Arabic (تعدي) for breach of contract or failure to perform a duty. In the context of Islamic financial/ business transactions, taaddi arises when a party to a contract (aqd)/ transaction fails to adhere to a set of applicable standards (e.g., contractual terms) pertaining to conduct/ due care necessitated in such a contractual setting. In general, taaddi implies breach, transgression, and wrong-doing (zhulm) in the context of others’ rights and property, etc.

For example, in the contract of mudaraba (المضاربة), the worker (aamil/ mudarib) is not under any contractual obligation to guarantee (that is, provide a dhaman as to) its capital (ras al-mal) or profits (ribh), unless it is proven that taaddi or taqseer were committed by the worker. By nature, taaddi implies “intentional” breach or misconduct giving rise to financial consequences that impact the other party or parties. However, taaddi may arise from both intentional and unintentional acts, where the key consideration is the occurrence of breach or transgression, etc.

Taaddi, along with negligence (ihmal/ taqkseer), causes a party committing it to be liable for any unfavorable/ adverse consequences (such as losses, underperformance, etc.), provided that taaddi (and negligence, as the case might be) is duly established and evidenced.