AUTOCORP GROUP, petitioner, vs. INTRA STRATA ASSURANCE CORP., respondent, GR No. 16662, June 27, 2008

 

Doctrine:     In the case of Philippine American General Insurance Co., Inc. v. Mutuc, the Court held that an agreement whereby the sureties bound themselves to be liable in case of an extension or renewal of the bond, without the necessity of executing another indemnity agreement for the purpose and without the necessity of being notified of such extension or renewal, is valid; and that there is nothing in it that militates against the law, good customs, good morals, public order or public policy.

Facts:

The petitioner Autocorp Group, secured an ordinary re-export bond, Instrata Bond No. 5770, from private respondent Intra Strata Assurance Corporation (ISAC) in favor of public respondent Bureau of Customs (BOC), in the amount of P327,040.00, to guarantee the re-export of one unit of Hyundai Excel 4-door 1.5 LS and/or to pay the taxes and duties.

The petitioner also obtained another re-export bond, Instrata Bond No. 7154, from ISAC in favor of the BOC, in the amount of P447,671.00, which was eventually increased to P707,609.00 per bond. Thereafter, petitioner executed and signed two Indemnity Agreements with identical stipulations in favor of ISAC, agreeing to act as surety of the subject bonds

The undersigned agree at all times to jointly and severally indemnify the COMPANY and keep it indemnified and hold and save it harmless from and against any and all damages, losses, costs, stamps, taxes, penalties, charges and expenses of whatsoever kind including counsel or attorney's fee.

In sum, ISAC issued the subject bonds to guarantee compliance by the petitioner with their undertaking with the BOC to re-export the imported vehicles within the given period and pay the taxes and/or duties. In turn, petitioners agreed, as surety, to indemnify ISAC for the liability the latter may incur on the said bonds.

Meanwhile, the Autocorp Group failed to re-export the items guaranteed by the bonds and/or liquidate the entries or cancel the bonds, and pay the taxes and duties pertaining to the said items despite repeated demands.

ISAC filed with the RTC on 24 October 1995 an action against petitioners to recover the sum of P1,034,649.00,... plus 25% thereof or P258,662.25 as attorney's fees.

The RTC rendered its Decision ordering petitioner to pay ISAC and/or the BOC the face value of the subject bonds in the total amount of P1,034,649.00, in which, the Court of Appeals affirmed the lower court decision with modification of Attorney’s fee.

 

Issue:           Whether or not the petitioner is jointly liable when amendments were introduced, without his consent and approval?

Held:

The subject bonds, Instrata Bonds No. 5770 and No. 7154, became due and demandable upon the failure of petitioner Autocorp Group to comply with a condition set forth in its undertaking with the BOC, specifically to re-export the imported vehicles within the period of six months... from their date of entry. Since it issued the subject bonds, ISAC then also became liable to the BOC. At this point, the Indemnity Agreements already give ISAC the right to proceed against petitioners via court action or otherwise.

The Indemnity Agreements, therefore, give ISAC the right to recover from petitioner the face value of the subject bonds plus attorney's fees at the time ISAC becomes liable on the said bonds to the BOC, regardless of whether the BOC had actually forfeited the bonds, demanded... payment thereof and/or received such payment. It must be pointed out that the Indemnity Agreements explicitly provide that petitioners shall be liable to indemnify ISAC "whether or not payment has actually been made by the ISAC" and ISAC may proceed against petitioners by... court action or otherwise "even prior to making payment to the [BOC] which may hereafter be done by ISAC.

INDEMNITY, The undersigned Autocorp Group and Rodriguez agree at all times to jointly and severally indemnify the COMPANY [ISAC] and keep it indemnified and hold and save it harmless from and against any and all damages, losses, costs, stamps, taxes, penalties, charges and expenses of whatsoever kind and nature including counsel or attorney’s fee which the COMPANY [ISAC] shall or may at any time sustain or incur in consequence of having become surety upon the bond herein above referred to…

The foregoing provision in the Indemnity Agreements clearly authorized ISAC to consent to the granting of any extension, modification, alteration and/or renewal of the subject bonds.

WHEREFORE, the Decision of the Court of Appeals which affirmed with modification the Decision of the Regional Trial Court is AFFIRMED in toto.

 

 

 

 

 

BASIC RULES OF RAMADHAN UNDER SHARI’AH LAW

What does Ramadhan mean?

