[PUBLISH]

In the

United States Court of Appeals

For the Eleventh Circuit

____________________

No. 20-13735

____________________

LANDCASTLE ACQUISITION CORP., 

Plaintiff-Appellee,

versus

RENASANT BANK, 

Defendant-Appellant.

____________________

Appeal from the United States District Court

for the Northern District of Georgia

D.C. Docket No. 2:17-cv-00275-RWS

____________________

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2 Opinion of the Court 20-13735

Before WILLIAM PRYOR, Chief Judge, GRANT, and HULL, Circuit 

Judges.

HULL, Circuit Judge:

This case arises out of the insolvency of the Crescent Bank 

and Trust Company (“Crescent”) and the conduct of its customerlawyer Nathan Hardwick, a manager of his law firm, Morris 

Hardwick Schneider, LLC (“Hardwick law firm”). In 2009, 

Crescent, a Georgia bank, made Hardwick a loan for $631,276.71. 

Hardwick, as his law firm’s manager, signed a security agreement 

that pledged, as collateral, his law firm’s certificate of time deposit 

(“CD”) for $631,276.71. So far, all looked hunky-dory, or facially 

valid in legal speak.

For five years, Hardwick’s loan remained current. When 

Crescent failed, the Federal Deposit Insurance Corporation 

(“FDIC”), as receiver, took over and sold Hardwick’s loan and CD 

collateral to Renasant Bank. Hardwick then made loan payments 

to Renasant, and Renasant held the CD collateral.

When Hardwick defaulted in 2014, the security agreement 

permitted Renasant to liquidate the CD collateral to pay the loan 

balance, which Renasant did. Renasant notified the Hardwick law 

firm of the loan default and CD liquidation but received no 

response—much less any objection—from the law firm.

Eventually, Hardwick’s and his law firm’s financial troubles

caught up with them. The law firm filed for bankruptcy, and 

Hardwick was convicted of wire and financial fraud. See United 

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States v. Maurya, 25 F.4th 829, 835 (11th Cir. 2022). The bankrupt 

law firm had countless creditors, including plaintiff Landcastle 

Acquisition Corporation (“Landcastle”), which was assigned the

law firm’s potential claims against others.1

In 2017, Landcastle sued Renasant (as successor to the FDIC 

and Crescent), claiming Renasant was liable for $631,276.71, the 

CD amount. Landcastle’s lawsuit seeks to invalidate the Hardwick 

law firm’s security agreement. 

That security agreement is unconditional and facially valid. 

But Landcastle alleges that Hardwick, the law firm’s agent and 

manager, lacked authority to pledge its CD as collateral. In its 

attempt to invalidate the security agreement, Landcastle 

introduces and relies on the law firm’s corporate records and 

testimony. Landcastle’s evidence thus comes from outside the 

failed bank’s records.

This case requires us to apply federal law developed from a 

combination of federal common law and a statute, known 

collectively as the “D’Oench doctrine.” See D’Oench, Duhme & 

Co. v. Fed. Deposit Ins. Corp., 315 U.S. 447, 62 S. Ct. 676 (1942); 12 

U.S.C. § 1823(e). That estoppel doctrine applies when the FDIC 

takes over a failed bank and sells it to a solvent bank. See D’Oench, 

315 U.S. at 460, 62 S. Ct. at 681. Just as the parol evidence rule bars 

extrinsic evidence to contradict a written contract, the D’Oench

1 In 2016, the bankruptcy court approved Landcastle’s $300,000 bulk purchase

of any claims that the Hardwick law firm potentially had against others.

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doctrine bars the use of evidence outside the failed bank’s records

to challenge the validity of a facially valid note, guaranty, or 

collateral pledge acquired by the FDIC from a failed bank and sold 

to a solvent bank, like Renasant. To be clear, D’Oench does not 

bar such challenges; rather, it limits what evidence can be used to 

mount those challenges.

Courts have developed this robust federal common law 

because the FDIC must be able to rely upon the failed bank’s 

official records when it quickly estimates and sells a failed bank’s 

assets—loans and collaterals—to a successor bank that takes over 

the failed bank’s deposit liabilities. The FDIC’s immediate sale 

enables the purchaser-successor bank, like Renasant, to open the 

failed bank the next morning with deposits (the failed bank’s 

liabilities) available to customers without interruption. See 

Langley v. Fed. Deposit Ins. Corp., 484 U.S. 86, 91–92, 108 S. Ct. 

