THE JERUSALEM INSTITUTE OF JEWISH LAW 
Rabbi Emanuel Quint, Dean

Lesson # 93 (part 1)•Three-persons-presence rule

The Talmud In Gittin 148 states that there are three laws that the Rabbis have enacted having no legal basis. The law of three-persons-presence (ma’amad sheloshton); the law that if a man assigns all of his assets to his wife, he only makes her a trustee of the assets; and if a person celebrates the wedding of his son in a special house, the son becomes the owner of the house. In this lesson we shall discuss only the first of these three laws, the three-persons presence rule. Although it has no legal basis, it was advantageous as an enactment for promoting commerce.

I have not found any accurate translation of the term ma'amad sheloshton that conveys the impact of the law. It translates into the three of them standing together. I have called it the three-persons-presence rule (the term being hyphenated). The three persons referred to are the creditor, Reuven; the debtor, Shimon; and the third party, the assignee of the debt, Levi.

Shimon owes $100 to Reuven. Reuven desires to assign the debt to Levi, by sale or by gift. Unless otherwise stated, Reuven owes $100 to Levi and wants to pay Levi by having Shimon pay to Levi the $100 that he owes to Reuven. 

The halachah provides for the three-persons-presence assignment to be made when the three parties are together, namely the creditor, the debtor, and the person to whom the debt is being assigned, the assignee: Reuven. Shimon, and Levi, respectively. The same rules usually also apply to bailments. The three-persons-presence law works as follows: as soon as Reuven utters the words of assignment in the presence of Shimon and Levi instructing Shimon to pay Levi. Reuven is completely out of the picture as far as the $100 held by Shimon is concerned. The place of Reuven is taken by Levi, and the relationship is now exclusively between Shimon and Levi. 

Reuven desires to assign the $100 debt to Levi. If while Reuven, Shimon, and Levi are present together Reuven declares to Shimon, "Give to Levi the $100 that you owe me," or "Give to Levi the $100 that you are holding for me," Levi immediately acquires the debt, and Shimon now owes the $100 to Levi. The rule holds true whether the assignment from Reuven to Levi is by gift or by way of repayment of $100 that Reuven owes to Levi. It cannot be used to transfer funds to Levi for merchandise that Reuven is about to purchase from Levi. It also cannot be used to effect a loan from Reuven to Levi.

Shimon does not have the option to state he will not pay to Levi. There is also a strong dissent that states that if Shimon states that he will not pay Levi, then he is not bound to make the payment to Levi, and Levi may not sue Shimon for the $100.

Once the statement is made by Reuven, neither Reuven nor Shimon can now cancel the transaction. The money is owed to Levi, and not to Reuven. Reuven no longer has the authority to forgive the debt to Shimon. 

Reuven may, by three-persons-presence assign the debt to Levi even if Levi was born after the debt arose.

Assume the same facts as above and that Shimon replies that he 
will give the $100 to Levi when he wants to. When Levi makes demand upon Shimon for the $100, Shimon replies that he does not want to give the money at this particular time. Shimon must pay on the due date.

Assume the same facts as in the above case: Shimon owes Reuven $100 and Reuven, Shimon, and Levi are present. Instead of Reuven saying to Shimon. “Give to Levi the $100 that you owe to me." Reuven says to Shimon. "Give to Levi $100." without mentioning that he meant the existing debt of $100 that was due from Shimon to Reuven. Shimon now pleads that he thought that Reuven meant to borrow $100 that he wanted Shimon to give to Levi, and Reuven pleads that he was referring to the existing debt of $100 that Shimon owed to him. If it refers to the existing debt, then it falls within the scope of three- persons-presence rule, while if it refers to a new loan from Shimon to Reuven, it does not fall into the scope of three-persons-presence. The halachah is that this fits into the category of three-persons-presence. There is a dissent that it does not fit into three-persons-presence since the statement from Reuven to Shimon did not refer to the money due from Shimon to Reuven. There is an opinion that is a compromise between the two views. It holds that if the debt from Shimon to Reuven exceeds the amount of money that Reuven told Shimon to give to Levi, then three-persons-presence will apply; otherwise it will not apply. 

Reuven cannot appoint his agent to be present with Shimon and Levi and have the agent instruct Shimon to transfer the $100 to Levi. Nor can Reuven give the instructions in writing to transfer the $100 to Levi. Nor can the place of Reuven be taken by a guardian for infants. The place of Levi can be taken by an agent appointed by Levi for the purpose of representing him in a three-persons-presence transaction. If Levi is an infant. his guardian participates on his behalf in a three-persons-presence transaction.

The money due to a woman is transferred to her husband without the necessity for the debtors being present and the wife giving the instructions in the presence of the husband and her debtor. 