The term Ramadhan was taken from its root word “ramad”, it is an Arabic term, which means “be burnt or scorched”. Technically, Ramadhan refers to (29) Twenty-Nine or (30) Thirty days of fasting by which, it is attributed to the burning of sins, or forgiveness of all sins upon perseverance and repentance to Allah. 

Ramadhan is the 9^th month of Hijri Calendar, while fasting during this month is called Sawm.  

 Is Sawm or fasting during Ramadhan mandatory?

Under the law (Surah Al Baqara: 183), Fasting was prescribed upon all Muslims. “O believers, fasting is prescribed for you, as it was prescribed those before you…” Hence, fasting during the month of Ramadhan is wajib; it means obligatory.

 Who is required to observe Sawm or fasting?

·       All competent Muslims of either gender, male or female;

·       Children upon reaching at the age of puberty;

·       Insane person upon recovery of his sound mind.

 Is there an exception to not observe fasting?

Under the law, (Surah Al Baqara: 185), the principle of Rukhsa as an exception to the rule may be applied. A Rukhsa principle is when the Lawgiver has enjoined His servant, He corollary grants the facility of bringing easiness out of difficulties, “Allah intends for you ease and does not intend for you hardship…”

 Exception to the exception

Under the law, the applicability of the principle of Rukhsa is valid only in times of adversities, and when it ceases to exist, the obligatory duties must be complied with. Thus, a traveler is only allowed to break his fasting while on journey, but the concessionary principle ceases upon reaching his destination, and those days he missed up by him during the month of Ramadhan must be fulfilled in any days after the month of Ramadhan, except during Fridays.  

 Who may exercise the Rukhsa Principle?

Among the recognized exceptions under the law are the following:

·       Insane;

·       Pregnant or Breastfeeding woman;

·       Menstruation;

·       Illness or sick person;

·       Travelers;

·       Elderly person;

·       Individuals who are experiencing extreme hunger or thirst that could harm his health.

 What are prohibited acts while fasting?

Under the law, among others, the prohibited acts are as follows:

·       Intentional eating or drinking of any kinds of consumable items before sunset;

·       Sexual Intercourse at daytimes;

·       Gossips, and all other forms of slander;

·       Adult talks and lewd conversation;

·       Fighting or Grudges;

·       Unnecessary and excessive arguments;

·       and others

 What is the penalty of having sexual intercourse at daytimes during Ramadhan?

Under the law, (Hadith Sahih Bukhari, No. 1835), the following are the penalties, either of these may compensate such offense:

·       Freeing a slave (Muslim slave);

·       Fasting for two consecutive months, if he does not own a slave or incapable of getting one;

·       Feeding sixty (60) indigent people.

 Is declaration of intention at evening or dawn required?

Under the law (Hadith: Mutafaqun Alayhi; Sahih Bukhari and Sahih Muslim), the declaration of Niyyah or Intention is important. “Indeed, deeds are (judged) by intentions. Every man will be rewarded only for what they intended”.

 The intention or niyyah is an action by heart. No need to utter something to that effect.

 Is sohoor or eating at dawn mandatory?

Under the law (Hadith: Mutafaqun Alayhi; Sahih Bukhari and Sahih Muslim),

The sohoor or eating before dawn is Sunnah. This is not mandatory for fasting, but the sohoor or eating before dawn, there is a blessing in it.

 What is the best time to break fasting?

Taking an Iftar (break-fast) should be immediate after sunset, or as soon as the Adhan for Maghrib was pronounced in the locality.

 

 

 

 

FIRST METRO INVESTMENT CORP., petitioner, vs. ESTE DEL SOL MOUNTAIN RESERVE, INC., et al, respondents, GR No. 141811, Nov. 15, 2001

 

Doctrine:      When a contract between two (2) parties is evidenced by a written instrument, such document is ordinarily the best evidence of the terms of the contract. Courts only need to rely on the face of written contracts to determine the intention of the parties. However, this rule is not without exception. The form of the contract is not conclusive for the law will not permit a usurious loan to hide itself behind a legal form. Parol evidence is admissible to show that a written document though legal in form was in fact a device to cover usury. If from a construction of the whole transaction it becomes apparent that there exists a corrupt intention to violate the Usury Law, the courts should and will permit no scheme, however ingenious, to becloud the crime of usury.

Facts:          

The petitioner FMIC granted respondent Este del Sol a loan of Seven Million Three Hundred Eighty-Five Thousand Five Hundred Pesos (P7,385,500.00) to finance the construction of its sports/resort complex project. Under the terms of the Loan Agreement, the proceeds of the loan were to be released on installment basis with an interest of sixteen (16%) percent per annum based on the diminishing balance.

