¹ H. T. R., v. XXXV, pp. 39–42.

² Select Pleas, Starrs and Other Records from The Rolls of The Exchequer of The Jews, Selden Society Publications, v. 15, p. 65 f.

³ Such interest bearing loans by Jew to Jew through the mediation of a Christian were held by Rabbi Jacob of Rumerupt, the great French Tosafist known as Rabbenu Tam, to be permissible. See Tosafot on Baba Mezia, fol. 71b, s.v. K'gon. This holding was by no means unchallenged. See Sulḥan ‘Aruk, Yoreh De ‘ah, ch. 168, sec. 7 and authorities there cited. But the great authority of Rabbenu Tam among the English Jews, who were under the religious influence of their brethren from across the Channel, was apparently sufficient for them to consider such loans lawful.

⁴ Davis, Hebrew Deeds (Shtaroth), No. 83.

⁵ There is in the Hebrew law of evidence a whole branch known as ‘ne'emanut’ or credence. The principle upon which this branch of the law is based is, that the parties to a transaction may regulate in advance the rules of evidence which are to govern any litigation which may arise in the future out of that transaction. This principle goes back to the Mishnah, Ketubot, 9, 5, where the rule is laid down that if a husband, at the time he endowed his wife, stipulated in writing that he is to have no claim upon her for ‘either vow or oath,’ he will have no such claim upon her, although ordinarily a woman who demands her dower must state under oath that she has nothing of what belonged to her husband in her possession. For a further elaboration of this principle see Talmud, Shebuʻot, fol. 42a, Maimonides, Yad ha-Ḥazaḳah, Malveh, ch. 15, and Shulḥan ʻAruk, Hoshen Mishpat, ch. 71. Obviously, such a principle has wide possibilities. It was, indeed, used by Jewish creditors throughout the Middle Ages for the purpose of strengthening their position as litigants in various ways. It was also seized upon by money-lenders to provide them with a convenient means of evading the strict Pentateuchal usury laws. The clauses quoted in the text are examples of such use of this principle. Note particularly the expression ‘free of vow and free of oath’ which is clearly an allusion to the Mishnah in Ketubot cited above. In fact, the very same expression is used in the Talmud, Ketubot, fol. 87a, in the discussion which follows that Mishnah. Pollock and Maitland, who mention this device in their History of English Law, v. II, p. 225 (2nd edition), were unaware of its Hebrew origin.

It should be noted here that a stipulation to the effect that the wife, when claiming her dower, is to be free from any oath is also found in the Demotic marriage settlement of the later Ptolemaic type. This stipulation reads: “I shall not be able to require an oath from thee in the house of judgment on account of the right of thy woman's property above (named), saying ‘thou didst not bring them to my house in thy hand.’” Adler Dem. 14 and Ryl. 16. As between the Mishnah in Kethuboth, mentioned above, and the Demotic marriage settlement it is, of course, difficult to determine who borrowed from whom. But the phrase “in the house of judgment,” which occurs in the Demotic documents and which is strikingly similar to the Hebrew “beth-din” furnishes, perhaps, a clue. See also Cowley, Aramaic Papyri, 14, where reference is made to an oath by a woman in an action of separation or divorce in which she claimed her dower. Cowley remarks that the object of the oath is not known. It seems, however, that the above stipulation in the Demotic marriage settlement and in the Mishnah make its object sufficiently clear.

⁶ Calendar of The Close Rolls, 1268–72, p. 300.

⁷ Select Pleas etc. from The Exchequer of The Jews, p. 94.

⁸ Calendar of The Plea Rolls of The Exchequer of The Jews, v. III, p. 297.

⁹ Calendar of The Close Rolls, 1268–72, p. 243. See also pp. 292, 410–411, 1254–1256, p. 378–379; Calendar etc. of The Exchequer of The Jews, v. III, pp. 53, 105, 128, 200, 307; Pollock and Maitland op. et loc. cit. and documents there cited.

¹⁰ Responsa of Rabbi Solomon ben Adret, No. 651 (Vienna, 1812).

¹¹ Chapter 46, subdiv. 4, sec. 32 (Zolkiew, 1808).

