Al-Khiraqi does not classify reconciliation except in the case of denial specifically.

817 - Issue: He said: "And the reconciliation that is permissible is that the claimant has a right which the defendant does not know of, so they reconcile for a portion of it. But if he knows what is against him and denies it, then the reconciliation is void."

In summary, reconciliation based on denial is valid. Malik and Abu Hanifah held this view. Al-Shafi'i said: It is not valid, because he has exchanged something that has not been established for him (1), therefore the exchange is invalid, just as if he had sold the property of another. Also, it is a contract of exchange that lacks consideration on one of its two sides, so it is void, like reconciliation regarding the penalty for slander (Qadhf).

As for us, we rely on the generality of his statement, may Allah bless him and grant him peace: "Reconciliation between Muslims is permissible." This falls under the generality of his statement. If they say: "But he said: '...except a reconciliation that permits an unlawful matter,'" we reply that this falls within that, for he had no right to take from the defendant's wealth, so it became lawful through reconciliation. We say: We do not concede that it falls under that, and it is not correct to interpret the Hadith based on what they mentioned for two reasons: First, this is found in reconciliation in the sense of a sale, for it makes lawful for each of them what was forbidden to him before it, and likewise reconciliation in the sense of a gift, for it makes lawful for the recipient what was forbidden to him, and the waiver makes it lawful for him to cease performing what was obligatory upon him. Second, even if an unlawful act were made lawful by it, the reconciliation would still be valid, for an invalid reconciliation does not make the unlawful lawful. Its meaning is rather what one resorts to for the sake of obtaining the forbidden while it remains forbidden, such as if he reconciles with him to enslave a free person, or to legitimize a forbidden sexual union, or reconciles with him using wine or pork. That is not the case in what we are discussing. Furthermore, they do not even hold this view, as they permit one who has a right which his debtor denies to take from his wealth an amount equal to it or less. If that becomes lawful for him without his [the debtor's] choice or knowledge, then it is more fitting that it should be lawful with his consent and giving. Similarly (2), if it is lawful when the debtor confesses, then it is more appropriate that it be lawful when he denies it and he [the claimant] is unable to obtain his right except through that, and because