

January 3, 1995   UNITED STATES COURT OF APPEALS                            UNITED STATES COURT OF APPEALS

                      FOR THE FIRST CIRCUIT                                FOR THE FIRST CIRCUIT

                                             

Nos. 93-2374
     94-1128
     94-1129

                         JAY A. PRITZKER,
                       Plaintiff, Appellee,

                                v.

                        BOB YARI, ET AL.,
                     Defendants, Appellants.

                                             

                           ERRATA SHEET                                     ERRATA SHEET

     The opinion of  the court  issued on December  13, 1994,  is
corrected as follows:

     On  page 38, line  11, change "Words of  Days" to "Works and                                                                           
Days".              

                  UNITED STATES COURT OF APPEALS
                      FOR THE FIRST CIRCUIT
                                             

Nos. 93-2374
     94-1128
     94-1129

                         JAY A. PRITZKER,
                       Plaintiff, Appellee,

                                v.

                        BOB YARI, ET AL.,
                     Defendants, Appellants.

                                             

          APPEALS FROM THE UNITED STATES DISTRICT COURT
                 FOR THE DISTRICT OF PUERTO RICO

          [Hon. Jaime Pieras, Jr., U.S. District Judge]                                                                
                                             

                              Before

                  Selya and Cyr, Circuit Judges,                                                         
                   and Zobel,* District Judge.                                                       
                                             

     Roger R. Crane, with whom Bachner,  Tally, Polevoy &amp; Misher,                                                                          
Roberto  Boneta, Munoz  Boneta Gonzalez  Arbona Benitez  &amp; Peral,                                                                          
Jose Trias-Monge,  and  Trias  &amp;  Melendez  were  on  brief,  for                                                    
defendant Bob Yari.
     Martin I. Kaminsky, with  whom W. Hans Kobelt and  Pollack &amp;                                                                           
Kaminsky were on brief, for defendant Baird, Patrick &amp; Co.                  
     Benjamin   Rodriguez-Ramon,  Rodriguez-Ramon   &amp;  Rodriguez-                                                                           
Hernandez, and  Emigdio R. Seles  on brief for  defendant Lincoln                                          
Realty, Inc.
     Ruben  T.  Nigaglioni,  with  whom Diana  Mendez-Ondina  and                                                                      
Ledesma, Palcu &amp;  Miranda were  on brief, for  defendant Paul  S.                                   
Dopp.
     Gael  Mahony, with whom Frances  S. Cohen, David A. Hoffman,                                                                          
Joshua  M. Davis,  Hill  &amp; Barlow,  Salvador  Antonetti-Zequeira,                                                                          
Ricardo Ortiz-Colon,  and Fiddler,  Gonzalez &amp; Rodriguez  were on                                                                  
brief, for plaintiff Jay A. Pritzker.

                                             

                        December 13, 1994
                                             
               
*Of the District of Massachusetts, sitting by designation.

          SELYA, Circuit Judge.   In this  troika of appeals,  we                    SELYA, Circuit Judge.                                        

address several  questions arising  collaterally from  a bitterly

fought breach-of-contract  suit between Paul  S. Dopp and  Jay A.

Pritzker  (the D/P  Litigation) concerning  the ownership  of two

hotels, situated on approximately  1,000 beachfront acres, in the

Commonwealth  of   Puerto  Rico.    The   engine  of  high-stakes

litigation  runs on money, and at various times during the course

of the D/P Litigation Dopp forged financing agreements with three

different  financiers, namely,  Bob  Yari,  Lincoln Realty,  Inc.

(Lincoln),  and  Baird, Patrick  &amp;  Co. (BPC),  for  the apparent

purpose of fueling his prosecution of the suit.

          Although  we first  must  address BPC's  jurisdictional

challenge,  our principal task today  is to resolve the contested

legal  status of  these financing  agreements.   Having carefully

examined the relevant law and the facts of the case, we hold that

all three financing agreements involve "litigated credits" within

the meaning  of article 1425  of the Civil  Code of  Puerto Rico,

P.R. Laws Ann. tit. 31,    3950 (1991); that all  are, therefore,

subject to redemption by Pritzker under Puerto Rico law; and that

Pritzker properly  perfected his rights  to redemption.   We also

hold  that the  lower  court's trimming  of  Pritzker's right  to

redeem   Yari's  litigated   credit  lacked   any  legal   basis.

Consequently, we affirm in part and reverse in part.

I.  BACKGROUND          I.  BACKGROUND

          The facts relating to the underlying breach of contract

and the protracted litigation emanating from it are chronicled in

                                3

a  series of opinions,  see Dopp v.  Pritzker,     F.3d     ,                                                           

(1st Cir. 1994) [Nos. 93-2373, 94-1130, &amp; 94-1131, slip op. at 3-

6]; (Dopp IV); Dopp v. HTP  Corp., 947 F.2d 506, 508-09 (1st Cir.                                           

1991)  (Dopp II);  Dopp v.  HTP Corp., 831  F. Supp.  939, 941-92                                               

(D.P.R. 1993)  (Dopp III); Dopp v.  HTP Corp., 755 F.  Supp. 491,                                                       

492-94 (D.P.R. 1991) (Dopp I), and need not be rehearsed.  Hence,                                      

we confine our account to the facts that are needed  to place the

instant appeals into workable perspective.1

                  A.  The Financing Agreements.                            A.  The Financing Agreements.                                                        

          In March  1990, a  jury  sitting in  the United  States

District Court  for the  District of  Puerto Rico  found Pritzker

liable to  Dopp in the  sum of $2,000,000  for breach of  an oral

contract  concerning  the  purchase  of the  Dorado  Beach  Hotel

Corporation (DBHC).  The district  court entered judgment in  the

D/P Litigation, see Dopp I, 755  F. Supp. at 504, and a firestorm                                    

of appeals ensued.   We eventually  upheld the liability  finding

but  vacated the damage award and  ordered a new trial limited to

questions of remediation.  See Dopp II, 947 F.2d at 520.                                                

          As  these  events  were  unfolding,  Dopp  launched   a

collateral   enterprise,  assigning   various  portions   of  the

anticipated  proceeds of the D/P Litigation to third parties.  He
                                                  

     1For  purposes   of  oral  argument,   we  consolidated  the
financiers' appeals  with  three other  appeals    two  taken  by
Pritzker and  one by Dopp    involving the remedial  phase of the
main  litigation.   We  resolved most  of  the points  raised  in
Pritzker's  and Dopp's  appeals by  means of  a separate  opinion
issued  on  October 28,  1994.   See  Dopp  IV, supra.    In this                                                               
opinion, we deal with  not only the financiers' appeals  but also
the  complaints  voiced  by  Pritzker  and  Dopp  concerning  the
district court's rulings anent the financing agreements.

                                4

undertook  this  effort,  in his  words,  "to  meet  some of  the

litigation  and personal expenses . . . incurred during the years

of this  intense litigation and  in connection  therewith."   All

told,  Dopp  entered  into  three  separate nonuniform  financing

agreements with three distinct financiers.

          Dopp signed the first  financing agreement, styled as a

"Judgment or  Settlement Purchase  Agreement," on June  26, 1990.

In  this  transaction,  Lincoln  agreed  to  provide  $50,000  in

exchange for an 8% interest in the proceeds of the D/P Litigation

above  a stipulated floor.  The agreement obliged Dopp to apprise

Lincoln of developments in the litigation on a current basis.

          Dopp  entered into  the  second financing  agreement on

October  16, 1991.   In  it, BPC  agreed to  provide  $100,000 in

exchange for a 5% interest in the proceeds  of the D/P Litigation

over a  floor different  from that  negotiated  between Dopp  and

Lincoln.   Moreover, the  BPC agreement mandated  certain minimum

repayments  to the financier.  These minima varied depending upon

the date on which, in  the words of the contracting  parties, the

D/P  Litigation   might  eventually  be   "settled  or  otherwise

decided."  Like the Lincoln  agreement, the BPC agreement obliged

Dopp  to keep  the  financier seasonably  informed of  litigatory

developments.

          Dopp  entered   into  the  third  and   last  financing

agreement on July 23, 1992.  In consideration of $250,000 in cash

and a  promise to obtain, or  at least to assist  in obtaining, a

$2,500,000 to $3,000,000 line of credit for one year, Dopp agreed

                                5

to allocate the remainder  of the proceeds of the  D/P Litigation

according  to a preset formula:  "(i)  first, to repayment of all

indebtedness  in  relation to  the line  of  credit to  have been

obtained  in Dopp's name; (ii)  second, $2,500,000 to Yari; (iii)

third, $12,000,000 to Dopp; (iv) fourth, $7,000,000  to Yari; and

(v)  fifth, the remaining amount,  if any, to  be divided equally

between  Dopp and Yari."   Dopp III,  831 F. Supp.  at 954.2  The                                             

Yari agreement also  set in  place virtual joint  control of  the

litigation.    Although  Yari ultimately  provided  less  funding

(somewhere between  $500,000 and  $625,000) than Dopp  claims was

due, the district court found that Yari "complied with all of his

obligations under his agreements . . . ."  Id. at 956.                                                        

                 B.  Pertinent Proceedings Below.                           B.  Pertinent Proceedings Below.                                                          

          On October 9, 1992, Dopp disclosed the existence of the

financing  agreements in  the  midst of  a  new discovery  round.

Exactly one week  later, Pritzker wrote  to Lincoln, offering  to

tender the amount paid  to Dopp in exchange for  Lincoln's rights

and beneficial interests  under its financing agreement.   On the

same date, Pritzker sent  substantially identical missives to BPC

andYari,3and notifiedthe districtcourtof hisletter-writing spree.
                                                  

     2On September 24, 1992, Dopp and Yari entered into a written
modification  of   their  agreement.    The   amendment  is  only
peripherally related to the issues we must decide today.   To the
extent it is relevant, we discuss it in Part III(D), infra.                                                                    

     3Pritzker made the three tenders pursuant to article 1425 of
the Civil Code of Puerto Rico, which provides in its entirety:

               When  a litigated  credit  is sold,  the
          debtor shall have the right to extinguish the
          same  by reimbursing  the  assignee  for  the

                                6

          When  his  communiques  drew  no  meaningful  response,

Pritzker  promptly filed a complaint  in the district  court.  He

named  Dopp and the three financiers as defendants, along with an

ostensible partnership  between Dopp and Yari.   Pritzker averred

that  each of  the financing  agreements involved  the sale  of a

litigated credit within the  meaning of article 1425 and,  hence,

was subject to  extinguishment.  Between  December 18, 1992,  and

June  1, 1993, Pritzker,  through a series  of motions, deposited

with the district court the funds that he believed were necessary

to  redeem the financiers' interests  in the proceeds  of the D/P

Litigation.

