Lessons in Islamic Law – Contract Law

The other day, I was reading something in the Tao Teh Ching which reminded me of something I read once in the Quran and I was looking for that and came across the following passage. In case anyone cares, I am not a Muslim, but I never trust what anyone else tells me the Quran says (or the Bible, either), so I read the actual book to see what it really says. Anyway, this is what the Quran says about contracts. (More particularly, promissory notes.)


O believers, when you negotiate a debt for a fixed term,

draw up an agreement in writing,

though better it would be to have a scribe write it faithfully down;

and no scribe should refuse to write as God has taught him,

and write what the borrower dictates,

and have fear of God, his Lord, and not leave out a thing.

If the borrower is deficient of mind or infirm,                                         

or unable to explain, let the guardian explain judiciously;

and have two of your men to act as witnesses; but if two men

are not available, then a man and two women you approve,

so that in case one of them is confused the other may remind her.

When the witnesses are summoned they should not refuse.

But do not neglect to draw up a contract, big or small,

with the time fixed for paying back the debt.

This is more equitable in the eyes of God,

and better as evidence and best for avoiding doubt.

But if it is a deal about some merchandise

requiring transaction face to face,

there is no harm if no contract is drawn up in writing.

Have witnesses to the deal, and make sure

that the scribe or the witness is not harmed.

If he is, it would surely be sinful on your part.

And have fear of God,

for God gives you knowledge,

and God is aware of every thing.

If you are on a journey and cannot find a scribe,

pledge your goods against the loan;

and if one trusts the other,

then let him who is trusted

deliver the thing entrusted, and have fear of God, his Lord.

Do not suppress any evidence,

for he who conceals evidence is sinful of heart;

and God is aware of all you do.



So what are the important principles here?

  1. Contracts should be in writing.
  2. They should be written by “scribes.” (Modern translation: lawyers.)
  3. Don’t leave anything out. (Make sure all important terms are addressed.)
  4. Have it witnessed. (Modern translation: notarized?)
  5. Don’t harm the scribe or witnesses. (Modern translation: don’t shoot the lawyers.)
  6. A written contract is “better as evidence and best for avoiding doubt.” (Modern translation: the parole evidence rule.)
  7. “Do not suppress any evidence.” (Modern translation: tell the truth, the whole truth, and nothing but the truth.)
  8. I have no intention of going here, but two women equal one man, at least for witness purposes, so “if one of them is confused, the other may remind her.”  (Modern translation: if you are discussing this with a woman you might want to still talk to you in the future, you should preface the discussion with “Can you believe this?”)

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by Michael Baumer