What happens if the mudarib trades with the property of the mudaraba and incurs a loss, then pays the remaining balance to another operator without the consent of the owner of the capital?
If the mudarib trades with the property of the mudaraba and makes a loss, and pays the balance thereof without the consent of the owner of the capital to another operator to use it by way of mudaraba and he makes a profit, the owner of the capital shall have the whole of his capital and his share of the profit in the hands of the second mudarib by way of capital and profit, and the second mudarib shall have the right of recourse against the first mudarib for the balance of his share in the profit in the event that he was unaware that the first mudarib was exceeding his authority, or of the loss he had made, and if he was aware of the excess of authority or of the loss, he shall not be entitled to have any recourse against him.