P'ninat Mishpat: Reducing Amount Owed Due to Interest Taken | Beit Din Eretz Hemda - Gazit | Beit Midrash

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Case: The plaintiffs (=pl) sold a home, and much of the money paid by the buyers went through the defendant (=def), the sale’s real estate agent. Pl agreed for def to keep 250,000 NIS of the proceeds indefinitely, and def was to pay 2,500 NIS a month of interest for the arrangement’s duration. Def paid pl 72,500 NIS of interest. After a few years, pl asked for the principal, and def was able to return only 15,000 NIS. Pl requests the remaining 235,000 NIS from the sale. Def agrees to pl’s claims but says that since the time of their agreement, he has become destitute and is unable to return the money.

Ruling: Beit din does not have resources to make a determination on def’s claim that he lacks the ability to pay, and pl may turn to Hotza’a Lapo’al (the arm of the government that enforces the payment of debt), which has access to information on earnings and assets.

P'ninat Mishpat (803)

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Beit din raised the issue of the ribbit (interest) that pl received from def over the course of the loan (there was no heter iska or other reason for it not to be prohibited by Torah-level law). The two sides indicated that they had not thought about the matter, and def did not demand that pl return the interest or reduce it from the amount due.

Beit din certainly will not require the payment of further ribbit. The question is what to do about the 72,500 NIS that was already taken as ribbit. The gemara (Bava Metzia 61b) cites a machloket among Amoraim whether interest that is set from the time of the loan (ribbit ketzutza), which is forbidden as a Torah-level violation, is to be returned. The halacha is that the beit din enforces its return to the borrower (Shulchan Aruch, Yoreh Deah 161:5).

The Taz (ad loc. 3) infers from the language of Rashi that beit din takes action to return the ribbit only if the borrower requests this. The Beit Meir (ad loc.) agrees and explains that the borrower’s silence is understood as mechila (relinquishing of rights) of the return (although he also cites opinions that mechila does not work regarding ribbit). Shut Sh’eilat Yaavetz (I:147) agrees with the Taz and says that once mechila has been assumed, the borrower can no longer demand the money. The Knesset Hagedola (to Tur 161:19) disagrees with the Taz and learns Rashi differently, and the K’tzot Hachoshen (Choshen Mishpat 9:1) agrees that the borrower deserves the ribbit back even without a request.

The majority of beit din’s dayanim rule like the Knesset Hagedola and therefore, without def’s request, reduced the amount due to 162,500 NIS. The dissenting opinion relied not only on the Taz and those who agree with him, but also on the halacha that a dayan must not rule on behalf of a litigant more than he asked for (Rama, CM 17:12). Although this does not apply when the litigant did not know his halachic rights, in this case, def learned that the interest paid was forbidden and still did not feel it was his place to ask for it back. The minority opinion agrees that pl has a moral obligation to return (/deduct) the ribbit received.

P'ninat Mishpat