• Hibah as a Door to an Efficient Wealth Management in Islam


    HIBAH – The demise of a Malaysian comedian named Abam Bocey earlier this year, had stolen nation’s attention and became the talk of many when his funeral prayer was attended by hundreds of people, as reported by The Star on 10th February 2020. Despite his passing, positive stories about this humourist did not stop to fill the air and could easily be read and traced on Twitter with the hashtag #KitaBaikRamaiSayang, as reported in Sinar Harian. Amidst the positivity that people could draw from his death which was in fact described by the Mufti of the Federal Territory on his official page, as a sign of husnul khatimah, a controversy involving the estate that he left began to emerge when it was reported on various news media regarding an alleged dissension between his younger brother and widow, over the late comedian’s properties.


    Picking quarrels or even ending up in scuffles when it comes to claiming the estate of a deceased is not a novel issue as such occurrence has always made an appearance on news portals. Last year around early February, the issue of the mother of the late former MP of Rompin, Tan Sri Dr. Jamaludin Jarjis, who took legal action against her grandchildren involving her late son’s properties which were said to be worth more than a billion of ringgit, had made headlines on various main stream online news portals such as BH Online and Bernama. Dissatisfactions over the allotment of inheritance had also resulted in some family members being hostile to each other, which could even go to the extent of physical attacks. On 29th of August 2019, BH Online reported that a man was punched by his elder brother, due to the latter being dissatisfied with the way the estate was being managed.


    The bitter truth is that there are still estates worth RM 70 billion which were left unclaimed in Malaysia ever since our country gained its independence, as reported on MyMetro dated 12th January 2020. Poor awareness with regards to the significance of estate management either by the property’s owner or even the heirs upon the proprietor’s death was said to be one of the contributing factors of this predicament. The principles of circulation of wealth and justice in wealth distribution which formed the basis of the faraidh system, according to Mohd Kamarul Khaidzir bin Saadan and Mohamad Sabri bin Haron (in their article entitled “Teori Maslahah Dalam Sistem Pewarisan Harta Orang Islam”), cannot materialise if the management of the estate left by the deceased is in a state of limbo. Hence, in this article we will explore about hibah as an alternative means to an efficient wealth management in Islam without negating the wisdom and beauty of the legislation of faraidh.



    Bank Negara defines hibah as “a transfer of ownership of an asset from a donor (wahib) to a recipient (mawhub lahu) without any consideration”. In a paper presented by Mohd Zamro Muda from the Syari’a Department of Faculty of Islamic Studies in Universiti Kebangsaan Malaysia entitled “Instruments of Hibah and Wills: Analysis of the Regulations and Applications in Malaysia”, hibah is defined as a form of contract (‘akad) in which an ownership of a property is conferred from one person to another, during the lifetime of the former, without getting remuneration (‘iwad) in return. In simpler terms, hibah can be understood as something which is given voluntarily. Among the key features which characterise a hibah contract, as listed in the above-cited article, are:

    • There must be a specific person of whom the hibah is entitled to
    • Debt or benefits/interests are not the subject matter of hibah but the subject matter of hibah must be in a physical (‘ain) form
    • Hibah is a contract which is made without entailing consideration from the receiving end
    • A hibah contract is effective during the lifetime of the wahib 
    • It is a contract which should be made voluntarily by the hibah provider without any form of coercion nor duress by any party 
    • A hibah is made without the wahib having an expectation to receive reward in return from the mawhub lahu



    In Surah Aali ‘Imraan, verse 92, Allah swt says:

    Never will you attain the good [reward] until you spend [in the way of Allah] from that which you love. And whatever you spend – indeed, Allah is Knowing of it

    (Translation by Sahih International)


    Whereas, in describing righteousness, Allah swt, in verse 177 of Surah Al-Baqarah, says to the effect:

    “…but [true] righteousness is [in] one who… gives wealth, in spite of love for it, to relatives, orphans, the needy, the traveller, those who ask [for help], and for freeing slaves…

    (Translation by Sahih International)


    Verses in the Qur’an which carry the theme of giving in charity are aplenty, and the above two verses are among them which encourage Muslims to embody the act of voluntary giving the things that we love as a sign of righteousness and piety, which includes the act of making hibah.


