A person who is a socher (renter), renting something, would not be responsible for a loss caused by an unavoidable accident. If an animal simply died on the spot, a socher would not be obligated to compensate the owner for the dead animal. But a sho'el (borrower), a person who borrowed it for no cost, would be liable in that type of situation. If an animal simply dies, a sho'el would be responsible even though he did nothing, because he took on all responsibility once he borrowed the item.
This Mishnah discusses what happens if somebody rents an animal and then lends it to one of his friends. The Mishnah says that if somebody rents a cow from his friend and lends it to another person, he has the original owner's full express permission to lend it to somebody else. So there is the original owner, who has the cow; he rents it to man number one, and man number one lends it out for free to man number two. The animal dies naturally. In that situation, the renter would not be responsible, because he paid and would not be responsible for an unavoidable accident. But the borrower would be liable; he would be responsible in that situation. We say that the renter, man number one, has to swear that the animal died naturally, that there was no peshi'ah (negligence) on his part. And then the borrower, that friend, pays the value of the cow to the renter. Man number two pays the value of the cow to man number one when the cow dies naturally.
The owner here would lose the cow. Since the owner rented it out to somebody—he rented it out to man number one, who is the socher—that person, the socher, would not be responsible for paying the owner in the event of death. So here, from the owner's perspective, he rented it out and received funds. When the animal died, it was not the socher's responsibility to pay him back. So the owner is not paid back anything for that. And the moment it died, it basically became the property of that socher, the renter. So now the borrower who borrowed it from the renter—man number two, who borrowed it from man number one—would be responsible even for an unavoidable accident. Therefore, he pays the renter the funds, the compensation for the dead animal, and does not pay the original owner.
Rabbi Yosi disagrees. Amar Rabbi Yosi, keitzad ha'lah oseh sechora b'farato shel chavero? How could it be that one person, the renter, is making money with the cow of his friend? The renter does not become the owner of the cow. He rented the cow from the owner. So if you are telling me that he takes payments from the borrower—that man number one would take payments from man number two—he would be profiting from something that is not really his, because it is really the owner's property. Ela tachzor parah la'ba'alim, says Rabbi Yosi. The halakha (Jewish law) is that the borrower would return the money to the original owner. Man number two does not give the money back to man number one, as in the opinion of Tanna Kamma (first Tanna). Rather, Rabbi Yosi says, man number two returns the value of the cow to the original owner. He gives it back to the original owner because it was the original owner's property the whole time, and therefore he is the one who has to get paid. It is as if the sho'el, the borrower, borrowed it from the actual owner, not that he borrowed it from the sho'el.