396, 401 (1987); Fed. Sav. & Loan Ins. Corp. v. Gordy, 928 F.2d 

1558, 1564 (11th Cir. 1991). Practically too, D’Oench affords the 

FDIC a super-charged, holder-in-due-course protection.

There’s more relevant D’Oench law and more to 

Hardwick’s tale but that gets us to the certified question:

Does D’Oench bar a claim (or defense) that the agent 

[Hardwick] who signed the agreement [the CD 

security agreement] with the bank [Crescent] 

purportedly lacked authority to do so?

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Applying the Supreme Court’s and our Circuit’s D’Oench

precedent, we hold that Landcastle’s lack-of-authority claims are 

barred because they rely on evidence that was outside Crescent’s 

records when the FDIC took over that failed bank and sold the 

Hardwick loan and CD collateral to Renasant.

Indeed, none of Landcastle’s evidence was in Crescent’s 

records. Undisputedly too, Crescent had no knowledge that 

Hardwick lacked authority to pledge his own law firm’s CD. 

Although D’Oench bars Landcastle’s non-bank-records 

evidence, Landcastle tries to escape D’Oench’s estoppel doctrine 

altogether. Landcastle makes a novel argument that seeks to slip 

in and use its non-bank-records evidence through another avenue. 

To do that, Landcastle isolates the 2009 transaction and then 

tries to use the same non-bank-records evidence to claim the 

security agreement was “void,” a legal nullity, and non-existent. 

From that, Landcastle argues Crescent itself never had any interest 

in the CD security agreement, the FDIC took over nothing from 

Crescent, the FDIC sold nothing to Renasant, and D’Oench

protection was never triggered.

But to allow Landcastle to do indirectly—introduce

non-bank-records evidence—what it cannot do directly in an FDIC 

case would eviscerate D’Oench equitable protection of the FDIC. 

That would mean every facially valid and unqualified note, 

mortgage, or collateral pledge assumed and sold by the FDIC as 

receiver would be subject to after-the-fact litigation based on 

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non-bank-records evidence alleging a former customer’s manager

lacked authority. That use of evidence outside the bank’s records

is precisely what D’Oench is designed to avoid.

The Supreme Court teaches us that even if a note is 

“voidable,” a failed bank can “transfer to the FDIC voidable title, 

which is enough to constitute ‘title or interest’ in the note” for 

purposes of the D’Oench doctrine. See Langley, 484 U.S. at 93–94, 

108 S. Ct. at 402. Therefore, agent Hardwick’s lack of authority,

even if proven by non-bank-records evidence,2 would render the 

security agreement, at most, voidable by the principal, but not 

void. So Crescent had and transferred at least a voidable interest 

to the FDIC, which is adequate for D’Oench purposes. 

Simply put, D’Oench bars Landcastle’s attempt to use

non-bank-records evidence to challenge the facially valid and 

unconditional security agreement acquired by the FDIC as receiver

from the failed bank Crescent and sold by the FDIC to Renasant.

We divide our opinion into these six parts: 

(1) we discuss the loan documents in Crescent’s records 

when the FDIC took over; 

2 The district court found fact issues existed as to whether Hardwick had 

apparent authority to pledge the CD given that all three managers, 

shareholders, and directors commingled their personal finances with those of 

their law firm. Further, the law firm’s CD was held as collateral for over five 

years and liquidated without objection by the law firm—yet another fact 

evincing Hardwick’s apparent authority.

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(2) we examine the procedural history and Landcastle’s

evidence that all comes from outside the failed bank’s records;

(3) we review Supreme Court and our precedent developing

the D’Oench estoppel doctrine as federal common law;

(4) we apply those D’Oench principles and explain that 

Landcastle’s lack-of-authority claims are barred because they are 

based on only evidence outside Crescent’s records;

(5) we outline why we reject Landcastle’s attempt to escape 

the D’Oench estoppel doctrine altogether; and 

(6) lastly, we respond to the dissent.

I. CRESCENT’S LOAN AND CD RECORDS 

The FDIC, created by Congress, works to insure deposits at 

banks and savings institutions. See 12 U.S.C. § 1811(a). When 

Crescent failed in 2010, the FDIC took over as receiver and, 

overnight, sold Crescent’s assets and liabilities—including the 

Hardwick loan and CD collateral—to Renasant. 

