Of Interest

“So how was it?” asked Yoni’s wife, Miriam, as soon as Yoni had walked through the door. She had wanted to appear calm and relaxed, but her nervousness had gotten the better of her.

“How was what?” Yoni replied, grinning mischievously.

“Oh, Yoni! Can you be serious?” pleaded Miriam, trying not to laugh. “You know perfectly well what I’m asking about. How was your first day at the office? Did it go well? Did you see Uncle Viggy? Did he say hello to you?”

“Oh, that’s what you meant!” said Yoni, feigning ignorance. “At the end of first seder, I was arguing with my chavrusa about a Tosafos and I lost track of the time. But you know what? Even though I left the kollel about fifteen minutes late, I still arrived at the office on time, baruch Hashem! When I got there, Uncle Viggy’s office manager gave me a nice welcome and showed me around, and he gave me a quick lesson in the different lines of jewelry they sell. And, yes, I did see Uncle Viggy. He always keeps the door to his office open, so I saw him sitting at his desk, but I didn’t get a chance to say hello. He was too busy making deals on the phone.”

“How do you know he was making deals?” Miriam asked. “You could hear him?”

“Hear him? With Uncle Viggy’s booming voice, his excitable nature, and the door being open, I’m surprised you didn’t hear him!” Yoni said with a chuckle. “Don’t get me wrong, Miriam. I think your uncle is a wonderful person. He did hire me, after all, didn’t he? It’s just that he’s so big and brash! I feel so terribly intimidated by him. To be honest, I’d be happy if I could do my job at Regency Jewelry without Uncle Viggy ever noticing me.”

*  *  *

“I hear you, Norm, I hear you,” Viggy belted out in his baritone voice. He was in his office talking on the phone to one of his oldest customers, Norm Sacks, the owner of Genuine Gems, a Los Angeles jewelry store. “Listen, we all got hit hard last year. What can you do? Hey, it’s got to pick up sooner or later, right, Norm?”

Viggy stopped talking for a few moments and listened to Norm. Then he replied, “Sorry, Norm, I just can’t do it. I just don’t have the cash available. I know that when you placed the order originally, I said you could return the merchandise if it didn’t move and I’d give you your money back, but, Norm, listen to me. The fact is that when you called in January to give back almost $30,000 in merchandise and I begged you to go easy on me, you agreed. I think we worked out a very fair deal. I took back all the merchandise and refunded you $15,000 on the spot, and the rest I said I would give you by this coming January. Norm, it’s not January yet!

“Listen, Norm, you know you have the rest of the money as a $15,000 credit posted to your account. Why don’t you take some merchandise now and get paid back that way? Please, Norm, I also have a business to run. Do you know that this whole year I barely made payroll?”

Viggy listened to Norm some more. After a few uh-huh’s and a couple of yeah’s uttered in response to what Norm was saying, Viggy finally offered,

“Listen, Norm, I do feel bad that I’ve been sitting on your $15,000 for the whole year, even though you did agree to it. So I’m really going to go the extra mile. I’ll send you a check right away for $5,000, but the last $10,000 you’ll have to take in merchandise. And I’ll do one more thing, because I feel so bad that I haven’t paid you. When you use the credit that’s on your account, I’ll give you an extra 10-percent discount on your order. Is it a deal?”

It seems that Norm must have been desperate for cash because he grudgingly agreed to Viggy’s offer.

“I’m glad we could work something out, Norm. I’ll talk to you later,” Viggy said and hung up.

As he sat working at his desk, Yoni had tried not to eavesdrop, but he couldn’t help but hear Viggy’s entire conversation with Norm Sacks — and by the time Viggy hung up with Norm, Yoni had broken into a cold sweat.

*  *  *

“You’re sure it’s assur?” Miriam asked in astonishment.

“Absolutely,” answered Yoni. “All last year the kollel was learning hilchos ribbis, and the Rosh Kollel made a big deal about how cases just like this come up all the time. There’s no question about it. He may not have realized it, but when Uncle Viggy told Mr. Sacks that he would give him a 10-percent discount on his next order, he was offering to pay him a kind of ribbis.”