          BPC moved  to dismiss Pritzker's  complaint against  it

for  want of  in personam  jurisdiction, but  the  district court                                   

demurred.4  After all defendants had answered  the complaint, the
                                                  

          price  the  later  [sic]  paid  for  it,  the
          judicial  costs  incurred  by  him,  and  the
          interest on  the price from the  day on which
          the same was paid.

               A   credit   shall   be  considered   as
          litigated from  the day the suit  relating to
          the same has been answered.

               The debtor  may make  use  of his  right
          within nine (9)  days, counted  from the  day
          the assignee should demand payment of him.

P.R. Laws Ann. tit. 31,   3950 (1991).

     4BPC's  motion stressed that  it is  a New  York corporation
transacting no routine business in Puerto Rico; that it has never
had an office  or agent in Puerto Rico; that  Dopp and BPC signed
the financing agreement  in New York; that Dopp is  a citizen and
resident  of New  Jersey;  and that  Pritzker  is a  citizen  and
resident of Illinois.   The district court found these  facts, by
and large, to be  accurately stated.  See Pritzker  v. Yari, Civ.                                                                     
No. 92-2825, 1993 WL 71760, at *3, slip op. at 6 (D.P.R.  Mar. 5,

                                7

court  consolidated  Pritzker's  suit with  Dopp's  suit  against

Pritzker.  See id. at 942-43.  In an opinion dated March 5, 1993,                            

the  court  held that  all  three  financing agreements  involved

litigated  credits within  the reach  of article  1425,  and that

Pritzker was  entitled, pursuant  to that statute,  to extinguish

such credits  through full reimbursement of  the amounts advanced

(together with interest and  costs).  See Pritzker v.  Yari, Civ.                                                                     

No. 92-2825,  1993 WL 71760, at  *5-7, slip op. at  11-17 (D.P.R.

Mar.  5, 1993).    In a  later,  end-of-case opinion,  the  court

reaffirmed  this  holding, see  Dopp III,  831  F. Supp.  at 952,                                                  

carved out a  partial exception  applicable to Yari,  see id.  at                                                                       

957-58,  and determined the monetary amounts  each party stood to

lose or gain, see id. at 958-59.                               

          Following  the  entry  of  final  judgment,  the  three

financiers filed notices of  appeal.  Lincoln and Yari  contested

the  application  of  article  1425  to their  agreements.    BPC

piggybacked  on this argument,  but focused its  appeal mainly on

jurisdictional questions.   Dopp  joined the  chorus, but,  as he

contributed no arguments that were both novel and substantial, we

subsume his  views in our  ensuing discussion of  the financiers'

points  on appeal.    Pritzker  cross-appealed,  excoriating  the

district court's determination that he could redeem only one-half

of Yari's litigated credit.
                                                  

1993).   The  court  added, however,  "that  the agreement  [BPC]
entered  into with Dopp involved the purchasing of an interest in
a case  being tried in the  District of Puerto Rico  and that BPC
has  manifested  a continuing  interest  in  the  conduct of  the
litigation."  Id.                           

                                8

II.  PERSONAL JURISDICTION          II.  PERSONAL JURISDICTION

          Before proceeding to the main event, we must first jump

through a jurisdictional hoop  and determine whether the district

court properly exercised  in personam jurisdiction over BPC.  The                                               

hoop does not present an impenetrable obstacle.

                      A.  Charting a Course.                                A.  Charting a Course.                                                     

          In its simplest  formulation, in personam  jurisdiction                                                             

relates to the  power of a court over a defendant.   It is of two

varieties, general and specific.   General personal jurisdiction,

as its name implies, is broad in its ambit:  it is the power of a

forum-based  court, whether  state or  federal, over  a defendant

"which  may be  asserted  in connection  with suits  not directly

founded on  [that  defendant's]  forum-based conduct  .  .  .  ."

Donatelli  v. National Hockey  League, 893 F.2d  459, 462-63 (1st                                               

Cir. 1990).  Put another way, "[g]eneral jurisdiction exists when

the litigation is not directly founded  on the defendant's forum-

based  contacts, but  the defendant  has nevertheless  engaged in

continuous and systematic activity, unrelated to the suit, in the

forum  state."  United Elec.  Workers v. 163  Pleasant St. Corp.,                                                                          

960 F.2d  1080, 1088 (1st Cir. 1992)  (Pleasant St. I).  Specific                                                               

personal jurisdiction, by contrast, is narrower in scope  and may

only  be relied upon "where  the cause of  action arises directly

out  of, or  relates to,  the defendant's  forum-based contacts."

Id. at 1088-89.             

          Nothing  in  the record  before  us  suggests that  BPC

engaged within Puerto Rico in continuous and systematic activity.

                                9

Since it is the plaintiff's burden to establish facts  sufficient

to sustain general in personam jurisdiction, see Ticketmaster-New                                                                           

York, Inc.  v.  Alioto, 26  F.3d 201,  207 n.9  (1st Cir.  1994);                                

Dalmau Rodriguez v. Hughes Aircraft Co., 781 F.2d 9, 10 (1st Cir.                                                 

1986),  and since Pritzker failed  to carry that  burden here, we

may assume that general  jurisdiction is lacking.  Our  analysis,

therefore, focuses exclusively on specific jurisdiction.

          The   proper   exercise   of   specific   in   personam                                                                           

jurisdiction hinges on satisfaction  of two requirements:  first,

that the  forum in  which the federal  district court sits  has a

long-arm  statute that  purports to  grant jurisdiction  over the

defendant; and second, that the exercise of jurisdiction pursuant

to that statute comports with the strictures of the Constitution.

See  Ticketmaster, 26 F.3d  at 204; Pleasant  St. I,  960 F.2d at                                                             

1086; Hahn v. Vermont Law Sch.,  698 F.2d 48, 51 (1st Cir. 1983).                                        

We analyze  these requirements  separately, mindful that,  in the

circumstances of  this  case, the  second  prong of  the  inquiry

necessitates   an  examination  into   the  sufficiency   of  the

relationship  between BPC's  contract  to finance  Dopp's  Puerto

Rico-based litigation  and the exercise of  jurisdiction over BPC

by the Puerto Rico-based federal district court.

                    B.  The Long-Arm Statute.                              B.  The Long-Arm Statute.                                                      

          The requirement that the forum  have a long-arm law  of

appropriate  reach  is  easily satisfied  here.    A  Puerto Rico

statute provides in pertinent part that a Puerto Rico-based court

may  take jurisdiction over a person not domiciled in Puerto Rico

                                10

"if  the  action or  claim  arises  because  said person  .  .  .

transacted business in Puerto Rico personally or through an agent

. . . ."   P.R. Laws Ann. tit. 32, app. III,  R.4.7(a)(1) (1984 &amp;

Supp.  1989).  We have concluded before, and today reaffirm, that

this statute extends personal jurisdiction as far  as the Federal

Constitution  permits.   See  Dalmau Rodriguez,  781  F.2d at  12                                                        

(citing A.H. Thomas Co. v. Superior Court, 98 P.R.R. 864, 870 n.5                                                   

(1970)); Mangual v. General  Battery Corp., 710 F.2d 15,  19 (1st                                                    

Cir. 1983).

                         C.  Due Process.                                   C.  Due Process.                                                  

          The   second  requirement      that  the   exercise  of

jurisdiction fall within constitutional  bounds   presents a more

intricate  puzzle.   Whether  or  not  BPC "transacted  business"

within the meaning of the long-arm statute depends on whether the

requisite  minimum contacts can be attributed to it.  By its very

nature, the inquiry into minimum contacts is far from exact: "the

criteria by  which  we  mark  the  boundary  line  between  those

activities which justify the subjection of a corporation to suit,

and  those   which  do  not,  cannot  be   simply  mechanical  or

quantitative."   International Shoe  Co. v. State  of Washington,                                                                          

326 U.S. 310, 319 (1945).   The inquiry into minimum contacts  is

also highly idiosyncratic, involving an individualized assessment

and  factual  analysis  of  the  precise  mix  of  contacts  that

characterize each case.   See Pleasant St. I,  960 F.2d at  1088;                                                      

Hahn, 698 F.2d at 51.              

          To  sharpen  the  logic  of  the  personal jurisdiction

                                11

inquiry, we have developed a tripartite analysis:

          First,  the  claim underlying  the litigation
          must directly arise out of, or relate to, the
          defendant's forum-state  activities.  Second,
          the   defendant's   in-state  contacts   must
          represent  a  purposeful  availment   of  the
          privilege  of  conducting  activities in  the
          forum  state,  thereby invoking  the benefits
          and  protections of  that  state's  laws  and
          making  the defendant's  involuntary presence
          before the state's court foreseeable.  Third,
          the exercise of  jurisdiction must, in  light
          of the Gestalt factors, be reasonable.

Pleasant St. I, 960 F.2d at 1089; see  also Ticketmaster, 26 F.3d                                                                  

at 206; Pizarro v.  Hoteles Concorde Int'l, C.A., 907  F.2d 1256,                                                          

1258  (1st  Cir. 1990).   A  careful  application of  these three

elements to the facts  at hand demonstrates that the  exercise of

in  personam jurisdiction over  BPC, for the  specific purpose of                      

determining the legal status of its agreement with Dopp, does not

offend constitutional principles.

