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Cancelation fee

Fatwaa ID: 1379

Question:
Assalamualeikum

Is it permissible to charge a cancelation fee. Eg. A person does transport and at the last hour the client cancels. Please also mention of the permissibility if this fee was mentioned in the clause or if it wasn’t mentioned in it.
جزاك الله خيرا

Answer:
In the Name of Allaah, the Most Gracious, the Most Merciful.
As-salaamu ‘alaykum wa-rahmatullaahi wa-barakaatuh.

In principle, it is impermissible to impose penalties or fines for cancelations that were made ahead of time such that it does not inconvenience the service provider. However, if it was a last minute cancelation, which resulted in the service provider not having adequate time to find another client despite having made himself available, then the service provider has the right to charge the client in full for the booked time. The above is applicable irrespective of whether it was expressly mentioned in the contract or not.

And Allaah Ta’aala knows best.
Mufti Muajul I. Chowdhury
Darul Iftaa New York
https://askthemufti.us/

12/10/1444 AH – 06/28/2023 CE | AMG1-3195

وصل اللهم وسلم وبارك على سيدنا محمد وعلى ءاله وصحبه أجمعين

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