Article II. On Usury, or on Profit Received from Mutuum

Usury, taken in a broad sense, is called every profit received from mutuum, or by occasion of it, whether with or without a legitimate title. But usury in the stricter sense is profit immediately proceeding from mutuum, that is, precisely by force of the mutuum, and without another just title. Nevertheless the crime of usury is not present if someone expects something for a mutuum, not as a debt, but from mere benevolence, provided implicit usury does not underlie it; or if he exacts a thing already owed elsewhere from justice, since thus in fact no new burden is imposed. St. Lig., n. 774, 777 and following. If it exceeds the limits of a just title, or is exercised toward the poor, it is called oppressive usury ¹.

¹ The case is not equal, that profit exceeds the limits of justice, and that profit in itself just is sought from the poor. For in the first case justice is injured, but in the second charity alone is injured, as the Author notes below. Therefore, since the obligation of restitution follows a violation of justice, and by no means merely the violated office of charity, for that reason the burden of restitution can indeed be urged in the former case, but not in the latter, at least if the matter is considered merely according to natural right.

853. Principles. I. Usury received by force of mutuum in a thing consumable by first use, as in wine, wheat, etc., is altogether illicit. The reason is that the use of such a thing is scarcely appreciable by price independently of the borrowed thing itself; but that thing furnishes title only to the restitution of a similar thing, nor is there a permanent use which can be equivalent to price ². Thus commonly.

² The intrinsic reason why usury received by force of mutuum is altogether illicit, if it is to be solid and so unshaken that it always retains its force, cannot be sought elsewhere than from the nature of this contract, which, by the certain opinion of all, is and must be gratuitous. And in fact, even if you suppose, which is false, that wine, wheat, etc., have no other use except that they are consumed, is it not some advantage which is procured for you, that here and now you can consume? But further, as will be said below, the reason why it is appreciable by price to grant one's own money or anything else to the free use of another is not to be sought, according to the very common sense of the Doctors, from the advantage which another receives from it, but rather from the inconvenience which, from the very nature of the thing, he undergoes who deprives himself, in favor of another, of the advantage of using his own thing. Therefore, just as, when treating of commodatum or donation, we certainly do not seek the reason why the donor or lender can lawfully exact nothing from justice from the fact that no utility appreciable by price accrues to the donee or borrower, or that the donor or lender assumes no burden appreciable by price for himself, but rather we must seek it from the nature of a gratuitous contract, by force of which one by spontaneous liberality renounces the right of exacting the deserved price for the use or full dominion of some thing granted to another; so also it seems it must be determined concerning the contract of mutuum, unless one wishes to be entangled and wrapped up in inextricable difficulties.

II. Oppressive usury is repugnant to natural law, whether it is done toward the poor or toward the rich: 1. if it is done toward the poor, because the lender is bound from charity ³ to give the mutuum gratuitously; 2. if it is done toward the rich beyond the limits of a just title, or at least of the legal rate, because justice requires that there be proportion between this title and the profit received from it, or between profit and the value of use ⁴. This is clear from various texts of Scripture.

³ If oppressive usury is said to be that which also exceeds the limits of some extrinsic title, the reason of guilt here arises not only from violated charity, but also from injustice; for the laws of justice must be preserved no less with the poor than with the rich.

⁴ A little before, in Principle I, the Author had determined beforehand that the use of the thing is in no way appreciable by price; but here, as it were, he proposes the value of use as a just title of profit. Thus, of course, and not otherwise, it must happen whenever, for asserting the gratuity of mutuum, you wish to use some reason other than that which you have in the preceding note to that first principle.

III. Usury can be excused from all injustice if a just title is present, for example, emerging damage, etc. The reason is that then the profit is received not by force of the mutuum, but by reason of an extrinsic title. For it is lawful for you to receive as much as you handed over; moreover, if from a hundred coins given you lose ten, in some way you disburse one hundred and ten. Therefore you can receive one hundred and ten.

IV. Usurers and their cooperators are bound from justice to restitution, since they injure commutative justice no otherwise than thieves themselves; therefore the rules handed down in the Treatise on Restitution are to be applied to them.

854. Questions. QUESTION 1. In doubt whether the borrower gave something above the principal gratis or not, can you retain it?

I answer affirmatively, with the common and more probable opinion, unless something else must be determined from the circumstances ⁵. St. Lig., n. 761.

⁵ Namely, what was received can be retained when, all things considered, it can prudently be judged from the circumstances that the borrower repaid it merely from a liberal gift. When the confessor sufficiently learns this, he will determine that the gift can be retained, both if the lender accepted it in good faith, and if in doubtful or even bad faith, namely as if it were owed to him from justice. For in the latter hypothesis he will indeed be bound to put aside the erroneous persuasion, as it were, of a debt paid to him, and his depraved disposition; but not likewise to lose that which has been conferred upon him by the legitimate title of donation.

Moreover, those words of St. Alphonsus contribute to the prudent judgment of which we have spoken (book 3, n. 761, question II): "In doubt, the borrower is regularly presumed to have given under compulsion, because men give their own things gratis with difficulty." Thus the holy Author, who nevertheless soon adds: "But in this doubt deference must be given to that party for which the stronger presumption stands; hence the Salmanticenses, Sporer, Lessius, say that it is to be presumed that the borrower with moral certainty donated, if he is not poor or avaricious, or did not give impelled by fear, nor from vexation or the request of the lender, or," add, "if the little gifts are of slight moment, as the Doctors commonly hold, even when the crime of simony is in question.... But the opposite is presumed if the lender before the donation signified that he wished something as owed to himself, or if the borrower is poor, or not accustomed to give, or if he pays before the return of the mutuum; because then he is easily presumed to give lest he soon be compelled to restitution." Nevertheless this question will rarely have place in practice, since in the common custom pacts are established beforehand.

QUESTION 2. Can the lender retain what the borrower gave from fear lest otherwise the mutuum be denied to him?

I answer affirmatively, more probably. The reason is that, for usury, it is required that it be given by force of a pact, or as a debt from justice. Thus more commonly. St. Lig., n. 763, inclines to this opinion.

855. QUESTION 3. Is it usury if you lend on this condition, that the borrower buy the things necessary to himself at a just price in your shop?

I answer affirmatively, if this is brought into a pact. The reason is that a burden is imposed on the borrower, and his liberty is restricted, which is illicit and unjust ⁶. St. Lig., n. 780, etc.

⁶ Although from a pact of this kind no damage or inconvenience comes to the borrower, nevertheless the pact will be repugnant to the nature of this plainly gratuitous contract, and therefore it will not lack some injustice. The same would have to be said if someone, with such a pact, gave another a vineyard; for in the same way pacts imposing a burden are repugnant to donation, which by its own nature is a gratuitous contract.

QUESTION 4. Can an antidoral donation, or one which is made from a grateful mind, be brought into a pact?

I answer negatively. The reason is that from pacts there necessarily arises a title of justice, but not a donation bestowed merely from a grateful mind. St. Lig., n. 764, and others commonly.