Question
Where the properties are in trust, as a ‘legal donkey’ as a result of estate planning to reduce the financial impact of property falling into a deceased estate to be wound up, can the testator provide that if any heir wants to be paid out, whilst the others wish to continue ownership through the trust as a ‘legal donkey, that the one to be paid out can be paid off over time and that the heir cannot sell the shares to an outsider third party?
Answer
The concept of a legal donkey is not sharia compliant. Allamah Sarakhsi Rahimahullah has written:
ركن التصرف كلام معتبر شرعا وذلك يتحقق من الرقيق واعتبار الكلام بكونه صادرا عن مميز أو مخاطب ولا ينعدم ذلك بالرق ومحل التصرفات ذمة صالحة لالتزام الحقوق ولا ينعدم ذلك بالرق فان صلاحية الذمة للالتزام من كرامات البشر وبالرق لا يخرج من أن يكون من البشر
(المبسوط (١٣:٣)
The Rukn (basic element) of Tasarruf (exercise) is legally acknowledged speech and that can materialize from slaves. Valid speech is it emanating from a discerning or legally capable individual and this (discernment and capacity) is not lacking in slaves. A body capable for legal exercise is an active liability capable of obligating legal claims upon itself and this is not absent due to slavery. The capability of obligating something on one’s liability is from the honorable traits of human and a person does not cease being a human due to slavery.
This passage clearly clarifies that only human beings have the capability and right of conducting transactions and obligating claims as opposed to the theory allowing abstract entities such as “legal donkeys” to carry out the same.
Therefore, any transfers to a legal entity will not conduct a change of ownership, thus if the testator dies the estate will be shared amongst the heirs accordingly. This means they become the sole owners and are at free will to transact in their wealth with a third party or whom so ever they wish. This also implies that the heir’s portion cannot be paid off at the other
heir’s convenience neither can his exercise in his portion be restricted. Yes, if it is fixed property the partners have a first option to buy. There is detail regarding this.
Checked and Approved By:
Mufti Muhammed Saeed Motara Saheb D.B.