Maliks Muwatta Book 36, Hadith Number 38D.

Section : Judgement on Taking On Debts and Transfers of Debt.

Yahya said that he heard Malik say, “What is done in our community about a man who refers a creditor to another man for the debt he owes him is that if the one referred to goes bankrupt or dies, and does not leave enough to pay the debt, then the creditor has nothing against the one who referred him and the debt does not return to the first party.”

Malik said, “This is the way of doing things about which there is no dispute in our community.”

Malik said, “If a man has his debt to somebody taken on for him by another man and then the man who took it on dies or goes bankrupt, then whatever was taken on by him returns to the first debtor.”