by Peter Murphy
Reg had questions about my tax affairs that took up most of Wednesday afternoon. I pretended to be frustrated at the interruption, but in a strange way it was almost a relief to be made to remember what had been going on in my practice four or five years ago. Anything was better than sitting at my desk without the faintest idea of how the third section could progress beyond ‘therefore’. On Thursday, I rummaged through a number of files and went back through briefs I had written, or the government had produced, dealing with the statute of limitations in cases long gone. I don’t know what I was expecting to find: some chance observation, some statutory provision or court judgment I had overlooked – anything that might offer a glimmer of hope. I found nothing.
On Friday afternoon, just after lunch, I gave up. The third section still consisted of a single incomplete sentence, and there was no prospect of developing it further. The plaintiffs had no response to the government’s motion to dismiss. The hearing was on Monday morning. Dave was right. Our claim was barred by the statute of limitations. It was unfair, but the law was the law, and that was the way it was. I drafted an email of apology to all the plaintiffs who had signed up, the van Eyck family in general, and anyone else I thought I might conceivably have offended. I would send it when I returned from court on Monday. I tried to write the van Eyck case off in my mind. It had been fun, but it was time to move on to the next case. It didn’t work as far as my feelings about Sam were concerned. Sam was personal: I didn’t know how what I was going to say to her, but whatever it was, I wasn’t going to say it in an email.
29
Sam got back to the office at about five thirty, carrying a bottle of scotch in a brown paper bag. I was on my own. I had sent Arlene and Reg home for the weekend, saying that I would see them after court on Monday. Eric had left early to go home to Syracuse to see his parents for a couple of days. Despite the piles of paper lying around wherever you looked, the place felt abandoned. I felt as if I had just climbed on board the Marie Celeste.
‘Were you at the library?’ I asked.
She nodded. ‘I thought we’d have a wake,’ she replied, taking the bottle from the bag and placing it on the conference table. She walked to our minute kitchenette and returned with two glasses and a jug of ice. She kicked her shoes off into the corner of the room, next to mine, and took a seat. ‘What do you think?’
‘Why not?’ I agreed.
I sat opposite her. She poured two glasses and added some ice. We clicked the glasses together as a toast and downed them without the whisky touching the sides. She refilled the glasses instantly. This time, we contemplated the drinks with their warm, almost golden glow, and took just a sip. I tried to work out what I wanted to say to her.
‘Sam,’ I began, ‘I don’t know how to –’
‘Stop,’ she interrupted.
I stopped.
‘Kiah, I know you feel bad, but I don’t want you ever to say sorry. You have nothing to be sorry for. It turns out, apparently, that there was nothing we could have done from day one. The government screwed Jacob over and there is nothing we can do about it. We didn’t know that, and you didn’t know that, when we started. If we’d never filed suit, we would never have known. At least now, we can lay it to rest. I can go visit my dad’s grave and tell him I did the best I could.’
Her words hit me hard. I started to cry, and didn’t stop. I lost it. I felt as if my heart was about to break. She put down her glass, walked over to me, and hugged me. She held me as I cried for what seemed like a very long time. In the end, her hair was making it difficult to breathe. I gently moved her head, and searched in my purse for my handkerchief to wipe my eyes.
‘That’s when I knew I wanted to take the case,’ I told her eventually, in between sniffs, ‘when you told me about your dad. I suppose it was because my memory of losing my own parents was so fresh. It really touched me. I wanted to help you to keep the promise you made to your dad.’
‘And you did,’ she replied. She was kneeling by my side now, looking directly into my eyes. ‘You did. I did everything I could, and that’s all he could ever have asked of me. I could never have promised him more than that. And if I’d never met you, if you’d never agreed to help me, I could never have done it.’
I smiled. ‘Some other lawyer would have –’
‘No, Kiah, they wouldn’t. There were no other lawyers willing to touch this. You couldn’t think of a single one who would even consider it. Remember? It was you, and I will always be grateful.’
She stood and walked back to her seat. We drained our glasses and she poured more. We sat in silence for some time.
