Fatwa ID: 08193

Answered by: Moulana Ateiq-ur Rehman

Question:

If a person signs a contract and they just terminate before the expiry, from a Shari’ah aspect, can you demand the money for the balance of the term?

In the name of Allah, the Most Gracious, the Most Merciful

السلام عليكم ورحمة الله وبركاته

The Prophet Muhammad said: “Reconciliation is allowable between Muslims except such as makes unlawful something which is lawful, or makes lawful something which is unlawful; and Muslims must keep to the conditions they have made, except for a condition which makes unlawful something which is lawful, or makes lawful something which is unlawful.” (Tirmidhi, Ibn Majah, and Abu Dawud transmitted it, but Abu Dawud’s transmission ended at “the conditions they have made.”)
(Mishkat al-Masabih 2923, Book 11, Hadith 159)

Generally, it is not permissible to break the clause of a contract if the contract is made in accordance with Shari’ah. If the contract was Shari’ah compliant, and in the contract, it was stipulated that balances need to be paid if the contract is terminated, the balance will need to be paid. However, this is not an answer to your question.

To answer your question, we will need more details about the actual contract to ensure that the contract itself is correct and legally binding. Also, we need information about the conditions of terminating the contract, such as ample notice or penalties.

وإذا كان الصلح عن إقرار فاستحق بعض المصالح عنه رجع المدعى عليه بحصة ذلك من العوض
وإن وقع الصلح عن سكوت أو إنكار فاستحق المتنازع فيه رجع المدعي بالخصومة ورد العوض وإن استحق بعض ذلك رد حصته ورجع بالخصومة فيه
مختصر القدوري p121 (المكتبة الشاملة)

وَعَن عَمْرو بن عَوْف الْمُزَنِيِّ عَنِ النَّبِيِّ صَلَّى اللَّهُ عَلَيْهِ وَسَلَّمَ قَالَ: «الصُّلْحُ جَائِزٌ بَيْنَ الْمُسْلِمِينَ إِلَّا صُلْحًا حَرَّمَ حَلَالًا أَوْ أَحَلَّ حَرَامًا وَالْمُسْلِمُونَ عَلَى شُرُوطِهِمْ إِلَّا شَرْطًا حَرَّمَ حَلَالًا أَوْ أَحَلَّ حَرَامًا»
رَوَاهُ التِّرْمِذِيُّ وَابْنُ مَاجَهْ وَأَبُو دَاوُدَ وَانْتَهَتْ رِوَايَته عِنْد قَوْله «شروطهم»
(Mishkat al-Masabih 2923, Book 11, Hadith 159)

Only Allah (عز و جل) knows best.

Written by: Maulana Ateiq-ur Rehman
Checked and approved by: Mufti Mohammed Tosir Miah
Darul Ifta Birmingham