Assume the same three persons with the following factual differences. Shimon does not owe any money to Reuven, but rather Reuven owes $100 to Levi. While the three of them are present together, Reuven tells Shimon to give $100 to Levi to repay Reuven's debt, and Reuven will thereafter repay Shimon. Levi has not acquired the right to insist that Shimon give him the $100. Each of the three may cancel the transaction. 

Even if Levi has agreed to look only to Shimon for the $100 and has forgiven Reuven the debt in reliance on the fact that Shimon will pay him the $100, all three may cancel the transaction, in which event Reuven will still owe Levi $100 and neither will have any rights or liabilities to Shimon. They may cancel the transaction even if Shimon has made partial payment to Levi.

If Shimon, instead of canceling the transaction, fails to pay Levi, then Levi may look to Reuven for the repayment of the debt. If Shimon has made partial payment before Reuven cancelled, Shimon may obtain from Reuven the amount that he advanced to Levi. If Levi forgives Reuven, Shimon must make the payment to Levi.

If Levi by kinyan forgives the debt to Reuven, then Levi cannot look 
to Reuven for repayment, whether or not Shimon has cancelled the transaction or whether or not Shimon pays Levi. 

Reuven owes Levi $100. Shimon is holding 60 bushels of wheat belonging to Reuven. All three, Reuven, Shimon, and Levi, being present, Reuven instructs Shimon, "Give to Levi $100, for I have in your hands 60 bushels of wheat," and all three agree to the procedure. Thereafter if Shimon wants to cancel the transaction, he may do so. He may plead that he is not under obligation to go to the trouble of selling the wheat to use the proceeds to pay Levi. Even if Levi tells Shimon to give him $100 worth of wheat to comply with Reuven's instructions, Shimon may refuse to do so, since Reuven's instructions were to give Levi money, not wheat. 

However if Reuven's statement to Shimon in three-persons- presence is "Give to Levi $100 from the wheat that you are holding," it is the equivalent of having stated "Give him $100 worth of wheat," and Shimon must comply with the instructions of Reuven.

If Shimon owes Reuven $100 and is also holding the 60 bushels of wheat for Reuven, even if Reuven told Shimon to give Levi $100 the instructions are binding under three-persons-presence and Shimon may give to Levi either wheat worth $100, or $100. 

Reuven is the owner of an instrument of indebtedness. He deposited the instrument with Shimon for safekeeping. While Reuven, Shimon, and Levi are present together, Reuven instructs Shimon to give the instrument to Levi. Reuven may cancel the three-persons-presence transaction. But until he does, Shimon must transfer the instrument to Levi, and after the transfer has taken place, Reuven may no longer cancel the transaction. If when Reuven deposited the instrument with Shimon he wrote a deposit instruction that he was depositing the instrument with all the rights and liens that flowed from it, then Reuven may not cancel the three-persons-presence transaction even if Shimon has not yet delivered the instrument to Levi. 

Shimon owes Reuven $100. Reuven tells Shimon, Levi not being present, to pay the $100 to Levi. The instructions are not binding, and Levi has no right to sue Shimon for the $100, and Reuven and Shimon may cancel the instructions. 

However, if Shimon agreed by kinyan to hold the money for Levi, then Shimon may not cancel the instructions.

Shimon owes $100 to Reuven, and Reuven owes $100 to Levi. By three-persons-presence Reuven instructs Shimon to pay Levi the $100 that he owes to him. Shimon does not pay Levi, either because he refuses to do so or because he does not have the $100 to pay him. May Levi sue Reuven, or does three-persons-presence remove Reuven completely from the picture so that Levi no longer has any rights against Reuven? There are two views set forth in Shulhan Aruch. 

The first view is that Levi cannot sue Reuven, for as soon as he 
instructed Shimon to pay Levi by three-persons-presence. and Levi not objecting thereto. Reuven is absolved of liability.

The second view is that Reuven remains liable to Levi unless Levi explicitly states that Reuven no longer has any liability to Levi for the $100. Even according to this view. Levi must first sue Shimon, and if he cannot collect from Shimon, only then may he sue Reuven. Assume that Shimon has the ability to pay when the debt is due from him to Levi, but Levi is lax in pursuing his remedy against Shimon. By the time he sues Shimon, Shimon no longer has the ability to pay the $100. In such a case, even according to this second view, Levi cannot sue Reuven, since Levi has brought the loss upon himself. 

This subject matter continues in the next lesson, which shall IYH conclude our discussion of the three-person-presence rule.

The subject matter of this lesson is more fully discussed in Vol. IV, Ch.126 of A Restatement of Rabbinic Civil Law by E. Quint, published by Jason Aronson, Inc. and on sale at local Judaica bookstores. 

Questions to quint@inter.net.il