Prior to Crescent’s failure, Hardwick induced Crescent in 

2009 to make him a loan for $631,276.71: (1) by procuring a CD for 

$631,276.71 in the name of “Morris Hardwick Schneider, LLC”;

and (2) by signing, on the same day, an agreement granting 

Crescent a security interest in the CD as collateral for his loan. 

Crescent also had his law firm’s corporate resolution as to that CD.

When the FDIC took over as receiver, Crescent’s bank 

records included Hardwick’s note and these documents: (1) a

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Hypothecation Agreement (the “security agreement”) granting

Crescent a security interest in the CD; (2) an Assignment of the CD; 

and (3) the Hardwick law firm’s Corporate Resolution as to the 

CD. We review each in turn. 

A. Security Agreement as to the CD 

The parties to the security agreement are: (1) Crescent, the

“Lender”; (2) Nathan Hardwick, the “Borrower”; and (3) the 

Hardwick law firm, the “Pledgor.” The first page of the agreement 

states, “[I]n consideration of loans granted by Lender [Crescent] to 

Borrower [Hardwick], the [Pledgor Hardwick law firm] . . . hereby 

assigns the Lender all its right, title and interest to, and grants 

Lender a security interest in,” the CD collateral, described as CD 

#55529696. Hardwick signed for the Pledgor Hardwick law firm

as “MANAGING MEM[BER].”

The security agreement providesthat in the event of default,

Crescent may dispose of the CD collateral as a secured party. 

Undisputedly, the plain terms of the agreement permitted

Renasant to liquidate the CD to pay off Hardwick’s loan balance. 

B. Assignment of CD 

The CD was also assigned to Crescent as security for the 

payment of Hardwick’s loan. The Assignment states, “Assignment 

of deposit or share account: For value received, I [the Hardwick 

law firm] assign and transfer to you [Crescent], and I give you a 

security interest in the following account(s): CRESCENT BANK 

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CD# 55529696.” Hardwick signed the Assignment as the 

“MANAGING MEM[BER]” of the Hardwick law firm. 

C. Law Firm’s Corporate Resolution as to the CD 

Crescent’s records contain a third document, entitled

“Resolution of Corporation, Partnership & LLCs.” The corporate 

resolution was signed by: (1) Hardwick, as both “MANAGING 

MEMBER” and “DESIGNATED REPRESENTATIVE” of the 

Hardwick law firm; and (2) Robert Driskell, the Hardwick law 

firm’s Chief Financial Officer, as an “AUTHORIZED SIGNER.” 

The corporate resolution was addressed to Crescent.

The second page of the corporate resolution states, 

“RESOLUTION APPLIES TO (check all that apply).” That second 

page has this box: “■ SPECIFIC ACCOUNTS ACCOUNT 

NUMBER(S): 55529696.” That box was checked. That number is 

the CD number. 

Below that checked box, the corporate resolution lists

Hardwick and Driskell as the “Authorized Parties.” The corporate 

resolution concludes with the proclamation: “IT IS FURTHER 

RESOLVED AS FOLLOWS, the Entity [the Hardwick law firm]

certifies to the Financial Institution [Crescent] that: Unless 

specifically designated, each of the Authorized Parties [Hardwick 

and Driskell] whose signature appears above may sign without the 

other(s).” 

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II. PROCEDURAL HISTORY 

In 2017, Landcastle filed this lawsuit against Renasant to 

recover the funds from the liquidated CD, alleging conversion and

breach of contract. Landcastle asserted that Hardwick lacked

authority to pledge the Hardwick law firm’s CD as collateral for his 

personal loan. 

A. Summary Judgment Evidence 

Following discovery, both parties moved for summary 

judgment. Landcastle introduced documents about the Hardwick 

law firm’s structure. None of these documents were in Crescent’s 

records. Yet we must review them because Landcastle bases its 

claims on them.

Landcastle’s documents revealed that the lawyers in the 

firm’s name—Arthur Morris, Hardwick, and Randolph 

Schneider—were not even “members” of the LLC law firm. In 

actuality, the law firm was owned by a corporation called 

MHSLAW, P.C. The designated “sole member” of the firm was

MHSLAW, P.C. 