‘What have you been getting up to at the library?’ I asked. ‘I kept meaning to ask you, but with all this other crap going on…’
‘Oh, just wasting my time, probably,’ she replied.
‘Tell me anyway.’
She sat up in her chair.
‘OK. Before I came to see you originally, I’d been spending time in the library, reading up on Alexander Hamilton. I’m not sure why, really, but he was the Secretary of the Treasury, so he was very involved with getting the economy running again after the war, trying to make sure the currency stayed stable and all the rest of it. So I guess I thought I might find something to explain why Jacob and others like him were never repaid. I never did find anything definite. But then, on Tuesday, when you told us about the statute of limitations, I remembered something he’d said. It was during a debate in the House of Representatives, and at the time, there was something about it that struck me, but I couldn’t remember where I’d seen it. So this week, I tried to find it again, and eventually, this morning, I did.’
‘What did he say?’ I asked.
‘Well, you have to understand what was going on. You remember, after the war, the country was pretty much bankrupt?’
‘Sure.’
‘Well, there were a lot of people who were pretty much bankrupt too, and they included people who had made loans for the war, who the government couldn’t afford to pay back.’
‘Like Jacob,’ I pointed out.
‘Yes, like Jacob. But these were poor people who couldn’t wait for the economy to get back on track, or for the currency to stabilise. They needed to eat, and they didn’t have any money.’
I nodded. ‘So what did they do?’ I asked.
‘They made deals with speculators,’ she replied.
‘Speculators?’
‘Yes. These were guys who did have money and who could afford to wait. So a speculator would make a deal with a guy who couldn’t wait for the government to pay him back. The speculator would buy his loan certificate at a huge discount, maybe as low as twenty or twenty-five cents on the dollar. So the guy who sold the certificate would have money to eat, but the speculator would take over his claim against the government, which he could afford to hold on to until the government could afford to pay.’
‘And he could watch it grow at the rate of six per cent compound every year until it was paid,’ I added.
‘Right. A hell of a deal for the speculator, but the poor guy who couldn’t wait was losing a fortune.’
‘OK,’ I said. ‘I see that. But where does Alexander Hamilton come in?’
‘Well, the speculators were not exactly popular with the Congress,’ she replied. ‘Many congressmen thought they were leeches, bloodsuckers, taking unfair advantage of patriots who had contributed all they had to the war effort.’
I nodded. ‘That’s a fair point.’’
‘Yes,’ she said, ‘but being congressmen, they didn’t feel they could just leave it at calling them names. They wanted to do something about it. They asked Hamilton to put a stop to it.’
‘How would he do that?’
‘By refusing to pay out on any certificate that had been bought for less than face value, and making sure the repayment went to the original lender. They raised the matter
in the House of Representatives and they made Hamilton give them an answer.’
For some reason, I felt my hands and feet begin to tingle, and there were butterflies in my stomach.
‘What answer did he give them?’ I asked. I’m sure I must have sounded nervous. I certainly felt nervous.
‘Hamilton said he sympathised, but there was nothing he could do. The government had to pay the speculators. They had no choice.’
‘Why?’ I breathed.
‘It was something to do with the Constitution,’ she replied. ‘He said the government had to pay because it was guaranteed by the Constitution.’
I truly believe that my heart stopped in that moment. When I could breathe again, I asked her to repeat what she had said. She did.
30
‘I made a copy of it,’ she said.
She reached down for her purse and took out several sheets of folded paper.
‘It’s from the report of the proceedings. God only knows how accurate any of this is,’ she added. ‘They didn’t have recording devices then, and it sounds as though it was going on at quite a pace. But this is what they wrote down.’
She unfolded the sheets, and moved her chair next to mine, so that we could read together.
House of Representatives
The 9th Day of February, 1790
Debate on the Public Credit
THE SPEAKER: Order! I will have order, Gentlemen!
VARIOUS MEMBERS: We will not pay! No gold for the Leeches! etc. etc.
