Ownership of goods
QUESTION:
I entered into a service agreement with Zaid to supply and install security equipment. My supplier invoiced Zaid directly, however, Zaid paid the full contract amount to me (for supply and install) which I then, in turn, paid to my supplier. I took delivery of equipment from supplier and began the installation. Subsequently, a fire broke out in my storeroom and the balance of equipment was destroyed. Therefore, I was paid for some work (supply and install) which I could not complete. Am I the owner of the outstanding equipment, or is Zaid? If I am the owner, do I have to reimburse Zaid for unfinished work or not? If Zaid is the owner, must I reimburse him for unfinished work?
ANSWER:
We understand from your query that Zaid purchased security equipment from you and in addition to that, he hired you to fit the equipment for his stores, hence all payments were made by Zaid directly to you. You purchased the goods directly from your supplier (to supply Zaid) and stored the goods on your premises, which indicates that you were holding ownership of the goods. The goods would then be taken from your premises as required (by you) and fitted at the various stores owned by Zaid. However, your premises was struck by a fire which resulted in all the equipment burning down.
1. Now, coming to your query, the security equipment was never handed over to Zaid after selling the goods to him, rather it was stored at your premises, hence you will be liable for the loss. The goods will be considered as your ownership.
2. Yes, if Zaid paid for the equipment in full, then you will be required to reimburse Zaid for the equipment.
3. If you are now in debt due to the fire outbreak to the extent that your liabilities exceed your assets, then you could qualify to receive Zakaat. In this instance, you may collect Zakaat funds and use the funds to reimburse Zaid for the losses.
ALLAH TA’ALA ALONE IN HIS INFINITE KNOWLEDGE KNOWS BEST!
ANSWERED BY:
Mufti Mohammed Desai
Date:- 01 Muharram 1445 / 20 July 2023