New York’s attorney general, Eliot Spitzer, is world famous for his legal triumphs, having won colossal settlements in a series of lawsuits against corporate giants.

Arguably, however, none of Mr. Spitzer’s victories on Wall Street carries as much consequence for average New Yorkers as his biggest defeat: the Campaign for Fiscal Equity case.

Ruling on that case last year, the state Court of Appeals declared – despite the attorney general’s arguments to the contrary – that the public schools of New York City are not providing students with the basic education guaranteed by the state constitution. This month, a court-appointed panel said state lawmakers should correct the problem by increasing aid to the city schools by $5.6 billion, or 45%, over the next four years.

On Friday, the judge supervising the case, Leland DeGrasse of the state Supreme Court at Manhattan, called a hearing on January 11 to discuss how he should convert those findings into a court order against Governor Pataki and the Legislature.

The pending infusion of cash may or may not improve the schools, as proponents of the lawsuit hope, but it will almost certainly force the state to raise money through higher taxes, expanded legalized gambling, or both. On both counts, as the state’s chief lawyer, Mr. Spitzer bears at least a share of the responsibility.

Mr. Spitzer did not choose this fight. As attorney general, he must defend state government against all legal challenges, ranging from inmates suing over the quality of prison food to profound disputes over the meaning of the constitution. He also played no role in shaping the education budget that was declared unconstitutional. Even his legal strategy was constrained by the wishes of the Pataki administration, which was his client in this case. Both sides of the litigation say the attorney general’s office mounted the best defense it could under the circumstances.

Yet the loss in the CFE case could come back to haunt Mr. Spitzer, a Democrat, during the upcoming race for governor, which he formally entered last week. And, if elected, complying with the court ruling might well be the biggest headache facing his administration.

The attorney general’s press secretary, Darren Dopp, said Mr. Spitzer is committed to representing the state’s interests without regard to the political fallout.

“If you do anything less than that, you’re not doing your duty,” Mr. Dopp said.”It might mean people would criticize what you do in office. But that comes with the territory.”

Defending the state against any lawsuit can be politically awkward, especially when the attorney general and the governor are from different parties. The CFE case, which began six years before he took office, presented Mr. Spitzer with a particularly dicey task.

To begin with, he would have to argue against more money for education, a difficult position for any politician to take. The suit was also overwhelmingly popular in New York City, Mr. Spitzer’s hometown, and had the support of powerful interest groups such as the teachers’ unions, most Democratic elected officials, and some city-based Republicans, including Mayor Bloomberg.

In perhaps the most dramatic illustration of Mr. Spitzer’s dilemma, one of his political consultants, Luis Miranda of the Mirram Group, is also chairman of the Campaign for Fiscal Equity, the coalition that was suing the state.

Yet Mr. Spitzer decided early on that he and his office would argue the state’s defense. Although the attorney general and his employees have a policy of recusing themselves from certain cases – such as those involving family members, business associates, or former legal clients – his aides said Mr. Miranda’s role did not present that type of conflict of interest.

The chief counsel for the plaintiffs, Michael Rebell, said he is surprised – given what he assumes is Mr. Spitzer’s sympathy for the cause – that the attorney general didn’t withdraw and tell the governor to hire outside counsel.

“I know there have been attorneys general in other states that have done that kind of thing if they have a fundamental disagreement on interpretation of the constitution,” Mr. Rebell said.

“He’s taken a lot of heat for it,” Mr. Rebell said of Mr. Spitzer’s decision to defend the state. “I almost give him credit for it – almost….It’s against his political interests, which is why I find it interesting.”

Mr. Spitzer’s predecessor as attorney general, Dennis Vacco, had brought in an Atlanta firm with expertise in school funding litigation, Sutherland Asbill & Brennan, to help with the state’s defense. Mr. Spitzer could have scored points with his Democratic allies by dismissing the firm, but chose to keep it on during the seven-month trial, which began shortly after he took office.

The state’s case was not calculated to win friends. It argued that the city schools, with their low test scores, high drop-out rates, under qualified teachers, and run-down buildings, were, in fact, providing an education that was minimally adequate under the constitution. They noted that the city was already spending $10,400 a student, more than any other large urban district, and blamed the problems on mismanagement and waste rather than a shortage of money.

The arguments did not persuade Judge De-Grasse, who ruled in favor of the plaintiffs. “The governor’s position was untenable,” Mr. Rebell said. “They had a very weak case, but they put it forward in a professional way. … They did their best.”

A critic of the court ruling, Sol Stern of the Manhattan Institute, laid the blame with Mr. DeGrasse.

“In my view it was a kangaroo court,” Mr. Stern said. “Nobody – I don’t care who – could have won that case in that courtroom.” The attorney general’s office had better luck at the Appellate Division, a midlevel court, which overturned Mr. DeGrasse’s ruling and dismissed the suit. However, the decision quickly became a political football. The five-judge panel reasoned that the state satisfies its constitutional obligation if it provides students with the equivalent of an eighth- or ninth-grade education, and found that the city schools had met this standard. “Eight is not enough” quickly became the rallying cry for critics of that ruling – and a slogan that Democrats used against Governor Pataki in the 2002 elections. Mr. Spitzer came in for a share of the heat.

“The advocates certainly weren’t pleased with us and actually demonstrated against us,” Mr. Dopp said. “You had to accept that and do the job.”

During his re-election campaign, Mr. Pataki himself called the eighth-grade standard “100% wrong.” This statement may have reassured the voters, but it probably didn’t help the state’s case on appeal, Mr. Rebell said.

“The lawyers have to go to the Court of Appeals and defend this Appellate Division decision, and their client has publicly stated that he disagrees with the judges below,” Mr. Rebell said.

As it turned out, the high court voted 4-1 in favor of the plaintiffs. It ordered lawmakers to spend whatever it takes to offer all New York City students “a meaningful high school education.” That led to the $5.6 billion recommendation earlier this month.

Now Mr. Spitzer – who has just declared that he hopes to replace Mr. Pataki as governor – is once against cooperating with him to limit the impact of Mr. DeGrasse’s ruling and, in all likelihood, to appeal his order to a higher court.

The office “has operated for the past six years in a nonpartisan way,” the first deputy attorney general, Michele Hirshman, said. “We’re going to continue to do that.”

“We’ve had a positive working relationship with the attorney general’s office,” a spokesman for the governor, Kevin Quinn, said last week. “And as we move forward we are hopeful that the attorney general won’t let politics get in the way of progress.”