The Mishnah before us appears in the second chapter of Maseches Shevi'is, and it lists debts to which the law of shemittas kesafim (the cancellation of debts) does not apply. The Mishnah opens with the case of a person who slaughters a cow and divides it among buyers on Rosh Hashanah - the Rosh Hashanah that begins the eighth year, which is in fact the day after the cancellation of debts, since shemittas kesafim takes effect at the very end of the seventh year.
We must first note that this does not work the way we practice today: we have two days of Rosh Hashanah, and the first of them is the first of Tishrei. But in the times when only one day of Rosh Hashanah was observed, if Elul was extended to thirty days and Rosh Hashanah was pushed off to the day that would have been the thirty first of Elul, it turns out that the first day has no status of Rosh Hashanah at all - it is still part of the seventh year, and not part of the eighth.
Therefore, if the day on which the animal was distributed fell in such an extended month, the debt is cancelled: what each of the buyers owes the slaughterer for his portion of the cow is considered a loan that he extended to them, and the moment the first of Tishrei arrives, which in this case is the second day of Rosh Hashanah, all the debts are wiped away at once.
The commentators point out that the only reason this case is treated as a loan is that the slaughterer did not hand over the meat on straight credit; rather, he asked for a pledge and security, and the buyer did not offer him any security. Since the security that was requested was never given, the arrangement is considered a lender and a loan, and it is therefore cancelled by shemittah.
From here the Mishnah continues: if the month was not extended, and that day of Rosh Hashanah turned out to be the first of Tishrei of the eighth year, the debt is not cancelled, since the loan came into being after the shemittah.
Debts Created by the Authority of Beis Din:
The Mishnah now lists several obligations that a person incurs through the ruling and decision of a beis din. Since the obligation is created by a decision of beis din, shemittah does not apply to it.
"Ha'ones veha'mefateh" - one who became liable to pay money because of rape or seduction.
"Veha'motzi shem ra" - one who claims about the woman he married that she presented herself as a virgin and was not.
"V'chol ma'aseh beis din" - any ruling of beis din that obligates one person to pay money to another.
Regarding all of these the Mishnah rules: "Einam meshamtin" - the law of shemittas kesafim does not apply to them.
To understand the reason, we must distinguish between the two principles contained in the Mishnah:
In the cases of rape, seduction and defaming a wife, we are dealing with monetary fines, and these are not loans at all: the person borrowed nothing; rather, the Torah obligated him to pay a fine, and therefore shemittas kesafim has no relevance to them.
As for any ruling of beis din - the Torah's prohibition, "Lo yigos", that a person may not demand from his fellow the money owed to him once shemittah has passed, was stated only regarding "his fellow," and does not apply to a beis din. For that reason, an obligation created by beis din is not subject to the laws of shemittah.
One Who Lends Against a Pledge and One Who Hands His Documents Over to Beis Din:
The Mishnah continues: "Ha'malveh al ha'mashkon veha'moser shetarosav l'veis din - einan meshamtin" - one who lends money on the basis of a pledge that he received into his possession, and likewise one who hands over to beis din the loan documents of what is owed to him, the law of shemittas kesafim does not apply to these loans.
With a pledge: the laws of shemittas kesafim do not apply, because it is as though the lender has already collected his debt, since he holds in his hand something that belongs to the borrower. And since there is a form of collection here, the concept of shemittas kesafim has no place.
With one who hands his documents over to beis din: as explained, the prohibition against demanding from one's fellow the repayment of a loan that shemittah has released does not apply to a beis din. Therefore, when beis din is the custodian of his documents and his loan papers, the laws of shemittah do not apply.
In summary: we learned the law of one who slaughters a cow and distributes it on Rosh Hashanah, and how the question of whether the debt is cancelled depends on whether the month was extended, and also that the debt is considered a loan only because a pledge was requested and not given. We also listed the debts to which shemittah does not apply: rape, seduction and defaming a wife - which are fines and not loans; any ruling of beis din, one who lends against a pledge, and one who hands his documents over to beis din - since "lo yigos" was not said regarding beis din, and since with a pledge it is as though he has already collected.
In the next section we will discuss the pruzbul, the enactment through which a way was found to circumvent the laws of shemittas kesafim.