    Besides, in the Sahih Muslim there is a title dedicated on kitab al-hibah which lays down various hadeeth on hibah. One of the hadeeths is as reported by Zaid b. Aslam:

    “…that ‘Umar (Allah be pleased with him) donated a horse in the path of Allah. He found that it had languished in the hand of its possessor, and he was a man of meagre resource.  He (Hadrat ‘Umar) intended to buy it. He came to Allah’s Messenger (may peace be upon him) and made a mention of that to him, whereupon he said: Don’t buy that even if you get it for a dirham for he who gets back the charity is like a dog which swallows its vomit.

    (Translation of Sahih Muslim, Book 12. Refer: http://www.iium.edu.my/deed/hadith/muslim/012_smt.html) 


    The act of making hibah can also be traced its legality based on the renowned hadeeth which was reported by Abu Hurairah, where Rasululullah s.a.w. said:

    “Give each other gifts and you will love each other.” (Source: al-Adab al-Mufrad 594. Refer: https://abuaminaelias.com/dailyhadithonline/2012/11/24/give-gifts-love-one-another/) 


    Based on the first mentioned hadeeth, it can be observed that the act of voluntary giving was practised back in the days of the sahabah. And in fact it is something that is encouraged as seen in the second hadeeth, from which it is hoped to blossom the feeling of love between the donor and the recipient. From the above sacred authorities from the Qur’an and Sunnah, we can observe that hibah is acknowledged and recognised in Islam. Hence, in the ensuing paragraphs we will explore how hibah can benefit our ummah in managing the Muslims’ wealth in an efficient manner.



    Firstly, a donor can grant hibah to anyone he desires during his lifetime. As we all know, the system of faraidh governed the apportionment of the deceased’s properties to his or her heirs and there is a fixed portion to the one who deserved his or her share. On the other hand, the heirs of the deceased are to be excluded from the will of the deceased except if the other heirs do not object to such apportionment. As the Principles of Muhammadan Jurisprudence by Abdur Rahim put it: “A further reason why a bequest in favour of an heir is not allowed is that it would amount to giving preference to some heirs over others, thus defeating the spirit of the law which has fixed the portion of each in the inheritance and causing disputes among persons related to one another. If the other heirs consent to a bequest to one of them or to a bequest of more than one-third of the estate, the above reasons no longer hold good and the bequest as made will be valid”. This shows that the general rule is that the heirs of the deceased no longer have their share from the wasiyyah of the deceased as their shares are allotted through the system of faraidh. This is further supported by a hadeeth which is narrated by At-Tirmidhi as can be found on page 49 of Asbabu Ikhtilaf Al-Fuqaha’ written by Al-Sheikh ‘Ali Al-Khafeef:

    “إن الله قد أعطى كل ذي حق حقه، فلا وصية لوارث”


    Hence, unlike faraidh and wasiyyah, a person can grant hibah to anyone he desires during his lifetime. This is further supported by section 2 of the Administration of Syariah Court of Kelantan Enactment 1982, which defines “alang hayat” or “hibah” in Malay as, “pemberian percuma atau pindah milek harta oleh seseorang dalam masa hayat kepada sesiapa yang dia kehendaki”. The phrase “…kepada sesiapa yang dia kehendaki” shows that the giving of hibah is unconditional and can be made simply to anyone. This shows the flexibility of hibah as a means of wealth management in Islam.


    • Hibah to heirs

    In the case of Re Abdul Rahman bin Hj Ahmad & Ors [2013] 1 SHLR 51, the Court had affirmed the validity of the contract of hibah that was made by the applicant which is the father of the recipients as the Court was satisfied that all of the conditions of a valid hibah were fulfilled which are: Firstly, the parties of the hibah contract which consist of the hibah donor (wahib) and the recipient of hibah (mauhub lahu), secondly, the contract of hibah which consist of ijab and qabul, of which the learned Judge explained that the sighah (ijab and qabul) must be continuous, unconditional and untampered with. Thirdly, the subject matter of the hibah (al-mauhub) must be in existence at the time of hibah, it must be valuable and owned by the hibah donor as explained by the Judge in the above-cited case. Thus, from this case, we can observe that hibah can be given in a parent-child relationship, as long as all of the conditions of a valid hibah are satisfied.

