Guide to circumstances for the cancelation of the offer

In-Depth Analysis

As Shariah principles are always based on full disclosure, fairness and equal justice, the aggrieved party will have the right to rescind the contract in order to protect his or her interest. There are different stages of a contract starting from the making of the offer and receiving the acceptance which is followed by the execution of the contract — the subject matter changing hands. There are five circumstances for the cancelation of the offer: 1. Withdrawal of the offer by the maker: The majority of Muslim jurists are of the opinion that an offer can be withdrawn by its maker at any time before its acceptance by the other party. The maker can use the window between the offer and acceptance to pull back should it find the existence of any of the said elements in the counterparty. 2. Death of a party or loss of capacity: The death of either party before acceptance causes the offer to lapse. Similarly, if there occurs a loss of perfect capacity at either end, or other party becomes insolvent, the offer ceases to exist. 3. Refusal of the offer: The counterparty rejects the offer in writing, by words (verbal) or conduct. 4. Termination of the session or lapse of time limit: The offer will be deemed canceled due to the termination of the session before acceptance or the lapse of the time limit set by the maker of the offer. 5. Destruction of the subject matter: The destruction of the subject matter wholly or in part leads to the lapse of the offer. Thus, the existence of the subject matter is a condition for the validity of the offer. Another important point: the Shariah principles require that the seller must have the title and possession to the subject matter before putting it up for sale without which it shall be considered as a forward sale where both the considerations are deferred. A forward sale is forbidden in Shariah.