          1.   Relatedness.   The element  of relatedness  is not                    1.   Relatedness.                                    

difficult to satisfy here.   For one thing, the  relatedness test

is,  relatively  speaking, a  flexible,  relaxed  standard.   See                                                                           

Ticketmaster, 26 F.3d  at 207.   For another  thing, it is  self-                      

evident  that the dispute between Pritzker and BPC over the legal

status  of BPC's contract with Dopp would not have arisen but for

that contract.   Because the very document that  represents BPC's

forum-related  activity is  itself the  cause and  object of  the

lawsuit, this activity comprises the source and substance of, and

is thus related to,  Pritzker's squabble with BPC.   See Pleasant                                                                           

St. I, 960 F.2d at 1089.               

          2.    Purposeful Availment.    We  must next  determine                    2.    Purposeful Availment.                                              

                                12

whether BPC's Puerto Rico-based  contacts "represent a purposeful

availment of  the privilege  of conducting activities  in [Puerto

Rico],  thereby invoking  the benefits  and protections  of [its]

laws and making the  defendant's involuntary presence before [the

Puerto Rico-based] court foreseeable."  Id.                                                     

          The  path of inquiry is  neither long nor  winding.  It

necessarily begins with McGee v. International Life Ins. Co., 355                                                                      

U.S. 220 (1957).  There, the  Court ruled that a California court

could properly exercise jurisdiction over an out-of-state insurer

in a suit  brought by a  beneficiary of a  policy written by  the

insurer at the behest  of a California resident, even  though the

insurer  had no  office  or agent  in  California and  had  never

performed  any other  business in  that state.   The  McGee Court                                                                     

articulated a  principle of  marked importance for  our purposes:

in order to be subject to  the jurisdiction of the forum state, a

nonresident need have only one contact with the forum, so long as

the contact  is meaningful.  See  id. at 223   ("It is sufficient                                               

for purposes of due process that the suit was based on a contract

which    had   substantial   connection   with   that   State.").

Accordingly, McGee  stands  for  the  proposition  that  "minimum                            

contacts" is  not necessarily a  numbers game; a  single contract

can fill the bill.

          For our purposes, McGee remains  good law.5  In  Burger                                                                           
                                                  

     5The court below expressed  some hesitation about relying on
McGee,  fearing that  "the  broad view  of personal  jurisdiction               
articulated  in McGee  was  curtailed in  the next  major Supreme                               
Court  case dealing with the  issue, Hanson v.  Denckla, 357 U.S.                                                                 
235  (1958)."   Pritzker v. Yari,  supra, at  *4, slip  op. at 9.                                                  

                                13

King Corp. v. Rudzewicz,  471 U.S. 462 (1984), the  Court, citing                                 

McGee, affirmed the principle that "even a single act can support               

jurisdiction."  Id. at 475 n.18.  In that case, the Justices held                             

that  a   court  sitting  in  Florida   properly  could  exercise

jurisdiction  over a  Michigan resident  in a  suit brought  by a

Florida  corporation for  breach of  a franchise  agreement, even

though the defendant's only  relationship to the forum  state was

of  a contractual  nature.   Explaining  that "[j]urisdiction  in

these  circumstances  may  not  be  avoided  merely  because  the

defendant  did not physically enter the forum State," id. at 476,                                                                   

the Supreme Court observed that "where  individuals `purposefully

derive benefit' from their interstate activities, it may  well be

unfair to allow them  to escape having to account in other States

for consequences that arise proximately from such activities; the

Due  Process Clause may not  readily be wielded  as a territorial

shield to avoid interstate obligations that have been voluntarily

assumed."   Id. at  474-75 (quoting Kulko  v. California Superior                                                                           

Court, 436 U.S. 84, 96 (1978)).               

          These  opinions demonstrate  that the  jurisprudence of
                                                  

This  observation is  true but  beside any  relevant point.   The
Hanson  Court placed  its principal  emphasis on  the requirement                
that there  be a purposeful act  by the defendant, and  that this                                                           
requirement  may not be satisfied merely by the unilateral act of
another.     See  Hanson,  357   U.S.  at  253-54.     The  Court                                  
distinguished McGee on this basis, and on the ground that Hanson,                                                                          
unlike McGee,  "involve[d] the validity of an  agreement that was                      
entered without any  connection with  the forum State."   Id.  at                                                                       
252.    In the  instant case,  neither  of these  problems looms.
BPC's decision to enter into the  financing agreement was clearly
its  own,  and that  agreement, which  entitled  it to  share the
proceeds of Puerto Rico-based litigation, bears close ties to the
forum.

                                14

minimum contacts casts  a wide net,  and a nonresident  defendant

may not always be able to elude the net by such simple expedients

as  remaining physically  outside the  forum or  limiting contact

with  the  forum to  a  single commercial  transaction.   Rather,

courts must  look beyond these formalistic  measures and evaluate

the  nature of the contacts  and, relatedly, the  degree to which

they represent a purposeful  availment of the forum's protections

and benefits.

          In the instant case, we conclude that BPC, by knowingly

acquiring an economically beneficial interest in the outcome of a

Puerto Rico-based  lawsuit  that involved  control over  property

located in Puerto Rico, necessarily exhibited sufficient  minimum

contacts to  subject  it  to the  district  court's  exercise  of

specific  in   personam  jurisdiction.    Two  considerations  in                                 

particular lead us to this conclusion.

          First,  the   subject  matter   of  BPC's   contact  or

relationship with Puerto Rico   the consummation of the financing

agreement   is  such that it can only be  characterized as an act

of  purposeful availment.  We think it is doubly significant that

the   financing   agreement   directly    concerned   forum-based

litigation, and, in turn,  that the litigation directly concerned

forum-based real estate.   Other than  physical presence, we  can

imagine  few  contacts that  are more  integral  to a  forum than

acquiring a financial stake in  forum-based litigation concerning

                                15

forum-based  property.6    The   significance  that  Puerto  Rico

attaches  to such an interest is reflected elsewhere in its long-

arm  statute, in which land ownership  is deemed an independently

sufficient basis for exercising  personal jurisdiction.  See P.R.                                                                      

Laws Ann. tit. 32,  app. III, R.4.7(a)(5) (extending jurisdiction

of  Puerto Rico  courts  over  a  person  who  "[o]wns,  uses  or

possesses,  personally or  through  his agent,  real property  in

Puerto Rico").

          Second,  the  specific  nature  of a  contact  is  also

important in discerning the  elements of purposeful availment and

foreseeability.    BPC  entered  into  its   financing  agreement

precisely  because  it stood  to  benefit  commercially from  the

eventual   outcome  of  the  Puerto  Rico-based  D/P  Litigation.

Furthermore, given the location of  DBHC's assets and the  nature

of the remedies potentially  available to Dopp, see Dopp  II, 947                                                                      

F.2d at 519  (listing alternative remedies),  both the extent  of

BPC's profits and the value of its agreement were closely tied to

the integrity and stability of Puerto Rico's economy.  This means

that the  practical importance of BPC's  relationship with Puerto

Rico was far greater  than the importance that could  be attached

to  the  random,  fortuitous, or  attenuated  relationships about

which the Court has previously voiced concern.  See, e.g., Burger                                                                           

King, 471 U.S. at 475; Keeton v. Hustler Magazine, Inc., 465 U.S.                                                                 
                                                  

     6Indeed,  had Dopp  succeeded in  obtaining  resolution (his
preferred remedy in the D/P Litigation, see Dopp  IV,     F.3d at                                                              
    [slip op.  at 7-17]), he might have wound  up with the hotels
and  the land,  and, if  so, BPC would  presumably have  been the
equitable owner of a measurable interest in those properties.

                                16

770, 774 (1984); World-Wide Volkswagen Corp. v. Woodson, 444 U.S.                                                                 

286, 299  (1980).   Consequently, we  believe that  BPC's venture

represented  nothing  less than  a  purposeful  availment of  the

privilege of conducting activities in Puerto Rico.7

          BPC disagrees with this conclusion.  It argues that the

singularity  of  its  contact  renders  the  financing  agreement

quantitatively insufficient  as a  predicate for the  exercise of

jurisdiction.  This argument fails for two reasons.

          In  the first  place, we  do not  view BPC's  financing

agreement  as merely a one-time  rendezvous with the  forum.  BPC

cannot retract the  fact that it backed  Dopp's forum-based suit,

so that  its pact can  hardly be  cracked up  to be  an act  that

lacked  incessant impact, but, rather,  smacked of the exact sort

of  contact through  which  jurisdiction, if  attacked, might  be

tracked  and should  remain  intact.   A  contract conferring  an

interest in ongoing litigation that touches upon the legal status
                                                  

     7Although we have  been unable to find any judicial decision
squarely on point,  we are  reinforced in our  conclusion by  the
results  reached  in  analogous  cases.    See, e.g.,  Grimes  v.                                                                       
Vitalink Communications  Corp., 17  F.3d 1553, 1559-60  (3d Cir.)                                        
(finding specific  personal jurisdiction  over a  nonresident who
owned stock in a  forum-based corporation and who tendered  it in
accordance  with a tender offer, on the ground that the defendant
purposefully availed himself of the privilege of having  a forum-
based  court determine his  rights and thus  invoked the benefits
and  protections  of the  forum), cert.  denied,  115 S.  Ct.                                                             
(1994); Manley v. Fong,  734 F.2d 1415, 1419-20 (10th  Cir. 1984)                                
(finding personal  jurisdiction over  a nonresident in  regard to
litigation arising out of a contract between the nonresident  and
a  resident,  executed  out-of-state,  for  the  purchase  of  an
interest  in a  forum-state oil-and-gas  lease); Quasha  v. Shale                                                                           
Dev.  Corp.,  667  F.2d  483,  486-89 (5th  Cir.  1982)  (finding                     
personal jurisdiction over nonresidents  in a suit concerning the
existence,  enforceability,  and  performance  of  a  contract to
purchase mineral interests located in the forum state).

                                17

of real property situated  in the forum establishes, by  its very

nature, a significant  relationship with the forum  and its legal

system.   Thus, it is easy to see how such a contact can become a

hook on which in  personam jurisdiction can be hung.   See Burger                                                                           

King, 471  U.S. at 475 n.18 (noting that "[s]o long as it creates              

a  `substantial connection' with the forum, even a single act can

support jurisdiction," and distinguishing this from an "isolated"

act  in  respect  to  which  "the  reasonable  foreseeability  of

litigation in  the forum  is substantially  diminished") (quoting

McGee, 355 U.S. at 223).               

