Bava Metzia, Chapter 3, Mishnah 9. This Mishnah is considered confusing, and the reason for this is that two conflicting opinions are presented in it, yet neither of them is mentioned explicitly. The Gemara brings the words of Rabbi Yochanan: "I will be an indentured servant to whoever succeeds in establishing this Mishnah as a single opinion." We will explain it as two separate opinions.
The central topic in the Mishnah is the dispute between Rabbi Yishmael and Rabbi Akiva, and the Mishnah does not present it at all: there is no mention in it of Rabbi Akiva or of Rabbi Yishmael. Furthermore, the Mishnah is structured as if the main issue being discussed is the question of whether a specific place was designated to store the item or not, but this is not the case.
The foundation of the law - an unpaid watchman versus a robber:
An unpaid watchman is exempt from circumstances beyond his control. If someone deposits a dining room set with his friend, and the friend places it in his storage room, and a flood subsequently occurs - the watchman says: There was nothing I could do, it was a flood. The destruction of the furniture is not his responsibility. However, if he loses his status as a watchman and becomes halachically equivalent to a robber, a robber bears full responsibility for everything, even for circumstances beyond his control. If the person is considered a robber in relation to the deposit, he will be obligated to replace the furniture even if it was destroyed in a flood.
We also rule that a borrower without consent - a person who borrows an item without permission - is a halachic equivalent to a robber, and certainly in the context of the laws of watchmen. If a person deposited his dining room set in his friend's storage room, and the watchman took a chair to reach a shelf in the kitchen: the very taking of the chair is borrowing without consent. With this, he ceases to be a watchman over that chair and becomes halachically equivalent to a robber, and if anything happens to the chair, even in circumstances beyond his control, he bears responsibility. It should be noted that regarding the remaining chairs and the table that were left in the storage room and not taken, he remains exempt from circumstances beyond his control, and he is only liable for what he took.
The question of returning the item:
The verse obligates "veheshiv et hagezeilah asher gazal" - it is a duty to return any stolen item to the owner. Hence the question: A person who returns the chair that he took out of the storage room in order to reach the top shelf, and puts it back in its place - does he return to the status of a watchman, or does he remain in the status of a robber until he notifies the original owner that he returned it?
Rabbi Yishmael: There is no need for notification, and there is no need for the owner's knowledge that the item was returned. Taking the chair from the storage room to climb to the top shelf is absolutely forbidden, as this is borrowing without consent. But once the chair is returned to its place, the taker reverts to being a watchman over it and is exempt from circumstances beyond his control. If a flood comes afterwards and the piece of furniture is warped and destroyed, he does not bear responsibility, since he returned it.
Rabbi Akiva: Disagrees. Once he has acquired the status of a robber, being a borrower without consent, he cannot return the item to its place without notifying the original owner. The owner wants to know and deserves to know, and in the absence of notification, this is not a return. Therefore, even though he returned the item to its place, he remains in the status of a robber and not in the status of a watchman, and if a circumstance beyond his control occurs, he will be obligated to replace the chair that he used without permission.
The practical halachah follows Rabbi Akiva: once he has taken the item, he cannot return it and exempt himself from responsibility until he notifies the original owner.
Why the Mishnah used the terminology of designating a place:
The Mishnah presents the matter as if the issue being discussed is the question of designating a place. The meaning of designating a place is establishing a specific location where the item will be stored. The Mishnah brings two different cases, because they highlight the extremes of the approaches of the two Tannaim.
According to Rabbi Yishmael, once the chair is returned to its place, the liability for circumstances beyond his control ceases, since the taker reverts to being a watchman. Therefore, when a specific place was not designated: initially, the furniture was placed on the left side of the storage room, and the watchman is permitted to move it to the right side. Placing it on the right side is still considered "in its place," since there is no specific place where it must be, but rather anywhere in the storage room. For this reason, even though he placed it in a different spot, he can say according to Rabbi Yishmael that he returned it to its place, meaning to storage, and he is exempt.
According to Rabbi Akiva, once he took the object unlawfully and borrowed it without permission, he becomes a robber. Even if he returned it exactly to its place, to the very same corner where the original owner placed it and exactly as it was placed, it means nothing. His status has changed, and he is liable until he notifies the original owner. Even if a flood comes now, he will have to pay for that chair, as he is liable for accidents.
The language of the Mishnah:
The Mishnah opens: "Hamafkid chavit etzel chaveiro velo yichadu lah habba'alim makom" - One deposits a barrel with his friend for safekeeping and no specific place was designated for it to be kept, so he can place it anywhere. "V'tiltelah venishberah" - The watchman moved the barrel, and before he returned it, circumstances beyond his control occurred and it broke, such as it being struck by lightning. Is he liable? That depends. "Im betoch yado nishberah" - This is referring to the stage before it was returned. It does not mean specifically that it is literally in his hand, but that it has not yet been returned to its proper place. In this case, the law depends on the reason why the watchman moved the barrel:
For his own need: He moved it for his own needs, such as needing something to stand on to reach the top shelf - he is liable, as this is borrowing without permission and he becomes a robber, and since he has not yet returned it, he is liable for accidents.
For its need: He took the barrel and moved it not for his personal benefit but for the benefit of the barrel, such as seeing it sitting in direct sunlight in the corner of the garage, and if it remains there it might explode, and therefore he moved it to another corner to protect it - he is exempt. He is acting as a watchman, whether this is his duty or he is going above and beyond, and he never becomes a robber, and therefore remains exempt for accidents.
This first section is taught according to the opinion of Rabbi Yishmael: Once he returned the object to its place, he ceases to be a robber and returns to being a watchman, and he is exempt. Therefore, the Mishnah was precise and stated "betoch yado nishberah" - that it broke while still in his hand, meaning before he returned it. But once he returned it, whether he moved it for his own need or for its need, it does not matter and he is exempt for accidents, as he returned it and thereby fulfilled "and he shall return the stolen item that he robbed."
In contrast, the second part of the Mishnah follows the view of Rabbi Akiva, who holds that once he took the object, he cannot return it and go back to being a regular watchman until he notifies the original owner. Because of this, the Mishnah says: "Yichadu lah habba'alim makom" - A specific place was designated for storing the barrel, "v'tiltelah venishberah" - the watchman moved it and it broke. Here there is no mention of whether this occurred before the return or after, because there is no practical difference according to Rabbi Akiva: Once he took it for his own needs, he becomes a robber and there is no going back from this.
And therefore the Mishnah says: "Bein mitoch yado bein mishehinichah" - There is no difference whether he returned it to the place from which it was taken, to the very same corner where he promised to guard it, or not. The only question is whether it was for his own need: If he moved the barrel for his own needs to reach the top shelf, he is forever liable, and it makes no practical difference if he returned it to its place, as he became a robber and the law of the barrel is determined by this. And if it was for its need, that he moved it to protect it, he is exempt, as he is a watchman, and a watchman is exempt for accidents.
In summary: This Mishnah includes two opinions that are not mentioned in it by name - the dispute between Rabbi Yishmael and Rabbi Akiva regarding one who borrows without permission and returned the object to its place: According to Rabbi Yishmael he returns to being a watchman and is exempt for accidents, and according to Rabbi Akiva he remains with the status of a robber and is liable for accidents until he notifies the owner. The first section, where no place was designated, is taught according to Rabbi Yishmael, and the latter section, where a place was designated and it says in it "bein mitoch yado bein mishehinichah," is according to Rabbi Akiva. The halachah follows Rabbi Akiva, that once he took the object for his own need he cannot return it without notifying the original owner, and he will forever be liable for accidents.