The loan was payable in thirty-six (36) equal and consecutive monthly and Iin case of default, an acceleration clause shall apply and the amount due was made subject to a twenty (20%) percent one-time penalty on the amount due and such amount shall bear interest at the highest rate permitted by law from the date of default until full payment thereof plus liquidated damages at the rate of two (2%) percent per month compounded quarterly on the unpaid balance and accrued interests together with all the penalties, fees, expenses or charges thereon until the unpaid balance is fully paid.

However, the respondent failed to repay its obligation, it appeared to have incurred a total obligation of Twelve Million Six Hundred Seventy-Nine Thousand Six Hundred Thirty Pesos and Ninety-Eight Centavos (P12,679,630.98).

Accordingly, petitioner FMIC caused the extrajudicial foreclosure of the real estate mortgage at the public auction, petitioner FMIC was the highest bidder of the mortgaged properties for Nine Million Pesos (P9,000,000.00).  A Five Million Eight Hundred Eleven Thousand Three Hundred Sixty-Nine Pesos and Twenty-Five Centavos (P5,811,369.25) was applied to interests and penalty charges and partly against the principal, thereby leaving a balance of Six Million Eight Hundred Sixty-Three Thousand Two Hundred Ninety-Seven Pesos and Seventy-Three Centavos (P6,863,297.73). Thus, the petitioner demands for the settlement of the obligations with the alleged deficiency balance, but despite of it no avail was obtain.

The trial court rendered its decision in favor of petitioner FMIC, against defendants, ordering them jointly and severally to pay to plaintiff the unpaid balanced.

In contrast, the Appellate court reversed the challenged decision of the trial court.

 

Issue:           Whether or not the loan agreement refers to stipulation penalties, liquidated damages are excessive, iniquitous and unconscionable?

Held: After a careful and thorough review of the record including the evidence adduced, we find no reason to depart from the findings of the appellate court.

First, there is no merit to petitioner FMIC's contention that Central Bank Circular No. 905 which took effect on January 1, 1983 and removed the ceiling on interest rates for secured and unsecured loans, regardless of maturity, should be applied retroactively to a contract executed on January 31, 1978, as in the case at bar, that is, while the Usury Law was in full force and effect. It is an elementary rule of contracts that the laws, in force at the time the contract was made and entered into, govern it. More significantly, Central Bank Circular No. 905 did not repeal nor in any way amend the Usury Law but simply suspended the latter's effectivity.

Second, when a contract between two (2) parties is evidenced by a written instrument, such document is ordinarily the best evidence of the terms of the contract. Courts only need to rely on the face of written contracts to determine the intention of the parties. However, this rule is not without exception.

In this case, this Court agrees with the conclusion of the appellate court. We find the stipulated penalties, liquidated damages and attorney's fees, excessive, iniquitous and unconscionable and revolting to the conscience as they hardly allow the borrower any chance of survival in case of default.

WHEREFORE, the instant petition is hereby DENIED, and the assailed Decision of the Court of Appeals is AFFIRMED.

 

 

 

 

 

LARA'S GIFTS & DECORS, INC., petitioner vs. MIDTOWN INDUSTRIAL SALES, INC., Respondent, GR No. 225433, August 28, 2019

 

Doctrine:      When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money, the interest due should be that which may have been stipulated in writing. Furthermore, the interest due shall itself earn legal interest from the time it is judicially demanded. In the absence of stipulation, the rate of interest shall be 6% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.      

Facts:

Petitioner purchased from respondent various industrial and construction materials, this purchased was covered by a 60 days credit with a condition of 24% interest per annum that would be charged on all accounts overdue as stated in the sales invoice. Upon maturity of the credit, the petitioner paid its obligation by two checks, but checks were dishonored due to insufficient fund.

Meanwhile, the respondent sent demand letter for the settlement of the obligation, it turned no avail. Thereafter. The respondent filed a complaint for sum of Money with prayer for the attachment against the petitioner.

In his Answer, the petitioner argued that in his counterclaim that the product of the Respondent is substandard and that the finished product of the petitioner was rejected by its client because of poor quality. However, despite of the contentions, the Trial Court rendered its decision in favor of Respondent in which the CA affirmed such decision on the ground that the 24% of interest was agreed upon by the parties and that the same had been stated in the sales invoice.

Issue:           Whether or not the 24% of interest stated in the sales invoice is valid? 

