relationship with linder after do with the obligation on the guarantee it matters to the issue as to whether there was a fiduciary to concannon which was a key part of the district's court's decision on the fraud in fact  defense and it also matters to the court's decision that the delivery of the guarantee which was jose rendered delivered the guarantee to the bank the testimony was that math concannon didn't deliver the guarantee to the bank wasn't even aware of the name of the bank the bank's existence he had no knowledge whatsoever of the bank until years later when someone from the bank first contacted him about trying to collect on this guarantee that was undisputed and the bank didn't follow its own procedures and sending someone from the bank to obtain the guarantee so this trusted to do sherry delivers the guarantee to the bank and so the way that he she worked out in the case legally was the question arose if he was the authorised agent of concannon when he delivered the guarantee then it was an act of concannon that the deliver that the guarantee was delivered but if he was not authorized to act on behalf of concannon when he delivered the guarantee then there was no valid delivery of the guarantee and so for those reasons because there's an agency question involving course of conduct according to the district court's decision and because there's a fiduciary relationship question i would like to briefly address  is a is it's a matter of law either he was or wasn't the agent there could have been factual findings in support of that but the actual decision as to whether an agency relationships or existed either exists as a matter of law or it does not  are the facts disputed here the facts would seem to be pretty clear that your client was in some ways too trusting i suppose would be you know what it there was no there were i move forward to the the argument on the fraud in the fact i'm point which is point three which deals with the trust issue and the right to rely on a fiduciary the question presented on point three is did the district court err when it y when signing documents is there a right to rely on a fiduciary to explain for instance that a document creates new financial obligations the nature and extent of those obligations or that it makes no economic sen to enter into those obligations because they're not required under the circumstances that that's the core issue that were a fraud in the factum theory is it's and it's a typical to succeed on those when you have when you don't have someone being defrauded as to what it was they were signing and you have someone who could who could actually it's there they haven't been hidden from the facts it's not the situation of putting a deed in front of a bond person and telling them it's something else it's a fire and that was really the court's point and this is why the f ary issue is so important there's really two lines of cases here there's cases dealing with the do sherry's and cases not i would describe them with i don't mean to be disrespectful is kind of jack in the being stuck type of cases where someone comes in contact with someone who they have no prior relationship with they're strangers their arms length and there's a suggestion i'll trade you these beans for your cow now under those circumstances you have no right to rely on the representation that person makes to trust them to sign a document that they present to you without reading it or merely based on their representation unless there is some extenuating circumstance which is blindness etc and the court decided the case under that line of cases essentially treating this as a jack in the beanstalk type of situation and said dr king cannon you're far too sophisticated to make any complaint here there's a separate line of cases dealing with in the case law that we're relying on says that you have an absolute right to rely on your trusted food to sherry to to the exclusion of all reasonable not to the exclusion sorry for your own i  think what what what judge lauer i believe ultimately held in this case and the pro rata now was she looked at the copy of the guarantee and i think i'm presuming here she thought to herself if someone had presented me with this guarantee and i had looked at it i would have understood that i was incurring an obligation that's not in the in the in the judgment but i think that's fair to infer and the continents were available to yes the case law however while let me let me just jump to the policy consideration here ya the policy consideration is this bigger issue of reliance of a sophisticated person on a fiduciary sophisticated business people involved in complex matters must frequently repose trust  confidence in fiduciaries including accountants tax preparers business advisors as concannon did in this case it's a critical point because if this court affirms the district court's reasoning it will undermine relationships of all sophisticated persons you're centrally going to create a negligence analysis when you want to rely on a fiduciary instead of being able to say this is my fiduciary i have a trusted relationship the nature of the relationship here is subject to later challenge on the basis don't we don't get to negligence if we don't have a misrepresentation of the documents yes that was that's the key point here judge larry said there was no misrepresentation of the document essentially affirmatively the evidence was that at various times either mr lynn or or his assistant julie would bring documents to dr concannon and this is not disputed testimony say these are documents that need to what exactly what was said is in the record but these are documents that need to be signed in relation to the tax credit and they were represented as routine documents there was no disclosure of