Granfinanciera, S. A. v. Nordberg (1988)
- Docket
- 87-1716
- Decided
- 1988-01-01
Summary
Question: Does a person who has submitted a claim against a bankruptcy estate have a right to a jury trial when sued by the trustee in bankruptcy to recover an allegedly fraudulent money transfer? Conclusion: Yes. Justice William J. Brennan, Jr. delivered the opinion of the 6-3 majority. The Court held that the Seventh Amendment protected the right to a trial by jury in all cases in which a legal right, as opposed to an equitable right, was at issue. Since this case deals with the recovery of money, it is purely a legal issue. Under English common law, such a case would have received a jury trial as well. The Court also held that Congress may only legislate away the right to a trial by jury in cases where “public rights” are litigated. The Court declined to address Nordberg’s argument that Granfinanciera was barred from a jury trial because it was an agent of the Colombian government since the issue was not addressed in the lower courts, and this was not an exceptional case where the Court could overlook the lack of lower court discussion. Justice Antonin Scalia concurred in part and concurred in the judgment. He argued that “public rights” can only refer to situations where the government is involved. Because previous Supreme Court decisions had linked the idea of public rights with a waiver of sovereign immunity, which is only available to the government, public rights can only be at issue when the government is involved. In his dissent, Justice Byron R. White argued that the majority’s opinion inappropriately overrules a previous decision that Congress can establish an alternative adjudication to a jury trial in a bankruptcy proceeding. The Seventh Amendment does not apply to all federal proceedings, specifically bankruptcy, which Congress has assigned to specialized courts. He also argued that there was no evidence to suggest such a case would have received a jury trial rather than a chancery trial according to English common law. Justice Harry A. Blackmun dissented and argued that Congress has the right to establish alternative adjudication procedures in certain cases. Since a bankruptcy trial often requires expert knowledge, a jury might be detrimental to the proceedings, and therefore Congress had every right to fashion a modern bankruptcy system. Justice Sandra Day O’Connor joined in the dissent.