Legal document: T-S 16.21

Description

Legal document. Partnership agreement. Dating: 1140. The partners (Abū al-Barakāt and Abū al-Faraj) split losses evenly but grant the active partner (Abū al-Faraj) thirteen twenty-fourths of the profit. In fact, the document specifies two twenty-fourths of the profit allocated to Abū al-Faraj, the amount by which his share exceeded Abū al-Barakāt's, as "remuneration [for his trouble and work]". Per Maimonides, the share of profits allocated to the active partner must be at equal to or greater than the share of losses. This suggests that in this case only 1/24 of the thirteen twenty-fourths of the profit allocated to Abū al-Faraj is the “additional amount” corresponding to payment for his work. The document is explicit that profits are split "evenly" (each partner receives eleven twenty-fourths), and an "additional amount" of two twenty-fourths is to be allocated to Abū al-Faraj. Abū al-Faraj is to have free disposal of the partnership capital, part of which is considered a loan, without any recourse to Abū al-Barakāt. Abū al-Barakāt also declares that his partner’s testimony would be trusted, even though both partners are supposed to perform an accounting. A copy of the partnership agreement is written for each of the parties' records. Should the partnership be terminated by either party before the end of the fixed period (which is not evident in the document, possibly due to deterioration), the terminating partner would be required to pay the other 50 dinars as an outright gift. If Abū al-Barakāt were to terminate the partnership prematurely, he would lose the entire amount putatively loaned to Abū al-Faraj, which was likely half his capital. (Information from Lieberman, "A Partnership Culture," 119-120)