Our parasha begins (Devarim 16:18) with the mitzva to appoint judges and officers of the court, who should judge the people in the manner of mishpat tzedek (most simply translated as a just judgment). Earlier we find the mitzva of shemitta (undoing) of loans at the end of the Shemitta year (ibid. 15:1).
We will try to find a connection between these two segments of theparasha. We have discussed recently that the ideal judicial system, which was taught by our founding fathers, Avraham, Moshe, and David, merges between the ideas of justice and charity. The phrase of mishpat tzedek also hints at a merging of mishpat and tzedaka.
The matter of shemitta for loans also demonstrates the merging of these two principles. According to the strict letter of the law, if someone takes a loan, he makes both his assets and himself "dedicated" to the return of the money. He must take all reasonable steps to pay and must not use his money for improper purposes or give assets to third parties in a manner that compromises his ability to pay. In principle, he should use the money he earns only for absolute necessities or to create further assets, which will help in further payments. There is no excuse for non-payment. If someone, Heaven forbid, finds himself without the ability to pay, then he is an anuss (one facing extenuating circumstances), in which case, due to the element of tzedaka, no steps may be taken to harm or punish him. He is not exempt from paying, just that payment can be delayed until the time when he will have the ability to pay.
The element of tzedaka arises in the context of shemitta. Loans that were not paid after the time for payment arrived become voided. The creditor is reminded: the fact that he was capable of lending money is a sign of divine grace. Therefore, he is expected to "share with the borrowers" every seven years. This is an element of tzedaka and also the connection between the agricultural and the fiscal parts of Shemitta.
We should point out that the above is from the creditor’s perspective. From the borrower’s perspective, he still has a moral responsibility to try to pay, even after Shemitta. While the creditor is supposed to announce that he releases the borrower from responsibility, the borrower is encouraged to say "Even so" and pay. The mishna(Shvi’it 10:9) says that one who pays after Shemitta is someone that the Rabbis are happy with, as they are, in general, with people who keep their word.
Because the laws of shemitta of loans are now Rabbinic and because there was a real fear that because of this mitzva, people would stop lending, Hillel instituted pruzbol. Pruzbol is a mechanism through which a creditor who wants to make sure he does not lose his loan can do so. Thus, along with the lofty ideals, there are times when practical considerations require certain adjustments within the rules that the Torah allows.