Held:            In deciding this case, the Court laydown a guideline as to the payment of interest in cases of loan, forbearance of money, good and credit.

One of those guidelines is that when there is written stipulation between the parties, such rate of interest agreed upon by them shall be applied.  The legal interest as contemplated from the Civil Code be applied only in the absence of stipulation.

In this case, according to the Court, it is clear from the sales invoice which was agreed by the parties that the 24% interest per annum would be charged for all the account overdue.

Therefore, according to the court, the stipulated interest shall be applied until full payment of the obligation because that is the law between the parties.

 

In details, the court declared that:

1.    When an obligation, regardless of its source, i.e., law, contracts, quasi-contracts, delicts or quasi-delicts is breached, the contravenor can be held liable for damages. The provisions under Title XVIII on "Damages" of the Civil Code govern in determining the measure of recoverable damages.

2.    With regard particularly to an award of interest in the concept of actual and compensatory damages, the rate of interest, as well as the accrual thereof, is imposed, as follows:

a)    When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money, the interest due should be that which may have been stipulated in writing. Furthermore, the interest due shall itself earn legal interest from the time it is judicially demanded. In the absence of stipulation, the rate of interest shall be 12% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.

b)    When an obligation, not constituting a loan or forbearance of money, is breached, an interest on the amount of damages awarded may be imposed at the discretion of the court at the rate of 6% per annum. No interest, however, shall be adjudged on unliquidated claims or damages except when or until the demand can be established with reasonable certainty. Accordingly, where the demand is established with reasonable certainty, the interest shall begin to run from the time the claim is made judicially or extrajudicially (Art. 1169, Civil Code) but when such certainty cannot be so reasonably established at the time the demand is made, the interest shall begin to run only from the date of the judgment of the court is made (at which time the quantification of damages may be deemed to have been reasonably ascertained). The actual base for the computation of legal interest shall, in any case, be on the amount of finally adjudged.

c)    When the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest, whether the case falls under paragraph 1 or paragraph 2, above, shall be 12% per annum from such finality until its satisfaction, this interim period being deemed to be by then an equivalent to a forbearance of credit.

Paragraph 3 above failed to qualify that for loans or forbearance of money, the prevailing legal interest should only apply in the absence of stipulated interest. The stipulated interest is the law between the parties and should apply from the time of extrajudicial or judicial demand until full payment. This omission resulted in several rulings of this Court, which imposed the stipulated interest on the adjudged amount until finality of the decision BUT applied the prevailing legal interest in lieu of the stipulated interest from finality of the decision until full payment of the obligation. This is in direct contravention of the law, particularly Article 2209 of the Civil Code, which mandates that when a debtor incurs a delay in obligations to pay a sum of money, the indemnity for damages shall be the payment of the interest agreed upon. Only in the absence of a stipulated interest will the legal interest be applied.

PHILIPPINE NATIONAL BANK, petitioner, vs. ROSARIO TAJONERA, respondent, G.R. No. 195889, Sept. 24, 2014

 Doctrine:      Failure to perform a reciprocal obligation is a Breach of Contract.  Under the law, a loan requires the delivery of money or any other consumable object by one party to another, on the condition that the same amount or quality shall be paid. Loan is a reciprocal obligation, as it arises from the same cause where one party is the creditor, and the other is the debtor. The obligation of one party in a reciprocal obligation is dependent upon the obligation of the other, and the performance should ideally be simultaneous. This means that in a loan, the creditor should release the full loan amount and the debtor repays it when it becomes due and demandable.

Facts:

Through Rosario, the Vice President of Eduarosa Realty Development, Inc. (ERDI) obtained loans from Philippine National Bank (PNB) and entered into several credit agreements to finance the completion of the construction of their 20-storey Eduarosa Tower Condominium.

Pursuant to the Credit Agreement, ERDI obtained from PNB a loan in the amount of ₱60,000,000.00 plus ₱5,000,000.00 Domestic Bills. To secure this initial loan, ERDI mortgaged in favor of PNB its Paranaque properties together with the 20-storey condominium building to be erected thereon.

Subsequently, ERDI and PNB entered into The First Amendment wherein the former obtained an additional loan of ₱40,000,000.00. As security for the additional loan, the ERDI’s Greenhills property was mortgaged as evidenced by the Supplement to Mortgage.

Thereafter, the parties made Second Amendment was likewise entered into by the parties for the purpose of extending the repayment dates of the loan and the additional loan. Afterward, A Third Amendment was entered into by the parties wherein the respondents were granted a second additional loan of ₱55,000,000.00.