Landcastle emphasizes that (1) although Hardwick was a 

manager, he was not a “member”; (2) only MHSLAW, P.C. was a 

“member”; and (3) only MHSLAW, P.C. had authority to pledge 

the CD. 

Of course, nothing about MHSLAW, P.C. was in Crescent’s 

records. Instead, the CD was in the name of the Hardwick law 

firm. Plus, Landcastle’s documents show Hardwick (1) owned 

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50% of MHSLAW, P.C.’s stock, (2) was “President” and a 

“director” of MHSLAW, P.C., and (3) was a “Manager” of the 

firm.3 Hardwick ran the show, so to speak.

Now comes the twist that Landcastle tries to use, derived 

from a deep dive into MHSLAW, P.C.’s corporate structure.

MHSLAW P.C.’s bylaws—also evidence outside the failed bank’s 

records—state that a “director” cannot guarantee a debt over 

$10,000 “without the affirmative vote of the majority of the votes 

entitled to be cast by the shareholders.” And the law firm’s 

operating agreement provides that a “Manager” cannot guarantee

a debt over $10,000 “without the affirmative vote of the Members 

holding a majority interest.” 

3 Hardwick’s broad authority as President of MHSLAW, P.C. is demonstrated

by how MHSLAW, P.C.’s bylaws describe his President’s role: 

The President shall be the chief executive officer of the 

Company and shall have general and active management of 

the operation of the Company. He shall be responsible for the 

administration of the Company, including general supervision 

of the policies of the Company and general and active 

management of the financial affairs of the Company, and shall 

execute bonds, mortgages, or other contracts in the name and 

on behalf of the company.

Similarly, the law firm’s operating agreement designated Hardwick as a 

“Manager” and provided Hardwick with “complete power and authority to 

act on behalf of the Company, enter into contracts on behalf of the Company 

and otherwise bind the Company in any other manner.” 

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Because Hardwick owned only 50% of MHSLAW, P.C. and 

not a majority interest, Landcastle contended (1) Hardwick needed 

the vote of another shareholder of MHSLAW, P.C., and (2) thus 

Hardwick lacked authority to unilaterally pledge his law firm’s CD. 

Landcastle also filed declarations from Morris and Schneider—who 

each owned 25% of MHSLAW, P.C.’s stock—stating that they “did 

not vote to authorize either MHSLAW, P.C. or Morris Hardwick 

Schneider, LLC to pledge the CD as collateral.”

B. District Court’s Order and Certification 

In 2020, the district court denied both parties’ summary 

judgment motions. The district court determined that “it is 

beyond dispute that Crescent Bank did not know that Hardwick 

lacked authority to pledge the CD.” 

In denying Renasant’s motion, the district court identified as 

a threshold issue whether D’Oench bars Landcastle’s claims, based 

on non-bank records, that Hardwick lacked authority to execute 

Crescent’s security agreement. The court likened Hardwick’s lack 

of authority to a “forgery” that resembles “fraud in the factum.” 

The court concluded that “fraud in the factum” rendered the CD 

security agreement “void” and thus D’Oench did not apply. 

In denying Landcastle’s motion, the district court found that 

the corporate documents of MHSLAW, P.C. and the Hardwick law 

firm revealed that Hardwick did not have actual authority to 

pledge the CD because (1) the “sole member” of the law firm was 

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MHSLAW, P.C., and (2) Hardwick, despite owning 50% of its 

stock, needed the vote of another shareholder to pledge the CD. 

Nonetheless, the district court ruled that genuine fact issues 

existed as to whether Hardwick had apparent authority to pledge 

the CD. The court observed, inter alia, that all three managers of 

the LLC (who were also shareholders and directors of the LLC’s 

sole member MHSLAW, P.C.) failed to follow corporate 

formalities and routinely commingled their personal finances with 

those of the company.4 

In its same order, the district court certified two questions of 

law for immediate appeal pursuant to 28 U.S.C. § 1292(b). This 

Court granted Renasant’s petition for an interlocutory appeal as to

only the threshold question: “Does D’Oench bar a claim (or 

4 The dissent incorrectly claims that there is no evidence that Morris and 

Schneider—the other two managers, shareholders, and directors—knew 

about Hardwick’s purchase of the law firm’s CD or his pledge. Dissenting Op.

at 3. But the record creates fact issues about what Morris and Schneider knew. 

