803 F.2d 82 (3rd Cir. 1986), 86-5047, Public Loan Co., Inc. v. Federal Deposit Ins. Corp.

Docket Nº:86-5047.
Citation:803 F.2d 82
Party Name:PUBLIC LOAN COMPANY, INC., a Corporation of the State of New York; Preferred Equities Corporation, a Corporation of the State of Nevada; Leonard Rosen; and American Funding Limited, a Limited Partnership of the State of New Jersey, v. FEDERAL DEPOSIT INSURANCE CORPORATION, Defendant and Third Party Plaintiff, v. EQUITY 1 NATIONAL MARKETING, INC., a
Case Date:October 07, 1986
Court:United States Courts of Appeals, Court of Appeals for the Third Circuit
 
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Page 82

803 F.2d 82 (3rd Cir. 1986)

PUBLIC LOAN COMPANY, INC., a Corporation of the State of New

York; Preferred Equities Corporation, a Corporation of the

State of Nevada; Leonard Rosen; and American Funding

Limited, a Limited Partnership of the State of New Jersey,

v.

FEDERAL DEPOSIT INSURANCE CORPORATION, Defendant and Third

Party Plaintiff,

v.

EQUITY 1 NATIONAL MARKETING, INC., a body corporate of the

State of Florida, Third Party Defendant.

Appeal of PUBLIC LOAN COMPANY, INC., Preferred Equities

Corporation, Leonard Rosen, and American Funding Limited.

No. 86-5047.

United States Court of Appeals, Third Circuit

October 7, 1986

Argued Sept. 10, 1986.

Harvey I. Marcus, Keith O. Evans (argued), Marcus and Evans, Lodi, N.J., for appellants.

Roger J. Foss (argued), Cassidy, Despo, Foss & San Filippo, Red Bank, N.J., Lawrence F. Bates, Jane R. Rossnowski, Ira H. Parker, Federal Deposit Ins. Corp., Washington, D.C., for FDIC.

Before ALDISERT, Chief Judge, and HIGGINBOTHAM and HUNTER, Circuit Judges.

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OPINION OF THE COURT

ALDISERT, Chief Judge.

This appeal from summary judgment entered in favor of Federal Deposit Insurance Corporation (FDIC) requires us to decide whether a provision of the Federal Deposit Insurance Act, 12 U.S.C. Sec. 1823(e), 1 bars the defense of an oral accord and satisfaction in a claim on a promissory note and whether the maker and guarantors of a second promissory note properly raised a material question of fact concerning failure of consideration. We must also decide whether the district court abused its discretion in discovery rulings. We find that the district court neither erred in its application of Sec. 1823(e) nor abused its discretion in its discovery ruling and that the record failed to disclose a material question of fact as to consideration for the second promissory note. We will therefore affirm.

I.

The historical facts before the district court were somewhat complicated and extended. See Public Loan Co. v. Federal Deposit Insurance Corp., (D.N.J. No. 82-3606 June 7, 1985), reprinted in app. at 66a-86a. For review purposes we will summarize only the adjudicative facts. The litigation centers on the liability of makers and guarantors of two promissory notes. One note in the amount of $1.5 million was executed and delivered by S.N.L. Realty Company to the Metropolitan Bank and Trust Company in August 1980. The second, also payable to Metropolitan, was executed and delivered by Equity 1 National Marketing Company in the amount of $250,000 in August 1981. In February 1982 Metropolitan became insolvent and the FDIC was appointed its liquidator. In its capacity as liquidator, FDIC sold, assigned, and transferred to itself in its corporate capacity the two notes that are the subject of this appeal.

The 1980 S.N.L. Realty note was secured by five separate letters of credit which equalled the total amount of the note. Public Loan Company obtained one letter for $750,000 from the Equitable Trust Company of Baltimore. Two appellants here, Preferred Equities Corporation and Leonard Rosen, served as guarantors of Public Loan's letter of credit. This letter of credit is the only aspect of the 1980 note involved in this appeal. The issue on appeal regarding Equity 1's 1981 note centers on the liability of its guarantors, the four appellants here who were plaintiffs below: Public Loan, Preferred Equities, Leonard Rosen, and American Funding, Ltd. The issues are joined from an attempt by the makers of the notes to obtain a judicial declaration against the FDIC of no liability and counterclaims by the FDIC asserting the validity of the obligation.

A.

On July 29, 1982, the FDIC presented a sight draft drawn on Public Loan's letter of credit to the Equitable Trust Company for $132,669.23, the amount of interest due from S.N.L. to Metropolitan on the 1980 note. In a previous suit, Public Loan sued Equitable and the FDIC in the United States District Court for the District of Maryland seeking injunctive and declaratory relief--a restraining order to prohibit Equitable from honoring the FDIC's sight draft; declaring the letter of credit as having been paid, satisfied, and retired; restraining the FDIC from making a demand

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