Demise Of Business Partner

QUESTION:

Below is a Business Share agreement:
Initially, Partner A controlled 60%, and Partner B controlled 40%. Over time, changes were made between both parties. Partner B passed away in May 2026. How should we resolve this business venture?

ANSWER:

Fuqaha (Jurists) have stated that when a partner passes away, then the partnership ceases automatically. Hence, after the demise of Partner B, his portion of the partnership has terminated which will now fall part of the estate. The business must pay out his portion of the investment and the business will then resume as normal in regards to the other partners. If the heirs of deceased partner wish to be a part of the business, then a new partnership will have to be enacted.

(وتبطل الشركة) أي شركة العقد (بموت أحدهما) علم الآخر أو لا لأنه عزل حكمي (الدر المختار 4/327)
(وتبطل الشركة بموت أحدهما ولو حكما) أي ولو كان الموت حكما بأن ارتد أحدهما ولحق بدار الحرب وحكم بلحاقه لأن الشركة من العقود الجائزة فيكون لدوامها حكم ابتدائها وهذا لأنها تتضمن الوكالة

قوله: وإذا مات أحد الشريكين، أو ارتد ولحق بدار الحرب بطلت الشركة) لأنها تتضمن الوكالة. مجمع الأنهر في شرح ملتقى الأبحر (1/ 728(

(Re: Fatawaa Uthmaaniya Vol. 7 Pg.15)

ALLAH TA’ALA ALONE IN HIS INFINITE KNOWLEDGE KNOWS BEST!

ANSWERED BY:

Mufti Abdul Kader Fazlani

Date: 08 Rabi-ul-Awwal 1448 / 21 August 2026

CHECKED AND APPROVED BY:

Mufti Yacoob Vally Saheb