For example, Morris testified he knew of Hardwick’s financial troubles, and he 

“was [Hardwick’s] daddy for ten years” because Morris knew the law firm 

“[couldn’t] afford to have a major partner file for bankruptcy”; so Morris used 

personal funds and “weekly [bonus] payments” from the law firm given the 

“constant pressure on [Hardwick] from creditors for immediate funding.” 

Even the district court found that “Renasant’s evidence—in particular, the

managers’ use of [firm] funds to pay off Hardwick’s personal debts” raised fact 

issues about how Morris and Schneider conducted firm business. In short, 

Morris and Schneider were self-acknowledged enablers of Hardwick’s use of 

firm funds for his personal debts. 

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defense) that the agent who signed the agreement with the bank 

purportedly lacked authority to do so?” 

C. Standard of Review 

“We review de novo a question of law certified by the 

district court pursuant to § 1292(b).” Sec’y, U.S. Dep’t of Lab. v. 

Preston, 873 F.3d 877, 880 n.2 (11th Cir. 2017) (quotation marks 

omitted). While we “may not reach beyond the certified order, we 

may address any issue fairly included within the certified order.” 

Barrientos v. CoreCivic, Inc., 951 F.3d 1269, 1275 (11th Cir. 2020) 

(quotation marks omitted).

III. SUPREME COURT AND OUR D’OENCH PRECEDENT 

In this appeal, the certified question assumes that Hardwick

“purportedly” lacked authority to unilaterally pledge the CD. We 

proceed on that basis. In addition, Renasant stands in the shoes of 

the FDIC, and Landcastle in those of the Hardwick law firm.

Given D’Oench is not a doctrine we apply every day, we set 

forth the Supreme Court’s D’Oench and Langley decisions and 

then five Eleventh Circuit decisions holding D’Oench barred a 

broad array of claims against the FDIC when based on evidence 

outside the failed bank’s official records.

A. D’Oench Doctrine 

In 1942, the Supreme Court decided D’Oench, Duhme & 

Co. v. Federal Deposit Insurance Corp., creating what is known as 

the D’Oench doctrine. 315 U.S. 447, 62 S. Ct. 676. In D’Oench, the 

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FDIC conducted a purchase-and-assumption transaction of an 

insolvent bank and acquired a loan where the collateral was a 

demand note by the D’Oench company. Id. at 454, 62 S. Ct. at 678. 

When the FDIC sued to collect on the demand-note collateral, the 

D’Oench company asserted the defense of failure of consideration

because the failed bank had agreed the note would not have to be 

paid. Id. at 456, 62 S. Ct. at 679. The undisclosed agreement was 

evidenced by written “receipts,” stating: “This note is given with 

the understanding it will not be called upon for payment.” Id. at 

454, 62 S. Ct. at 678.

Yet the Supreme Court barred the D’Oench company’s

defense to the note as a matter of law. The Court concluded that 

the enforceability of the note was determined by federal common 

law rather than state law because of the federal policy to protect 

the FDIC. See id. at 457–61, 62 S. Ct. at 679–81. More specifically, 

the Supreme Court held that “secret agreements” could not be a 

defense to suit by the FDIC because such agreements would

contravene “a federal policy” that “protect[s] [the FDIC] and the 

public funds which it administers against misrepresentations as to 

the securities or other assets in the portfolios of the banks which 

[the FDIC] insures or to which it makes loans.” Id. at 457–58, 62 S. 

Ct. at 679–80 (emphases added). The written receipts reflecting the

insolvent bank’s agreement—that the note would not be paid—

were not in the bank’s official records when the FDIC assumed the 

bank’s assets and liabilities, and thus were not enforceable against 

the FDIC. Id. at 461, 62 S. Ct. at 681.

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B. Langley and 12 U.S.C. § 1823(e) 

Eight years after D’Oench, Congress passed The Federal 

Deposit Insurance Act of 1950, which broadened D’Oench’s 

protection of the FDIC. See 12 U.S.C. § 1823(e). Section 1823(e)

imposes various requirements on “any agreement which tends to 

diminish or defeat the interest” of the FDIC in any asset acquired 

from an insolvent bank. Id. An agreement—that “tends to 

diminish or defeat” the FDIC’s interest in an asset—is only valid

against the FDIC if it, inter alia, is in writing, is continuously an 

official record of the failed bank, is executed by the bank itself, and 

satisfies other approval and filing requirements in § 1823(e). Id.