Nevertheless, ERDI failed to settle its obligation. As a consequence, PNB filed an application for foreclosure of the Greenhills property. As the highest bidder, PNB was issued the Certificate of Sale. Upon ERDI’s failure to redeem the property, PNB consolidated its title and caused the cancellation of the title in the name of the respondent. A new title was issued in the name of PNB.

This prompted the respondents to file a complaint against PNB for annulment of sale, cancellation of title, cancellation of mortgage, and damages before the RTC.

The RTC rendered its judgment in favor of the respondents on the ground that PNB did not release the remaining balance of the approved loan under the Third Amendment.   PNB appealed to CA, but CA affirms TRC’s decision with modification.

Issue:           Whether or not the CA erred in annulling the mortgage contract constituted over the Greenhills property of the respondents?

Held:            PNB insists that there was no breach of its contractual obligation when it did not release the remaining balance of the approved loan to the respondents considering that the latter had no history of any payment either on interest or principal of the loan.

The agreement between PNB and the respondents was one of a loan. Under the law, a loan requires the delivery of money or any other consumable object by one party to another who acquires ownership thereof, on the condition that the same amount or quality shall be paid. Loan is a reciprocal obligation, as it arises from the same cause where one party is the creditor, and the other the debtor. The obligation of one party in a reciprocal obligation is dependent upon the obligation of the other, and the performance should ideally be simultaneous. This means that in a loan, the creditor should release the full loan amount and the debtor repays it when it becomes due and demandable.

PNB, not having released the balance of the last loan proceeds in accordance with the Third Amendment had no right to demand from the respondent compliance with their own obligation under the loan. Indeed, if a party in a reciprocal contract like a loan does not perform its obligation, the other party cannot be obliged to perform what is expected of them while the other's obligation remains unfulfilled.

In view of the foregoing, the court a quo aptly ruled that the refusal of PNB to release portion of the additional loan granted under the Third Amendment to Credit Transaction is not justified. In this jurisdiction, breach of contract is defined as:

It is the failure without legal reason to comply with the terms of a contract. It is also defined as the failure, without legal excuse, to perform any promise which forms the whole or part of the contract.

Undoubtedly, PNB breached its contractual obligation when it failed to release to Appellees the remaining balance of the approved loan.

WHEREFORE, the petition is DENIED. The Decision and Resolution of the Court of Appeals are AFFIRMED.

 

THEFT AT A GLANCE UNDER SHARI’AH LAW

Theft or Sariqa defined,

One of the legal punishments under Shari’ah rulings is the crime of theft. Generally, it prescribed the cutting-off-the-hands of the offender. The Arabic term for theft is “sariqa”, under Islamic jurisprudence sariqa or theft is categorized as hadd, means a punishment in which it is divinely fixed by the Supreme. In other words, the crime and punishment for sariqa or theft under Shari’ah ruling cannot be altered and modified in a sense as to subrogate its primary injunction.   

According to Muslim scholars, sariqa had been defined as the surreptitious removal of legally recognized property in the safe keeping of another person, that amounts to a specific minimum to which the thief has no right of ownership and which has not been entrusted to him, (Olaf Kondogen, p. 269, 2018). Sariqa may be defined as clandestine taking of things not entrusted to the taker and belonging to someone else, (Alauya, p. 225, 1999).

General rule

In Islam, to steal is absolutely haram or prohibited even a slightest pick of atom be taken without prior consents or permission from the owner. The well-known rulings of theft under Shari’ah have been legislated from its primary source. For instance, in verse 38, Surah al Maidah, it provides that: 

وَٱلسَّارِقُ وَٱلسَّارِقَةُ فَٱقْطَعُوٓا۟ أَيْدِيَهُمَا جَزَآءًۢ بِمَا كَسَبَا نَكَـٰلًۭا مِّنَ ٱللَّهِ ۗ وَٱللَّهُ عَزِيزٌ حَكِيمٌۭ

As for male and female thieves, cut off their hands for what they have done—a deterrent from Allah. And Allah is Almighty, All-Wise

The hadd punishment on sariqa in this verse is general in nature. If anyone is responsible for stealing saved items, his or her hand will be chopped off. It does not specify as to which hands of the offender be severed, and up to what extent. This is where the authentic hadith, or traditions of Prophet Mohammed (PBUH) be applied as interpretation to the primary sources of Muslim law. Meanwhile, it has to be noted that when the Supreme legislates His divine law, such is proceeded with wisdom. 