          In the second place, BPC's emphasis on the quantitative                                                                           

aspects  of its  contact ignores  both the  contact's qualitative                                                                           

aspects  and the role of substance, as opposed to mere frequency,

in the minimum contacts  calculus.  So one-sided a  view distorts

reality.   See International Shoe,  326 U.S. at  318 (assessing a                                           

defendant's   acts  by   "their  nature   and  quality   and  the

circumstances of their commission").

          BPC also  contends  that the  exercise of  jurisdiction

here would be inconsistent with circuit precedent.  In this vein,

BPC directs our  attention to Pizarro,  a case in  which we  held                                               

that a corporation's placement of nine advertisements in a Puerto

Rico  newspaper  did  not  create in  personam  jurisdiction  for                                                        

purposes of a tort suit  brought by a person who responded  to an

advertisement,  took  a  trip   to  the  advertised  resort,  and

                                18

sustained  personal  injuries  outside  of  Puerto  Rico.8    See                                                                           

Pizarro, 907 F.2d at 1260.                 

          We do not think that Pizzaro is in any way antithetical                                                

to the result we reach today.  We decided Pizarro based on a lack                                                           

of relatedness, specifically finding that the advertisements  had

"no connection with the negligent act . . . that allegedly caused

the injury,"  and that, therefore, it could not "be said that the

negligent act  `arose out  of' [the defendant's]  placing of  the

advertisements  . .  . ."   Id.  at 1259.   Since  relatedness is                                         

beyond  question in  the present case,  see supra  Part II(C)(1),                                                           

Pizarro is not on point and BPC's reliance on it is mislaid.                 

          3.  The Gestalt Factors.  Having determined  that BPC's                    3.  The Gestalt Factors.                                           

financing agreement falls within  the ambit of sufficient minimum

contacts,  we proceed  to  the third  and  final element  of  our

analysis and  inquire whether  the exercise of  jurisdiction over

BPC in the circumstances of this case would, holistically viewed,

offend  traditional  notions   of  "fair  play  and   substantial

justice."   Burger King, 471  U.S. at 476  (quoting International                                                                           

Shoe, 326 U.S. at 320).              

          Admittedly,  "fair play" and  "substantial justice" are

not  the most  self-defining  of legal  formulations.   For  that

reason, we have added the flesh of a five-factor gestalt analysis

to these skeletal due process concepts.  The factors include:

                                                  

     8Pizarro  typifies a  line of  cases to  like effect.   See,                                                                          
e.g.,  Fournier v. Best W.  Treasure Island Resort,  962 F.2d 126                                                            
(1st  Cir. 1992); Marino v.  Hyatt Corp., 793  F.2d 427 (1st Cir.                                                  
1986).

                                19

          (1)  the defendant's burden of appearing, (2)
          the  forum  state's interest  in adjudicating
          the dispute, (3) the plaintiff's  interest in
          obtaining  convenient  and effective  relief,
          (4)   the   judicial  system's   interest  in
          obtaining  the  most effective  resolution of
          the controversy, and (5) the common interests
          of  all  sovereigns in  promoting substantive
          social policies.

Pleasant St.  I, 960 F.2d  at 1088.   These  gestalt factors  are                         

designed to  put into sharper perspective  the reasonableness and

fundamental fairness  of  exercising jurisdiction  in  particular

situations.  See  Ticketmaster, 26 F.3d  at 210.   They "are  not                                        

ends  in themselves,  but  they  are,  collectively, a  means  of

assisting courts in achieving substantial justice.  In very close

cases, they may  tip the  constitutional balance."   Id. at  209.                                                                  

When  applied to the case  sub judice, the  gestalt factors point                                               

unerringly toward the exercise, and away from the declination, of

jurisdiction over BPC.

          As to the first  factor, we may fairly assume  that the

defendant's  appearance   in  Puerto  Rico  is   to  some  extent

burdensome.   But the concept  of burden is  inherently relative,

and,  insofar as staging a  defense in a  foreign jurisdiction is

almost always inconvenient and/or costly, we think this factor is

only meaningful  where  a  party  can demonstrate  some  kind  of

special or unusual  burden.  See, e.g.,  id. at 210 (noting  that                                                      

"most  of  the  cases that  have  been  dismissed  on grounds  of

unreasonableness [of  the burden of appearing] are cases in which

the  defendant's center of gravity,  be it place  of residence or

place  of business, was  located at an  appreciable distance from

                                20

the  forum"); see also Burger  King, 471 U.S.  at 474 (explaining                                             

that "it usually  will not  be unfair to  subject [a  nonresident

defendant]  to the  burdens  of litigating  in another  forum for

disputes  relating to  [in-forum  economic] activity").   In  the

modern era, the  need to travel between New York  and Puerto Rico

creates  no especially  ponderous burden for  business travelers.

Thus, BPC has  not adequately  demonstrated that  an exercise  of

jurisdiction  in  the  present  circumstances  is  onerous  in  a

special, unusual, or other constitutionally significant way.

          The second  factor    the  interest of  Puerto Rico  in

having a Puerto Rico-based court  adjudicate the dispute   weighs

heavily in favor of an exercise of jurisdiction.  Sovereigns have

few interests greater  than those in  the conduct of  forum-based

litigation and the disposition of forum-based real estate.  Here,

these interests are not only present; they constitute the essence

of  the  suit  which the  nonresident  defendant,  BPC, seeks  to

avoid.9

          The  third  factor  is  the  plaintiff's   interest  in

obtaining convenient  and effective relief.   This  consideration

likewise cuts in favor of jurisdiction.  Not only must we "accord

plaintiff's choice of forum  a degree of deference in  respect to

the  issue of its own convenience," Ticketmaster, 26 F.3d at 211,                                                          

but also we  must take  note of the  enormous inconvenience  that

                                                  

     9At  the expense of carting coal to Newcastle, we think that
the Commonwealth also possesses  an atypically strong interest in
having Puerto  Rico-based courts hear  and resolve  controversies
involving its litigated credit statute.

                                21

might   result  from   forcing  Pritzker   to  sue   elsewhere   

theoretically,  in every  jurisdiction  in which  a financier  is

located   despite ongoing litigation in a forum-based court.

          The fourth  factor   the judicial  system's interest in

obtaining the  most efficacious  resolution of the  controversy  

similarly counsels against furcation of the dispute among several

different jurisdictions.  Such a result would both contravene the

goal  of  judicial   economy  and  conjure  up  the   chimera  of

inconsistent outcomes.

          The fifth  and last  of the gestalt  factors implicates

the interests  of the affected governments  in substantive social

policies.  Here, the most salient such policy is that embodied in

article  1425  itself:    the discouragement  of  speculation  in

litigation.   All  sovereigns share  both a  general interest  in

preventing such speculation and a specific interest in respecting

Puerto  Rico's   decision  to   control  this   activity  through

regulation.   For obvious reasons, a failure to find jurisdiction

in this case would necessarily subvert these interests.

                       D.  Recapitulation.                                 D.  Recapitulation.                                                   

          In sum,  by deliberately  contracting for a  portion of

the proceeds of litigation, the subject of which concerned Puerto

Rico  property and  the situs  of which  was a  Puerto Rico-based

court,  BPC   deliberately  sought  to  procure   the  commercial

advantages of transacting business in Puerto Rico.  Having called

the tune, it now must pay the piper.  Hence, we conclude that the

instant litigation arises  out of, and thus directly  relates to,

                                22

the financing agreement that BPC consummated with Dopp.   Because

that agreement has a distinctive relationship to Puerto Rico   as

we have said, its subject matter and specific nature betoken that

BPC purposefully  availed itself of the  benefits and protections

of  Puerto Rico  and  its legal  apparatus    and  because  BPC's

subsequent (involuntary) presence  before the district  court was

entirely foreseeable, bringing  BPC before  the bar  of a  Puerto

Rico-based  court in  respect to  litigation  arising out  of the

financing  agreement is  neither  unreasonable nor  fundamentally

unfair. It follows, therefore, as night follows day, that  Puerto

Rico's  long-arm  statute reaches  this  dispute,  and the  lower

court's exercise  of in personam  jurisdiction over  BPC is  both                                          

legally and constitutionally supportable.

III.  THE FINANCING AGREEMENTS          III.  THE FINANCING AGREEMENTS

          We turn now to  the main event   a  series of questions

involving the enforceability and  interpretation of the financing

agreements.  In answering these questions, we look to  the law of

Puerto Rico  for the rule  of decision.10   See Erie R.R.  Co. v.                                                                        
                                                  

     10BPC  and  Yari  halfheartedly  attempt  to  challenge  the
district  court's  choice of  Puerto  Rico  law to  govern  their
respective  contracts with Dopp.   Neither entry makes  it to the
starting gate.  Yari  merely proposes how his contract  with Dopp
might  be  construed under  California  law,  without pausing  to
explain why California  law is  relevant.  Our  corpus of  cases,
cumulatively considered, clearly  commands that contentions which
are not  carefully composed and candidly  constructed customarily
careen beyond the cognizance of  this court.  See, e.g.,  Ryan v.                                                                        
Royal Ins. Co., 916 F.2d 731, 734 (1st Cir. 1990) ("It is settled                        
in   this  circuit  that  issues  adverted  to  on  appeal  in  a
perfunctory    manner,    unaccompanied    by   some    developed
argumentation, are deemed to have been abandoned.").  BPC's claim
fails  for several reasons, the first of which is that the record
contains no  indication that  BPC developed it  below.  "It  is a

                                23

Tompkins, 304 U.S. 64, 78 (1938).                  

