Dababneh v. F.D.I.C.

• Decision Date: 27 April 1992
• Docket Number: No. 88-1272,88-1272
• Citation: 971 F.2d 428
• Parties: Anton K.M. DABABNEH, Plaintiff-Appellant, v. FEDERAL DEPOSIT INSURANCE CORPORATION, in its corporate capacity and as Receiver of Moncor Bank, N.A., Hobbs, New Mexico, a national banking association, Defendant-Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 428

971 F.2d 428

Anton K.M. DABABNEH, Plaintiff-Appellant, v. FEDERAL DEPOSIT INSURANCE CORPORATION, in its corporate capacity and as Receiver of Moncor Bank, N.A. Hobbs, New Mexico, a national banking association, Defendant-Appellee.

No. 88-1272.

United States Court of Appeals Tenth Circuit.

April 27, 1992.

Order on Denial of Petition for

Rehearing and Suggestion for Rehearing

En Banc Aug. 20, 1992.

J. Douglas Foster (Paul M. Fish, with him on the brief), of Modrall, Sperling, Roehl, Harris & Sisk, P.A., Albuquerque, N.M., for plaintiff-appellant.

Evelyn D. Sahr, Trial Atty., Torts Branch, Civ. Div. (John R. Bolton, Asst. Atty. Gen., Stuart E. Schiffer, Acting Asst. Atty. Gen., Helen M. Eversberg, William L. Lutz, U.S. Attys., Jeffrey Axelrad, Director, Torts Branch, Civ. Div., Sophie E. Smyth, Trial Atty., Torts Branch, with her on the briefs), U.S. Dept. of Justice, Washington, D.C., for defendant-appellee.

Before HOLLOWAY, HENLEY, ^* and EBEL, Circuit Judges.

HOLLOWAY, Circuit Judge

This appeal from the United States District Court, District of New Mexico, stems from that court's granting of a motion to dismiss pursuant to Fed.R.Civ.P. Rule 12(b)(6) in favor of defendant-appellee Federal Deposit Insurance Corporation, in its corporate capacity ("FDIC-C"). Concluding that plaintiff-appellant Dababneh's claim against FDIC-C is not viable, and that his claim for future rent is unprovable under federal law, we affirm.

I. Background

The facts are not in dispute. In February 1984, plaintiff Dababneh and First City Financial Corporation ("First City"), a holding company for Moncor [National] Bank ("Moncor"), executed a sale/leaseback agreement whereby Dababneh purchased three properties from First City for $7.6 million. Moncor maintained offices on these properties. The agreement provided for a 15-year lease to First City, commencing March 1, 1984, with four options to extend the lease for additional five year periods. The lease called for a minimum annual rent of $836,000, payable in monthly installments, subject to future adjustments based on an inflation index. One month into the lease term, First City assigned the lease to Moncor through an agreement which left First City still liable under the lease's terms. See Appellee Answer Brief, Attachment 4. Moncor paid rent according to the lease's provisions through the end of August, 1985.

On August 30, 1985, the Comptroller of Currency declared Moncor insolvent and appointed the Federal Deposit Insurance Corporation as receiver ("FDIC-R"). Upon taking control of Moncor, FDIC-R immediately entered into a tripartite purchase and assumption transaction ("P & A") with United Bank of Lea County ("United" or "Assuming Bank"), and FDIC-C, pursuant to 12 U.S.C. § 1823(c). Under the P & A, United assumed all of Moncor's deposit liabilities, some of Moncor's other creditor liabilities, and purchased certain Moncor assets. United also paid a premium of $1.2 million for the going concern value of Moncor. By addendum to the P & A, United was granted an option to accept assignment of the Dababneh lease. All Moncor assets rejected by United were transferred to FDIC-C for liquidation. As a result, FDIC-R has no assets to pay claims by any unassumed Moncor creditors, although FDIC-C promised to provide United with sufficient funds to cover all assumed creditor claims. The P & A was approved by a district court order on the same date.

Under the P & A, United agreed to pay in full the claims of Moncor's trade creditors which were included in the liabilities assumed. However, United rejected the assignment of the Dababneh lease, notifying FDIC-R on September 26, 1985. On October 4, 1985, FDIC-R wrote Dababneh stating its intention to "disaffirm, cancel and terminate this lease effective sixty (60) days from and after October 9, 1985." Appellee's Answer Brief at 7. Following termination, Dababneh subsequently relet most of the property to United for a 10-year term at fixed monthly rental rates below that originally contracted for with Moncor. On November 21, 1985, approximately three months after Moncor's closing, Dababneh filed a written claim with FDIC-R for financial injuries resulting from termination of the lease. FDIC-R rejected this claim.

On August 29, 1986, Dababneh initiated this action against FDIC-R alleging that the P & A transaction constituted a preferential transfer in violation of the National Bank Act, 12 U.S.C. §§ 21, et seq. (1982). Dababneh seeks compensation for the lost rents under his lease with Moncor, terminated by FDIC-R, and related costs incurred to relet the property. ¹

The procedural events leading to this appeal began with a Rule 12(b)(6) motion to dismiss filed by FDIC-R in November 1986. Finding that "the motion [was] not well taken[,]" the district court denied the motion in January 1987 without other comment. No further action was then taken by FDIC-R respecting its motion.