“But I don’t get it,” said a puzzled Miriam. “I thought ribbis is when you pay interest on a loan, but what kind of loan did Mr. Sacks give to Uncle Viggy? All he did was return some merchandise.”

“That’s one of the tricky things about hilchos ribbis,” explained Yoni. “It’s not always easy to identify the loan that’s occurring. In Viggy’s case, when he took back the jewelry that he had sold to Mr. Sacks, what he was really doing was buying back the jewelry at the   same price that he had charged Mr. Sacks. Normally when you buy something, you’re supposed to pay for it at the time of the sale. So when a seller allows the buyer to pay for the delivered merchandise at a later date, what’s really happening is that the seller is giving the buyer a kind of loan. Halachah has a term for this kind of loan — a loan derived from a sale.” “So let me get this straight,” said Miriam. “By not receiving a full refund right away, Mr. Sacks was in fact lending Uncle Viggy money, and when Mr. Sacks uses the credit on his account to purchase merchandise, what’s really happening is that the loan is being paid back.” “Exactly,” Yoni confirmed. “I couldn’t have said it better myself.”

“And the 10-percent discount that Uncle Viggy offered Mr. Sacks is the interest on the loan, right?” Miriam asserted.

Yoni nodded.

“So let’s say I return something to a store and I’m supposed to get my money back, but instead I agree to accept a store credit. According to what you’re saying, I’m not allowed to be given a special discount when I buy something with the credit,” Miriam posited confidently.
“Well, not exactly,” responded Yoni. Miriam shrugged in frustration. “But you said—” she began to protest.

“Let me explain,” Yoni interrupted. “You have to understand that since Uncle Viggy committed himself to the discount only after the loan had already been made, the kind of interest he offered to pay is not forbidden according to the Torah. The Torah forbids ribbis only when the actual terms of the loan require the ribbis payment. It is, however, considered ribbis d’Rabbanan.

“Since this kind of interest payment is not forbidden according to the Torah, we find a number of leniencies related to it. For instance, in Yoreh Deah 160:4, the Rema quotes the talmidei haRashba, who actually allow one to pay back a ‘loan derived from a sale’ with merchandise that has been discounted voluntarily — just like Uncle Viggy wants to do.

“But even according to the talmidei haRashba, there are two situations when such a transaction would be forbidden. The first is when the discount is so large that it’s obvious it was given because of the loan; but the 10-percent discount that Uncle
Viggy offered Mr. Sacks would probably not fall into this category.

“The second case is when it is stated explicitly that the discount on the merchandise is being offered because of the loan. And that is the mistake Uncle Viggy made. He told Mr. Sacks clearly that he was giving the 10-percent discount because he felt bad that he had not yet refunded all the money. So in your example of returning a purchase to the store, you would be allowed to accept a 10-percent discount as long as no one said anything connecting the discount with the agreement to accept a store credit. Now you get it?”

“Yeah, I do,” Miriam assured her husband. “And I also get that we have a pretty big problem on our hands.”

A few moments passed in silence. Both Yoni and Miriam were lost in thought about how Viggy would react if Yoni actually told him that his deal with Norm Sacks was forbidden because of ribbis. They were both imagining roughly the same scene — big Uncle Viggy getting up from behind his desk and bellowing in that voice of his, “How dare you tell me how to run my business? You’re fired!”

“What are you going to do?” Miriam finally asked her husband.

“I’m not sure,” answered Yoni, “but I’ve already made an appointment to meet with the Rosh Kollel tonight after Maariv. When I told him the problem, he told me not to worry, that if he and I sit down together and brainstorm, we’ll probably be able to come up with a way to tell Uncle Viggy that won’t upset him.”

“I sure hope so,” said Miriam. Yoni’s worried look lifted and a smile spread slowly across his face. With a gleam in his eye, he said, “You know what else the Rosh Kollel said to me? He said, ‘Halevai everyone should know hilchos ribbis so well that they get into this kind of predicament. I’m proud of you, Yoni!’”

“Yoni, I have to tell you something,” Miriam said softly. “So am I.”

From Business Halacha Institute, here.