Coit Independence Joint Venture v. Firstsouth, F.A.

• Decision Date: 16 October 1987
• Docket Number: No. 87-1218,87-1218
• Citation: 829 F.2d 563
• Parties: COIT INDEPENDENCE JOINT VENTURE, Plaintiff-Appellant, v. FIRSTSOUTH, F.A., Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 563

829 F.2d 563

COIT INDEPENDENCE JOINT VENTURE, Plaintiff-Appellant, v. FIRSTSOUTH, F.A., Defendant-Appellee.

No. 87-1218

Summary Calendar.

United States Court of Appeals,

Fifth Circuit.

Oct. 16, 1987.

Robert E. Goodfriend, Paul E. Galvin, Akin, Gump, Strauss, Hauer & Feld, Dallas, Tex., for plaintiff-appellant.

Albert C. Maule, Chicago, Ill., J.K. Ivey, Donnal S. Mixon, Irving, Tex., Peter F. Lovato, Antony S. Burt, Chicago, Ill., for defendant-appellee.

Appeals from the United States District Court for the Northern District of Texas.

Before POLITZ, JOHNSON, and HIGGINBOTHAM, Circuit Judges.

PER CURIAM:

Coit Independence Joint Venture appeals the dismissal, for lack of subject matter jurisdiction, of a suit against a savings and loan association in federal receivership. We affirm.

I. BACKGROUND

From 1983 to 1986, the Coit Independence Joint Venture received several loans and engaged in other dealings with FirstSouth, a federal savings association. Coit and FirstSouth fell out, and Coit sued FirstSouth in Texas court in October 1986, for usury, breach of fiduciary duty, and breach of the duty of good faith and fair dealing. In December 1986, the Federal Home Loan Bank Board (FHLBB) declared FirstSouth insolvent and appointed the Federal Savings and Loan Insurance Corporation (FSLIC) as receiver. The FSLIC removed the case to federal court. In February 1987, the district court dismissed the suit for lack of subject matter jurisdiction. The district court held that, under federal banking statutes, suits by creditors against the FSLIC as receiver must be presented first to the FSLIC, then appealed to the FHLBB, and only then appealed to the federal courts under the Administrative Procedure Act. 5 U.S.C. Secs. 551 et seq. Coit appeals this dismissal.

II. DISCUSSION

Coit argues, first, that Congress did not intend the FSLIC to enjoy exclusive jurisdiction over creditors' state-law claims against savings associations under FSLIC receivership. Two courts have accepted Coit's statutory interpretation. Glen Ridge Condominiums, Ltd. v. Federal Savings and Loan Insurance Corp., 734 S.W.2d 374 (Tex.App.--Dallas, 1986); Morrison-Knudsen Co., Inc. v. CHG International, Inc., 811 F.2d 1209 (9th Cir.1987). However, as Coit acknowledges, this Court has held that the statutes do give the FSLIC exclusive jurisdiction over suits brought by creditors against receiverships. Northern Mississippi Savings & Loan Association v. Hudspeth, 756 F.2d 1096 (5th Cir.1985), cert. denied , 474 U.S. 1054, 106 S.Ct. 790, 88 L.Ed.2d 768 (1986) (interpreting 12 U.S.C. Secs. 1464(d)(6)(C) and 1729(d)). We have reaffirmed the Hudspeth decision several times, and are clearly bound by it. ¹ Federal Savings and Loan Insurance Corp. v. Bonfanti, 826 F.2d 1391 (5th Cir. 1987); Godwin v. Federal Savings and Loan Insurance Corp., 806 F.2d 1290, 1292 (5th Cir.1987); Chupik Corp. v. Federal Savings and Loan Insurance Corp., 790 F.2d 1269 (5th Cir.1986).

Coit points out that one of the statutory provisions relied on in Hudspeth has since been changed. The statute in Hudspeth read: "[T]he [FSLIC] shall have power ... to settle, compromise, or release claims in favor of or against the insured institutions, and to do all other things that may be necessary in connection therewith, subject only to the regulation of the Federal Home Loan Bank Board...." 12 U.S.C. Sec. 1729(d) (emphasis added), cited in Hudspeth, 756 F.2d at 1101. On October 13, 1986, the language changed to read: "... subject only to the regulation of the court or other public authority having jurisdiction over the matter." Id. (emphasis added). However, this Court has subsequently reaffirmed the FSLIC's exclusive jurisdiction. Bonfanti, at 1393 . Moreover, the statute itself says:

In connection with the liquidation of any such institution, the language "the court or other public authority having jurisdiction over the matter" in subsection (d) of this section shall mean said [Federal Home Loan Bank] Board.

12 U.S.C. Sec. 1729(c)(3)(B). ² Hence, the change in statutory language will not support overruling Hudspeth.

Coit argues that the statute, when interpreted to grant the FSLIC exclusive jurisdiction, violates the Constitution in several ways. First, Coit contends that its suit, as a common-law suit arising between private parties, must be heard by an article III court. Second, Coit claims that sending the dispute to an administrative body violates due process in that the FSLIC will act as both party and judge and in that any administrative determination will be reviewed under the lenient "substantial evidence" standard. ³ Third, Coit argues that administrative adjudication would deprive it of the right to trial by jury.

This Court has recently held that administrative review of FSLIC receivership actions affords due process. Woods v. Federal Home Loan Bank Board, 826 F.2d 1400, 1411 (5th Cir. 1987). Coit's other constitutional arguments have not been directly addressed by our cases. However, the arguments are not ripe for resolution at this time. The FSLIC may allow all or some of Coit's claims, depriving Coit of standing and a grievance. The Supreme Court has held that a party seeking to overturn legislation as unconstitutional must be "immediately harmed, or immediately threatened with harm" by the application of the statute. Poe v. Ullman, 367 U.S. 497, 505, 81 S.Ct. 1752, 1756, 6 L.Ed.2d 989 (1961). Coit does not meet this test.

In sum, Coit's statutory arguments are...