A mudarib bought a house through embezzlement: whose is the house now?

Question

Question: Khalid, providing his own money, has Bakr conduct a trade in hides and tallow for him on a commission basis. As need arises, however it happens, he keeps giving money, and then, on the basis of the dispatch invoices for the goods, Khalid and Bakr also settle the accounts of their dealings between themselves. This business has been going on for about three or four years.

Answer

Even though the embezzlement and dishonesty had become known, Khalid continued the business as before and did not dissolve it (faskh), and, relying on the word of Bakr’s father, he consented to receive the remaining sum month by month (according to his means). Now he no longer has the right to transfer the said house to his own name.

Source: Fatawa Mahmudiyya

Preview. The full text opens with JavaScript enabled.