Portia was there to defend Antonio against Shylock's claim to a pound of his flesh for forfeiting on a bond which he had signed as a guarantee for the repayment of a loan in the amount of three thousand ducats.
Bassanio, Antonio's closest friend and confidant, had approached the successful merchant for a loan so that he would have enough money to woo the wealthy and beautiful heiress, Portia, who lived in Belmont. Portia's father's will stated that she could only marry a suitor who successfully chose the correct casket from three—gold, silver and lead. Since she was beautiful and the heiress to an immense fortune, Portia had many suitors, themselves men of status and money who came to Belmont to chance their luck. Bassanio wanted to have an equal chance and therefore needed the money, as he tells Antonio in Act 1, scene 2:
In Belmont is a lady richly left;
And she is fair, and, fairer than that word,...And many Jasons come in quest of her.
O my Antonio, had I but the means
To hold a rival place with one of them,
I have a mind presages me such thrift,
That I should questionless be fortunate!
Antonio, unfortunately, did not have cash handy and asked Bassanio to approach a moneylender in Venice to grant him a loan. He would do the same. Bassanio found Shylock, a Jewish moneylender, who was prepared to extend the loan if Antonio would sign as guarantor, which the kindhearted Antonio did. The bond specified that the loan of three thousand ducats was to be paid in full in three months. If Antonio should forfeit, Shylock could then claim a pound of his flesh as he makes pertinently clear in Act 1, scene 3:
...If you repay me not on such a day,
In such a place, such sum or sums as are
Express'd in the condition, let the forfeit
Be nominated for an equal pound
Of your fair flesh, to be cut off and taken
In what part of your body pleaseth me.
At the end of the term, Antonio was struck by misfortune since he lost his fortune at sea and was bankrupt. He was unable to repay the debt and Shylock demanded restitution. It became clear that Shylock had malicious intent. He refused to negotiate any terms and insisted that his claim for a pound of Antonio's flesh be granted. He wanted to avenge the humiliation that he had felt when the Christian merchant publicly criticized him and treated him like a dog. Furthermore, he acknowledged that he found Christians despicable but that he especially hated Antonio.
Bassanio was informed about Antonio's predicament whilst he was in Belmont, ready to become Portia's husband after having chosen the correct casket. When he read the news, he turned pale and Portia asked him what the matter was. She learned about Antonio's position and offered to help by giving her love money to offer Shylock.
Portia also decided to disguise herself as a lawyer and secretly go to Venice with Nerissa, her lady-in-waiting, who would be disguised as a clerk. At court, she presented herself, in disguise, as Balthazar sent by an esteemed doctor of laws, Bellario, to defend Antonio. Shylock was unrelenting and insisted on having his way. He demanded to have a pound of Antonio's flesh.
Portia beseeched Shylock to be merciful and accept thrice more than the original loan amount, which he refused. She then referred to the very particular conditions of Venetian law which put Shylock in an extremely difficult position. Shylock could not cut off more or less than an ounce of Antonio's flesh, nor could he spill any of the merchant's blood. Shylock realized that he was in a tight spot and decided to accept terms.
Portia was, however, unforgiving and just as relentless as Shylock had been. She pointed out that any foreigner (which Shylock was) who deliberately intended to harm a Venetian would forfeit all his property to such a person and to the state. Furthermore, the duke could decide if such a person should be executed or not.
Antonio intervened and asked that the proposed sanctions against Shylock be adjusted. In the end, Shylock had to forfeit half his property to his daughter, Jessica, and her Christian husband, Lorenzo, and will the rest to them. They would then be in possession of his entire estate upon his death. More harshly, though, he was to give up his religion and become a Christian.
Portia's intelligent intervention surely saved Antonio's life and guaranteed a life of misery for the pernicious and vengeful Shylock.
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