¹² Yoreh De ‘ah, ch. 177, sec. 14.

¹³ See e.g. 1264–1268, pp. 265–266, 305, 403; 1272–1279, pp. 177, 271, 286.

¹⁴ Eyre of Kent, 6 and 7 Edw. II, v. II, p. 27, Selden Society Publ., v. 27.

A provision for the payment of interest in the form of a penalty for default is also found in a large number of Assyrian deeds. See Johns, Assyrian Deeds, vol. 3, sec. 401 f. In most of these transactions the loan was made for a short term without interest, with a provision that if the borrower failed to pay the debt on the due date, the amount of the loan was to be increased by one-quarter thereof. Johns is of the opinion that the one-quarter represented the monthly interest rate which the borrower was to pay from the time of default, so that the loan was to bear interest at the rate of 300% per annum. Kohler and Ungnad in Assyrische Rechtsurkunden, p. 460, maintain, on the other hand, that the one-quarter represented the yearly interest rate. There are, however, great difficulties in either view. As to Johns' view the main difficulty is that an interest rate of 300% per annum is entirely too high, even according to the standards of oriental money-lenders. Moreover, there are some documents in which the rate of increase is specified at one-third (Johns, Nos. 40, 43, 57, corresponding to Kohler and Ungnad, Nos. 293, 281, 263), others where it is stated to be one-half (Johns, Nos. 15, 18, 33, 34, 50, 129, 132, 133, 147, 148, 149; Kohler and Ungnad, 260, 270, 291, 264, 301, 313, 311, 307, 324, 325, 309), and still others where it is set at an amount fully equal to the amount of the principal. (See Kohler and Ungnad, op. et loc. cit.) If Johns' view should be accepted, we would have in these cases interest running at 400%, 600%, and 1200%, respectively, per annum, an altogether incredible rate, particularly when we take into account the fact that when a monthly rate of interest is expressly provided for in these documents it usually runs between 20% and 40% per annum, and that only in one case does it go up as high as 160%. (See Kohler and Ungnad, op. et loc. cit.)

The difficulty with Kohler and Ungnad's view is that in ancient times, as well as throughout the Middle Ages, interest was never computed on a yearly basis. There were several reasons for this. Chief among these were: 1. The computation of interest on a yearly basis would have accentuated the ruinous effect of usury upon the borrower, whereas the computation on a monthly basis made the transaction more palatable to him. 2. In cases where the borrower wanted to repay the loan in the middle of any one year from the time he borrowed, the money interest would have to be prorated, which would have been quite a complicated procedure in ancient times, and in the absence of a specific provision in the loan agreement might have given rise to controversies between borrower and lender. 3. In the case of an Assyrian money-lender the computation of interest on a yearly basis would sometimes have caused him the loss of a full month's interest, since the Assyrian year sometimes consisted of thirteen, instead of the usual twelve, months.

In view of all this the writer believes that the provision that in case of default the amount of the loan is to be increased by one-quarter merely means what it says, namely, that immediately upon default, and not after the lapse of a month, according to Johns, or a year, according to Kohler and Ungnad, a penalty of one-quarter of the amount of the loan became due, in the same manner as in the medieval documents and the Egyptian papyri of the second century B.C., mentioned in the text. In other words, the one-quarter was not an interest rate, per month or per year, but a penalty in a single sum to become due at once after default.

As to the reason why the Assyrian loans discussed above were originally made without interest Johns offers an explanation which, in the writer's opinion, does not quite fit the facts. According to Johns these loans were made by landlords to their cropsharing tenants as advances for the purpose of buying seed for the fields or food for the reapers. In section 399 he says: “These loans were usually meant to be without interest until such a time as they might reasonably be expected to be repaid. The interests set down as to be charged were rather to ensure attention to business, than a genuine business profit. They were a species of insurance against risk from negligence or incompetency.”

