- Sections
- P'ninat Mishpat
100
Ruling: [Last time we saw that the regular interest in this case could have been permitted but the punitive interest made the total interest too high.]
More fundamentally, interest as a penalty for late payment, which does not fit into the legal logic of a heter iska, is forbidden, as we shall explain. A penalty payment that increases by the day (as opposed to a one-time penalty) is classic ribbit, as it is agar natar (reward for waiting) (Shulchan Aruch, Yoreh Deah 177:16). The Rama (ad loc.) cites those who are lenient regarding a penalty, but most disagree, and the Shach (ad loc. 33) and the Shulchan Aruch Harav posit that it is a Torah-level prohibition. The Shach is lenient in the case where there is a heter iska, but Brit Yehuda (38:9) writes that this is only regarding a one-time penalty. While there might be room for leniency regarding a corporate entity, like a bank, here we are dealing with an individual, and therefore one must not be lenient in this case.
We calculate that after def’s last payment, he owed 33,237 NIS, which increased to 37,369 NIS by the time pl went to Hotza’ah Lapo’al. After this point, interest should no longer be accrued for two reasons. First, def should not have been expected to pay because pl sued for an exaggerated amount of money. Second, a heter iska is based on the expectation that the recipient is investing the money, whereas in a case in which the "lender" is demanding the money immediately, it is apparently forbidden to invest anymore, and therefore there is no justification for the amount to increase.

P'ninat Mishpat (775)
Beit Din Eretz Hemda - Gazit
681 - Limits of Interest Rate for Loan with Heter Iska – part I
682 - Limits of Interest Rate for Loan with Heter Iska – part II
683 - Limits of Interest Rate for Loan with Heter Iska – part III
Load More

P'ninat Mishpat: How Much Was Agreed to Pay for Renovations?
based on ruling 84054 of the Eretz Hemdah-Gazit Rabbinical Courts
Beit Din Eretz Hemda - Gazit | Kislev 5784

P'ninat Mishpat: Proof Needed to Remove a Squatter – part II
based on ruling 81116 of the Eretz Hemdah-Gazit Rabbinical Courts
Beit Din Eretz Hemda - Gazit | Cheshvan 5784

P'ninat Mishpat: Hezek Re’iya in Our Times
based on ruling 83126 of the Eretz Hemdah-Gazit Rabbinical Courts
Beit Din Eretz Hemda - Gazit | Cheshvan 5784

P'ninat Mishpat: Rent of an Apartment Without a Protected Room
based on ruling 84036 of the Eretz Hemdah-Gazit Rabbinical Courts
Beit Din Eretz Hemda - Gazit | Iyar 5784

Beit Din Eretz Hemda - Gazit

Limiting Exorbitant Lawyer’s Fees – part I
(Based on ruling 81120 of the Eretz Hemdah-Gazit Rabbinical Courts)
Tishrei 29 5783

Interceding Regarding a Will
Igrot Hare’aya – Letters of Rav Kook #105
Sivan 28 5782

Limits of Interest Rate for Loan with Heter Iska – part I
based on ruling 80033 of the Eretz Hemdah-Gazit Rabbinical Courts
Sivan 8 5782

Repercussions of a Sale that Turned Out Not Happening – part III
(based on ruling 83045 of the Eretz Hemdah-Gazit Rabbinical Courts)
18 Sivan 5784

Al Ha’eitz Eaten a Variety of Fruits
Rabbi Daniel Mann | 5773

Curses – or blessings?
Rabbi Stewart Weiss | Elul 18 5782

The Halachos of Pidyon Haben
Rabbi Yirmiyohu Kaganoff | Sivan 29 5778

Al Ha’eitz Eaten a Variety of Fruits
Rabbi Daniel Mann | 5773
Daf Yomi Shevuot Daf 17
R' Eli Stefansky | 20 Iyar 5785

Parashat Hashavua: About Optimism in Times of Crisis
Rabbi Yossef Carmel | Iyar 5785
