Center on Race, Law and Justice Features Book Discussion on Slavery and Bankruptcy

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On March 30, the Center on Race, Law and Justice presented a lively discussion with Emory Law School Professor Rafael Pardo, who spoke about his upcoming book The Color of Bankruptcy: Financial Failure and Freedom in the Age of American Slavery, to be published by Columbia University Press.

The event was held both in person at the Law School and broadcast live via Zoom. Co-sponsors for the event included the Asian Pacific American Law Students Association, the Black Law Students Association, OUTLaws, the Latin American Law Students Association, the Muslim Law Students Association, and the Society for Small Businesses. Susan Block-Lieb, the Cooper Family Chair in Urban Legal Issues, moderated the discussion.

The Intersection of Bankruptcy and the Law

Professor Rafael Pardo, Emory University School of Law

Emory Law School Professor Rafael Pardo

Pardo’s research looks at how the federal Bankruptcy Act of 1841 affected Black Americans during the antebellum era (1812-1861), which he found “simultaneously undermined the freedom of [some]Black Americans … [while also]enhancing and protecting the freedom [of others].” He illustrates the law’s effects through profiles of slave traders, enslaved Black Americans, and the formerly enslaved whose lives were touched by the law.

At the event, he highlighted two examples from court records filed in Louisiana the same day, Feb. 6, 1843, to show how the act affected Black Americans in different ways.

On that day, a federal official sent a letter to Augustin Pugh as part of his search for 11 enslaved Black Americans. Their enslaver, George Botts, looking to avoid asset seizure before declaring bankruptcy, had transferred possession of the enslaved people to Pugh. That same day, Pierre Casanave, a freed Black American, went to the federal courthouse to file for bankruptcy, seeking relief from his debts under the Bankruptcy Act.

“On this date, we see two very distinct episodes taking place that are in tension with one another in terms of thinking about the unfreedom and freedom of Black Americans, as filtered through the Bankruptcy Act,” said Pardo.

Financial and Societal Impacts

The term “slave trader,” according to historian Steven Deyle, encompasses a broad range of roles, including auctioneers, appraisers, and other “auxillary personnel.” Pardo describes how all of these types of individuals were able to use the act as a means to get their debts discharged so they could then “return to the business of slaving.” Pardo emphasized how this bankruptcy system demonstrated ways in which the federal governments was complicit in the business of the domestic slave trade by providing financial relief to enslavers and benefitting the enslaver’s creditors.

At the same time, however, many free Black Americans—of which there were over 19,000 living in New Orleans at the time—benefitted from the 1841 Act. Unlike some state legislation, Pardo said the Bankruptcy Act was “was facially race-neutral.”. Before 1841, some state-level debt relief laws were race-based. He gave the example of a law in Delaware that barred white debtors from imprisonment but allowed for freed Black debtors to be imprisoned and made to work off their debt through indentured servitude.

“The act allowed free Black Americans in the South to circumvent … how the law might oppress them, either intentionally through race-based legislation or even race-neutral legislation that, in practice, would have these sorts of harmful effects,” said Pardo. “The act, in my view, took on added significance for free Black Americans in a way that it didn’t have for white Americans.”

Through his research, Pardo found evidence of how the debt relief received by freed Black Americans through the act affected their long-term economic prospects. For example, Pierre Casanave, a grocer at the time he filed for bankruptcy, later launched several other businesses, including hairdressing salons and an undertaking business. He eventually became one of New Orleans’ most successful entrepreneurs.

“[Casanave] achieved all of this financial success,” Pardo said. “And though we can’t prove that the discharge he received was responsible for that, I have to believe that it played some role.”

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