Thirty-seven years later, the Supreme Court in Langley v. 

Federal Deposit Insurance Corp. concluded that the D’Oench

doctrine also protected the FDIC from claims raising “undisclosed 

conditions” and “fraud” as to “a facially unqualified note” the FDIC 

acquired from an insolvent bank. 484 U.S. at 92–93, 108 S. Ct. at

401–02 (emphasis added). In Langley, the FDIC sought to collect 

on the acquired note. Id. at 88–90, 108 S. Ct. at 400. The borrowers

alleged their note was “entirely void” and no contract was formed

because the failed bank itself procured their note through

fraudulent misrepresentations about the land being purchased with 

the note’s proceeds. Id. at 88–89, 108 S. Ct. at 400 (emphasis 

added).

Although the failed bank committed fraud, the Supreme 

Court concluded that the borrowers could not use evidence 

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inducement defense to the FDIC’s enforcement of “a seemingly 

unqualified note.” Id. at 92–93, 108 S. Ct. at 402. The Court

discussed how, when a bank fails, the FDIC must decide whether 

to (1) liquidate the bank’s assets (its loans) and much later pay the 

bank’s customers their deposits; or (2) provide public-funds 

financing for a solvent ongoing bank to purchase the failed bank’s

assets (its loans) and assume its liabilities (its deposits), thus 

avoiding an interruption in banking services. See id. at 91, 108 S. 

Ct. at 401. The FDIC’s evaluations “must be made with great 

speed, usually overnight” so that the successor bank opens the next 

morning with deposits accessible to customers without 

interruption and with assigned loans roughly equal to the assumed 

deposit liabilities. See id., 108 S. Ct. at 401 (quotation marks 

omitted).

The Supreme Court concluded that the FDIC would not “be 

able to make reliable evaluations if bank records contained 

seemingly unqualified notes that are in fact subject to undisclosed 

conditions.” Id. at 92, 108 S. Ct. at 401. The Court clarified that 

“[a] condition to payment of a note . . . is part of the ‘agreement’ to 

which the writing, approval, and filing requirements of 12 U.S.C. 

§ 1823(e) attach.” Id. at 96, 108 S. Ct. at 403.

In Langley, the borrowers’ “fallback position” was that a 

bank’s misrepresentation should fall outside the scope of D’Oench

and § 1823(e) “when the misrepresentation was fraudulent and the 

FDIC had knowledge of the asserted defense at the time it acquired 

the note.” Id. at 93, 108 S. Ct. at 402. In rejecting that claim, the 

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Supreme Court distinguished between “fraud in the factum” and 

“fraud in the inducement.” See id. at 93–94, 108 S. Ct. at 402.

The Court observed that fraud in the factum (1) is “the sort 

of fraud that procures a party’s signature to an instrument without 

knowledge of its true nature or contents”; (2) which “would take 

the instrument out of § 1823(e), because it would render the 

instrument entirely void”; and (3) would leave the FDIC with “no 

right, title or interest that could be diminished or defeated.” Id.,

108 S. Ct. at 402 (cleaned up).

On the other hand, the Court explained that “fraud in the 

inducement . . . renders the note voidable but not void,” and “[t]he 

bank therefore had and could transfer to the FDIC voidable title, 

which is enough to constitute title or interest in the note.” Id. at 

94, 108 S. Ct. at 402 (emphases added and quotation marks 

omitted). The Court reasoned that (1) “[t]his conclusion is not only 

textually compelled, but produces the only result in accord with 

the purposes of the statute,” and (2) “[i]f voidable title were not an 

‘interest’ under § 1823(e), the FDIC would be subject not only to 

undisclosed fraud defenses but also to a wide range of other 

undisclosed defenses that make a contract voidable.” Id., 108 Ct. 

at 402 (emphasis added).

The Court held that “neither fraud in the inducement nor 

knowledge by the FDIC is relevant to the section’s application.” Id.

at 93, 108 S. Ct. at 402. The Court pointed out that “a voidable 

interest is transferable whether or not the transferee knows of the 

misrepresentation or fraud that produces the voidability.” Id. at 94, 

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108 S. Ct. at 403. The Court stressed that “the equities [that] the 

statute regards as predominant” are those protecting the FDIC. 