There is, however, at least one document in Johns' collection which was apparently not an agricultural advance by a landlord to a cropsharing tenant. The loan in question (Johns No. 66, Kohler and Ungnad No. 124) was of 17 minas of silver, a very large amount in those days. It was made for a period of about two months without interest, with a provision that in case of default it was to bear interest at the rate of 2 shekels per mina per month, i.e. 40% per annum. A vineyard and a number of slaves were delivered to the lender as security for the loan. It would seem that the large amount involved and the security given preclude the possibility of the loan having been an agricultural advance by landlord to tenant. Furthermore, there is a number of similar loans without interest in a collection of Legal and Economic Documents from Ashjâly, published by Lutz in 1931, and among these there are also some which cannot be explained on Johns' theory. Of the thirty-three transliterated and translated documents in this collection eleven are loan agreements. Ten of these loans were made without interest, but with a provision that in case of default the loan was to bear interest, without specifying the rate or amount of the interest. (The version of the interest clause suggested by Lutz in his note on page 10 is the correct one. The omission from the documents of the date of maturity of the loans presents no difficulty. This date, in the case of the grain loans, was obviously implied by custom. A loan without interest and without a maturity date, express or implied, would have been an absurdity, since the lender would not have been in a position to demand or enforce payment at any time. Also, the reference in No. 18 to the “month when the grain loans become due” clearly indicates that there was a well-established custom with regard to the time when these loans became due.) Two of the loans were obviously not seasonal advances by landlord to tenant. One of them (No. 16), a grain loan, was made for two years, a period far in excess of a seasonal loan, and the other (No. 18) was a money loan for thirty days made, according to the tablet, “in the month when the grain loans become due,” that is after harvest time. (See note to the last document on page 30 of the collection.)

The writer therefore ventures the suggestion that the provision that an increase or interest was to be paid only in the case of default was made in accordance with a law which prohibited the taking of interest, unless the borrower was in default, and that reference to this law is contained in the documents published by Lutz. In several of these loan agreements, following the phrase “without interest charges” and the name of the lender, there is an obscure phrase which reads: “After the law of Dûr-Rimuš was established.” It is quite obvious that the reference to the law was not made merely for the purpose of establishing the date of the loan, for, in the first place, the date is always given at the end of the tablet, and secondly, such a limitation fixes the time at one end only, which, for practical purposes, is quite useless. The law must therefore have had some bearing upon the terms of the loan. These terms were very simple. They related to the time of payment and to interest, and since the time of payment is ordinarily not a subject of legislative regulation, it is reasonable to assume that the law related to interest. This assumption is strengthened by the fact that reference to the law is contained in four out of the ten translated and transliterated loan agreements without interest, and in none of the twenty-two documents, other than loan agreements.

Finally, although the writer is not unmindful of the fact that a discussion of the relationship between the Pentateuchal law against usury and Assyrian law on this subject is outside the scope of this paper and of his competence, he wishes, nevertheless, to call attention to one point which has a direct bearing upon the interpretation of the interest clause in the Assyrian loan tablets. It seems that Exodus 22, 24 has reference to the practice of imposing upon the borrower the payment of interest as a penalty for default. A careful reading of verses 24–26 will reveal that the whole passage consists of a series of rules which the lender is to follow in case of default by the borrower. He is not to distrain the borrower in case of default, he is not to impose upon him the payment of interest as a penalty, and if he does distrain him and takes away his raiment, he is to return it to him by sundown. Indeed, R. Samuel b. Meir (Rashbam), a famous twelfth century commentator of the Pentateuch, so interprets the above passage. To the phrase “Thou shalt not lay usury upon him” he adds by way of comment “to extend his time.”

¹⁵ Round, Ancient Charters, Pipe Roll Society Publ., v. 10, p. 82.

¹⁶ See Calendar of The Plea Rolls of The Exchequer of The Jews, v. I, pp. 27–28, 34 (1220), where a limitation upon the interest rate is mentioned.

¹⁷ See Mishnah, Kiddushin, 1, 5 and Jastrow's Dictionary s.v. אחריןח. The writer's attention has been called to the fact that Loewe had a correct translation of this clause before him in Starrs and Jewish Charters in The British Museum, v. I, p. 109 (19), for he himself wrote a note on it in v. II, p. 285, n. 1264.