is then and only then, that we shall be able to regain our loss glory as a nation of Muslims.

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