          Article 1425 of the Civil Code confers on a defendant a

right to redeem a "litigated credit" or "litigious  credit," that

is, the  interest of a third  party who has purchased  a stake in

the  outcome of civil litigation.   Evaluating this  statute is a

daunting task, made all the more complicated in this  case as the

parties have raised  a myriad  of issues ranging  from the  legal

status of the financing agreements to the propriety of Pritzker's

efforts to prime the article 1425 pump.  We address  these issues

sequentially, for  the most part subjecting  the district court's

determinations to plenary review.   See United States v. Gifford,                                                                          

17  F.3d  462, 472  (1st Cir.  1994)  (holding that  questions of

statutory interpretation  are purely legal in  nature, and, thus,

engender  de novo review);  Liberty Mut.  Ins. Co.  v. Commercial                                                                           

Union Ins.  Co., 978 F.2d  750, 757 (1st  Cir. 1992) (same);  see                                                                           

also Salve Regina Coll.  v. Russell, 499 U.S. 225,  239-40 (1991)                                             

(holding  that "courts  of  appeals [must]  review the  state-law

determinations of district courts de novo").                                                   

                        A.  Article 1425.                                  A.  Article 1425.                                                  

          We begin our  expedition by clarifying  certain matters

relating to article  1425 (the text of which is reproduced in its

entirety in note  3, supra).  The  undue hullabaloo in this  case                                    

stems from the  fact that article 1425 is  a very unusual animal.

                                                  

bedrock rule that when a  party has not presented an argument  to
the  district court,  he  may  not  unveil it  in  the  court  of
appeals."   United  States v.  Slade, 980 F.2d  27, 30  (1st Cir.                                              
1992).

                                24

Several aspects of the statute deserve emphasis or elaboration.

          First,  the  purpose  of   article  1425,  as  recently

restated  by the Puerto Rico  Supreme Court, is  to prevent "`the

illegal trade  of litigious  credits which  were purchased for  a

price below their  actual value,  and then the  actual price  was

recovered from the debtor  and big profits reaped.'"   Consejo de                                                                           

Titulares v. Urban  Renewal &amp;  Hous. Corp., 93  J.T.S. 25  (1993)                                                    

(Official  English Translation:   No. RE-87-297, slip  op. at 14)

(quoting  3 D. Espin Canovas, Manual de Derecho Civil Espanol 240                                                                       

(1983)); Mervin H.  Riseman, The  Sale of a  Litigious Right,  13                                                                      

Tul.  L.  Rev. 448,  448  (1939)  ("A desire  to  put  an end  to

litigation and to prevent speculation in lawsuits has resulted in

the  disapproval  by  the civil  law  of  the  sale of  litigious

rights.").   To  this extent,  then, the  district court  hit the

bull's-eye when it declared that the "single, serious purpose" of

article  1425   is  "to   discourage  financial   speculation  in

litigation."  Pritzker v. Yari, supra, at *5, slip op. at 11-12.                                               

          Second,  the Puerto Rico  Supreme Court has recognized,

in fidelity to  the statutory  text, that "[a]  credit is  deemed

litigious  from  the moment  the  lawsuit  claiming the  same  is

answered."   Consejo de  Titulares, supra, slip  op. at 13.   The                                                   

court added:

          [A] credit  is  regarded as  litigious  when,
          upon  being  litigated, a  final  judgment is
          required  to  ascertain its  existence, "that
          is,  it is one which  is in doubt  and one in
          which the rights are uncertain.  For a credit
          to  be considered  litigious it  is essential
          that the  litigation pending at  the time  of
          sale  or assignment  of  credit  concern  the

                                25

          existence of the credit itself and not merely
          the consequences of  its existence once final
          judgment is rendered."

Id.  at 13-14 (quoting Martinez v. District Court, 72 P.R.R. 197,                                                           

199  (1951)).   Here,  there  is  no  doubt  that  the  financing

agreements involve  interests that fall  within the  contemplated

chronological span.

          Third, article  1425 identifies the parties in interest

in   terms  that  are  somewhat  different  than  those  used  in

conventional  litigation.   We consider  the "debtor"  to be  the

original  defendant  (Pritzker), and  the  "assignee"  to be  the

third-party  investor (Yari,  Lincoln, or  BPC, depending  on the

financing agreement in question).   To carry out this  theme, the

original plaintiff (here, Dopp) would be the "assignor."

          Having   thus   introduced    the   generalities    and

particularities  of  article 1425,  we  proceed  to consider  its

application.

        B.  The Legal Status of the Financing Agreements.                  B.  The Legal Status of the Financing Agreements.                                                                  

          The  financiers contend that  none of  their agreements

with Dopp involved litigated credits subject to the strictures of

article  1425.   We  reject this  contention  and hold  that  the

financing agreements fall squarely  within the purview of article

1425.  Accordingly, the statute governs their legal disposition.

          1.   The  Transfer-of-Title  Theory.   The  financiers'                    1.   The  Transfer-of-Title  Theory.                                                       

principal  argument is that article 1425 should not be applied to

the financing agreements because the statute contemplates that an

assignee will actually replace, not merely bankroll, the assignor

                                26

in  the prosecution of the latter's claim against the debtor, and

that  no such  substitution transpired  here. This  amounts to  a

claim that article 1425 is only effective when the assignee steps

into the shoes of  the assignor, or, put another  way, when there

has been the functional equivalent of  a transfer of title to all

or part of the assignor's lawsuit.11

          In advancing this argument, the financiers rely heavily

on the historical origins of article 1425 as found chiefly in the

law of Spain and  France.  Citing numerous treatises  and tracts,

they strive to persuade us that the statute, when viewed in terms

of its apparent  original purpose, simply does  not encompass the

conduct at issue  here.   In particular, they  suggest that  laws

like   article  1425   were  designed  to   prevent  professional

litigators  from  stepping  into  a  plaintiff's  shoes  for  the

specific purpose of harassing  a defendant.  Because that  is not

what happened here, thefinanciers claim the statuteis inapposite.

          This is all well and good, but the text of article 1425

belies the financiers' claim.  The statute is drafted in terms of

general applicability and its language is bereft of the slightest

ambiguity.     No   mention  is   made  of   a  transfer-of-title

requirement, and,  moreover, the  plain language of  article 1425

seems naturally suited to the scenario presented in this case.

          In brief, we have no reason to  doubt the applicability
                                                  

     11Although  we  assume  arguendo that  all  three agreements                                               
created  interests  exclusively  in  the proceeds,  and  not  the
conduct, of the D/P Litigation, we  note that at least one of the
financing  agreements   Yari's   could be construed as empowering
the assignee to exercise substantial control over Dopp's lawsuit.

                                27

of  article  1425  to  the  financing  agreements,  and  thus  to

Pritzker's efforts  to redeem the interests  they created, unless

we are prepared to wander beyond the four  corners of the statute

in  search of some ancient legislative intent.  We cannot justify

undertaking such extra-textual measures in this case,  especially

given the  interpretive command  of the Puerto  Rico legislature:

"When  a law is clear and free  from all ambiguity, the letter of

the   same  shall  not  be  disregarded,  under  the  pretext  of

fulfilling the spirit  thereof."  P.R.  Laws Ann. tit.  31,    14

(1967  &amp; Supp.  1989).    Therefore,  we reject  the  financiers'

argument that article 1425  should be read to impose  a transfer-

of-title  requirement.12     Compare  Riseman,   supra,  at   460                                                                

(construing Louisiana's litigated credit statute, which, like the

Spanish and Puerto Rico statutes, had its immediate origin in the

French  Civil Code  and  its ultimate  origin  in the  Roman  Lex                                                                           

Anastasiana or Lex Per  diversas et Ab Anastasio,  and explaining                                                          

that  it  "merely provides  for the  nullity  of the  purchase of
                                                  

     12Yari tries to justify  a transfer-of-title construction by
asserting that  the district court's application  of article 1425
to  his agreement  with  Dopp renders  meaningless the  statute's
third  sentence,  which authorizes  the  debtor  to extinguish  a
litigated  credit "within nine (9) days, counted from the day the                                                                           
assignee should demand  payment of him."  P.R. Laws Ann. tit. 31,                                                
  3950 (1991) (emphasis supplied).  In Yari's view, this language
requires  that there  have  been a  transfer  of title  from  the
assignor  to the assignee, including  a transfer of  the right to
proceed against the debtor.  We decline to read the statute in so
crabbed a  manner.   While this language  unquestionably provides
debtors in transfer-of-title situations with a temporal guidepost
for effectuating  a redemption  (at least in  certain situations,
see  infra  Part  III(C)),  it  does  not  thereby  restrict  the                    
statute's  overall  scope.   At best,  the  phrase to  which Yari
clings  is designed to  address a particular  subset of litigated
credits, not the mine-run.

                                28

litigious  rights,   and  the  litigious  right   itself  is  not

annihilated.   Thus title to  the litigious right  remains in the

original owner, and he still has the right to proceed against his

debtor for the amount owed to him.").

          In following  this course,  we are not  suggesting that

historical  analyses or  foreign legal sources  are intrinsically

irrelevant in parsing the laws of Puerto Rico.  We recognize that

the Spanish  Civil Code, in particular,  may sometimes constitute

significant authority  in the  interpretation of the  Puerto Rico

Civil  Code.   See Republic  Sec. Corp.  v. Puerto Rico  Aqued. &amp;                                                                           

Sewer  Auth., 674  F.2d  952,  958  (1st  Cir.  1982);  see  also                                                                           

Bonillerse v.  Gonzalez, 17 P.R.R. 1084,  1090 (1911) (explaining                                 

that Puerto Rico  courts sometimes "can  look to eminent  Spanish

authors  for the proper  interpretation of  such portions  of our

Civil  Code  as  are copied  literally  from  the  Civil Code  of

Spain").    But recourse  to these  extrinsic sources  is neither

necessary  nor appropriate when, as now, the text of a particular

Code provision is unambiguous.13
                                                  

     13Our unwillingness  to rely  upon extra-textual  sources in
this  instance  is  reinforced  by  our  reservations  about  the
historical-exegetical  enterprise  advocated  by the  financiers.
From  a practical standpoint, we question  the wisdom and utility
of invoking ancient doctrines, gleaned from the writings of long-
deceased  expositors,  as a  means  of  interpreting statutes  to
govern the  present day and  age.  Nor  is this  concern original
with us.  See, e.g.,  Diaz Irizarry v. Ennia, N.V., 678  F. Supp.                                                            
957, 962 n.5 (D.P.R.  1988) ("Romantic as working with  the Civil
Code may be, the clock cannot be turned back.  It must be kept in
mind that the application of Spanish law to problems arising from
basic  socioeconomic  structures  .   .  .  which  operate  under
standards  stemming from  federal or  American law  is consistent
with  neither practical reality and efficiency nor the sources of
law  actually being  applied in  Puerto Rico  today.");  see also                                                                           

                                29

          2.   The  "Legitimate Purpose"  Theory.   Yari proposes                    2.   The  "Legitimate Purpose"  Theory.                                                          

that article  1425 is inapplicable to  these financing agreements

since the right of redemption does not attach when the assignment

is made for a legitimate purpose, and that obtaining financing to

carry on pending litigation,  as Dopp purportedly set out  to do,

is such a purpose.

