Federal Deposit Ins. Corp. v. Bird

• Decision Date: 16 June 1981
• Docket Number: Civ. No. 79-800.
• Citation: 516 F. Supp. 647
• Parties: FEDERAL DEPOSIT INSURANCE CORPORATION, In its Corporate Capacity, Plaintiff, v. Esteban D. BIRD, et al., Defendants.
• Court: U.S. District Court — District of Puerto Rico

516 F. Supp. 647

FEDERAL DEPOSIT INSURANCE CORPORATION, In its Corporate Capacity, Plaintiff, v. Esteban D. BIRD, et al., Defendants.

Civ. No. 79-800.

United States District Court, D. Puerto Rico.

June 16, 1981.

Feldstein, Gelpí, Hernández & Castillo, San Juan, P. R., for plaintiff.

Harry R. Nadal Arcelay, Ramon L. Walker Merino, Jesus R. Rabell Mendez, Cancio, Nadal & Rivera, San Juan, Puerto Rico, for movants.

César T. Andreu Megwinoff, San Juan, P. R., José Guillermo Vivas, Ponce, P. R., Pablo R. Cancio, Cancio & Cancio, Aguadilla, P. R., Charles A. Cordero, Old San Juan, P. R., José A. Sánchez Alvarez, Hato Rey, P. R., Donato Rivera de Jesús, Ramírez & Rivera, Hato Rey, P. R., Antonio Zapater Cajigas, Ponce, P. R., Carlos G. Látimer, Santurce, P. R., José A. Axtmayer, San Juan, P. R., Guillermo Nigaglioni, Nigaglioni, Palou & Ledesma, Hato Rey, P. R., Salvador Antonetti, Goldman, Antonetti & Davila, Santurce, P. R., for defendants.

OPINION AND ORDER

PEREZ-GIMINEZ, District Judge.

This is an action brought by the Federal Deposit Insurance Corporation (FDIC), in its corporate capacity, to enforce rights of action against former directors and officers of Banco Crédito y Ahorro Ponceño (Banco Crédito), and their insurors, which FDIC acquired from the Receiver of Banco Crédito. The Secretary of the Treasury of the Commonwealth of Puerto Rico, upon determining that Banco Crédito was in unsound financial condition and insolvent, ordered the bank closed and appointed FDIC as Receiver on March 31, 1978. Subsequently, FDIC, in its corporate capacity, and pursuant to 12 U.S.C. § 1823(e), purchased from the Receiver certain assets of Banco Crédito, including "any claim or claims against (Banco Crédito's) directors, officers of employees.".

This action seeks recovery for losses sustained by Banco Crédito as a result of alleged improprieties on the part of defendants. Plaintiff's theories of recovery, which rely upon the same underlying allegations of impropriety, are based on (1) alleged breaches of defendants' statutory and fiduciary duty owed Banco Crédito arising from an implied contract on the part of the defendants to discharge faithfully their duties as directors, and (2) negligence, i. e., failure to exercise care and diligence commensurate with the risk of harm and loss which their acts and omissions could cause.

Certain of the defendants¹ have filed a Motion to Dismiss on the ground that the action is barred by the applicable statute of limitations. In their Motion to Dismiss, defendants first urge that plaintiff's claims sound in tort and that any action brought against them must be filed within the prescribed period imposed by the applicable statute of limitations for such actions which would be one year under Puerto Rican law. The defendants next urge that the applicable limitations commenced to run at the time when the particular improprieties were committed by particular defendants. Consequently, defendants argue, plaintiff would have to allege and prove that each alleged improper act or omission occurred within the one year preceding the date of the filing of plaintiff's original complaint on March 30, 1979.

At the outset it must be understood that the questions presented in this action, like most others in actions in which the FDIC, in its corporate capacity, is a party, are governed by federal and not state law. The FDIC was created by an Act of Congress. 12 U.S.C. § 1811, et seq. All suits of a civil nature to which FDIC is a party are "deemed to arise under the laws of the United States". 12 U.S.C. § 1819. The Supreme Court "has consistently held that federal law governs questions involving the rights of the United States arising under nationwide federal programs". United States v. Kimbell Foods, Inc., 440 U.S. 715, 99 S.Ct. 1448, 1457, 59 L.Ed.2d 711 (1979). Where the authority of federal agencies to effectuate transactions derives "from specific acts of Congress passed in the exercise of a `constitutional function or power,' (citation omitted) their rights, as well, should derive from a federal source". Id.; Clearfield Trust Co. v. United States, 318 U.S. 363, 63 S.Ct. 573, 87 L.Ed. 838 (1943).

Determining that federal law controls in a particular case often gives rise to a second, "more difficult task ... of giving content to this federal rule". Kimbell Foods, supra, 99 S.Ct. at 1458. In Clearfield Trust, supra, the Supreme Court said:

"In absence of an applicable Act of Congress it is for the federal courts to fashion the governing rule of law according to their own standards.... In our choice of the applicable federal rule we have occasionally selected state law...."