    On the other hand, hibah between husband and wife can also take place, as in the case of Wan Khairani bt Wan Mahmood v Ismail bin Mohamad [2011] 3 SHLR 12. Whereby in this case, the learned Judge had differentiated between harta sepencarian and hibah, where harta sepencarian is defined as a property jointly acquired by a husband and wife during the subsistence of marriage which can be enforced when the conditions stipulated by Hukum Syara’ are fulfilled. Meanwhile, hibah is a contract where the donor of hibah (wahib) grants his property to the recipient without remuneration (‘iwadh). In this case, the Court decided that the disputed ownership of property was a hibah property instead of harta sepencarian, and the conditions of hibah were fulfilled. Thus, the hibah of the property by the husband to the wife was validly concluded and cannot be retracted by the husband.


    • Hibah to non-heirs

    Further, the flexibility of hibah can also be seen by the fact that hibah can be given to non-heirs since faraidh does not allot any portion to this category of people. Making hibah especially if we have adopted children would be a wise way in managing our wealth as no matter how much we love and care our adopted children and no matter how long they have been staying with us, the fact stays that adopted children cannot inherit our estate by way of faraidh. Thus, making a hibah would be a smarter way for people who desire to apportion some of their wealth or properties to their beloved adopted children, as well as to ensure their wellbeing and welfare are taken care of upon the former’s death. A few decided cases have illustrated the validity of hibah to an adopted child. In the case of Salmiah Che Hat lwn Zakaria Hashim [2001] JH 14 (1) 79, the legal issue that arose was whether a plot of land which was given by the adoptive father (uncle) of the Plaintiff to the Plaintiff was considered as hibah or otherwise. In this case, the Plaintiff’s adoptive father is the uncle of both the Plaintiff and the Defendant, who are cousins turned husband and wife. The Plaintiff’s adoptive father gave a plot of land to the Defendant, when the Plaintiff and the Defendant were in the subsistence of marriage. The adoptive father had retracted the land upon the couple’s divorce, and subsequently, the adoptive father had given the plot of land to the Plaintiff. The Plaintiff had applied to the Court to declare the plot of land as a subject matter of hibah. The Court in this case had declared that the conferment of the plot of land was a form of hibah that was given by the adoptive father to the Plaintiff and decided that it fulfilled the conditions of a valid hibah.


    To illustrate the conferment of hibah to non-heirs, an article entitled “Pengurusan Harta Melalui Hibah: Kepentingan Dan Manfaat Dari Pelbagai Aspek Untuk Kemajuan Ummah” written by Rusnadewi Abdul Rashid and Nor Hisyam Ahmad, had mentioned the often-cited case of Poolimahee Rajeswary @ Fatimah Binti Baba lwn Meah Binti Hussain [JH XIX/I BHG 1 hlm. 165]. In this case, the Defendant’s husband had, during his lifetime, gifted the Plaintiff, who was his adopted child, a plot of land on which laid a house. Despite the fact that the transfer of ownership did not take place during the lifetime of the hibah donor, the Court decided that the hibah was valid and fulfilled the conditions of a valid hibah. Other cases on hibah to adopted children that can be referred to are, inter alia, Norizah Bt Mansor [JH XIX/I BHG 1, Feb 2005] and Nang Lijah Bte Megat Stan [Kanun, vol.8.1996, hlm. 169].


    Secondly, the apportionment of hibah is unlimited in nature. Unlike faraidh, of which the share to each recipient is fixed and being regulated by the Holy Qur’an, and wasiyyah which generally can be made limited to 1/3 of the net estate of the deceased, the apportionment of hibah is unlimited and not restricted to any particular amount. According to the writers of the article entitled “Comparison between Will and Gift as An Estate Planning Instrument in Islam”, this is due to the fact that hibah is regarded as a gift by the donor of the hibah (wahib) during his lifetime and it is not included in the estate of the donor upon his death. To illustrate this point, the above-mentioned article had cited two cases. Firstly, the case of Jumaaton dan Raja Delila lwn Raja Hizaruddin [JH Dis 1998 Jld XII Bhg II hlm. 201] in which the son was given an amount of 11,095,666 shares from a total of 12,560,313 unit of shares by his father was considered by the Court as a valid hibah, despite the fact that the son would not be getting as much according to the law of faraidh. Meanwhile, in the case of Wan Mahmud bin Wan Abdul Rahman & 3 yang lain lwn Aminah binti Hj. Taib & 2 yang lain [JH XVIII/II Bhg II Dis 2004 hlm. 331], the husband had gifted his wife half of his properties by way of hibah, which clearly supports the notion that the apportionment of hibah is unlimited in nature. This marks yet another advantage of hibah as a means in managing wealth.