Apparently, this general law on amputation serves as exemplary, and as to forewarn the potential offender of the same crime in the future.  The phrase “كَسَبَا نَكَـٰلًۭا مِّنَ ٱللَّهِ ” (a deterrent from Allah) within the verse is the reason why law on amputation is prescribed.

Exception to the Rule

Under Islamic jurisprudence, there are two main divisions of mandatory law; the Azima and Rukhsa. Azima means determined, while Rukhsa means concessions. Rukhsa is the complete opposite of the former.  Azima refers to mandatory and strict compliance of the law or fulfilment of a duty. In Azima principle, there is no way out not to perform the obligations under which is mandated by the law Giver.  However, due to recognized circumstances beyond the control of humans which affect his non-performance of the duties, the Azima principle such as imposition of Law on Amputation may be suspended. Thus, Rukhsa will attend to address the burden and hardships. When there is:

• 1.  Widespread of famine, during the reign of Caliph Umar Bin Khataab, the law on sariqa was suspended by him due to the extensive starvation.

• 2.    Things may be decay or go to waste as such fruits, milk, fish, and the liked are not subject to law on amputation because of the hadith: 

لاَ قَطْعَ فِي ثَمَرٍ مُعَلَّقٍ وَلاَ فِي حَرِيسَةِ جَبَلٍ‏ فَإِذَا آوَاهُ الْمُرَاحُ أَوِ الْجَرِينُ فَالْقَطْعُ فِيمَا يَبْلُغُ ثَمَنَ الْمِجَنِّ

 

“The hand is not cut off for fruit hanging on the tree and for sheep kept in the mountains. So when they are taken from the fold or the place where the fruit is dried, a hand is cut off for whatever reaches the price of a shield.” (Sunan Abu Dawud, Book 17, Hadith No. 37).

• 3.       Less than the cost of the shield, the offender would not be subject to law on amputation if the value of the stolen item were less in value. Based on the hadith:

 

لاَ تُقْطَعُ يَدُ السَّارِقِ فِيمَا دُونَ الْمِجَنِّ

 

“The hand of the thief is not to be cut off for anything less than a shield." (Sahih Bhukari. Book 5, Hadith. No. 4939).

• 4.    The owner of the property pardons the offender after restoration, the Prophet (PBUH) permitted the non-enforcement of the cutting-off of the hand if it established that the offender had repented and reformed himself, provided that property stolen is restored.  

 

فَمَن تَابَ مِنۢ بَعْدِ ظُلْمِهِۦ وَأَصْلَحَ فَإِنَّ ٱللَّهَ يَتُوبُ عَلَيْهِ ۗ إِنَّ ٱللَّهَ غَفُورٌۭ رَّحِيمٌ

 

“But whoever repents after their wrongdoing and mends their ways, Allah will surely turn to them in forgiveness. Indeed, Allah is All-Forgiving, Most Merciful.” (Q5:39)

Essential elements of the crime of sariqa or Theft

Under Islamic law, the perpetrator in the crime of sariqa must be of the following: al Baligh or adult, al Aql or sane person (sound mind), and an intention of stealing, that is, he cannot be acted under foreign force. These three elements are necessary to establish the crime of sariqa. Moreover, it must be attested by at least two credible witnesses.

وَأَشْهِدُوا۟ ذَوَىْ عَدْلٍۢ مِّنكُمْ وَأَقِيمُوا۟ ٱلشَّهَـٰدَةَ لِلَّهِ

“And call two of your reliable men to witness and let the witnesses bear true testimony for the sake of Allah.” (Q65:2)

To appreciate the punishment for theft, the offender must be a sane adult who knows that theft is forbidden, the crime has to be proven either by confession or the testimony of two reliable witnesses as required from quoted verse, the stolen item has to be of value and taken secretly from a safe place, and the owner has to claim it. Otherwise, there shall be no amputation.

 

The Value for which, if it is stolen, the (Thief's) Hand is to be cut off

The minimum value of stolen property to appreciate the imposition of amputation is ranging from three (3) Dirhams or more, and/or its equivalent.

Numerous provisions from the hadith on this matter. For instance, in one narrated by Ibn Umar, the Prophet Mohammed (BPUH) cut off the hand of a thief for stealing a shield that was worth three Dirhams. (Sahih Bukhari, Book 86, Vol. 8, Bk. 81, Hadith No. 788-791).