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FOLLOW-UP LETTER TO THE October 23, 1998 Mr. Frank Larson RE: Docket No. 98-421. Dear Mr. Larson: This letter is a follow-up to my letter to you dated September 24, 1998 (copy attached), nine copies of which were sent to you at your suggestion, to "inform the Court about recent events in New York State relative to the question of the constitutionality of State Finance Law Section 123-b(1)," the very question presented in Docket No. 98-81 (denied October 5, 1998) and Docket No. 98-421 (scheduled for conference on October 30, 1998), particularly the details surrounding a decision by New York’s high court, issued September 22, 1998, dismissing an appeal in a case challenging the constitutionality of SFL 123-b(1) and Chapter 16 of the New York Laws of 1997. In my 9/24/98 letter to the Court I said, "The question of the constitutionality of SFL 123-b(1) will be at the heart of a certiorari petition now being prepared for speedy filing, based on this week’s decision by the New York State high court dealing with yet another unconstitutional borrowing practice (initiated by Chapter 16 of the New York Laws of 1997)." NOTE: Chapter 16 of the Laws of 1997 is known as the New York City Transitional Finance Authority act or, simply, the "TFA Act." Pro-se plaintiffs in these cases have found it necessary to alter their legal strategy. Rather than file now, with this Court, another petition for a Writ of Certiorari based on the 9/22/98 decision by the N.Y. Court of Appeals, which dismissed our appeal in the TFA case (taken of right) we have decided that it would be more appropriate to "exhaust our legal remedies" in New York by filing a motion with the N.Y. Court of Appeals for leave to appeal. This we did yesterday, October 22, 1998. As a consequence of this change in strategy, and following your suggestion that I keep the Court informed about what is happening in New York State relative to the core questions involved (and, gratefully, following again the procedure you suggested as appropriate for my letter of 9/24/98 to achieve distribution to the justices), I am enclosing the motion to the New York Court of Appeals, for leave to appeal, in nine copies, together with nine copies of this letter, explaining the situation. It is our sincere hope that this material can be distributed to the justices, timely, for consideration at their conference on October 30, 1998, on Docket No. 98-421. Thank you for your assistance and your attention to this matter. Very truly yours, Robert L. Schulz Pro-Se cc: Hon. Dennis Vacco, NYS Attorney General
Mr. Frank Larson RE: Docket No. 98-81 and 98-421. Dear Mr. Larson: Thank you for taking the time to speak with me on this date. As per your instruction, I am writing to let the Court know about recent developments in New York State relative to the question of the constitutionality of State Finance Law Section 123-b(1), including this week’s decision by New York State’s highest court (copy attached as Exhibit F hereto). As you undoubtedly know, this question of the constitutionality of SFL 123-b(1) is at the heart of two certiorari petitions now before the Supreme Court of the United States (No. 98-81 and 98-421), and the question of the constitutionality of SFL 123-b(1) was also at the heart of two earlier, unsuccessful certiorari petitions (No. 94-996 and 96-1739). The question of the constitutionality of SFL 123-b(1) will also be at the heart of a certiorari petition now being prepared for speedy filing, based on this week’s decision by the New York State high court dealing with yet another unconstitutional State borrowing practice (initiated by Chapter 16 of the New York Laws of 1997). The Court’s attention is directed to the fact that the question of the unconstitutionality of SFL 123-b(1) is also at the heart of a lawsuit filed last week dealing with yet another unconstitutional State borrowing practice (initiated in 1998 by Chapters 5 and 124 of the New York Laws of 1998). These are the facts relative to this week’s decision by New York State’s high court. 1. In 1975 the Legislature passed and the Governor signed into law a statute [State Finance Law 123-b(1)] which, in effect, directed the judiciary to dismiss all lawsuits challenging public borrowing, denying the people any forum in which to assert their constitutional rights. 2. In 1997, the Legislature passed and the Governor signed into law as Chapter 16 of the Laws of 1997, an Act which created the New York City Transitional Finance Authority (TFA) and authorized the TFA to contract for $7.5 billion in long-term debt. The Court’s attention is directed to Section 1 of the Act "Legislative findings and declaration" (attached as Exhibit A hereto). In June of 1997, before any bonds were issued by the TFA, the undersigned and four other New York State citizens filed a lawsuit in State Supreme Court. The plaintiffs petitioned the court to declare SFL 123-b(1) unconstitutional, null and void (because it is violative of a citizen’s fundamental right to petition the government for a redress of grievances), and to declare the TFA Act unconstitutional, null and void because it violated eight provisions of the NY Constitution and 2 provisions of the US Constitution. See Exhibit B hereto. However, the State Supreme Court did what it has been doing with all other challenges to unconstitutional public borrowing. It ruled that the constitutionality of SFL 123-b(1) had been upheld in a 1979 decision written by Judge Sol Wachtler and then the Court used SFL 123-b(1) to dismiss the TFA complaint for lack of standing. Unfortunately for the TFA and many earlier rulings of this type, the constitutionality of SFL 123-b(1) was never an issue in the Wachtler decision. See Wein v Comptroller 46 NY2d 394 (1979). The July 30, 1998, decision by State Supreme Court in the TFA matter was appealed to the New York Court of Appeals in August 1998. At the same time the appellants filed a motion to disqualify four of the seven judges on the Court of Appeals because of conflicts of interest based on spousal employment and ownership of the types of bonds being challenged in the TFA case, making the judges lenders to the State. Attached for reference as Exhibit D hereto is a copy of the comments appellants filed with the New York Court of Appeals with respect to that Court’s jurisdiction. Also attached as Exhibit E hereto is a copy of appellants’ motion to disqualify. Exhibits B and C hereto are copies of the Order to Show Cause which brought on the TFA case and the decision of the Appellate Division of State Supreme Court. On September 22, 1998, the Court of Appeals issued its decision (copy attached as Exhibit F). First, the Court dismissed the motion to disqualify four judges on the ground that the Court has no statutory authority to exclude any of its judges from participating in a case. Instead, appellants’ application for disqualification was converted by the Court to one for recusal which was then referred to each individual challenged Judge. Each of the challenged Judges then decided not to recuse, deciding instead to participate in decisions relating to the TFA case. Finally, the New York Court of Appeals, acting en banc dismissed appellants’ appeal of the TFA case on the ground that "there is no substantial constitutional question directly involved," which meant the Judiciary was continuing to honor the unconstitutional directive of the Legislative and Executive branches of SFL 123-b(1), to close the courthouse doors to petitions involving public borrowing. Additionally, based upon what we perceive to be the fixed attitude of the State’s high court, it becomes inevitable that in the interest of justice and in defense of government republican in form and substance, additional cases involving SFL 123-b(1) will, of necessity, be brought before the Supreme Court of the United States. This is immediately manifested by the complaint filed on September 14, 1998 (copy attached as Exhibit G). The persistence of the reckless borrowing practices and attitude of the New York Unified Court System must be matched by equal persistence on the part of citizen-petitioners. We petitioners believe it is imperative to have this matter finally determined by the Supreme Court of the United States so that the merits of cases against the unconstitutional and reckless incurrence of public debt may emerge in New York State court decisions. It is our sincerest hope that the Court, in conferencing on case No. 98-81, will be mindful that No. 98-421 is on its way to them and that yet another (the TFA case) will be filed in short order. We are grateful for the consideration that has been given to us. On behalf of the appellants, ______________________________ Enc. cc: Hon. Dennis Vacco, NYS Attorney General |