Bava Metzia, Chapter 3, Mishnah 5. The Mishnah opens with the word "and similarly", meaning that the same principle explained in the previous mishnah applies here as well. Wherever the Mishnah uses this expression, a question arises: if the exact same principle applies here, why were two cases necessary? Why would one case not suffice?
A rule regarding the sequence of mishnayos:
It is a rule in the words of Chazal that any case taught after another must contain a greater novelty than the one before it. This sharpens the question: if the second case is more novel than the first, why not teach only the second, and we would automatically learn that the law applies to the first as well?
Two fundamental answers are given to this question:
Sometimes the Mishnah or Gemara explains that this is not so, as there would be room to think that a stringency or leniency that applies in one case does not apply in the other, for some reason.
And sometimes things are taught in the manner of "lo zo af zo" (not only this, but also this) - there is no real novelty in the first case that could not be learned from the second, but the Mishnah sees fit to teach both of them: first it presents the basic and simple case so that the principle is clear, and only then details the case that follows. And such is the case in our mishnah.
The case in our mishnah:
Our mishnah presents a case of the same type: two depositors who come as it were as one group, as people who rely on each other, except that here they do not deposit money but rather vessels. The watchman assumes they rely on each other, and therefore pays no attention to who deposited the more valuable vessel and who the less valuable. When they return, both claim the valuable vessel, and therefore the exact same principle explained in the previous mishnah will apply here: each takes the portion that is uncontested, and the rest will be placed until Eliyahu comes.
And in the words of the Mishnah:
"Vechen shenei keilim" - And similarly, two vessels, and for the sake of the example two towels, that were deposited with the watchman.
"Echad yafeh maneh ve'echad yafeh elef zuz" - One is worth a maneh (one hundred zuz) and one is worth a thousand zuz. That is, one small towel and one large towel.
"Zeh omer yafeh sheli vezeh omer yafeh sheli" - When the two people return, each of them claims that the valuable vessel is his.
"Nosen es hakatan le'echad meihen" - One of the two receives the small towel.
"Umitoch hagadol nosen demei katan lasheni" - Regarding the second, we take from the large towel and cut a small towel from it and give it to him. It turns out that both have received at least a small towel.
"Vehashar yehei munach ad sheyavo Eliyahu" - The remainder remains in deposit until Eliyahu the prophet clarifies the matter.
Two approaches in the Rishonim:
Actual cutting: Many Rishonim learned that we actually cut the large vessel. While cutting a towel entails a certain loss of value, it is not particularly significant. And this is the novelty of our mishnah: even though there is a loss of value, we act in this way. Furthermore, for the person who hoped to receive the large towel and watches as it is cut, this serves as a deterrent to a certain degree, even more than with cash.
The approach of the Rashba: There is no cutting here at all. The Mishnah never stipulated that if there is not a great loss of value we do not cut, but rather used the same expression in all cases: "nosen demei katan lasheni" - he gives the value of the small one to the second. Therefore, the Rashba learned that in all cases we sell the valuable object, and from the money we give the second party the value of the less valuable object, and the remainder is held in deposit.
According to the Rashba, there is no novelty at all in our mishnah compared to the previous case, but rather it was taught in the manner of "lo zo af zo" (not only this, but also this): we do not teach only the simple case of cash, but even the law of vessels, and we do not enter into the complexity of breaking the vessels.
The opinion of Rabbi Yosi:
Rabbi Yosi says, consistent with his approach in the previous Mishnah: "Im ken mah hifsid haramai" - if so, what has the fraudster lost? If we allow the fraudster who tried to deceive to get away with it, he will lose nothing. And since he loses nothing, he will have no incentive to confess, and there will be nothing to deter him from trying his luck, which will harm society as a whole. Therefore, let everything be left until Eliyahu comes: since there is a dispute and the matter is stuck, both vessels - the expensive one and the less expensive one - remain deposited in escrow with the beis din, until Eliyahu the Prophet comes and decides who the expensive vessel belongs to. And since the fraudster now loses even the less expensive vessel which is not returned to his hands, he will ultimately admit the truth or come to a compromise, and at least the expensive vessel will be returned to its true owner.
The halachah:
Overall, according to Rabbi Yosi, this is the more appropriate path, but in practice, the halachah is decided according to the Tanna Kamma: if the expensive object can be divided into smaller parts and is not completely destroyed, this is what is done in practice - such as with a towel or a gold bar. But in a case where the object cannot be cut in two, such as a computer which cannot be cut in half, everyone agrees that it is sold and the other party is given the value of the less expensive vessel, so that both of them receive something, and the remainder is left in escrow until Eliyahu the Prophet comes or until the fraudster admits to his deed.