1. LEGAL MAXIMS القواعد الفقهية
INTRODUCTION – DEFINITION – HISTORY – 5 MAIN LEGAL MAXIMS –SOME APPLICATIONS ON ISLAMIC BANKING AND FINANCE

2. GLIMPSE OF THE HISTORY
Like all other knowledge in Islam, there were no distinct / obvious separation between them at the early stage.
The understanding of this knowledge and the introduction to the methodology by the Fuqaha’ came in stages before it is considered as a knowledge of its own.
As the oldest school of thought, Imam Abu Hanifah and the scholars in Mazhab Hanafi were the earliest to talk about this in their books and writings. From them, it is passed to other Mazahib which then undergoes improvements from time to time.
It was narrated in “Al-Ashbah Wa An-Nazhoir” that Al-Imam Abu Thohir Ad-dibasi who lived in the 3rd and 4th century, had compiled all the important foundations of Imam Abu Hanifa in 17 principles. He then repeated it every night in the mosque after people has left.
Knowing this, Al Imam Abu Said Alharowi, a shafie scholar, came and learned from him. After some further and deeper view on Imam Abu Thohir works, Imam Abu Said Al Harowi compiled it in 5 legal maxims as known to us now.

3. DEFINITION Qawaid Literal Meaning - Foundation
Technical Meaning - A ruling that is applicable to majority of components beneath it
Al Qawaid Al Fiqhiyyah
“General principles of Fiqh in a short phrase comprises the general shariah ruling in particular instances in a particular theme”
-Syeikh Ahmad bin Syeikh Muhammad Azzarqa’-

4. 5 LEGAL MAXIMS Al-Umur Bi Maqasidiha
(Acts are judged by the intentions behind it)
Ad-Dhararu Yuzal
(Harm must be eliminated)
Al-Adah Al-Muhakkamah
(Custom is the basis of judgement)
Al-Yaqin La Yazulu Bi Asy-Syak
(Certainty is not overruled by Doubt)
Al-Masyaqqah Tajlibu At-Taisir
(Hardship begets facility)
fulfilment of some good (Maslahah) and the avoidance of some mischief (mafsadah)
fulfilment of some good (Maslahah)

5. Al-Umur Bi Maqasidiha (Acts are judged by the intentions behind it)
Based on the hadith «إنما الأعمال بالنيات»(Acts are valued in accordance to the underlying intentions..)
ie : washing face vs ablution, muhajir imriil al-qais
“Al-iktibar fil uqudi lil maqasidi wal ma’ani la lil lafzi walmabani” (Contracts are to be understood in relation to their intention and substance not by the words and the phrases used)
ie : offering Tawarruq to customer but actual transactions were done in a way that it resembles Bai’ al-’Inah which is clearly prohibited in Islam.
- “الأصل في الأقوال و الأفعال و العقود و الشروط الإباحة “ (the starting assumption for all statements,actions ,contracts and conditions is permissibility)
- “ الأصل في المعاملات الإباحة “ (the original ruling for muamalah transactions is permissibility).

6. Ad-Dhararu Yuzal (Harm must be eliminated)
Based on the hadith «لا ضرر ولا ضرار»(Harm may neither be inflicted nor reciprocated)
ie : any parties engage in business transactions is prohibited to cause grief to others
Addhararu La Yuzal Biddharari Mithlih (Harm must not be eliminated by another harm)
“Iza Zala Al-Mani’ A’ada Al-mamnu’” (When obstacles that impede (permissibility) are removed then the activity which was previously forbidden become permissiable)
ie : introduction of Suq Assila’ at Bursa Malaysia as an alternative to LME.

7. Al-Adah Al-Muhakkamah (Custom is the basis of judgement)
Inspired by the hadith «ما رآه المسلمون حسنا فهو عند الله حسن»
Custom need to be taken into consideration before establishing a rule of law.
“Isti’malunnasi hujjatun yajibu al-amalu biha” (The usage of people is a proof that must be acted upon) – provided that it does not contradict with the rulings of shariah.
Ie : wakalah – understandable to sell it in reasonable price without being told the the details of the price.
in commodity, murabaha when the bank becomes an agent(wakil) for the customer and sell the commodity on his behalf which became as a custom in this transaction .

8. Al-Yaqin La Yazulu Bi Asy-Syak (Certainty is not overruled by Doubt)
Inspired by the hadith «إذا وجد أحدكم في بطنه شيئا فأشكل عليه أخرج منه شيء أم لا؟ فلا يخرجن من المساجد حتى يسمع صوتا أو يجد ريحا»
لا عبرة بالتوهم
Ie : In musharakah – assuming profit is higher, while the report said otherwise.

9. Al-Masyaqqah Tajlibu At-Taisir (Hardship begets facility)
Inspired by the quranic text :
«يريد الله بكم اليسر ولا يريدبكم العسر» «وما جعل عليكم في الدين من حرج»
“Addhoruroh tubihul almahzurat” (necessity justifies that which may be unlawful) ie : destroying demolition of intervening or adjacent house to prevent spreading of fire
“Addhoruratu tuqaddar biqadariha” (necessity is measured inaccordance with its true proportions) – ie : negligence of debtor – told to sell his move assets first
Ie: the AAOIFI resolution on its shariah standard no 30 to allow organized tawarruq only for those financial insitutions facing liquidity shortage that threaten their position and sustainability and disallow it for using it as an investment and financing avenue for making profits and circumventing to prohibited riba.
To conclude our presentation ,we would like to mention that Dr Wahbah al-Zuhaily addressed this issue by implimeting that the legal maxims are suitable only when there is no evidence from the Quran or the Sunnah that forbids those transactions.