وَضِيعة

وَضِيعة

Wadi'a, in lexical use, means loss, the tax the ruler takes from the land and the tithes, a reduction, and it is used in the phrase 'he reduced it for him' (wada'a 'anhu), and of a merchant who has lost in his trade. ¹ For the jurists it is a sale at the first price with a known amount deducted from it; it is also called mawadi'a, mukhasara, muhatta and hutayta, and this is its best-known sense. The jurists also use the word for loss and for the remission of a debt. ¹

Murabaha is giving a profit, that is a sale at a price fixed as the capital plus a known addition; it is the opposite of wadi'a. Tawliya is the transfer of the whole goods to the buyer at the first price, and ishrak is the transfer of part of the goods at the price of that part; wadi'a, tawliya and ishrak are all trust sales. ¹²

Wadi'a as a sale: its best-known sense is a trust sale at a known reduction from the first price. It is lawful as a kind of sale, and valid when its conditions are met; its conditions are those of murabaha. ²

Wadi'a as loss in partnerships: the jurists agree that loss in partnerships falls on the partners in proportion to their capital, and that no other arrangement may be stipulated; Ibn 'Abidin says there is no dispute that stipulating a loss other than the capital shares is void. ² In a mudaraba the owner of the capital bears the whole loss and the managing partner bears none; profit follows the agreed terms. If the managing partner gains and then loses, the loss is taken from the profit while the partnership continues; Ahmad, asked about it, held the loss is set against profit, and when the capital is returned and a new partnership is made, the earlier loss is not covered from the later profit. ²³

Wadi'a as remission of a debt: The Kifayat al-talib cited in the book gives the view that remitting part of a debt in return for early payment is not lawful, which is called (put and hasten) and is treated by most jurists as usury. ³ Cross-reference: the heading of remission (ibra'). ³