    Thirdly, hibah acts as an alternative when managing wealth through faraidh comes to a dead end. According to Siti Noor Farahin M. Fariddudini & Muhammad Adib Samsudin, the writers of “Comparison between Will and Gift as an Estate Planning Instrument in Islam”, managing wealth through hibah is simpler and faster as the gift or the conferment of property is made during the lifetime of the donor. It does not have to go through the process of faraidh which can be tedious especially so when the heirs are not well-educated on the way the estate should be managed through the faraidh system. The writers which cited “Harta Amanah Orang Islam Di Malaysia: Perspektif Undang-Undang Dan Pentadbiran”, written by Siti Mashitoh Mahamood, stated that with the existence of a hibah document, the subject matter of hibah can be benefited from and acquired by the hibah recipient much prompter.


    Besides, hibah would be a better choice as the execution process is made simpler, compared to the wealth management through wasiyyah which requires the will to be read before all the legal heirs upon the death of the maker of the will and which needs to go through the process of inheritance, either having to go through the High Court, Land Office, or Amanah Raya Berhad. This process can take months for the execution to take place, as per highlighted in the article entitled “Comparison between Will and Gift as an Estate Planning Instrument in Islam”.


    Fourthly, the conferment of hibah can be tailored according to the economic needs of the recipient. Based on the article entitled “Pengurusan Harta Melalui Hibah: Kepentingan dan Manfaat dari Pelbagai Aspek untuk Kemajuan Ummah”, the apportionment of hibah can be customised to suit the needs of the recipients, taking into consideration the economic needs of the recipients and the needs of the legal heirs as their economic needs vary. The flexible nature of hibah confers upon the hibah donor (for instance, a father), the right to grant a larger portion of hibah to his daughters probably due to the greater financial burden that the daughters have to bear, compared to his sons who might be more financially sound, without negating the sons’ right to the father’s estate based on the law of faraidh. The article had cited the case of Muhammad Awang & yang lain lwn Awang Deraman & yang lain [2004] CLJ (Sya) 139, whereby the deceased had, in his lifetime, gifted two plots of land that he owned to the Second and the Third Respondents (his children). Upon the deceased’s death, the claimants who were the other children of the deceased had questioned the validity of the hibah, inter alia, on the ground of injustice, due to the disproportionality of the apportionment of properties. The Court of Appeal had decided that irrespective of the apportionment of properties which might seem unjust, the hibah was nevertheless regarded as a valid hibah. And the deceased might have his very own reasons to divide the properties as such.


    Last but not least, a divorce between a husband and wife does not affect the conferment of hibah. According to the writers of “Pengurusan Harta Melalui Hibah: Kepentingan Dan Manfaat Dari Pelbagai Aspek Untuk Kemajuan Ummah” which referred to the work of Mohd Zamro Muda & Mohd Ridzuan Awang entitled “Undang-undang pusaka Islam: Pelaksanaannya di Malaysia”, if a husband divorced his wife by way of ba’in (such as triple talaq, khulu’or fasakh), either in a fit and healthy state or in time of sickness which led to his death, the husband and wife cannot inherit each other, should one of them pass away (even if the wife is in a state of ‘iddah). This is based on the view of ‘ulama’. According to the writers, this is due to the fact that the marriage tie is deemed broken and disrupted at that particular instance. Thus, one of the grounds of inheritance i.e. marriage no longer stands. Therefore, both the husband and wife can no longer inherit each other.


    On the other hand, hibah is not affected in any way, should a divorce take place between a husband and wife. The wisdom behind this permissibility, as highlighted by the writers, could be to protect the welfare or interest of either party in the receiving end. For instance, the former husband or wife who is more financially capable is permitted to make a hibah to the other who is more financially in need, probably as a form of appreciation for the latter’s contribution throughout the period of marriage.



    This article clearly shows the various advantages that a hibah could offer as a means of wealth management in Islam. It is very important to note that each and every legislation has its maqsad or objective to be achieved, and this include the legislations of faraidh and wasiyyah. Nevertheless, considering the flexibilities of hibah, and seeing the problems with the administration of wealth through the faraidh and wasiyyah systems could result in, hibah would be a great option due to the various advantages listed in the foregoing paragraphs. It is high time to educate and create awareness among the people to practise hibah in managing their wealth, with hope that it could minimise the number of unclaimed estate which should have been utilised for the benefits of the ummah.