Islamic Alternative Dispute Resolution

In any society if it is to exist peacefully than there be a semblance of rule and regulation through which a society governs itself. They must be fair, practicable and reflect what the society wants. The law must also be progressive so that they don’t stifle the growth of the society.  

Alternative Dispute Resolutions/Consensual processes, for example collaborative law, mediation, conciliation, or negotiation, are some of the options in which the parties mutually agreed to resolve a dispute amicably.

Alternate Dispute Resolution is the best solution for resolving a dispute between parties, through which parties come to the conclusion without lingering into judicial proceedings.

The Qur’an and the Sunnah or traditions of the Prophet (PBUH), are the primary sources of Islamic law provide the basic principles of Islamic transactions and commercial laws. The Qur’an, which was later supplemented by the traditions of the Prophet, has outlined the parameters within which any economic transactions must comply (Securities Commission Malaysia, 2009: 5).

Islam is not a just a religion but a way of life which guides the follower in every aspect of his life. Therefore it is necessary to look into the teachings of the Quran and or Sunnah of the Prophet Muhammad (S.A.W.W), which includes his saying, doing or tacit approval for guidance in the interpretation of the law.

 The Qur’an and the Sunnah have enumerated clearly the prohibited elements which could render a contract null and void. Among the most important prohibitions in Islamic commercial law are riba, gharar and maysir. Gharar is uncertainties that are to be avoided and maysir, zero sum game or any investment in non-Shari’ah compliant companies or conventional bond. Riba’ can occur in all interest-based lending activities, fixed return on deposits in conventional banking and forward forex contract. In addition to make the contract lawful it requires two basic conditions, firstly, voluntary consent from competent contracting parties and secondly the lawful contractual objective or aim based on general rule deduced from Surah al-Nisa’ (4:29).

Therefore Alternative Dispute Resolution mechanisms are already ingrained in the Quran and the sayings of the Prophet Mohammed (PBUH).  One of the Verses from the Quran, which provides foundation for Sulh (Peace)

“The believers are naught else than brothers. Therefore make peace between your brethren and observe your duty to Allah that haply ye may obtain mercy”

“And if two parties f believers fall to fighting, then make peace between them. And if one party of them doth wrong to the other, fight ye that which doth wrong till return unto the ordinance of Allah; then, if it return, make peace between them justly, and act equitably. Lo! Allah loveth the equitable”.

“There is no good in much of their secret conferences save (in) him who enjoineth almsgiving and kindness and peace-making among the people. Whose doth that, seeking the good pleasure of Allah, We shall bestow on him a vast reward”.

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