Alliant National Title Insurance Co., Inc. v. Larson (In re Larson)

Summarized by David Little , Miller & Law, P.C
13 years 10 months ago

Citation:

CO-12-005

Tag(s):

Ruling:

A three judge panel of the Bankruptcy Appellate Panel for the Tenth Circuit (the “BAP”) denied debtors’ motion for leave to appeal an interlocutory order of the United States Bankruptcy Court for the District of Colorado denying stay of an adversary proceeding to avoid waiving debtors’ Constitutional protection from compelled self-incrimination. The BAP held: (1) no controlling question of law as to which there is substantial ground for difference of opinion existed as the Tenth Circuit has previously ruled that delaying review of the constitutional interest against self-incrimination does not sufficiently imperil that interest to justify the cost of an immediate appeal; and (2) the immediate resolution of debtors’ Fifth Amendment claim did not materially advance the ultimate termination of the adversary proceeding, but rather would halt the proceedings as debtors asserted only speculative concerns about self-incrimination and not facts capable of evaluation.

Procedural context:

Alliant National Title Insurance Company, Inc. (“Alliant”) had underwritten residential real estate transactional title insurance policies for which debtors had acted as escrow agents and allegedly misappropriated funds. Debtors filed under Chapter 13, the case was converted to Chapter 7, and Alliant then filed a non-dischargeability action for the amount it had become liable as result of debtors’ alleged misappropriation. Debtors were later informed by the Attorney General for the State of Colorado that they were the subject of a criminal investigation related to their actions as escrow agents. Upon receiving this information, debtors moved to stay Alliant’s non-dischargeability action arguing that proceeding with the action would force the debtors to either waive their Fifth Amendment protection against self-incrimination or compromise their position in the action. The United States Bankruptcy Court for the District of Colorado denied stay of the action and debtors filed their notice of appeal and accompanying motion for leave to appeal the Bankruptcy Court’s order.

Facts:

Due to the nature of the case and length of the opinion, the Facts and Procedural context are combined into one section (under Procedural context).

Judge(s):

Cornish, Karlin, and Somers

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