See id. at 94–95, 108 S. Ct. at 403 (emphasis added).

Langley teaches three federal common-law lessons under 

D’Oench: (1) even if the failed bank itself made material 

misrepresentations and fraudulently induced the borrower to enter 

into a promissory note, the bank’s admitted fraud against a 

borrower renders the borrower’s note only “voidable but not 

void”; (2) the failed bank’s transfer of a voidable note to the FDIC 

is enough to grant the FDIC title or interest in the note; and (3) a 

borrower cannot use documents outside the failed bank’s official 

records to challenge a facially valid and unqualified note acquired 

by the FDIC from a failed bank. See id. at 93–94, 108 S. Ct. at 402–

03.

We now review our Circuit and other precedent faithfully

applying these D’Oench principles as federal common law. 

Repeatedly, our Court has emphasized that the FDIC cannot make 

a reliable evaluation, nor can a successor-purchaser bank, if a failed 

bank has facially valid and unconditional loan assets that are sold 

and then much later a party can challenge them based on 

documents outside the failed bank’s records.

C. FSLIC v. Two Rivers Associates, Inc. 

In 1989, this Court faced a situation where the failed bank’s 

official records did provide some support for the borrower’s 

defense. Nonetheless, this Court concluded that the D’Oench

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doctrine still protected both the FDIC and the Federal Savings and

Loan Insurance Corporation (“FSLIC”) from claims relying on

official bank records, unless those bank records contained an 

“explicit acceptance” of a specific legal obligation by the failed 

bank. Fed. Sav. & Loan Ins. Corp. v. Two Rivers Assocs., Inc., 880 

F.2d 1267, 1276 (11th Cir. 1989) (“Two Rivers”).5

In Two Rivers, after a bank failed, the FSLIC as receiver

instituted foreclosure proceedings against a borrower that had 

defaulted on its mortgage. Id. at 1270. A subordinate creditor 

opposed the foreclosure and filed affidavits from officials at the 

insolvent bank stating that the bank had agreed to fund the 

borrower’s entire project. Id. at 1273. The creditor argued, inter 

alia, that D’Oench should not apply because the bank’s agreement 

to fund the entire project was not “secret” but reflected in the failed 

bank’s own records. Id. at 1275.

The FSLIC contended that under federal common law the 

creditor was “estopped from asserting his defenses and 

counterclaims” based on documents and an agreement not in the 

failed bank’s records. Id. at 1273. In holding D’Oench barred the 

creditor’s claim against the FSLIC, this Court found the failed 

bank’s records contained evidence of an “obligation to provide an 

5 As to the FSLIC, this Court agreed with other circuits that D’Oench “should 

protect the FSLIC to the same extent it protects the FDIC.” Two Rivers, 880 

F.2d at 1274–75. On August 9, 1989, the FSLIC was abolished, and the FDIC 

became its statutory successor. See Gordy, 928 F.2d at 1559 n.1.

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additional” loan. Id. at 1275–76 (emphasis omitted). This Court, 

however, still applied D’Oench to bar the creditor’s claim because 

the bank’s records contained no “explicit acceptance of the 

obligation to fund the entire project.” Id. at 1276.

In so ruling, this Court observed that the D’Oench doctrine

“allow[s] the FDIC to rely on bank records . . . when taking over a 

failed bank.” Id. at 1275. Adhering to Langley, our Court

emphasized that “neither the FDIC nor the state banking 

authorities would be able to make a reliable evaluation if bank 

records contained seemingly unqualified notes that are in fact 

subject to undisclosed conditions.” Id. at 1276 (alterations adopted) 

(quoting Langley, 484 U.S. at 91–92, 108 S. Ct. at 401).

Our Court also stressed: While the creditor’s arguments and 

affidavits “might be appropriate in a suit against [the insolvent 

bank]” had the bank not failed, they were “not sufficient in this case 

to survive summary judgment against the FSLIC.” Id. In other 

words, while under state law a creditor’s claim may be viable 

against a failed bank, under federal common law, the creditor “[i]s 

estopped” from asserting claims based on documents not in the 

failed bank’s records. See id. at 1277.