          This  argument  founders  for the  most  abecedarian of

reasons:   the statute itself contains no such exception, and the

statutory text is not sufficiently problematic to invite judicial

editing  that might lead to  the possible recognition  of such an

exception.  As a fundamental principle of statutory construction,

we  will not depart from, or otherwise embellish, the language of

a statute absent either  undeniable textual ambiguity, see United                                                                           

States v. Charles  George Trucking  Co., 823 F.2d  685, 688  (1st                                                 

Cir.  1987) (expounding  the primacy  of plain meaning),  or some

other  extraordinary  consideration,  such  as  the  prospect  of

yielding  a patently absurd result, see Sullivan v. CIA, 992 F.2d                                                                 

1249,  1252  (1st  Cir.  1993) ("Courts  will  only  look  behind

statutory  language in the rare case where a literal reading must

be  shunned because it would  produce an absurd  outcome, or when

the  legislature  has  blown an  uncertain  trumpet.") (citations

omitted); see also Colonos de Santa Juana v. Sugar Bd., 77 P.R.R.                                                                

371,  374 (1954)  (stressing the  need, "wherever  possible, [to]

                                                  

Oliver Wendell Holmes, Jr., The Path of the Law, 10 Harv. L. Rev.                                                         
457, 469 (1897) ("It is revolting  to have no better reason for a
rule of law  than that so it was  laid down in the time  of Henry
IV.").

                                30

avoid  an  interpretation of  a statute  which  would lead  to an

unreasonable  result"), aff'd,  235  F.2d 347  (1st Cir.),  cert.                                                                           

denied, 352 U.S. 928 (1956).                

          When  interpreting a  Puerto Rico  statute, we  must be

faithful not only to conventional rules of construction, but also

to the  legislature's specific directives.  One such directive is

the edict  that unambiguous statutes must  be construed according

to  their letter.   See P.R.  Laws Ann. tit.  31,   14;  see also                                                                           

Roman  v. Superintendent  of Police,  98 P.R.R.  667, 671  (1966)                                             

(adverting to    14 and admonishing that, when a statute is clear

and  explicit, courts  have no  authority to  add limitations  or

restrictions that do not appear on its face).

          This  command carries unusual import in this situation,

since  the legislature  has expressly  carved out  three distinct

exceptions to the textual  scope of article 1425.   See P.R. Laws                                                                 

Ann.  tit.  31,    3951 (1991)  (excluding "assignments  or sales

made:  (1) To a  coheir or co-owner of the right  assigned[;] (2)

To a creditor in payment of his credit[; or] (3) To the possessor

of an estate,  subject to the right in litigation  which has been

assigned").   The  financiers' proposed  exception is  not to  be

found in this compendium.  As the maxim teaches, "expressio unius                                                                           

est exclusio alterius."   So  it is here.   Consequently,  Yari's                               

"legitimate purpose" argument must fail, as it asks us to engraft

an exception beyond those  enumerated, and does so in the face of

                                31

unambiguous statutory text.14

          3.   The "Fixed  Price" Theory.   Next,  Yari maintains                    3.   The "Fixed  Price" Theory.                                                  

that article  1425 applies only  to contracts  involving a  fixed

purchase price, and that his agreement with Dopp does not qualify

in  view of its  somewhat novel line-of-credit  feature.  Because

article 1425  itself has nothing  to say about whether  or when a

price is fixed, we think this argument collapses by virtue of the

same  legal  principle  previously  discussed:    a  fixed  price

requirement does not  appear on the  face of the statute  and can

have no bearing on the interpretation of it.

          In a  transparent attempt to  elude the force  of plain

meaning, Yari hawks an  alternative construction of article 1425.

He asserts that because  the statute speaks in the past tense, it

only relates to assignments that constitute, or have constituted,

fully  closed transactions.   We  think that this  is anfractuous

reasoning, yielding an  undesirable, overly cramped  construction

of  the  statute.    What  is  more,  to  the  extent  that  this

construction  can  be  regarded  as  importing  uncertainty  into

article 1425,  the proper  interpretive  course would  not be  to

retreat into formalism, as Yari suggests, but, rather, to distill

and advance  the "reason  and spirit" of  the statute.   See P.R.                                                                      

Laws Ann. tit. 31,   19 (1967 &amp; Supp. 1989)  ("The most effectual

and  universal manner of discovering  the true meaning  of a law,

                                                  

     14We  do not intend to  imply that the  legitimacy of Dopp's
purpose  in  forging  these financing  agreements  is  altogether
evident from  the  record.   Rather,  our disposition  of  Yari's
argument renders further exploration of this point unnecessary.

                                32

when its expressions  are dubious, is  by considering the  reason                                           

and spirit thereof;  or the  cause or motives  which induced  its

enactment.") (emphasis

supplied).

          Here,  the policy  behind the  statute    to discourage

litigious  profiteering     would  be disserved  by  allowing  an

assignee to avoid redemption merely by using something other than

a fixed price as the consideration  for his purchase.  Thus, even

if  there  is ambiguity  within  the text  of  article  1425    a

proposition  to which  we  do  not  subscribe    Yari's  proposed

construction is so isthmian as to offend the reason and spirit of

the statute.

          Because  the text  of article  1425 plainly  covers the

financing agreements, the district court correctly ruled that the

statute governed their disposition.

                  C.  The Timing of the Tender.                            C.  The Timing of the Tender.                                                        

          The  next snare set by the financiers is contrived from

a  number  of alleged  improprieties  which,  they claim,  render

Pritzker's efforts to  extinguish the credits  invalid.  Most  of

these  assertions rest on the financiers' particular construction

of  article  1425,  and,  therefore,  have  no  continuing  legal

relevance in light  of our  understanding of that  statute.   See                                                                           

supra Part III(A)-(B).  Withal, the financiers  raise a colorable               

question  as to the positioning and shape of the nine-day window,

established  in the third sentence  of article 1425.   We address

this question.

                                33

          The district court determined  that the period in which

Pritzker's article 1425 rights became operative "commenced on the

date  Pritzker  knew officially  that  the  assignments had  been

made."  Pritzker v.  Yari, supra, at *7,  slip op. at 17.   Since                                          

Pritzker acquired the requisite knowledge on October 9, 1992, and

notified the  parties of his  intentions exactly one  week later,

"Pritzker  therefore duly  exercised his  rights within  the time

provided by the statute."  Id.                                        

          The  district  court's   finding  that  Pritzker  first

learned  of the  litigated credits  on October  9 is not  open to

attack.15    This finding  does  not  fully answer  the  question

raised,  because  the  financiers  maintain that,  even  so,  the

statute  obligated Pritzker  not simply  to offer  to  tender the                                                           

funds necessary  for redemption  within the nine-day  period, but

also  actually to  tender  those funds  or,  at the  very  least,

deposit  them  with  the  court.    Judge  Pieras  rejected  this

analysis, ruling that the law required Pritzker, during the nine-

day  interval, merely to offer to tender the amounts necessary to

acquire the  interests then held by  the assignees.  See  id.  We                                                                       

think that the rejection of the financiers' temporal challenge is

supportable,  but we  anchor  it in  a  somewhat different,  less

confining rationale.

          The parties and the district court saw  the question as

                                                  

     15If anything, this finding may not give sufficient range to
Pritzker's  rights; while  Dopp  disclosed the  existence of  the                                                    
financing  agreements on  October  9, Pritzker  probably did  not
receive actual notice until October 12 or thereabouts.

                                34

a matter  of what  actions had to  be taken  within the  nine-day

period.   The  financiers  claimed that  a  debtor must  actually

tender the funds, or deposit  them in the registry of the  court,

whereas the court, adopting a thesis urged by Pritzker, concluded

that a debtor need only  offer a tender or deposit of  the funds.

Both  of  these  positions assume  that  the  nine-day  period is

applicable to the litigated  credits at issue here.   We question

this threshold  assumption.  On reflection,  a third construction

of  this portion of article  1425 presents itself:   the nine-day

period enumerated in the third sentence speaks only of situations

in which, to use the statute's words, "the assignee should demand

payment of  [the debtor]."   Under this  third construction,  the

sentence in  question does  not govern  the general operation  of

article 1425, but, rather, only governs its  operation within one

particular situation.16

          We think that this construction is completely plausible

in light of  the unqualified declaration in article  1425's first

sentence to the effect  that "[w]hen a litigated credit  is sold,

the debtor shall have the  right to extinguish the same . .  . ."

Moreover,   if  this  interpretation  prevails,  it  has  obvious

consequences  for these appeals:  although it is true that, where

the nine-day period  applies, it applies strictly, see Consejo de                                                                           

Titulares, 93 J.T.S. 25 (slip op. at 14) ("The legal term for the                   

assigned debtor to exercise this litigious redemption is nine (9)

days from the date the assignee claims payment.   This term which
                                                  

     16This is not such a situation.  See supra note 12.                                                         

                                35

is extinguished with the lapse of time is final, unextendable and

cannot be  tolled."), such  rigidity is  immaterial if  the third

sentence does not encompass the litigated credit in question.17

          We are left, then, with three competing interpretations

of this portion of article 1425.  Yet, the task of choosing among

them is less formidable than it may first appear; for purposes of

this case, it suffices merely to narrow the field.   Once that is

done,  it becomes plain that,  whether or not  the third sentence

applies in this instance, the assigned error lacks force.

