Is the pledging of an item by the seller valid if the buyer becomes bankrupt and the seller has the right to revoke the sale?
General Chapter
Al-Mughni
Book of Pledges (Collateral)
Primary text
If the buyer becomes bankrupt, and the seller pledges the object of the sale—which the seller has the right to reclaim—before exercising that right of reclamation, the pledge is invalid. This is because the seller is pledging property that they do not legally possess ownership over.