EXTRACTION OF COMMERCIAL DISPUTE AND MADHABS

Shariah will apply automically to international trade contracts between Muslim parties, and where
one party is Muslim if the other party agrees. They may choose shariah law alone or combine it with
English law or international legislation like UNCSOG 1980.

They will need to agree upon a forum(law court or arbitration tribunal) which will apply the law and
settler the dispute.

If party combine law and shariah to govern the contract, the forum will make adjustment between
them = deal with conflict of law and syariah issues.

If parties choose syariah alone, then there is possibility of conflict of madhab.

WHAT IS MADHAB ?

A madhab is a distinct school of law that develops its own legal methodology to interpret the Basic
Code.

Four main : Syafie, Hanafi, Hambali and Maliki.

HANAFI - regards the Quran as the principal source of Shariah, does not accept ahah Hadith cuz
one/2 narrators may be fallible. If hadith departs from Quran, Hanafi school took Quran and
disregard the hadith.

He did not acceot weak hadith cuz extremely cautious about the authenticity of Hadith. Use Qiyas
extensively to make new laws ouf of Quran and Sunnah.

Syafie – acceth ahad hadith even though contradict Quran, Sunnah as the explaination of Quran.
Allow marriage without guardian’s consent.

MALIKI – accept practie of Madinah’s people in lawmaking – accept ahad hadith tha are practiced
cuz madian people who saw the prophet and practiced his Sunnah.

HAMBALI – accaepted all hadith, weak or strong.

CUSTOM ???

Hanafi – custom as formal source subject to fulfilment of certain conditions- custom must not
conflict with Shariah or spirit of syariah.

Maliki – attached special importance to Madinah practice and customs.

Syafie and Hambali – did not accept custom as sources of law.

THE DIFFERENCES ?

Only to methodologies of lawmaking, the end product is same.

ARBITRATION SHOULD FOLLOW TO WHICH MADHAB ?

Where judges bound to act according to the State school of law, no matter to which school they
personally belong, there will be no difficulties.

==== the diputes will be settled by the State madhab irrespective of the fact that the parties belong
to some other madhabs. If however, State tolerates the difference of madhabs, it will give rise to
real conflict of law issues.

HOW TO AVOID CONFLICTS-

If belong to same school, they may choose a country that follows their madhabs.

If different madhabs, they may mutually subject their contract to a particular madhabs. They should
choose a forum that applies the madhab agreed upon. If they submit the matter to court that
follows differenct madhab that agreed upon by the parties, the forum should decide according to
chosen madhab.