318 U.S., at 367, 63 S.Ct., at 575. To hold that federal common law shall control does not inevitably require the creation of a nationwide federal rule. In certain circumstances, depending upon the nature "of the specific governmental interests and to the effects upon them of applying state law", it would be entirely appropriate to adopt and apply relevant state law as part of the federal common law. Kimbell Foods, supra, 99 S.Ct., at 1458, quoting United States v. Standard Oil Co., 332 U.S. 301, 310, 67 S.Ct. 1604, 1609, 91 L.Ed.2d 2067 (1947). A primary consideration in each circumstance would be the existence vel non of an applicable federal statute. This Circuit has held, for example, that in cases arising under the Civil Rights Act, 42 U.S.C. § 1983, et seq., adoption of state law comports with the general federal policy of recognition and use of state statutes of limitations when the federal statute contains none. Burns v. Sullivan, 619 F.2d 99 (1 Cir., 1980); Ramírez de Arellano v. Alvarez de Choudens, 575 F.2d 315 (1 Cir., 1978).

With specific respect to the FDIC, when, as in the instant case, it exercises authority granted it under 12 U.S.C. § 1823 and purchases assets from the receiver of a closed insured bank, its rights shall be determined by reference to federal law. D'Oench, Duhme & Co. v. FDIC, 315 U.S. 447, 62 S.Ct. 676, 86 L.Ed. 956 (1942); FDIC v. Meo, 505 F.2d 790, 793 n.4 (9 Cir., 1974); FDIC v. Rectenwall, 97 F.Supp. 273 (N.D. Ind., 1951); Gunter v. Hutcheson, 492 F.Supp. 546 (N.D.Ga., 1980). When acting in its corporate capacity, it is a federal agency. FDIC v. Glickman, 450 F.2d 416 (9 Cir., 1971); James v. FDIC, 231 F.Supp. 475 (W.D.La., 1964); Freeling v. FDIC, 221 F.Supp. 955 (W.D.Okla., 1962), affirmed 326 F.2d 971 (10 Cir., 1963).

In the instant case, however, the task of giving content to the federal law to be applied with respect to the applicable limitations statute is not difficult. In 1966 Congress enacted Pub.L. 89-505, codified at 28 U.S.C. § 2415, which established, to the exclusion of the application of any state law, "a federal statute of limitations with respect to every action for money damages brought by the United States or an officer or agency thereof which is founded upon any contract express or implied...", 28 U.S.C. § 2415(a) and "every action... founded upon a tort...", 28 U.S.C. § 2415(b). The intention of Congress to include federally created corporations such as plaintiff is clear from the legislative history of this statute. S.Rep.No.1328, 89th Cong., 2d Sess., reprinted in (1966) U.S.Code Cong. & Ad.News 2502, 2508. Furthermore, it has been held that the federal statute of limitations is applicable where the agency has acquired its claim by assignment. United States v. Sellers, 487 F.2d 1268 (5 Cir., 1973); Weissenger v. United States, 423 F.2d 782 (5 Cir., 1968); vacated on other grounds, 423 F.2d 795 (5 Cir., 1968); United States v. Dold, 462 F.Supp. 801 (S.D.S.Dak., 1978); United States v. Winter, 319 F.Supp. 520 (E.D.La., 1970).² The existence of a clear Congressional intent to establish for the United States and its agencies statutes of limitations with respect to contract and tort claims dictates the result that the provisions of 28 U.S.C. § 2415 be applied to this action.

The issue that remains to be determined is that of when FDIC's cause of action accrued. For reasons discussed more fully below, however, this Court does not find it necessary to determine the exact time of accrual in ruling on the instant motion to dismiss. Similarly, it is not necessary to rule on the issue of whether FDIC's claims sound in contract or in tort. Nevertheless, some discussion of these issues is appropriate at this juncture.

Irrespective of whether FDIC's claims are determined to sound in contract or tort, the relevant federal statute of limitations would commence to run from precisely the same time, i. e., "after the right of action accrues". 28 U.S.C. § 2415. Consequently, FDIC would have had six years from the date of accrual to file this action if it sounds in contract (28 U.S.C. § 2415(a)) and three years to file if it sounds in tort (28 U.S.C. § 2415(b)). In either case the threshold question as to the date the right accrued is critical.

Before proceeding with an analysis of the arguments of the parties regarding the accrual issue, the Court notes that the mere fact of the acquisition of the claims asserted in this action by the FDIC would not revive any claim which was already time barred by a Puerto Rican statute of limitations. In other words, if any of the claims which FDIC acquired on March 31, 1978, and asserts herein were barred by a relevant Puerto Rican limitations statute at that time, such claims remain barred. Guaranty Trust Co. v. United States, 304 U.S. 126, 141-142, 58 S.Ct. 785, 793, 82 L.Ed. 1224 (1938); United States v. Pall Corporation, 367 F.Supp. 976, 979 (E.D. N.Y., 1973); United States v. Blackmon, 496 F.Supp. 1250, 1251 (E.D.Ark., 1980). It is not necessary to determine at this time whether a federal agency may avail itself of the unexpired portion of a state limitations period if this be longer than the federal limitations period.

Defendants urge that a cause of action against bank directors for violations of common law and statutory...