Are the dealings and justifications acceptable in the Mudarabah case that took place between Al-Jam'iyyah Al-Khairiyyah Company (Charitable Society Company) and Al-Arabiyyah Company, where the director of Al-Jam'iyyah refused to send a division of the loss incurred by the Mudarabah, and 50% of the loss was borne by Al-Jam'iyyah and 50% by the Mudarib?

The justifications mentioned for the question and the described transaction are unacceptable. This is because legitimate mudarabah (definition) (profit-sharing) means that the loss is borne by both the mudarib (working partner) through his effort and the capital provider through his money. The mudarib does not guarantee the capital unless there is transgression or negligence. This ruling does not change even if the capital provider stipulates that the mudarib bear a portion of the loss, as such a condition is void by the consensus of jurists, while the contract itself remains valid according to the majority.

As for the director of the charitable organization, his hand over the organization's funds is one of trusteeship and agency. He is obligated to observe what is most beneficial for the organization, because an agent is obligated to observe what is most beneficial for his principal. The severe harm in burdening the organization with 50% of the loss without any legitimate Islamic justification is not hidden.