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The Microsoft spell checker sometimes suggests lays, but this does not sound right to the ear! The spellchecker can get a bit befuddled like this sometimes.
If the problem occurred in the past you would say Therein lay the problem.
Present, past simple, Past Participle
1. lie: not telling the truth lie, lied, lied
2. lie: become horizontal lie, lay , lain
3. lay:put lay, laid, laid
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