          If and to the extent that the third sentence of article

1425 has pertinence here,  we agree with the lower court  that it

requires only an offer of redemption, not a full tender of funds,

within  the  nine-day period.    Any  other interpretation  would

significantly  undermine the  efficacy of  the statute,  since it

would force  debtors to marshall the funds immediately on receipt

                                                  

     17Of course, even if this third construction is accepted, it
does not answer  the attendant question  of whether the  debtor's
redemption efforts, once he has notice of a litigated credit, can
ever be tardy.  Both  the spirit of the statute and  common sense
dictate  that some  temporal  limit  should  obtain, and  that  a
debtor's rights  may, if  not seasonably exercised,  become stale
and expire.  See Pritzker v. Yari, supra, at *7, slip op.  at 15-                                                  
16 (hypothesizing that the purpose behind the nine-day window "is
to  prevent the unfair situation of a debtor litigating at length
with an  assignee  and then,  when  the assignee  has  prevailed,
exercising  the right  of  redemption"); Riseman,  supra, at  453                                                                  
(discussing  Louisiana's analogous  statute  and concluding  that
"[i]f,  on learning of  the transfer,  [the debtor]  continues to
contest the  suit, he may not, when he realizes that the judgment
is about to become  final or that he is  going to lose the  suit,
avail  himself of the provisions which the law has established in
his favor for the  purpose of terminating litigation").   Be that
as it may, these appeals do not warrant a full-dress inquiry into
timeliness, for Pritzker's offers plainly satisfy any  timeliness
rule that might apply.

                                36

of notice, or else forfeit their rights.  Because assignees could

more often than  not time disclosure of  their acquired interests

to minimize redemption opportunities, the  notice provision would

become  a trick  box.   We do  not believe  that the  Puerto Rico

legislature  intended to  place  assignees in  so advantageous  a

position.

          In our estimation, the  district court's shaping of the

nine-day   window  produces   a  more   realistic  and   balanced

interpretation.   Faithful to the overarching  statutory purpose,

this  reading allows  the debtor  merely to  offer to  redeem the

litigated credits  within the  nine-day period, thus  placing the

assignees on  notice of probable redemption,  but without backing

the debtor into a  cash-flow corner.  This is  the interpretation

of the third sentence of article 1425 that  we believe the Puerto

Rico  legislature intended  and that  we believe the  Puerto Rico

courts will adopt.

          In an effort  to salvage  their competing  construction

through extra-textual  assistance,  the financiers  dredge up  an

assortment of  other provisions  of  the Puerto  Rico Civil  Code

containing time  restrictions,  which,  they  suggest,  ought  to

inform our interpretation of article 1425.  Although  such extra-

textualism  is not  improper here    the  statute is,  after all,

opaque  on this particular  point    the financiers'  efforts are

unavailing.  For one  thing, we remain unconvinced that  randomly

culled provisions, entirely unrelated to litigated  credits, have

anything  worthwhile to  say  about the  construction of  article

                                37

1425.   Cf.  P.R. Laws  Ann. tit.  31,    18 (1967 &amp;  Supp. 1989)                     

("Laws which refer  to the  same matter, or  whose object is  the

same, shall be interpreted with reference to each other, in order

that  what is  clear in one  may be  employed for  the purpose of

explaining what is doubtful in another.").  For another thing, to

the extent  that other,  unrelated provisions are  relevant, they

seem  to  militate  against, not  in  favor  of, the  financiers'

interpretive  stance.    In   this  regard,  the  district  court

specifically noted that the legislature's use of more restrictive

phrasing in article 1414, P.R. Laws  Ann. tit. 31,   3924  (1991)

(stipulating  that "[t]he  right  of legal  redemption cannot  be

exercised except  within nine (9) days"),  indicates that article

1425's  nine-day  window  should  be construed  in  a  relatively

liberal  manner.  "Had the legislature desired to place a similar

restriction on  the commencement of the right to redeem litigious

credits,  it  would have  used the  limiting language  of Article

1414, rather  than the  more flexible wording  of Article  1425."

Pritzker v. Yari, supra, at *7, slip op. at  16.  In the end, all                                 

roads  lead to  Rome:  the  financiers' interpretation  stalls no

matter which interpretive path one decides to follow.

          Having  rejected  the  first of  the  three alternative

constructions in favor  of the  second, we need  not continue  to

pursue the selection process.  If, on the one hand, the  nine-day

window applies   that  is, if the second construction  prevails  

nothing beyond an offer to redeem is exigible  at that point, and

Pritzker's  offer,  made  on  day  seven,  undeniably  meets  the

                                38

statutory standard.  If,  on the other hand, the  nine-day window

does  not serve as a generic limitation  on a debtor's ability to

proceed  under the statute    that is, if  the third construction

prevails     it follows  a  fortiori that  Pritzker's  failure to                                              

tender the necessary funds within nine days of receiving official

notice is irrelevant, especially  given his subsequent deposit of

funds with the court.

          For  the foregoing  reasons,  we  hold that  Pritzker's

efforts  to  redeem the  financiers'  interests  fall within  the

temporal compass of article 1425.

           D.  The Redemption of the Litigated Credits.                     D.  The Redemption of the Litigated Credits.                                                                

          Hesiod, reputed  to be  a shepherd and  part-time poet,

wrote  in Works  and Days,  roughly 2700  years ago,  that "right                                   

timing is in all things  the most important factor."  But  timing

is not the only  salient factor under article 1425:   the statute

mandates that the debtor "reimburs[e] the  assignee for the price

the  [assignee] paid  for  [the litigated  credit], the  judicial

costs incurred by him, and the interest on the price from the day

on which  the same was  paid."   Thus, article 1425  requires not

only the correct chronology, but also the proper price.

          In most situations, ascertaining the proper price poses

no  particular  problem.    For  instance,  BPC's  and  Lincoln's

litigated credits each involved a  discrete sum that had  already

been transferred to Dopp at the time Pritzker first exercised his

statutory rights.  The add-ons    "judicial costs" and "interest"

   are  subject  to  easy,  mathematically  precise  computation.

                                39

Neither  BPC  nor  Lincoln disputes  that,  ultimately,  Pritzker

consigned the statutorily required  amounts to the district court

in respect  to their assignments.   Consequently, the sufficiency

of  Pritzker's  payment to  acquire  the interests  of  these two

financiers is not before us.

          Yari's  agreement is  a horse  of a  slightly different

hue.18   It never involved  a simple one-time  transfer of funds.

Instead, it originally involved two things    a sum of money, and

assistance in  establishing a line of credit    in exchange for a

portion of the litigation proceeds.  Later on, when Yari and Dopp

amended  their  agreement, see  supra  note  2, the  modification                                               

confirmed "that  the parties `fully  intend to move  forward with

the  present [July 23] Agreement despite the  fact that a line of

credit may  not be obtainable.'"   Dopp III, 831 F.  Supp. at 954                                                     

(quoting amendment).  It also suggested that, perhaps, Yari might

become more  personally involved  in funding the  D/P Litigation.

See  id. (describing the  modification as "call[ing]  for Yari to                  

advance  to  Dopp,  in  an amount  to  be  determined  and to  be

negotiated by the parties in good faith, funds necessary to allow

Dopp's   prosecution   of  the   [D/P   Litigation]  to   proceed

diligently").  Yari thereafter complied with all specific funding

requests made  by Dopp.19  All  in all, Yari invested  a total of
                                                  

     18Even  so, Yari  does  not raise  any cognizable  questions
concerning the computation of "judicial costs" and "interest."

     19Dopp waived the contention,  belatedly raised in his reply
brief, that the question of Yari's compliance vel non should have                                                               
been submitted to the jury.  See Sandstrom v. Chemlawn Corp., 904                                                                      
F.2d  83, 86 (1st Cir. 1990).   More generally, we have no reason

                                40

$500,000, according to the  district court, see Dopp III,  831 F.                                                                  

Supp. at  954, consisting  of the  following advances:   $250,000

under the  original financing agreement;  $50,000 contemporaneous

with  the   execution  of  the  modification   to  the  financing

agreement;  $100,000  on  November  5,  1992;  $50,000  in  early

December  of the  same year;  and, finally,  $50,000 in  March of

1993.

          We need not delve too deeply into details at this time;

no matter what the fine print, it is perfectly clear  that Yari's

obligations under his agreement with Dopp involved both cash  and

non-cash  components.    Consequently,  gauging  the  utility  of

Pritzker's redemption  efforts prompts us to  examine the meaning

and  scope of article 1425's reference to  "the price . . . paid"

for a litigated credit.

          In certain respects, this is a choice between the devil

and the deep blue sea.  If the statute is  interpreted to include

only the  cash component of a hybrid offer, then it may run afoul

of  the  economic reality  of the  agreement.   If,  however, the

statute extends to the non-cash component, then the twin risks of

quantitative  uncertainty and  undesirable consequences  loom, if

for   no  other  reason  than  that  such  a  rule  might  induce

contracting parties  to structure financing agreements  partly in

kind so as to make redemption more arduous.
                                                  

to  disturb the  district  court's finding  that, despite  having
failed to establish  a line  of credit, "Yari  complied with  his
obligations  under the agreements and would  be entitled to those
proceeds  promised  him under  the  terms  of  the Agreement  and
qualified thereafter."  Dopp III, 831 F. Supp. at 956.                                          

                                41

          The district court opted for the former interpretation,

specifically  holding  that  "Pritzker  does  not  assume  Yari's

obligations  and is required  to do no more  to redeem the credit

than  to reimburse  the price  actually paid,  plus  interest and

expenses."    Dopp III,  831 F.  Supp. at  956.   To  bulwark its                                

position,  the court  noted that  "[t]he courts of  Louisiana, in

applying  the  provision of  the  Louisiana Civil  Code  which is

analogous to Article 1425, have reached the same result."  Id. at                                                                        

956 n.23 (citing Louisiana cases).

          Though we do  not go the  whole hog, we  agree up to  a

point.  We hold, as did the  district court, that compliance with

article  1425  did not  entail  Pritzker's  assumption of  Yari's

responsibility  to fund Dopp's suit  against him.   In respect to

damages arising  out of a breach of contract, it is a basic tenet

of contract  law that a  legal remedy (e.g.,  a sum of  money) is                                                     

presumptively preferable  to an equitable remedy  (e.g., specific                                                                 

performance),   so   long  as   the   former   is  adequate   and

ascertainable.   See 3  Farnsworth on  Contracts, supra,    12.4.                                                                 

Moreover,  we echo  the  district court's  sage observation  that

granting  specific performance would be "flatly inconsistent with

the purposes  of Article 1425."   Dopp III,  831 F. Supp.  at 955                                                    

n.21.  Endorsing  such a remedy  would force  a debtor either  to

forgo redemption  indefinitely (thus  running the risk  of losing

his rights under  article 1425)  or to fund  the assignor's  case

against him.

