A Comparative Study of Guaranty Contracts in General Jurisprudence, Islamic Jurisprudence, and Contemporary Laws

Abstract

Guaranty contracts are entered into to facilitate and ensure the collection of creditors' claims. This type of contract is considered a derivative contract, meaning that the debt must have already fully materialized and been established as valid without a doubt. However, the question arises whether the underlying debt must be established in the possession of the debtor, or if it is sufficient for the debt to have arisen as a result. Legal scholars hold differing opinions on this matter, leading to uncertainty regarding whether the underlying debt should be established or if the creation of the debt is sufficient for a derivative guaranty contract. In Sunni jurisprudence, a secured debt in the possession of the debtor is considered sufficient, similar to the deferred price in a sale contract even if the goods have not yet been delivered to the buyer. Nevertheless, legislators have explicitly recognized the existence of a cause for the creation of debt in certain instances of these guaranty contracts, while remaining silent on others. This has led to disagreements among jurists and legal scholars. This article delves into the theological and legal aspects of this subject to explore whether the establishment of the underlying debt or the mere creation of the debt cause is sufficient for guaranty contracts, shedding light on the diverse perspectives within the field.