the fact that these are new documents you signed any document like this before this creates a new obligation it's a bill i can't guarantee of all existing debt and all future debt and the value of that debt is approaching twenty million dollars there was none of that disclosure whatsoever concannon testified that the only disclosure he ever had from winner was that the original six hundred thousand dollars that he invested in a tax shelter he would receive a six hundred thousand dollars tax credit essential a dollar for dollar laundered out they had to they no longer exist but under the odense decision there are several defenses that survive which can be he asserted against a later holder of it and that includes specifically the fraud in the fact in defense if there was fraud in the fact and there is no obligation that radiance and now in force and the question is how is that fair to true to radians the bank in this case and it's discus brief some cases about this when an agent appears at the bank and and represents themself to be an agent bringing you for instance a guarantee of twenty million dollars you are on notice as a bank that you must enquire and determine whether that agent actually has the authority that they purport to have or that they appear to have and so when the bank doesn't send someone out to get the signature per their regulation and when arrives representing that he has authority to deliver the guarantee and bind concannon to twenty million dollars the bank is on notice under the case law that it must inquire pick up the phone call from can and he can and did not hear from the bank until years later when it first sought to enforce the concerning whether there was a valid chain of assignments the question presented here is did the district court make a mistake of law when it rejected concannon as argument that the chain of title was defective due to avoid transfer the core dispute here is whether the f b i seized structured transaction was ultra vires virus which would spoil the chain of assignments in this case and i don't think there's any dispute among the parties was authority but what case do you have to that effect or what's going to tory long to decide what we site is the is the general and well known case law that a federal administrative agency is a creature of statute it has no power  less or until congress authorizes it to act as the supreme court said in the federal trade commission vs ral rallied him case we cite official powers cannot be extended beyond the terms and necessary implications of the the broader powers be desirable they must be conferred by congress these kinds of transactions have been happening for decades no your honor that's the difference in this case so i think it is good public policy it's good for the taxpayers but the f need something completely different in this case under its authority as a receiver there's specific statutory authority for what they can do as a receiver we've cited in our brief they can create a bridge bank they can create certain specific types of entities and we argue that saying you can create these two types of energies exclude you from creating other types amenities that aren't mention what the f t c did in this instance with something novel instead of auctioning  notes and loan files on the open market to private parties as they usually do when acting as a receiver what a receiver normally would be understood to do for very good public policy reasons they developed this new structure transaction program it was based on things that happened back in the savings and loan crisis in the f l s i c and there was a huge windfall to private investors because of the way those properties got dumped on the market and the f b i see again without any other it's very desirable congress never asked to authorize them to do this they decided to form public private partnerships with private equity and so the f d i c created an l l c a private business entity fifty fifty owned by the f and this private equity firm acorn private capital management and then after forming this limited liability company which they have no authority to form a limited liability company let alone to form one in a partnership with private equity interests they then sell the note not enough to that entity that the f d i c supposedly acting in its role as a receiver now own fifty fifty with private equity to own a loan file is an l l c with fifty fifty membership with a private capital company is not acting as a receiver at that point perhaps the transfer to that entity was done as a receiver but now standing on the other end of that transaction taking ownership of that in a fifty fifty partnership with private with a private entity that is nothing that has been done for decades your honor that is nothing that congress ever contemplated it is not mentioned in the enabling statute in any way shape or form and we argued that extensively in the brief it was good public policy allowing a acorn capital management to manage these properties for a period of time manage the correct moment at which to corners of where canons argument is that the city committed an ultra violent act by entering into a structured transaction with private investors using l c s that are owned by the network owned by the f t c and other private investors his brief cases highly distinguishable from our situation at hand and the louisiana public service commission case that dealt with a federal agencies preemption of state law that case did not deal the assets and conserve them for liquidation or reorganization that's what the f b i cia did in this particular situation concannon argues that the f b i s c would have been better served to have employed other methods and conserving the assets and liquid a knee assets upon their bank but the