Phoenix Assur. Co. of Canada v. Runck
| Decision Date | 22 March 1982 |
| Docket Number | 10069 and 10090,Nos. 10065,s. 10065 |
| Citation | 317 N.W.2d 402 |
| Parties | PHOENIX ASSURANCE COMPANY OF CANADA, Norwich Union Fire Society, Ltd., Royal Insurance Company of Canada, Sun Insurance Office, and Wawanesa Mutual Insurance Company, Plaintiffs and Appellees, v. Clayton E. RUNCK, Jr., Defendant and Appellant, Herman Sobania and George Schulz, Defendants and Appellees. PHOENIX ASSURANCE COMPANY OF CANADA, Norwich Union Fire Society, Ltd., Royal Insurance Company of Canada, Sun Insurance Office, and Wawanesa Mutual Insurance Company, Plaintiffs and Appellees, v. Clayton E. RUNCK, Jr., Defendant and Appellant, Herman Sobania and George Schulz, Defendants and Appellants. PHOENIX ASSURANCE COMPANY OF CANADA, Norwich Union Fire Society, Ltd., Royal Insurance Company of Canada, Sun Insurance Office, and Wawanesa Mutual Insurance Company, Plaintiffs and Appellees, v. Clayton E. RUNCK, Jr., Defendant and Appellant, Herman Sobania and George Schulz, Defendants and Appellants. Civ. |
| Court | North Dakota Supreme Court |
Vogel, Brantner, Kelly, Knutson, Weir & Bye, Fargo, for plaintiffs and appellees; argued by M. Daniel Vogel, Fargo.
Robert Vogel, Grand Forks, for defendant and appellant Clayton E. Runck, Jr.
Brian C. Southwell, Minneapolis, Minn., for defendants and appellants Herman Sobania and George Schulz.
These are consolidated appeals by the defendants and appellants, Clayton E. Runck, Jr., Herman Sobania, and George Schulz, from a state district court's order granting plaintiffs' and appellees', Phoenix Assurance Company of Canada, Norwich Union Fire Society, Ltd., Royal Insurance Company of Canada, Sun Insurance Office, and Wawanesa Mutual Insurance Company, [hereinafter collectively referred to as Phoenix] motions directing the defendants to respond to certain discovery procedures initiated by Phoenix and from the state district court's order denying the defendants' motion for a protective order from some of Phoenix's discovery proceedings and allowing Phoenix the continued use of grand jury transcripts and material in their case. 1
The orders stem from an action initiated by Phoenix alleging insurance fraud perpetrated by the defendants 2 upon Phoenix as a result of a fire in Starbuck, Manitoba, in December of 1971. Phoenix' amended complaint alleged, in substance, that Runck, a North Dakota resident, purchased a building in Starbuck, Manitoba, Canada, and insured it and its contents for $130,000; that later Runck and Sobania, a resident of Minnesota, transported and stored certain agricultural equipment in the building located on the land in Starbuck, Manitoba; that Runck, Sobania, and Schulz, a resident of North Dakota, made plans to burn the building and on or about 18 December 1971, Schulz and Sobania traveled to Starbuck, Manitoba, started, or made arrangements to start, a fire that resulted in the building burning to the ground; that Runck filed a proof of loss and received $75,715.00 from Phoenix; that the activities of the defendants constituted fraud and resulted in unjust enrichment; and that, as a result, Phoenix was entitled to damages and restitution. Defendants answered with a general denial, and also asserted that the statute of limitations barred any such action.
Both sides subsequently initiated discovery proceedings. The defendants individually invoked the fifth amendment privilege, whereupon plaintiff moved for orders compelling responses and the defendants individually or collectively moved for protective orders. These and other motions and countermotions culminated in at least three different hearings before the state district court which ultimately issued the orders 3 granting plaintiffs' motions compelling discovery and denying defendants' motion to suppress the grand jury transcript and material.
The defendants separately appealed from these orders and the appeals were combined. 4
Prior to reaching the merits of the defendants' appeal, we must discuss two preliminary matters.
Phoenix filed a motion to dismiss Schulz' appeal because no brief was filed on behalf of Schulz. During oral argument we were informed by counsel for Sobania, who also filed the notice of appeal for Schulz, that the brief filed on behalf of Sobania also applied to Schulz because the issues were identical as to each. However, the issues are not identical. Schulz was granted immunity in exchange for testifying before the grand jury and, so far as the record before us reflects, Sobania did not testify before the grand jury, nor was he given immunity. Nevertheless, because of other similarities we will consider Schulz' appeal and deny Phoenix' motion to dismiss.
The second preliminary matter which we must consider is whether or not the orders issued by the state district court are appealable. Although the question was not raised by the parties, it is a matter of jurisdiction and this Court may dismiss the appeal on our own motion if the orders are not appealable. Simpler v. Lowrey, 316 N.W.2d 330 (N.D.1982); Chas. F. Ellis Agency, Inc. v. Berg, 214 N.W.2d 507 (N.D.1974).
During oral argument several theories were suggested upon which we could reach the merits of this appeal. These theories treated the orders as affecting substantial rights of the parties which if lost cannot be undone and that the orders involved the merits of the action.
