Is the physical mixing (ikhtilāt) of the two capitals a condition for the validity of a partnership?
General Chapter
Al-Mughni
Book of Partnership
Primary text
The physical mixing of the two capitals is not required if they are specifically designated and present. This position is held by Abu Hanifa and Malik. Since the partnership is a contract intended for profit, the mixing of capital is not a prerequisite, similar to Mudarabah (profit-sharing without capital mixing). Furthermore, as it is a contract concerning transaction management, mixing is not required, similar to agency (Wikalat). If a loss occurs, it is shared by both partners, as liability for loss and profit are both consequences of the partnership, attaching to both partners just as if they were mixed.
Supporting text
Malik stipulated that the capitals must be under the control of both partners, such as placing them in a shop belonging to them or in the hands of their joint agent. Al-Shafi'i stated that the partnership is not valid unless the capitals are mixed, arguing that if unmixed, the loss or gain accrues only to the owner of that specific capital. Abu Hanifa stated that if one of the capitals is lost, the loss falls solely on its owner.