statute does not say these are the only ways you can do it a bridge depository institution things like that these are the only ways it doesn't acting what they did here was incidental to their expressed powers expressly can burn upon them by congress and conserving and liquidating the assets of from your bank this was something done in bergeron's of that we don't believe that the quote historically employed methods were the only way in which the f b i says he was authorized to act and again he can have cited no cases no statutory authority indicating that what the it's more important to protect the taxpayer is the nearest town hew to any specific requirement of law and as mr concannon counsel inform the court this what the see here did provided a benefit to the taxpayers well they certainly did that during the savings and determining what to do when it comes to conserving and liquidating the assets of a failed institution so i believe that broad authority conferred upon it would certainly in compas the actions that the f b i see employed in this particular matter if there are no further questions with respect to the structure transaction of move ahead to the delivery of the guarantee to premiere bank the district court found as a finding of fact that  delivered the guarantee to premier bank on behalf of concannon accordingly this finding because it is a finding of fact the subject to clearly iran or the i'm sorry clearly erroneous review which is as the court knows the highest standard there is appellate review so you're saying that the finding of fact included not only the delivery but the actual authority to make the delivery what i'm getting at right now is simply the delivery of the note to premier bank that was a finding of fact subject of a clearly his signature and can believe when there was acting on his behalf and paid manured to act on his behalf he can the knitted through his own testimony that the guarantee must have been provided to him by lanier as a result of these factors the district court found as a matter of law that when you're had actually already to deliver the guarantee to premiere bank so what i'm getting at is it is if the court does not overturn th not deliberate it would be of no value would be worth no more than the paper it was written on it was necessary to make the guarantee binding against concannon and as the district court noted if the if  guarantee arrived not from the person signing up but from the agent yes your honor i don't believe that's accurate and i believe that mistakes the law i'm not aware of any tastes where a bank has been provided a guarantee and they practice you know when you get a guarantee from somebody obligating them to repay millions of dollars i would suggest that it's probably wise for the bank to call that individual to confirm that he or she signed that guarantee but i'm aware of or no statutory authority which obligates the thing to do that so absent case law or statutory authority to that effect i don't believe premiere bank had a duty to further enquire as to the scope of years agency had lender provided other documents to the same bank over some period of time or that there been any kind of prior relationship established that he was in fact the farms project alone len you're his staff would bring concannon documents to sign a multiple probably dozens of times they that the two individuals had a longstanding relationship with each other that went back but i your honor he became a part owner in this providence farms l l c providence farms was a real estate development company illin your invested money into it and was a partner and as a result probably irrelevant but in terms of financial benefit what you get out of this out of signing the guarantee i'm not sure i agree with you i'm not sure that it's relevant to the issues here but well it's more than passing well i should say more than passing strange when he's on the hook for what how many presumption would be that he was afforded a partnership interest probably in excess of what he paid for and in exchange for him signing this personal guarantee i don't believe that came out of the district court i would imagine  fraud of the fact that that's all right with the court proceeding regarding the fraud and the fact in concannon negligence to read the documents simply can't cannot rise to the level of fraud in the fact in th cases that i have seen entails situations where you had one party providing documents to the other party to sign who was in a basket the superior position for example there was one case where it was a ninety year old woman's son or daughter providing a document to sign and they represent in the document to be a receipt where in fact it actually obligated the ninety year old woman to repay back at a much money  the individual buying insurance from that particular person but the insurance agent is not a five use year and there was a case specifically on point that we discussed in our brief farmers ensurance company versus mccarthy case so i would  strongly disagree with the assertion that just because one is an agent one is also if i do share it further even if one is a five you cheri that does not excuse the spinal negligence in failing to read the document he or she was providing in this particular case we don't have an educated blind senile type of person but who is signing this document who is dr concannon who is a practicing physician trained at harvard medical school  there is no evidence that he could not have been aware of the nature of the contents of the document he was signing cases are very clear both state and federal that one is presumed to have read the entirety of any document he i don't believe there was any negligence on his that there there should have been a finding of negligence on his part