Appointment as neutral custodian confers custody, not unlimited power to hand the asset to either side or sell it. The Hanafi commentaries discuss the custodian’s liability if he releases it without authorization.
Likewise, expiry of the payment deadline does not automatically make the custodian an agent empowered to auction the asset. Authority to sell must be separately established. Custodian, sales agent and pledgee are distinct roles.
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Custody does not itself confer sale authority
Kitab al-Rahn: Salam, Sarf, Third-party Custody and Fungible Collateral
Appointment as neutral custodian confers custody, not unlimited power to hand the asset to either side or sell it. The Hanafi commentaries discuss the custodian’s liability if he releases it without authorization.
Likewise, expiry of the payment deadline does not automatically make the custodian an agent empowered to auction the asset. Authority to sell must be separately established. Custodian, sales agent and pledgee are distinct roles.