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from Kab bin Malik, That Abdullah bin Abi Hadrad Al-Aslami owed him some debt. Kab met him and caught hold of him and they started talking and their voices grew loudest. The Prophet (SAW) passed by them and addressed Kab, pointing out to him to reduce the debt to one half. So, Kab got one half of the debt and exempted the debtor from the other half.
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Yahya said that he heard Malik say, "What is done in our community about a man who refers a creditor to another man for the debt he owes him is that if the one referred to goes bankrupt or dies, and does not leave enough to pay the debt, then the creditor has nothing against the one who referred him and the debt does not return to the first party." Malik said, "This is the way of doing things about which there is no dispute in our community." Malik said, "If a man has his debt to somebody taken on for him by another man and then the man who took it on dies or goes bankrupt, then whatever was taken on by him returns to the first debtor."
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Whenever a dead man in debt was brought to Allah's Apostle (SAW) he would ask, "Has he left anything to repay his debt?" If he was informed that he had left something to repay his debts, he would offer his funeral prayer, otherwise he would tell the Muslims to offer their friend's funeral prayer. When Allah made the Prophet (SAW) wealthy through conquests, he said, "I am more rightful than other believers to be the guardian of the believers, so if a Muslim dies while in debt, I am responsible for the repayment of his debt, and whoever leaves wealth (after his death) it will belong to his heirs."
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Kab demanded his debt back from Ibn Abi Hadrad in the Mosque and their voices grew louder till Allah's Apostle (SAW) heard them while he was in his house. He came out to them raising the curtain of his room and addressed Kab, "O Kab!" Kab replied, "Labaik, O Allah's Apostle (SAW)." (He said to him), "Reduce your debt to one half," gesturing with his hand. Kab said, "I have done so, O Allah's Apostle (SAW)!" On that the Prophet (SAW) said to Ibn Abi Hadrad, "Get up and repay the debt, to him."
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Yahya related to me from Malik from Yazid ibn Khusayfa that he had asked Sulayman ibn Yasar whether zakat was due from a man who had wealth in hand but also owed a debt for the same amount, and he replied, "No." Malik said, "The position that we are agreed upon concerning a debt is that the lender of it does not pay zakat on it until he gets it back. Even if it stays with the borrower for a number of years before the lender collects it, the lender only has to pay zakat on it once. If he collects an amount of the debt which is not zakatable, and has other wealth which is zakatable, then what he has collected of the debt is added to the rest of his wealth and he pays zakat on the total sum." Malik continued, "If he has no ready money other than that which he has collected from his debt, and that does not reach a zakatable amount, then he does not have to pay any zakat. He must, however, keep a record of the amount that he has collected and if, later, he collects another amount which, when added to what he has already collected, brings zakat into effect, then he has to pay zakat on it." Malik continued, "Zakat is due on this first amount, together with what he has further collected of the debt owed to him, regardless of whether or not he has used up what he first collected. If what he takes back reaches twenty dinars of gold, or two hundred dirhams of silver he pays zakat on it. He pays zakat on anything else he takes back afte rthat, whether it be a large or small amount, according to the amount." Malik said, "What shows that zakat is only taken once from a debt which is out of hand for some years before it is recovered is that if goods remain with a man for trading purposes for some years before he sells them, he only has to pay zakat on their prices once. This is because the one who is owed the debt, or owns the goods, should not have to take the zakat on the debt, or the goods, from anything else, since the zakat on anything is only taken from the thing itself, and not from anything else." Malik said, "Our position regarding some onewho owes a debt, and has goods which are worth enough to pay off the debt, and also has an amount of ready money which is zakatable, is that he pays the zakat on the ready money which he has to hand. If, however, he only has enough goods and ready money to pay off the debt, then he does not have to pay any zakat. But if the ready money that he has reaches a zakatable amount over and above the amount of the debt that he owes, then he must pay zakat on it."
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that the Messenger of Allah (saw) said: "When a rich man takes too long to repay a debt, this is wrongdoing, and if the debt is transferred to a rich man, you should accept if."
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that the Messenger of Allah (saw) said: "(Wrongdoing) is when a rich man takes a long time to repay a debt, and if one of you is referred to a rich man (to collect a debt), he should accept that referral."
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Allah's Apostle (SAW) used to invoke Allah in the prayer saying, "O Allah, I seek refuge with you from all sins, and from being in debt." Someone said, O Allah's Apostle (SAW)! (I see you) very often you seek refuge with Allah from being in debt. He replied, "If a person is in debt, he tells lies when he speaks, and breaks his promises when he promises."
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Yahya said that Malik spoke about a man who died and had a debt owing to him and there was one witness, and some people had a debt against him and they had only one witness, and his heirs refused to take an oath on their rights with their witness. He said, "The creditors take an oath and take their rights. If there is anything left over, the heirs do not take any of it. That is because the oaths were offered to them before and they abandoned them, unless they say, 'We did not know that our companion had extra,' and it is known that they only abandoned the oaths because of that. I think that they should take an oath and take what remains after his debt."
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Malik said, "The generally agreed on way of doing things in our community about a mudabbar is that the owner cannot sell him or change the position in which he has put him. If a debt overtakes the master, his creditors cannot sell the mudabbar as long as the master is alive. If the master dies and has no debts, the mudabbar is included in the third (of the bequest) because he expected his work from him as long as he lived. He cannot serve him all his life, and then he frees him from his heirs out of the main portion of his property when he dies. If the master of the mudabbar dies and has no property other than him, one third of him is freed, and two thirds of him belong to the heirs. If the master of the mudabbar dies and owes a debt which encompasses the mudabbar, he is sold to meet the debt because he can only be freed in the third (which is allowed for bequest)." He said, "If the debt only includes half of the slave, half of him is sold for the debt. Then a third of what remains after the debt is freed." Malik said, "It is not permitted to sell a mudabbar and it is not permitted for anyone to buy him unless the mudabbar buys himself from his master. He is permitted to do that. Or else some one gives the master of the mudabbar money and his master who made him a mudabbar frees him. That is also permitted for him." Malik said, "His wala' belongs to his master who made him a mudabbar." Malik said, "It is not permitted to sell the service of a mudabbar because it is an uncertain transaction since one does not know how long his master will live. That is uncertain and it is not good." Malik spoke about a slave who was shared between two men, and one of them made his portion mudabbar. He said, "They estimate his value between them. If the one who made him mudabbar buys him, he is all mudabbar. If he does not buy him, his tadbir is revoked unless the one who retains ownership of him wishes to give his partner who made him mudabbar his value. If he gives him to him for his value, that is binding, and he is all mudabbar." Malik spoke about the christian man who made a christian slave of his mudabbar and then the slave became muslim. He said, "One separates the master and the slave, and the slave is removed from his christian master and is not sold until his situation becomes clear. If the christian dies and has a debt, his debt is paid from the price of the slave unless he has in his estate what will pay the debt. Then the mudabbar is set free."
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