Having intercourse with one wife in the presence of the other and where she can see is something concerning which there should be no dispute that it is haraam. 

1 – al-Hasan al-Basri said: They – meaning the Sahaabah and senior Taabi’een – used to regard wajs as makrooh, which means having intercourse with one when the other can hear the sounds. The word “makrooh” according to the earlier scholars means that it is haraam. 

Narrated by Ibn Abi Shaybah in al-Musannaf, 4/388 

2 – Ibn Qudaamah (may Allaah have mercy on him) said: If two wives agree to live together in one house, that is permissible, because they each have the right to their own house, but they may give up that right. Similarly they may agree to let him sleep between them in one bed. But if they agree to let him have intercourse with one of them when the other one is looking, that is not permissible, because it is vile and despicable and is not appropriate, and it does not become permissible even if they agree to it.

al-Mughni, 8/137 

3 – al-Hajaawi the author of Zaad al-Mustanqi’ said: It is makrooh to have intercourse where anyone can see. 

Shaykh Ibn ‘Uthaymeen commented on these words by saying: 

It is very strange that he limited himself to describing it as makrooh. This covers two issues. The first is having intercourse where the awrahs of both partners can be seen. Undoubtedly limiting oneself to saying that this is makrooh is a mistake, because it is obligatory to cover the ‘awrah. If it is in a place where anyone can see their ‘awrahs, this is undoubtedly haraam, and what this author says is not correct at all. 

The second is having intercourse in a place where the ‘awrah cannot be seen. Limiting oneself to saying that this is makrooh is also subject to further discussion. For example, if they are covered with a blanket and he starts to have intercourse with her, and the movements can be seen. This is undoubtedly more likely to be haraam, because it is not appropriate for a Muslim to lower himself to such a level. 

This may also provoke desire in the person who sees this, and that may lead to evil consequences. 

The correct view concerning this matter is that it is haraam to have intercourse with a woman in view of anyone, unless the onlooker is a child who does not understand what is happening; in this case it does not matter. But if the child understands what is happening then intercourse should not take place where he can see, even if he is a child, because a child may speak about what he has seen unintentionally. 

Sharh Kitaab al-Nikaah min Zaad al-Mustanqi’, tape 17. 

And Allaah knows best.