The following question and answer by Sheikh Yusuf Talal DeLorenzo attendees of the Dow Jones University Courses on Islamic Investement.
Question:: I asked previously and received no reply what are the essential components to a contract according to the different madhhabs? Also, some say that the offer and acceptance element of the contract is not present if you are a shareholder because you have a very limited say. is this accurate?
Answer: The classical jurists are in agreement that every legal contract is composed of a pillarand four fundamental elements. The pillar of every contract is an offer and its acceptance.Thereafter, the contract is composed of four fundamental elements; 1. The expression of theintention to transact, the parties to the transaction, the subject of the transaction, andthe purpose of the transaction. All the legal schools are in agreement on this; though theymay differ on some of the details.
The answer to the second part of the question is that it is not accurate to say thatbecause a shareholder has very little say, the element of offer and acceptance is notpresent. These are two separate matters, and the one has no bearing on the other. I hopethat this will have become clear from my answer to the question about ijab andqabul.