Federal Deposit Ins. Corp. v. Rectenwall

• Decision Date: 30 April 1951
• Docket Number: Civ. No. 556.
• Citation: 97 F. Supp. 273
• Parties: FEDERAL DEPOSIT INS. CORP. v. RECTENWALL.
• Court: U.S. District Court — Northern District of Indiana

97 F. Supp. 273

FEDERAL DEPOSIT INS. CORP. v. RECTENWALL.

Civ. No. 556.

United States District Court N. D. Indiana, Fort Wayne Division.

April 30, 1951.

Kennerk & Dumas, Fort Wayne, Ind., for plaintiff.

Hunt & Mountz, Fort Wayne, Ind., Atkinson & Sanders, Auburn, Ind., for defendant.

SWYGERT, District Judge.

The complaint, to which the defendant has directed a motion to dismiss for failure to state a claim, alleges that the defendant, as cashier of the Farmers and Merchants State Bank of Spencerville, Indiana, "did illegally, wrongfully, fraudulently and negligently pay or cause to be paid" to certain designated persons "funds of the Bank to which they were not entitled, by means of paying checks presented to the Bank and drawn by them on their respective accounts in the Bank when, in truth and in fact, the * * * parties did not have funds on deposit in their respective accounts sufficient to pay said checks." The complaint further alleges that the plaintiff is the assignee of this cause of action through its purchase, pursuant to 12 U.S.C.A. § 264(n) (4), of the unacceptable assets of the Spencerville bank, including this claim, in order to enable another insured bank to assume its deposit liabilities.

In his motion to dismiss, the defendant first urges that the well-recognized rule at common law that actions for personal torts are not assignable prevents the maintenance of this suit by the plaintiff. The plaintiff maintains, however, that it acquired this cause of action as an incident to a right of property, referring presumably to the other assets acquired by the plaintiff by its purchase, and thus that its right to bring this suit is controlled by the decision in Traer v. Clews, 1885, 115 U.S. 528, 6 S.Ct. 155, 29 L.Ed. 467. In view of the position which is taken, this contention need not be considered, other than to note that there are some substantial differences in the facts of that case and those of the case at bar.

At the outset it must be recalled that this question, like all others presented in actions in which the Federal Deposit Insurance Corporation is a party, is governed by federal and not state law. 12 U.S.C. § 264(j) Fourth; D'Oench, Duhme Co. v. F. D. I. C., 1942, 315 U.S. 447, 62 S.Ct. 676, 86 L.Ed. 956. As was stated in United States v. Allegheny County, 1944, 322 U.S. 174, 183, 64 S.Ct. 908, 913, 88 L.Ed. 1209: "The validity and construction of contracts through which the United States is exercising its constitutional functions, their consequences on the rights and obligations of the parties, the titles or liens which they create or permit, all present questions of federal law not controlled by the law of any state."

As a matter of federal law, however, the procedure employed here by the plaintiff has not been the subject of very extensive judicial consideration. Although in the only case found in which an assignment of a claim of this type was involved its validity was recognized, the court there apparently did not have before it the question of the assignability of such a claim as an action ex delicto. Brown v. New York Life Ins. Co., 9 Cir., 1945, 152 F.2d 246.

If it is conceded for present purposes that a claim of this type was non-assignable at common law, there yet remains, however, the question of whether this principle has been changed by the statutory procedure which the plaintiff here employed. Section 264(n) (4), under which the plaintiff acted, provides in part: "Whenever in the judgment of the board of directors such action will reduce the risk or avert a threatened loss to the Corporation and * * * will facilitate the sale of the assets of an open or closed insured bank to and assumption of its liabilities by another insured bank * * * the Corporation may purchase any such...