“There are too many expenses this month,” Mr. Isaacs sighed. He asked his neighbor Mr. Adler whether he would be willing to lend him $2,000.
“When do you think you can return the money?” asked Mr. Adler.
“I should be able to return $1,000 in three months,” replied Mr. Isaacs, “and the remainder three months later.”
“So you want two installments,” Mr. Adler repeated, “$1,000 in three months and another $1,000 in six months.”
“Correct,” Mr. Isaacs confirmed.
“To make sure we don’t run into misunderstandings later,” Mr. Adler said, “I’d like to draft a loan document, signed properly by two witnesses.”
The two drafted a loan document stating that Mr. Isaacs borrowed $2,000, payable in two installments of $1,000, and had witnesses sign.
Half a year later, Mr. Adler came to Mr. Isaacs and demanded that he pay him the $2,000.
“I already paid you the first installment of $1,000,” said Mr. Isaacs. “It was due three months ago and I paid you on time.”
“No you didn’t,” said Mr. Adler. “I asked you for payment then, but you claimed you didn’t have the money yet. You asked for extra time. Do you have any receipt?”
“No, I trusted you,” replied Mr. Isaacs. “I’m sure that I paid the first half, though.”
“Then why do I still have the loan document?!” argued Mr. Adler. “There’s no adjustment to the sum.”
“Obviously, because I still owe you the other half,” replied Mr. Isaacs. “The loan document doesn’t prove, though, that I still owe you the full amount.”
Mr. Adler summoned Mr. Isaacs before Rabbi Dayan’s beis din. “Who is believed in this case?” asked Mr. Adler.
“The Gemara [B.M. 103a] takes for granted that a person who claims he partially paid the amount written in a loan document is not believed without proof,” replied Rabbi Dayan. “Since a loan is destined for collection, the borrower should have demanded a receipt or written on the loan document that it was partially paid, which is like a receipt.” (Gra C.M. 82:4; Sma 82:16)
“The Rashba was similarly asked in his responsa [1:1065] about a person who borrowed money to repay in installments,” continued Rabbi Dayan. “Toward the end, the borrower claimed he paid all the installments already due and that the loan document remained with the lender on account of the final payment.”
“What did the Rashba rule?” asked Mr. Isaacs.
“He ruled that the borrower is not believed,” answered Rabbi Dayan. “He should have asked for a receipt or written a new loan document.” (See B.B. 170b)
“Is this ruling cited in Shulchan Aruch?” asked Mr. Isaacs.
“The Rama [C.M. 82:2] cites this ruling,” replied Rabbi Dayan. “He adds that the lender can collect with an oath. The Shach [82:10] notes that an oath is required only if the borrower requests one, as with any loan document the borrower contests that he already paid.”
“What if the lender admits that some was paid, but they argue about how much?” asked Mr. Isaacs.
“In such a case, the lender is still believed, because the document is in his hand,” replied Rabbi Dayan. “However, he would be required to take an oath about the remainder he claims is still due, even if the borrower did not request one. This applies also if there are receipts for part of the sum [C.M. 84:1].
“We already mentioned in numerous occasions that beis din almost never imposes an oath nowadays. Instead, it will usually impose a compromise, taking into account the need for the oath.”