Federal Deposit Ins. Corp. v. Roldan Fonseca, 85-1274

• Decision Date: 27 June 1986
• Docket Number: No. 85-1274,85-1274
• Parties: , 6 Fed.R.Serv.3d 70, 21 Fed. R. Evid. Serv. 61 FEDERAL DEPOSIT INSURANCE CORPORATION, Plaintiff, Appellee, v. Marcelino ROLDAN FONSECA, et al., Defendants, Appellants.
• Court: U.S. Court of Appeals — First Circuit

Page 1102

795 F.2d 1102

55 USLW 2091, 6 Fed.R.Serv.3d 70, 21

Fed. R. Evid. Serv. 61

FEDERAL DEPOSIT INSURANCE CORPORATION, Plaintiff, Appellee, v. Marcelino ROLDAN FONSECA, et al., Defendants, Appellants.

No. 85-1274.

United States Court of Appeals,

First Circuit.

Argued Sept. 13, 1985.

Decided June 27, 1986.

Richard A. Lee, San Juan, P.R., with whom Steven T. Scott, Hato Rey, P.R., were on brief, for defendants, appellants.

Victoria D. Pierce, Hato Rey, P.R., with whom Michael B. Burgee, Deputy Gen. Counsel, Washington, D.C., and John David Ferrer, San Juan, P.R., were on brief, for plaintiff, appellee.

Before CAMPBELL, Chief Judge, ALDRICH and TORRUELLA, Circuit Judges.

TORRUELLA, Circuit Judge.

This is an appeal from a summary judgment in an action by the Federal Deposit Insurance Corporation (FDIC) seeking foreclosure of mortgage and collection of monies under 12 U.S.C. Sec. 1819. Jurisdiction is predicated on 28 U.S.C. Sec. 1345. We affirm.

I

Appellants Marcelino Roldan-Fonseca and his wife Felicita Aponte purchased in 1977 a piece of real property encumbered with a first mortgage lien guaranteeing a $13,000 note. Appellants assumed said mortgage and in addition executed a second mortgage on the property to secure a $16,000 promissory note in favor of the seller, Santiago Halais (Halais). Subsequently, the first mortgage creditor transferred the $13,000 note to Banco Credito y Ahorro Ponceno (Banco Credito).

A year after the sale, Halais told appellants that he wanted them to pay the $16,000 due. Appellants did not, however, have the $16,000. Nor could they qualify for a federally-insured refinancing mortgage loan. Thus, Halais and appellants agreed that the latter would sell the property to Ivette Halais (Halais' daughter) and her fiancee Salvador Torralbas, who as buyers would apply for a mortgage loan to refinance the two outstanding mortgages. Upon completion of the refinancing transaction Torralbas and Ivette Halais (Torralbas/Halais) would sell the property back to appellants who would then assume what the parties expected would be a single mortgage lien.

Pursuant to said agreement appellants sold the property to Torralbas/Halais who, on January 27, 1978, executed a mortgage lien guaranteeing a $28,050 note. By its own terms the mortgage contract was to constitute a first mortgage lien in favor of Advisors Mortgage Investors, Inc. (Advisors). The proceeds from the sale were to be used to settle the loans secured by the two outstanding mortgages. Accordingly, Torralbas/Halais payed the $16,000 owed to Halais. Upon delivery of the $16,000 note, Advisors cancelled the mortgage lien guaranteeing said note. Neither Advisors nor Torralbas/Halais, however, cancelled the first outstanding mortgage lien, even though Advisors had retained the portion of the proceeds designated to pay the first mortgage note. The Registry of the Property of Puerto Rico recorded the mortgage guaranteeing the note payable to Advisors as a second mortgage lien. Thereupon Advisors sold the $28,050 note to Consolidated Mortgage and Finance Corporation (Consolidated) which in turn pledged it to Banco Credito as collateral for funds.

The FDIC obtained both the $13,000 and $28,050 notes upon becoming the receiver of Banco Credito in March 1978. Banco Popular de Puerto Rico (Banco Popular) acquired the first mortgage note from the FDIC receivership in 1978. The FDIC in its corporate capacity purchased the $28,050 note from the FDIC in its receiver capacity on March 31, 1978. Appellants reacquired the property on January 23, 1980, thereby assuming responsibility for the payment of aforementioned notes. In 1983 the FDIC filed the complaint in the instant case seeking collection of monies and mortgage foreclosure on the basis of the $28,050 note. Appellants counterclaimed and filed a third-party complaint against Torralbas/Halais and the attorney attending the execution of the $28,050 note. ¹ The district court dismissed the third-party complaint and subsequently granted the FDIC's motion for summary judgment. ² This appeal ensued. Appellants contend that the court below erred in entering summary judgment under Fed.R.Civ.P. 56.