Ordinarily, orders relative to discovery procedures are interlocutory and not appealable. Northwest Airlines, Inc. v. State Board of Equalization, 244 N.W.2d 708 (N.D.1976). Interlocutory orders may be appealable if they involve the merits of the action. Section 28-27-02(5), North Dakota Century Code; Northwest Airlines, Inc. v. State Board of Equalization, supra.
In Northwest Airlines, Inc., supra at 710 we said:
"The words 'merits of the action' cannot be clearly defined in any technical legal sense, however, they can be regarded as referring to significant legal rights as distinguished from technicalities relating to only procedure or form."
Although we recognize that discovery orders are not generally appealable, we believe the orders issued in this instance are appealable because they involve substantial constitutional rights which, if violated, may be so damaging as to cause irreparable harm. Cf. Burlington Northern v. North Dakota District Court, 264 N.W.2d 453 (N.D.1978) [].
The appeals raised two main issues: (1) Does the fifth amendment privilege against self-incrimination apply to possible foreign prosecution, and (2) What action should this Court take regarding the appeal from the district court's order denying the suppression of the grand jury transcript and material?
We will first consider the state district court's order denying the defendants' motion to suppress the use of the grand jury transcript and materials and the defendants' appeal of that order to this Court.
Earlier the federal district court of Minnesota upon the application of the United States Attorney had issued an ex parte order permitting the disclosure of the grand jury transcripts and material "preliminarily to and in connection with judicial proceedings namely civil litigation to recover losses due to possible arson and insurance fraud."
This order, as indicated by its caption, was issued pursuant to the provisions of Rule 6(e)(3)(C)(i), Federal Rules of Criminal Procedure. See In re Judge Elmo B. Hunter's Special Grand Jury Empaneled September 28, 1978 (30 Crim.L.Rep. 2331).
Thereafter the transcripts and grand jury material were made available to Phoenix.
The defendants' motion, 5 in the state district court, to suppress the use of the federal grand jury transcript and material, which use was authorized by an ex parte order issued by a federal district court in Minnesota, in a limited sense, is comparable to an appeal to a state district court seeking a reversal of a federal district court's order.
During oral argument we were advised that appropriate steps are being taken to make the ex parte order authorizing the disclosure of the grand jury material and transcript issued by the federal district court appealable, and then appeal it to the appropriate court. 6
In a somewhat analogous situation in which this Court declined to assume original jurisdiction, Justice Strutz, in a concurring opinion in State v. Meier, 127 N.W.2d 665, 674 (N.D.1964), said:
"... If our decision would be effective as a final judgment of this court, the reservation of the jurisdiction by the Federal District Court is entirely meaningless because that court has no appellate jurisdiction over the decisions of this court."
Conversely, we can add by saying that state courts do not have appellate jurisdiction over federal district courts. Even though the federal district court did not specifically retain jurisdiction as was the case in State v. Meier, supra, the federal district had and continues to have jurisdiction over the subject matter and on that basis a hearing on the ex parte order can be held making such order appealable and an appeal can be processed through the federal appellate channels. Unlike the Meier case, the federal court in this instance did not direct the matter to be brought to the state court. We believe the reference to a "court" in Rule 6, FRCrimP, is to a federal court, preferably the one in whose district the grand jury convened, rather than a state court. Even if appellate jurisdiction is not directly involved here, State v. Meier, supra at 671. See also, Medical Arts Building, Ltd. v. Eralp, 290 N.W.2d 241 (N.D.1980), as to comity.
This suggests that in this instance a decision issued by a federal appellate court after reviewing the order of the federal district court, authorizing the use of the federal grand jury...
To continue reading
Request your trial
-
Moses v. Allard, Civ. A. No. 90-73567
...necessarily flows to trans-national application as well. The North Dakota Supreme Court also examined this issue in Phoenix Assur. Co. v. Runck, 317 N.W.2d 402 (1982), where it held the privilege inapplicable to foreign prosecutions. It emphasized the practical difficulties that could resul......
-
U.S. v. Gecas
...L.Ed.2d 81 (1970). The North Dakota Supreme Court has similarly refused to expand the privilege's scope. See Phoenix Assurance Co. of Canada v. Runck, 317 N.W.2d 402, 413 (N.D.), cert. denied, 459 U.S. 862, 103 S.Ct. 137, 74 L.Ed.2d 117 However, several district courts, including one distri......
-
U.S. v. (Under Seal)
...Parker, 411 F.2d 1067, 1070 (10 Cir.1969), vacated as moot, 397 U.S. 96, 90 S.Ct. 819, 25 L.Ed.2d 81 (1970); and Phoenix Assurance Co. of Canada v. Runck, 317 N.W.2d 402 (N.D.), cert. denied, 459 U.S. 862, 103 S.Ct. 137, 74 L.Ed.2d 117 We reject petitioners' contention that Murphy v. Waterf......
-
Medical Arts Clinic, P.C. v. Franciscan Initiatives, Inc.
...would impose upon Medical Arts the impossible task of seeking a remedy that would " 'unring a bell.' " Phoenix Assurance Co. of Canada v. Runck, 317 N.W.2d 402, 408 (N.D.1982), cert. denied, 459 U.S. 862, 103 S.Ct. 137, 74 L.Ed.2d 117 (1982). See Burlington Northern v. North Dakota District......