McCarthy v. Arndstein

Background

A man declared an involuntary bankrupt was ordered to appear and be questioned under a statute that lets courts examine people about a bankrupt’s assets. He answered some questions but refused others, saying answers might incriminate him. After a judge ordered him to answer, he was jailed for contempt, sought habeas relief, and the Supreme Court reviewed whether his refusal was protected.

Reasoning

The central question was whether the constitutional right not to incriminate oneself applies when a bankrupt is questioned in a bankruptcy proceeding under §21a. The Court explained that the privilege against self-incrimination is not limited to criminal trials; it protects a witness in any proceeding when answers might lead to criminal charges. Section 21a governs examinations and does not say the privilege is taken away or provide full immunity. The Court contrasted compelled surrender of property (like business books), which Congress treats as part of the bankrupt estate, with compelled testimony, which is governed by rules about witnesses and evidence.

Real world impact

The ruling means people called to testify in bankruptcy examinations can refuse to answer questions that would tend to incriminate them unless Congress provides complete immunity. Trustees and courts cannot force oral testimony that exposes the witness to criminal risk without offering immunity. The requirement to turn over property remains separate and can be enforced while testimony stays protected.