THE SPEAKER: Order, I say! If there is no order, I will suspend the sitting and clear the House. Order! You will come to order, Gentlemen. Mr Secretary, you may continue, if you please, but on your request, I will adjourn the debate.
THE SECRETARY OF THE TREASURY (MR HAMILTON): No, Mr Speaker. We have weighty matters to resolve. Let us continue. Gentlemen, you have been provided with my report on the public credit. If you have questions, I will do my best to answer them. I ask only the courtesy that you do so one at a time.
Laughter.
THE SPEAKER: The Gentleman from South Carolina, Mr Butler, is recognised.
MR BUTLER: Thank you, Mr Speaker. Mr Secretary, I understand from your report that you propose to pay in full every loan certificate presented to the Treasury. I would be interested to know how you propose to do so in the light of our present circumstances.
Laughter, shouts.
THE SPEAKER: Order!
MR BUTLER: I would further ask, sir, how you dare to pay those speculators who purchased loan certificates at a discount from the poor after the war, and who now demand payment on terms equal to those afforded to the original lenders. They are leeches, sir, parasites. I say they shall have nothing.
VARIOUS MEMBERS: Hear, hear!
MR HAMILTON: The Honourable Gentleman has raised questions of the utmost importance.
VARIOUS MEMBERS: He has indeed! Answer! etc. etc.
MR HAMILTON: If I am afforded the opportunity, I will answer to the best of my ability. As to how we shall pay, I confess that I know not. We have too little gold to pay in full the debts owed to every man who has presented his certificate to the Treasury. But I have this faith: that these United States will not forever be in penury. We will be strong, and as and when we can, we will pay our debt in full. As to the Honourable Gentleman’s second question, I am of opinion that we must pay in full even those whom he has rightly described as leeches and parasites.
VARIOUS MEMBERS: Never! He must resign! They shall have nothing!
MR HAMILTON: I will be heard…
VARIOUS MEMBERS: Resign, sir.
THE SPEAKER: Order! Enough! I will clear the House.
MR HAMILTON: No, Mr Speaker. I will account for myself. I will be heard, Gentlemen. I share the feelings of the House about these men. When Congress appealed for the means to fight against our enemies, many patriots gave their all. We all agree that these patriots must be repaid on presentation of their certificates. What, then, of those base men who bought certificates speculatively, thinking to live off the blood of the patriots? Gentlemen, this is no easy question.
A MEMBER: I find it to be easy enough, sir.
MR HAMILTON: Then, sir, you are mistaken. Firstly, I say this: I say that our hope of future credit requires that all be repaid in full. If it be seen abroad that we cannot, or will not, repay our debts, I doubt that any nation will long trade with us or furnish us with credit.
But there is another consideration I esteem as far more important. The repayment of this debt is guaranteed by the Constitution of the United States. By this standard, we are allowed to make no distinction, since the Constitution applies to all alike.
Gentlemen, this opinion gains further strength from the nature of our debt. The faith of America has been repeatedly pledged for it. This debt was not contracted as the price of bread or wine or arms. It was the price of liberty.
We looked at each other.
‘What do you think?’ she asked.
I looked down at the page again, and felt tears welling up in my eyes.
‘I think Alexander Hamilton wrote the third section of my brief,’ I replied.
‘I’m not getting it yet,’ Sam said.
I walked over to my bookcase and took down a volume I should probably have read more often during my legal studies. It’s surprising how the most basic principles can be overlooked amid the din of modern law practice with its endless deadlines, and procedural rules, and local rules, and all the other minutiae without which we apparently find it impossible now to resolve legal disputes. But with all the crap we’ve imposed on the laws designed to protect us, there are still some enduring anchors to keep us from floating away on a tide of technicality, if we will only allow ourselves to hold on fast to them.
‘This is what Hamilton was talking about,’ I said, opening the book at the page I knew I needed. ‘It’s the first paragraph of Article Six of the Constitution.’
I read it aloud.
‘All Debts contracted and Engagements entered into before the Adoption of this Constitution shall be as valid against the United States under this Constitution as under the Confederation.’
