Daichi: This takes place really early.
Verity: She doesn't own the things mentioned.
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The others had looked at him strangely when he admitted to never using a hammer in his life. He had avoided mentioning Cudge, as that would bring up memories of his last adventure, and that was the last thing he wanted. Mr. L had agreed, because bringing up that adventure involved bringing up his very existence, and that was something the two of them could actually agree on.
Not just because Paper Luigi didn't want people to know he had a voice in his head, but because Mr. L had very good reasons for not letting anybody else know about his existence. Of course, eventually, he was bound to slip up and say something out loud, and then it would all fall apart. But, for now, the others were blissfully unaware of the other presence in his mind.
Paper Luigi had never used a hammer before because he had never needed one before. Something which, in this strange 3D Mushroom Kingdom, was very much subject to change. With Bowser involved, they would inevitable have to go to the desert, with a large number of sentient cacti.
The perils of living in a world populated by mutant plants.
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Paper Luigi had used to enjoy shopping. Then he met Mr. L. Shopping, from that point on, would turn into a mental argument with a voice that just would not leave. Coming to an agreement had taken a while, and he still had no clue how to use the hammer. He'd have to figure it out as he went along.
'You have no idea what you're doing. This is a bad idea.' He knew that ignoring Mr. L would not make him go away. He had given up on getting rid of him long ago.
He would still ignore him, of course. Besides, after facing a multiversal apocalypse, how hard could this be?
He would soon realize that asking that question, in any capacity, was quite possibly the worst idea he'd ever had.
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Daichi: As for how he realized that? The same way everyone else does. Things got very difficult afterwards.