Is it valid to stipulate the option to cancel a sale (Khiyar) for a third-party non-contracting individual (Ajnabi)?
Chapter on the Option of the Two Parties in Sale
Al-Mughni
Book of Sales
Primary text
Stipulating the option for a third-party individual is valid. This stipulation functions as a stipulation for the benefit of the contracting party who imposed it, and a delegation of authority to the third party. This is the position of Abu Hanifa and Malik. The basis for validity is that the option relies on the mutual condition of the contractors, and the authority to implement it can be delegated, supported by the principle that Muslims adhere to their conditions (Hadith: 'Al-Muslimun 'ala shurutihim'). Both the stipulator and the delegated third party have the right to dissolve the sale.
Supporting text
Al-Shafi'i holds two opinions on this matter. Al-Qadi states that if the option is granted generally to a third party ('for so-and-so without me'), it is invalid because the option is intended to secure the interest (Hazz) of one of the contracting parties, which the third party lacks. If the third party is appointed as an agent (Wakeel), it is valid. If the object of sale is a slave, stipulating the option for the slave himself is valid, as he is treated like a third party. If the contracting party was an agent, stipulating the option for himself is valid because the assessment of interest is delegated to him; however, stipulating it for a third party is invalid in that context, unless the view that an agent can appoint another agent is accepted.