Can the lessor terminate a land lease if the lessee becomes bankrupt before any period of the term has passed?
General Chapter
Al-Mughni
Book of the Insolvent (Bankruptcy)
Primary text
If a lessor rents out land for cultivation and the lessee declares bankruptcy before any portion of the lease term has elapsed, the lessor possesses the right to dissolve the lease because he has found the substance of his property (the land itself). If the bankruptcy occurs after the entire term has passed, the lessor is merely a creditor for the rent owed. If bankruptcy occurs after some part of the term has passed, dissolution is not permitted according to the primary principle of our school, analogous to a sale where part of the sold item perishes. The time elapsed is treated like the sold item, and the passage of a duration for which rent is due is treated as the partial destruction of that item, as avoiding the passage of a fraction of time is impossible.
Supporting text
The opinion of Al-Qadi suggests that if the landowner dissolves the lease after the tenant has planted crops, the landowner must permit the tenant's crops to remain until harvest, paying the tenant a fair rent for that period. This is because the contracted item is the usufruct, and when the contract is dissolved, the dissolution applies only to what the tenant currently possesses under the contract. Since returning the remaining usufruct is impossible, compensation is due, similar to when a sale is dissolved after the sold item has been destroyed, in which case the seller receives its value and shares with creditors. This view aligns with the Shafi'i school, but it is not supported by the principles of our school, nor is it supported by the narration or sound reasoning.