on the observance of its usury laws in everyday commercial life.[1] However interesting an investigation into the commercial and industrial partnerships of the Middle Ages might be, we must not attempt to pursue it here, as we have rigidly limited ourselves to a consideration of teaching.  We must refer, however, to the commenda, which was the contract from which the later mediaeval partnership (societas) is generally admitted to have developed, because the commenda was extensively practised as early as the tenth century, and, as far as we know, never provoked any expression of disapproval from the Church.  This silence amounts to a justification; and we may therefore say that, even before Aquinas devoted his attention to the subject, the Church fully approved of an institution which provided the owner of money with the means of procuring an unearned income.

[Footnote 1:  Ashley, op. cit., vol. i. pt. ii. p. 411; Weber, Handelsgesellschaften, pp. 111-14.]

The commenda was originally a contract by which merchants who wished to engage in foreign trade, but who did not wish to travel themselves, entrusted their wares to agents or representatives.  The merchant was known as the commendator or socius stans, and the agent as the commendatarius or tractator.  The most usual arrangement for the division of the profits of the adventure was that the commendatarius should receive one-fourth and the commendator three-fourths.  At a slightly later date contracts came to be common in which the commendatarius contributed a share of capital, in which case he would receive one-fourth of the whole profit as commendatarius, and a proportionate share of the remainder as capitalist.  This contract came to be generally known as collegantia or societas.  Contracts of this kind, though originally chiefly employed in overseas enterprise, afterwards came to be utilised in internal trade and manufacturing industry.[1]

[Footnote 1:  Ashley, op. cit., vol. i. pt. ii. pp. 412-14.]

The legitimacy of the profits of the commendator never seems to have caused the slightest difficulty to the canonists.  In 1206 Innocent III. advised the Archbishop of Genoa that a widow’s dowry should be entrusted to some merchant so that an income might be obtained by means of honest gain.[1] Aquinas expressly distinguishes between profit made from entrusting one’s money to a merchant to be employed by him in trade, and profit arising from a loan, on the ground that in the former case the ownership of the money does not pass, and that therefore the person who derives the profit also risks the loan.  ’He who lends money transfers the ownership of the money to the borrower.  Hence the borrower holds the money at his own risk, and is bound to pay it all back:  wherefore the lender must not exact more.  On the other hand, he that entrusts his money to a