Federal Deposit Ins. Corp. v. Csongor

Decision Date26 April 1984
Citation464 N.E.2d 942,391 Mass. 737
CourtUnited States State Supreme Judicial Court of Massachusetts Supreme Court

Thomas G. Hoffman, Boston, for defendant.

Ira K. Gross, Boston (Brian E. Pastuszenski, Boston, with him), for plaintiff.


HENNESSEY, Chief Justice.

The plaintiff, Federal Deposit Insurance Corporation (FDIC), as liquidator of Surety Bank and Trust Company (bank) pursuant to G.L. c. 167, § 26, brought an action against the defendant, Frank Csongor, for collection of a debt. 1 The plaintiff filed a motion for summary judgment, together with supporting affidavits. The defendant opposed the motion and submitted his own affidavit. In a detailed opinion covering all issues raised by the parties, the trial judge ordered summary judgment for the plaintiff. The defendant appealed, and we transferred the case here on our own motion. We conclude the judge correctly ordered summary judgment on the basis of the underlying debt owed by the defendant to the plaintiff, and in the circumstances of this case the judge did not need to address whether summary judgment would have been proper solely on the basis of the 1972 note. We affirm.

We summarize the facts as presented in the affidavits of both parties. The plaintiff introduced several affidavits relevant to this appeal. First was the affidavit of James A. Krachey, a liquidator for the bank. Krachey obtained the bank's records, among which was a promissory note dated March 21, 1972, in the amount of $153,260.86, payable to the bank on June 19, 1972, and signed by the defendant. The records also contained a "liability card" bearing the defendant's name and address. The bank maintained in the ordinary course of its business such liability cards on all borrowers as a record of loans made and payments received. Entries on the defendant's liability card were as follows: an entry recording a bank note taken from the defendant on August 16, 1971 (the 1971 note), in the amount of $149,454, bearing interest at a rate of seven per cent and due on February 9, 1972; an entry recording a bank note taken from the defendant on March 22, 1972 (the 1972 note), in the amount of $153,260.86, renewing the 1971 note. Next, the bank records contained four cancelled treasurer's checks drawn on the bank payable to and endorsed by the defendant. They were all dated August 13, 1971, and totaled $144,400, the amount of the 1971 note less $5,054 in prepaid interest. The records reflect that no payment was made on either note. The plaintiffs also submitted an affidavit of Ronald G. Willard, who was a liquidator of the bank in 1972. In the ordinary course of his work as a liquidator for the FDIC, he prepared a "tracing file" for Csongor's account. The tracing file was compiled from records kept in the ordinary course of the bank's business and shows the application that was made of the proceeds of the loan being traced. Willard traced the proceeds of the defendant's 1971 note to the four treasurer's checks discussed above. The proceeds were used to satisfy various obligations to the bank. See infra at 945. He also traced the 1972 note to the 1971 note. He states that the 1972 note renewed the 1971 note. The third affidavit presented by the plaintiff was made by Elizabeth McCarthy, a documents examiner who compared the signature on the 1972 note to certain other signatures admitted by the defendant to be his own. She stated her conclusion that the signature on the 1972 note and the signatures on the other documents were made by the same person. Finally, the plaintiff submitted affidavits of Mr. Ira K. Gross, the plaintiff's attorney, with portions of the defendant's sworn deposition testimony attached. In his deposition taken on May 27, 1980, the defendant testified that he had signed a blank note payable to the bank in the summer of 1971. He stated that he had gone to the bank and signed the note to help his brother. In addition, he gave sworn testimony in a deposition taken July 17, 1977, that in 1970 he was on the payroll of Northeast Welding & Machine Co., Inc., and later obtained stock in the company. Also attached to the affidavit of Mr. Gross was a certified copy of the articles of organization of International Technical Group, Inc., which listed the defendant as a director.

The affidavit submitted by the defendant stated: "1. On or about March 21, 1972, I signed a blank promissory note with the Surety Bank and Trust Company which was presented to me by the Bank's President, Daniel Moore. 2. At no time did I believe I was responsible for payment on the blank promissory note. 3. At no time did I personally receive any monies from the bank funds, as a result of signing the blank promissory note. 4. My brother, Desider Csongor, informed me that Daniel Moore had represented to him that the Bank would not require payment by me of indebtedness on the blank promissory note. 5. I would not have executed the note if Mr. Moore had informed me that I was personally liable for repayment of the funds. 6. I have examined the note which the plaintiff asserts that I signed. It is my honest belief that the signature on the note which I examined is not mine."

The judge stated that, "[a]fter reviewing the affidavits and counter-affidavits supporting and opposing the motion for summary judgment, this Court rules that as a matter of state commercial law the defendants have failed to raise a genuine, triable issue relating to their proffered commercial defenses, and the FDIC is entitled to summary judgment. However, even assuming that one or more of the commercial defenses were made out, the [Csongors] would be estopped from raising these defenses under applicable federal law." On appeal, the defendant challenges the judge's decision on three grounds. First, he argues that there was insufficient uncontradicted evidence of a debt owed to the plaintiff to justify a grant of summary judgment. Second, he claims to have produced sufficient evidence of his status as an accommodation maker to preclude a grant of summary judgment. Finally, he asserts that the entry of summary judgment was improper because he denied that he had received or borrowed money at the "time he signed the blank promissory note." 2 There is no merit in any of the defendant's contentions.

"Summary judgment is a 'device to make possible the prompt disposition of controversies on their merits without a trial, if in essence there is no real dispute as to the salient facts....' " Cassesso v. Commissioner of Correction, 390 Mass. 419, 422, 456 N.E.2d 1123 (1983), quoting Community Nat'l Bank v. Dawes, 369 Mass. 550, 553, 340 N.E.2d 877 (1976). Reviewing the order of summary judgment now before us, we will uphold it if "certain factors converge to convince us that the trial judge was ruling in this case on undisputed facts and, of course, that his ruling was correct as matter of law." Community Nat'l Bank v. Dawes, supra at 556, 340 N.E.2d 877. See Farley v. Sprague, 374 Mass. 419, 425, 372 N.E.2d 1298 (1978). Accordingly, the defendant must have established by sworn statements some dispute of material fact, or must demonstrate some error of law, for this court to overturn the order of the trial judge.

The defendant argues that he has met his burden of raising a disputed issue of material fact by challenging the authenticity of his signature on the 1972 note. See G.L. c. 106, § 3-401(1), inserted by St.1957, c. 765, § 1 ("No person is liable on an instrument...

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