Fatwa ID: 07036

 

Answered by: Alimah Jannatun Nessa

 

Question:

 

We, two brothers married to two sisters,came to England 1997. I am the eldest and was told by elders to keep my younger brother and his wife with me for financial savings. We moved to a council house and later I bought another house and moved there. Later bought the council house and a few years later sold that and bought another and rented while living in one house. Until then we both were working and had a joint account and joint spending instead of counting every penny with my brother. No agreement was made verbally or in writing of any partnership. Then in 2006 decided to be separated. I as an elder brother gave the choice to my brother to choose the house to move into. House he moved in had a capital of £140000.00and mine had £100000.00 (approximately). We separated our joint account. (And my share in the shop was £30-40000.00)thus it looks almost even for both of us.

 

While we were together I opened a shop with someone at 50% partnership as my own means of work with £900. Same time my brother had the full opportunity and was told by me to open a business. He chose to learn a skill and worked as a self-employed person which I helped him to be able to do. Later he bought a new car for rental which was stolen and I had to pay £25000.00 on his behalf. A few years later my brother opened another business which I had no involvement in and he suffered big losses and became self-employed again. All these years until now we had our own houses,our own earnings and spending and had no knowledge of any financial matters of each other.

 

On the other hand I’m still in the same partnership with my business partner. Our business has not been very successful but we’re content and our needs are fulfilled. We kept our wages to minimum low so we can save and invest in property. (A way of saving). We bought a house(in Uk )and commercial property in Pakistan and all rental income went back into the same property for the last 20 odd years. On the other side,profits from the shop we expanded our business bought a warehouse and stock which was worth almost £400,000.00.

 

My brother now claims that he has equal share with me in everything. (Shop and property).

 

On his insistence I agreed to give him 50% of my share until 2007 when we separated.

 

My brother asked someone he was told that since we separated (2007) the shop wasn’t divided (rather it wasn’t announced verbally,it was also not announced in first place as it was an accidental or circumstantial partnership )therefore my brother has right of 50%in my shop and In property i bought/invested as my personal earnings of looking after/running business.

 

He never worked/managed my business. I was the sole responsible for loss and profit of day to day activities.

 

In today’s world there are two business models of 50 -50 partnership.  1- all partners have equal time and capital and 2-ones capital and others time.

 

Does my brother own 50%with me in the shop or not ?

 

Is he my partner in my personal savings bought properties?

 

Or

 

We were until 2007 when we separated ?

 

Please let me know how we should deal with the situation as this is causing a lot of grief and separation of a large family.

 

 

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

 

Answer:

 

A partnership is defined by the Partnership Act of 1890 as a relationship between two or more persons who carry on a business with the goal of making a profit. In a general partnership, each partner contributes capital, skills, or labour to the business, and each partner is liable for the debts and obligations of the partnership.

 

Based on what you have said, your brother will not be recognised as a partner in your business as he does not meet the criteria outlined in the Partnership Act of 1890.

 

The issue is where you have verbally agreed to give him 50% of your property upon his insistence.

 

Although verbal agreements are permitted in the UK, there are a number of conditions that must be met in order for them to be upheld in court.

 

These conditions include:

• An offer should be made by one party and accepted by another
• Something of value should be exchanged in return of a promise
• Intention for a legally binding agreement to be made by both parties

 

We can conclude from this that not only are you not considered business partners but you are also not obligated to give 50% of your property because of a verbal agreement if you did not have the intention of making a legally binding agreement.

 

 

Only Allah (عز و جل) knows best.

Written by Alimah Jannatun Nessa

Checked and approved by Mufti Mohammed Tosir Miah

Darul Ifta Birmingham