          Thus,  when an article 1425 assignee, in exchange for a

                                42

stake  in the  outcome of litigation,  transfers to  the assignor

both cash and  non-cash consideration, the debtor  must tender to

the assignee the cash  equivalent.20  Cf. Riseman, supra,  at 452                                                                  

(suggesting that if  the price  actually paid is  lower than  the

price stipulated in the financing agreement, "the `redeemer' need

pay only the `real' price").

          It  remains for us now to apply these principles to the

case at hand.  On  this record, there is no evidence  that Yari's

promise to  use best efforts to seek  a line of credit sufficient

to fund Dopp's efforts in the D/P Litigation has any demonstrable

monetary value.   See supra note  20.  Given this  void, we agree                                     

with  the court below that Pritzker should be permitted to redeem

Yari's litigated  credit despite  having tendered only  an amount

corresponding to the funds actually transferred from Yari to Dopp

prior  to the time Pritzker sued to enforce his asserted right of

redemption.21

     E.  The Equitable Reduction of Yari's Litigated Credit.               E.  The Equitable Reduction of Yari's Litigated Credit.                                                                     

          The  district court, having  determined that  all three
                                                  

     20At the  very least, the cash equivalent must correspond to
the cash component of a hybrid offer.  We take no view of whether
there  may be  circumstances  in which  a  debtor would  have  to
augment the cash component by adding to it the cash equivalent of
a non-cash component that has a demonstrable cash value.  In this
case, Yari introduced no  evidence to show the value of  the non-
cash component; and, moreover, he never contended that Pritzker's
tender must be augmented  in this manner.  Any  possible argument
in this regard is,  therefore, waived.  See, e.g.,  United States                                                                           
v. Slade, 980 F.2d 27, 30 &amp; n.3 (1st Cir. 1992).                  

     21Neither Pritzker  nor Yari contests the  trial court's use
of the  date Pritzker filed suit as  the cutoff date for purposes
of  redemption.  We, therefore, accept Judge Pieras' selection of
that date uncritically, expressing no opinion on its propriety.

                                43

financing agreements came within the ambit of article 1425, ruled

that  the  arrangement between  Dopp  and  Yari required  special

treatment because  their pact,  as structured, concerned  a "rare

situation[]" involving "peculiar  facts."  Dopp III, 831 F. Supp.                                                             

at 958-59.  The court identified two particular concerns.  First,

it expressed a  sensitivity "to  Dopp's need to  obtain funds  to

maintain his action  against Pritzker,"  id. at  957, bearing  in                                                      

mind that "Pritzker is a billionaire who could never be forced to

relent in  his defense,"  id.  at 957  n.25.   Second, the  court                                       

reflected  that,  "although Yari  technically  complied  with the

terms of his agreement with Dopp, he did not succeed in providing

what  he originally intended.   As a result,  Dopp never received

what he hoped he had bargained for under the agreement."   Id. at                                                                        

957.

          Based on these two  concerns, and mindful that Pritzker

stood to receive  a windfall  on redemption  of Yari's  litigated

credit, the court concluded as a matter of statutory construction                                                                           

that it "could not have been the intention" of the legislature to

allow full  redemption in such a  situation.22  Id. at  958.  The                                                             

court wrote:

          The  Dopp/Yari agreement  is far  outside the
          heartland of agreements  contemplated by  the
          legislature when it enacted Article 1425.  It
          is likely that the lawmakers did not envision
          the   possibility  of   a  case   like  this.
                                                  

     22At certain points in  his appellate briefs, Dopp intimates
that  the  district  court   in  effect  reformed  the  Dopp/Yari
financing agreement.  We do not read the court's opinion  in that
way;  and, moreover, the record on appeal evinces no basis for an
order tantamount to an order of reformation.

                                44

          Property and assets  have traditionally  been
          mortgageable  to  protect and  preserve their
          value.  In this  case, the lawsuit's worth is
          an  asset which requires expenditures for the
          services of attorneys and experts, as well as
          for  other  general  costs  of  litigation to
          preserve  its value.   To apply  Article 1425
          without allowing for  adjustments to  reflect
          expenditures that have permitted  the lawsuit
          to  survive would  be  to  deplete and  maybe
          extinguish  altogether  the   value  of   the
          lawsuit . . . .

Id.   To ameliorate this  perceived inequity,  the court  limited             

Pritzker's redemptive right  to one-half the credit held by Yari.

See id.                 

          Pritzker  contends   that  the  lower   court's  ruling

collides  with  the  plain  language and  undeniable  purpose  of

article 1425.   This  contention raises a  question of  statutory

interpretation  that sparks de novo review.  See Gifford, 17 F.3d                                                                  

at 472; Liberty Mut., 978 F.2d at 757.23                              

          Exercising plenary review, we agree with Pritzker that,

as a matter of law, the district court's ruling cannot stand.  As

with Yari's efforts to  read certain unenumerated exceptions into

the  statute,  see  supra   Part  III(B),  the  district  court's                                   

limitation on  Pritzker's redemptive rights finds  no purchase in
                                                  

     23Of course,  a district court's equity  power is relatively
broad and  is typically  subject to deferential  review when  the
exercise of that  power is  genuinely a function  of the  court's
discretion.  See 1 Steven A. Childress &amp; Martha S. Davis, Federal                                                                           
Standards of  Review   4.16,  at 4-125  to 4-126 (2d  ed. 1986  &amp;                              
Supp.  1993).   Nevertheless, such deference  does not  extend to
whatever errors of law  may underlie a district court's  remedial
or equitable  determinations.  See id.  at 4-127 &amp; n.4;  see also                                                                           
Narragansett  Indian Tribe v. Guilbert,  934 F.2d 4,  5 (1st Cir.                                                
1991) (exempting  mistakes of  law from usual  deferential review
accompanying  district  court's  grant  or  denial  of injunctive
relief).

                                45

the text of article  1425.  The  very existence of the  litigated

credit statute  evinces the  legislature's likely  knowledge that

windfalls can  result when  litigants barter future  interests in

litigation  proceeds.   It  is  thus telling  that  the statute's

language  neither  suggests  nor  permits   variable  application

depending upon the extent of a particular windfall, the size of a

particular  recovery, or  the  relative  financial  condition  of

particular litigants.   This  can only signify  that, as  between

debtors  and  assignees,  the  legislature  determined  that  the

former,  rather  than  the  latter, more  properly  deserved  the

benefit of any trouvaille.

          To be sure, it is always possible that  legislators, in

drafting a statute, may  not have considered the entire  gamut of

possibilities  that   might  come  within  the  statute's  sweep.

Nevertheless, "[w]hen a law is clear and free from all ambiguity,

the  letter of  the  same shall  not  be disregarded,  under  the

pretext of fulfilling the  spirit thereof."  P.R. Laws  Ann. tit.

31,   14 (1967 &amp;  Supp. 1989).  In other words, courts, in Puerto

Rico  as  elsewhere,  are  simply  not  free  to  disregard   the

unambiguous language  of a law because the  facts of a given case

to  which the  law applies  evoke a  sympathetic reaction.   See,                                                                          

e.g., Mansell v. Mansell, 490 U.S. 581, 594 (1989) (declining "to                                  

misread [a] statute in  order to reach a sympathetic  result when

such  a reading requires us to do  violence to the plain language

of  the statute");  cf. East India  Co. v.  Paul, 7  Moo. 85, 111                                                          

(P.C. 1849) (admonishing that "courts of justice [must] take care

                                46

. . . that hard cases do not make bad law").

          Nor  can  the  court's  decision  be  justified  simply

because the district judge rendered it under the rubric of equity

and  in "[t]he interests of justice."   Dopp III, 831 F. Supp. at                                                          

958.  While it is  true that equity occupies an honored  place in

the jurisprudence of Puerto  Rico, judges may assume the  role of

chancellors only in the  absence of a governing rule  of positive

law.   See  P.R. Laws  Ann. tit.  31,    7  (1967  &amp; Supp.  1989)                    

(ordaining that  "[w]hen there  is no  statute applicable  to the

case  at  issue,  the  court  shall  decide  in  accordance  with

equity").   Here, there is  an apposite statute,  and, therefore,

the district  court's use of  equitable principles to  trump that

statute is legally indefensible.

          We  need  go  no  further.24   Because  the  rights and

obligations of  Pritzker and Yari, inter sese, must be determined                                                       

in accordance with the  provisions of article 1425, unembellished

by  freeform  concepts  of  equity,  the  halving  of  Pritzker's

redemptive rights must be reversed.

IV.  CONCLUSION          IV.  CONCLUSION

          We  succinctly summarize  our conclusions.   First, the

district court  appropriately exercised in  personam jurisdiction                                                              

over  BPC.   Second,  the court  correctly  ruled that  the three

                                                  

     24Because  Pritzker  is  entitled  to redeem  Yari's  entire
interest in  the proceeds  of the  D/P Litigation  (whatever that
interest may be), there is  no need to inquire into the  district
court's disposition of Yari's  cross-claim against Dopp seeking a
declaration,  inter alia,  that Yari  is  entitled to  "[all] the                                  
rights created in his favor under the [financing] Agreement."

                                47

financing   agreements  involved  litigated  credits  within  the

meaning  of  article  1425.    Third,  we  hold  that  Pritzker's

redemption efforts were both timeous and methodologically proper.

Fourth, we hold that  the district court lacked the  authority to

limit Pritzker's redemptive right to one-half of Yari's litigated

credit.

          The district court's judgment  in respect to Pritzker's                                                                           

civil action  is affirmed  in  part and  reversed in  part.   The                                                                           

district  court   is  directed  to  enter   an  amended  judgment                                                                           

accordingly,  when and as appropriate.   Costs shall  be taxed in                                                                           

favor of Pritzker.                           

                                48