II

Summary judgment may be granted if the case contains no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Santoni v. FDIC, 677 F.2d 174, 177 (1st Cir.1982). The burden is on the moving party to present evidence showing the absence of factual dispute as to material issues raised by the pleadings. Emery v. Merrimack Valley Wood Products, Inc., 701 F.2d 985, 991 (1st Cir.1983). Appellants argue that this burden was not met below because the FDIC failed to submit evidence addressing issues raised by claims and affirmative defenses presented in the counterclaim and answer to the complaint. The FDIC counters that (1) it only presented evidence regarding material issues raised by the pleadings; and (2) issues raised by appellants' answer and counterclaim were immaterial and, therefore, did not justify the presentation of evidence showing the absence of factual dispute.

As a legal matter, FDIC is correct, but in a notable respect the record is not at all like the customary summary judgment record. FDIC has furnished but one affidavit, this being a short one to the effect that the facts in a certain pleading are true to the best of affiant's "knowledge and belief." This is in no way the evidentiary affidavit called for in the rule. Unsworn factual recitations in legal memoranda are also of no value. Finally, FDIC's reliance upon facts "considered proven" by the court in ruling on a motion to dismiss is equally unjustified. This acceptance was only for the purpose of determining legal insufficiency in a quite different area and context.

All that FDIC is entitled to rely on here, accordingly, is what appellant appears on the record to admit. This includes (1) the FDIC in its corporate capacity is the holder of the $28,050 note; (2) a mortgage guaranteeing said note is duly recorded at the Registry of Property of Puerto Rico; (3) the mortgage note was purchased by the FDIC-Corporation from the FDIC-Receiver pursuant to 12 U.S.C. Sec. 1823(e); (4) the property encumbered by the $28,050 mortgage belongs to appellants; (5) appellants had assumed the mortgage whose foreclosure was being sought; (6) the aforementioned note is in arrears; and (7) appellants owed the FDIC amount claimed in the complaint. ³

On the other hand, movants for summary judgment do not have to present evidence as to averments involving immaterial issues. A material issue is raised when the facts alleged, if proven, are such as to constitute a valid claim or defense. FDIC v. Lauterbach, 626 F.2d 1327, 1335 (7th Cir.1980). Since claims and affirmative defenses posing irrelevant issues do not require the submission of evidence showing the absence of factual dispute, the question here is whether averments not addressed by FDIC in appellants' answer and counterclaim amount to valid defenses or claims against the FDIC.

A

1. Appellants claim that the $28,050 note was executed to cancel two mortgages encumbering their property. Advisors, however, failed to disburse funds to pay the $13,000 indebtedness and cancel the first mortgage lien. Appellants claim that the FDIC should be held accountable for Advisors' failure to settle the $13,000 mortgage because (1) said failure amounted to fraud in the execution of the contract; and (2) since the FDIC had knowledge of Advisors' fraud it is not a holder in due course. Therefore, they contend that the FDIC is subject to all claims and defenses stemming from the failure to cancel the first mortgage lien, to wit: (1) the nullity of the $28,050 note due to lack of consideration resulting from Advisors' fraud; (2) preclusion of foreclosure due to the failure to settle the first mortgage note; and (3) liability for sums outstanding from the $13,000 indebtedness which appellants allegedly settled through the execution of the $28,050 note. ⁴

Federal law governs cases where, as here, the FDIC in its corporate capacity sues to collect assets acquired from the receiver of an insured bank. FDIC v. De Jesus-Velez, 678 F.2d 371, 374 (1st Cir.1982); FDIC v. Bird, 516 F.Supp. 647, 649 (D.P.R.1981). Federal statutory law makes the aforementioned claims and defenses immaterial in the instant case.

By Section 1823(e) Congress gave the FDIC special protections not available to ordinary holders of commercial paper which are not dependent upon whether the FDIC would qualify as a holder in due course under state law. FDIC v. Merchants National Bank of Mobile, 725 F.2d 634, 635 (11th Cir.1984), cert. denied, --- U.S. ----, 105 S.Ct. 114, 83 L.Ed.2d 57 (1985); FDIC v. De Jesus-Velez, supra at 375 n. 10. Section 1823(e) provides:

No agreement which tends to diminish or defeat the right, title or interest of the Corporation in any asset acquired by it under this section, either as security for a loan or by purchase, shall be valid against the Corporation unless such agreement (1) shall be in writing, (2) shall have been executed by the bank and the person or persons claiming an adverse interest thereunder, including the obligor, contemporaneously with the acquisition of the asset by the bank, (3) shall have been approved by the board of directors of the bank or its loan committee, which approval shall be reflected in the minutes of said board or committee, and (4) shall have been, continuously, from the time of its execution, an official record of the bank.

Agreements not meeting all four requirements set forth by the statute are unenforceable against the FDIC. FDIC v. De Jesus-Velez, supra. Such is the case here.

Appellants' claims and defenses stem from Advisors' failure to cancel the $13,000 mortgage. Yet the $28,050 note under which the FDIC pursues the instant action fails to mention Advisors' agreement to cancel the $13,000 mortgage. Nor does the...