Federal Deposit Insurance Corporation v. Glickman

• Citation: 450 F.2d 416
• Decision Date: 28 October 1971
• Docket Number: No. 24746.,24746.
• Parties: FEDERAL DEPOSIT INSURANCE CORPORATION as Receiver of San Francisco National Bank, Plaintiff-Appellee, v. David M. GLICKMAN, Defendant-Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals (9th Circuit)

450 F.2d 416 (1971)

FEDERAL DEPOSIT INSURANCE CORPORATION as Receiver of San Francisco National Bank, Plaintiff-Appellee, v. David M. GLICKMAN, Defendant-Appellant.

No. 24746.

United States Court of Appeals, Ninth Circuit.

October 28, 1971.

Michael Lewton (argued), John A. McGuinn, San Francisco, Cal., for defendant-appellant.

Michael Ahrens (argued), of Bronson, Bronson & McKinnon, San Francisco, Cal., Leslie H. Fisher, Washington, D. C., for plaintiff-appellee.

Before KILKENNY and CHOY, Circuit Judges, and POWELL, District Judge.^*

PER CURIAM:

This action was tried to a jury. On separate verdicts judgments were entered finding appellant Glickman liable on two promissory notes executed in favor of a bank which later, by reason of its insolvency, came under the receivership of Federal Deposit Insurance Corporation hereinafter referred to as "FDIC". The notes were given in the respective sums of $220,500 and $10,000.

Three evidentiary questions are presented on appeal: (1) Whether the district court erred in excluding a transcript of testimony given in a prior criminal prosecution brought by the United States; (2) Whether the court erred in excluding the testimony of one of the bank's customers preferred to establish an agency relationship between the bank and one with whom the appellant had had certain dealings; and (3) Whether the court erred in refusing to admit evidence of a previous action brought by FDIC on the $10,000 note which resulted in a co-maker's discharge from liability.

Prior to the commencement of the instant action the United States prosecuted criminal charges against the president of the insolvent bank and another alleged to be the bank's agent; a witness was produced by the Government for the purpose of establishing the existence of the alleged agency relationship. Here, in defense to the $220,500 note, appellant pleaded an oral accord by which he, under pressure from the bank, conveyed three parcels of land to the alleged agent. The record is devoid of any evidence of an accord and satisfaction directly between the appellant and the bank. Under California Evidence Code, § 1291(a), where a witness (declarant) is unavailable, former testimony is admissible as an exception to the hearsay rule when offered against the person who offered it in evidence in his own behalf on the former occasion. Appellant contends that the United States (which offered the testimony in the criminal case) and FDIC are the same "person" within the meaning of the codified hearsay exception. The witness, a resident of Canada, was unavailable, and error is assigned to the court's refusal to admit a transcript of the former testimony.

The strength of the claimed error in the court's evidentiary ruling turns on whether the United States and FDIC are one and the same. In its present setting the determination is not aided by precedent. There can be little doubt of the establishment of FDIC as a federal agency. James v. Federal Deposit Insurance Corporation, 231 F. Supp. 475, 477 (D.C.La.1964); Freeling v. Federal Deposit Insurance Corporation, 221 F.Supp. 955, 956 (D.C.Okla. 1962), affirmed 326 F.2d 971 (10th Cir. 1963). And similarly to certain other federal instrumentalities FDIC enjoys the sovereign's historic immunity from suit except by congressional consent. See Federal Savings and Loan Insurance Corporation v. Quinn, 419 F.2d 1014, 1016-1017 (7th Cir. 1969). At this point, however, a distinction must be drawn between FDIC's dual capacity as federal insurer of deposits and as liquidating agent for the bank. See Freeling v. Sebring, 296 F.2d 244, 245-246 (10th Cir. 1961). In the latter instance FDIC stands in the shoes of the insolvent bank. Cf. DeLorenzo v. Federal Deposit Insurance Corporation, 259 F.Supp. 193, 198 (D.C.N.Y.1966).

The Government, not the insolvent bank, proffered the excluded testimony in the former criminal action. The distinction is further heightened by the fact that FDIC, in its capacity as receiver of a bank, is not represented in this litigation by the United States Attorney, as would be the Government if it were a party. Under the circumstances of this case we hold that the United States Government and FDIC are not the same person for purposes of making applicable the hearsay exception.

The district court sustained FDIC's objection to testimony offered to show that the alleged agent had represented to the witness that he was a member of the bank's executive committee. Appellant claims that this testimony was admissible as proof of the alleged agency. Numerous California cases hold that a declaration of an alleged agent is not admissible to establish the agency unless made in the presence of or authorized in some way by the would-be principal. See DeMartini v. Alexander Sanitarium, Inc., 192 Cal.App.2d 442, 13 Cal.Rptr. 564 (1961); Shehtanian v. Kenny, 156 Cal.App.2d 576, 319 P.2d 699 (1958); Hilyar v. Union Ice Co., 45 Cal.2d 30, 286 P.2d 21 (1955). Citing the Restatement of Agency, § 286 (2 ed. 1958), the Court of Appeals for the Eighth Circuit, in United States v. Bensinger...