Sam nodded.
‘That’s it. That’s what he was saying. They actually guaranteed the debt – Jacob’s debt – in the Constitution.’
‘Exactly, and Hamilton knew, even before the Supreme Court spelled it out, that the Constitution prevails over any contrary law. So there was no way to avoid it. There was no law they could enact to shut the speculators out. The government had to pay them, whether they wanted to or not.’
‘Connect it up for me,’ Sam said. ‘How does that help us now?’
‘The Constitution still prevails over any contrary law,’ I replied. ‘That hasn’t changed since 1790. So what if we argue that the statute of limitations is a contrary law? They can’t shut Jacob out any more than they could shut out the speculators.’
‘The government can’t use the statute to defeat a claim guaranteed by the Constitution,’ she smiled.
‘That has to be an argument. Congress can pass any statute of limitations it wants, but Jacob still has a valid claim, and on the face of it, Article Six of the Constitution says that the war debt is valid without any limitation of time. Any judge who throws this case out because of the statute of limitations is effectively repealing Article Six of the Constitution.’ I smiled. ‘Judge Morrow will have to think long and hard before he does that.’
She screamed and hugged me.
‘Kiah, does this mean we’re going to win on Monday?’
We held each other for several moments. My heart was racing. I desperately tried to focus on what we had discovered. I sensed that Sam had made a vital breakthrough, but I still needed to keep my feet on the ground. I still needed to work out exactly what it meant.
‘Not quite so fast,’ I said.
‘We still have to think this through.’
‘Think what through? If –’
‘The debt is valid, yes, but that doesn’t necessarily mean that the government has to provide a remedy for collecting it, and if they do, maybe they can still attach conditions to using the remedy.’
‘Such as a statute of limitations?’
‘Maybe.’
She sighed and shook her head.
‘But how can they say the debt is valid, but then not give us a way to collect it? It doesn’t make sense.’
I smiled.
‘That’s what they’ll have to explain to the court. It’s not a guarantee that we’ll win, Sam, but the government’s case just got a lot harder to argue.’
‘We have a chance after all?’
‘We have a definite chance, particularly when you consider what else Hamilton said about the war debt: he said it was the price of liberty. When you put it that way, any judge is going to think twice about dismissing without at least letting us try to prove our case.’
I hugged her again and kissed her on the cheek.
‘You’ve kept us alive,’ I replied. ‘You did that, Sam. We’re in with a shot.’
She laughed.
‘So, now what?’
‘Now,’ I replied, ‘I’m going home to get some sleep, and tomorrow I’m going to write a brief that will tell Dave Petrosian he has a fight on his hands.’
‘What can I do?’
‘You can go back to the library and get me copies of Hamilton’s reports on the public credit – all of them, however many of them there are. Then you can go back over the proceedings in the House of Representatives at about the same time and see if you can find anything else of interest, anything at all, either before or after February 9.’
She nodded. She was beaming. So was I.
‘You got it,’ she said.
31
Dave Petrosian
I found Kiah’s brief lying on my desk when I arrived in the office at eight thirty on the Monday morning. It was in a brown envelope marked ‘extremely urgent’. I’d had a good weekend. Well, why wouldn’t I? I was looking forward to the week ahead and its promise of success. There’s always a certain pleasurable anticipation when you’re about to go to court on a motion you can’t lose. Motions you can’t lose only come along once in a while, and when they do, I’ve always thought of them as a reward for working so hard on the tricky ones that you have to argue, that could go either way. As I opened the envelope, I fully expected it to be a concession, an agreement to dismiss the lawsuit without the necessity for a court appearance. Kiah wasn’t one to waste the court’s time. She’d had a week to contemplate her mistake; she’d realised she didn’t have a leg to stand on; and she would have no appetite for appearing in court just for the pleasure of listening to Judge Morrow dismiss her case on such an embarrassing ground. Obviously. I would have done the same in her position. That’s how confident I was about what I would find in the brown envelope.