In Re Richard W. Candland, Debtor. Richard W. Candland v. Insurance Company of North America

Candland disagreed with the opinion of the Bankruptcy Appellate Panel (BAP), which affirmed the bankruptcy court, concluding that Candland’s debt to the Insurance Company of North America (INA) was nondis-chargeable pursuant to 11 U.S.C. § 523 (a)(2)(B). The bankruptcy court exercised jurisdiction under 28 U.S.C. § 157 (b)(1), and we have jurisdiction under 28 U.S.C. § 158 (d). We affirm.

I

Candland is an experienced businessman who holds numerous degrees and licenses, including a law degree, securities license, insurance license, annuity license, and real estate license. Candland was engaged in the business of soliciting investors for sophisticated real estate limited partnerships. In 1984, Candland invested in the Fort Worth Willows Limited Partnership (Partnership) and executed promissory notes to the Partnership. In order to obtain additional capital, the Partnership attempted to assign the notes to a financial institution, and the financial institution required Candland to find a guarantor for his payment on the notes.

Candland applied to INA for bonds which would guarantee his payment on the notes. According to its practice, INA would issue financial guarantee bonds based…