(a) ... any [TILA violator] is liable to such person in an amount equal to the sum of—
(2)(A)(i) in the case of an individual action twice the amount of any finance charge in connection with the transaction, or (ii) in the case of an individual action relating to a consumer lease under part E of this subchapter, 25 per centum of the total amount of monthly payments under the lease, except that the liability under this subparagraph shall not be less than $100 nor greater than $1000[.]
However, Congress amended the statute in 1995 to read:
(a) ... any [TILA violator] is liable to such person in an amount equal to the sum of—
(2)(A)(i) in the case of an individual action twice the amount of any finance charge in connection with the transaction, (ii) in the case of an individual action relating to a consumer lease under part E of this subchapter, 25 per centum of the total amount of monthly payments under the lease, except that the liability under this subparagraph shall not be less than $100 nor greater than $1000, or (iii) in the case of an individual action relating to a credit transaction not under an open end credit plan that is secured by real property or a dwelling, not less than $200 or greater than $2000[.]
The unmistakable authority before the change was that the $1000 cap applied to both parts (i) and (ii). However, with the addition of part (iii) in 1995, the precise meaning of "subparagraph" was called into question. There is no question that Congress did a terrible job of drafting, no matter whether it intended to allow the $1000 cap to remain applicable to both parts (i) and (ii) or whether it intended to abrogate it. Nigh was awarded $24,000 under part (i), as the District Court and the Fourth Circuit gave the section its natural reading.
But it seems plain that this is an absurd result. So the question the Court will have to answer is what it plans to do about the mistake. It will have to revisit old principles of statutory interpretation, but the question is really much larger: what role should the courts play in fixing the obvious mistakes of the legislature? At its base, then, this is as important a question as the Court has ever answered—what is the proper method for determining how the powers of our federal government are to be separated?
Just as interesting, as has become custom in tough decisions with the current Court, will be which way the moderates will swing. Justices O'Connor and Kennedy will most likely have to take sides in the strict textualist/legislative intent struggle for power.
The case was argued October 5. For a more complete factual background, click here.