Realizing that FDIC-R had no assets with which it might pay his claim, Dababneh obtained permission to amend his complaint to add FDIC-C, the banking insurance fund administrator, as a party. The first amended complaint, filed in March 1987, was identical to the original complaint except for the addition of the FDIC-C as a codefendant. FDIC-C moved for dismissal of the first amended complaint, asserting failure to state a claim. ² This time, however, the district court granted the motion to dismiss by an order in October 1987, again without explanation. By an amended order, the district court formally dismissed the complaint against FDIC-C only, and certified the dismissal as a final judgment pursuant to Fed.R.Civ.P. Rule 54(b). Following this order, Dababneh appealed.

Dababneh argues that the P & A affected a "nonratable distribution" in violation of 12 U.S.C. §§ 91 and 194, ³ whereby Moncor's trade creditors were paid 100% of their claims through the liabilities assumed by United, in preference over the unassumed creditors who remain uncompensated after the P & A dissipated the receivership assets held by FDIC-R. ⁴ Dababneh contends that he is also entitled to 100% payment of his future rent claims against Moncor under the ratable distribution requirement of § 194. See White v. Knox, 111 U.S. 784, 786, 4 S.Ct. 686, 687, 28 L.Ed. 603 (1884) (holding that for ratable distributions, "[a]ll creditors are to be treated alike"). Dababneh argues that under First Empire Bank v. FDIC, 572 F.2d 1361 (9th Cir.1978), cert. denied, 439 U.S. 919, 99 S.Ct. 293, 58 L.Ed.2d 265 (1979), FDIC-C is jointly liable with FDIC-R for this preference, and that FDIC-C can be compelled to supplement the receivership estate from its insurance fund to pay Dababneh's claim. Therefore, he argues, a valid claim exists and dismissal was improper.

FDIC-C answers, in relevant part, that FDIC-C's participation in a P & A transaction "does not dilute the distinction between the FDIC's two capacities." Answer Brief at 35. Such participation, FDIC-C insists, "does not impose upon it a duty to creditors of Moncor Bank." Id. Additionally, FDIC-C asserts that Dababneh's claims against it are not ripe because 12 U.S.C. § 194 requires that he "prove" his claim to the satisfaction of either the FDIC-R, or to a court of competent jurisdiction, as a precondition to the pro rata distribution he seeks. FDIC-C contends, as did FDIC-R in its initial, ill-fated motion to dismiss, that federal common law deems actions against receivers for the loss of future rents legally "unprovable." See Answer Brief at 9-13 & n. 17. Accordingly, FDIC-R rejected the claim. Moreover, since the district court has yet to make its own adjudication on the merits of the suit against FDIC-R, FDIC-C argues, "it is premature for this Court to speculate on the appropriate source of payment for the claim." Id.

We review the district court's determination of a Rule 12(b)(6) motion under a de novo standard, accepting all factual allegations in the complaint as true. Zilkha Energy Co. v. Leighton, 920 F.2d 1520, 1523 (10th Cir.1990). Moreover, under Rule 12(b)(6), the dismissal of FDIC-C is inappropriate "unless plaintiff can prove no set of facts in support of his claim to entitle him to relief." Thatcher Enterprises v. Cache County Corp., 902 F.2d 1472, 1473 (10th Cir.1990).

II. FDIC-C's Direct Liability

We agree with the FDIC-C that it may not be held to be independently liable for a nonratable distribution, and therefore the district court could properly dismiss the claim against the Corporation to avoid such a result. Plainly, the question of whether the insurance funds which FDIC-C administers must later serve as the source of funds needed to permit the FDIC-R to make a ratable distribution, see, e.g., First Empire, 572 F.2d at 1371 (requiring the FDIC to "supplement the remaining assets should they fall short" of a ratable distribution), is a separate question from whether the FDIC-C can be held independently liable for FDIC-R's actions. That FDIC-C and FDIC-R are legally "two separate entities is a well accepted matter of law." FDIC v. Dempster, 637 F.Supp. 362, 365 (E.D.Tenn.1986). Moreover, this separateness does not disappear when a P & A transaction occurs, because "FDIC as receiver contracts with FDIC in its corporate capacity to purchase the assets that are unacceptable to the assuming bank." FDIC v. Merchants Nat'l Bank of Mobile, 725 F.2d 634, 638 (11th Cir.1984).

Dababneh relies, inter alia, on §§ 91 and 194 to hold FDIC-C liable for a nonratable distribution. These statutes, however, do not impose direct liability on FDIC-C; they do not accord FDIC-C any controlling or active role in closing the insolvent bank's affairs. Under § 91, FDIC-R, which has assumed the role of the insolvent bank, must assure that there is no "preference of one creditor to another[.]" Under § 194, the Comptroller is required to make a "ratable dividend ... on all such claims as may have been proved[.]" This duty to ratably...