D. FDIC v. McCullough 

Extending the federal common-law D’Oench doctrine

further, this Court has held D’Oench barred borrowers’ claims that 

a note and mortgage were entirely “void” based on “failure to 

perform a condition precedent, failure of consideration, and 

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fraudulent inducement.” Fed. Deposit Ins. Corp. v. McCullough, 

911 F.2d 593, 600–02 (11th Cir. 1990) (emphasis added).

McCullough is particularly instructive here. In that case, 

Charles Little borrowed over $1 million from Twin City FSB, a 

local bank, secured by a mortgage on various properties. Id. at 595. 

The borrowers assumed Little’s debt held by Twin City. Id. at 595–

96. When Twin City failed, the FSLIC, as receiver, sued the 

borrowers to recover the debt. Id. at 596. In defense, the 

borrowers contended that (in consideration of their assuming 

Little’s debt) the failed Twin City had promised to convey to them

title to certain properties and oil leases. Id.

The borrowers argued: (1) “the note and mortgage should 

be considered void because Little and [the failed] Twin City had 

fraudulently induced them to assume Little’s prior indebtedness”; 

(2) “the transaction should be declared void due to a failure of 

consideration”; and (3) “the mortgage being sued upon was legally 

insufficient because the notarization was not conducted in 

accordance with Alabama law.” Id. (emphases added).

In affirming the grant of summary judgment for the FSLIC, 

this Court addressed the scope of D’Oench. Id. at 599. Even 

though D’Oench involved a secret agreement, we observed that 

“the policy considerations leading to the development of federal 

common law in D’Oench have resulted in extension of the 

D’Oench estoppel doctrine well beyond” its initial factual setting. 

Id. at 600. Borrowers’ claims and defenses based “upon unrecorded 

promises or schemes”—even if creating claims of fraudulent 

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inducement or failure of consideration—“are now also generally 

precluded by D’Oench and its progeny.” Id. Our Court again 

underscored that “[s]uch defenses if allowed against the FSLIC or 

the FDIC would, like the defense at issue in D’Oench, contravene 

the primary federal policy that the FSLIC and the FDIC must be 

able to rely upon financial institutions’ records in order to best 

protect the public funds they administer.” Id. (emphasis added).

Our Court concluded, to put the FSLIC on notice of the 

failed bank’s obligation to transfer the mortgaged or other 

property, there must be “explicit documentation evidencing [the 

failed bank’s] obligation to transfer specific properties to the 

McCulloughs.” Id. at 601. While there were two documents in the 

bank’s records with references to transfers of additional property, 

those documents were legally insufficient under D’Oench to give 

notice to the FSLIC that the failed bank “had made a fixed 

commitment” to transfer property. Id.

This Court also rejected the McCulloughs’ argument that

the mortgage securing the note was legally insufficient. Id. at 602–

03. “Although facially appearing to be a valid, legal mortgage, the 

parties agree[d] that the mortgage was not witnessed or 

acknowledged in proper fashion” under Alabama law. Id. at 602. 

The borrowers argued that under state law this flaw rendered the 

bank’s mortgage “voidable” and “insufficient to pass legal title” to 

the property described in the mortgage. Id. (emphases added). 

In holding D’Oench barred that claim, this Court compared 

D’Oench’s protection of the FDIC and FSLIC as analogous to state 

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law protection of “a holder in due course.” Id. Our reasoning was: 

“Although the error in acknowledgement might render the 

mortgage voidable were this suit between two private parties 

litigating under state law, we conclude that the FSLIC’s federal 

common law defenses bar the McCulloughs’ claim of improper 

notarization. On its face, the mortgage appears valid.” Id.

(emphasis added).

Our Court also concluded that the FSLIC, if accorded 

holder-in-due-course status under Alabama law, “could not be said 

to have had notice of the irregularity of which the McCulloughs 

now complain.” Id. at 604. In any event, the irregularity in the 

mortgage is not cognizable against a holder in due course. Id. So 

long as the disputed note or loan in the bank’s records appears

facially valid, the FDIC as receiver is allowed to rely on it with the 

protection of the D’Oench doctrine. See id. at 602.

E. Twin Construction, Inc. v. Boca Raton, Inc. 

Once more this Court faced a scenario where a document in 

the failed bank’s official records supported a party’s claim against 

the FDIC. Nevertheless, this Court held that a document in the 

failed bank’s records is not enough to bring a party’s claim outside 

of D’Oench protection unless the document was executed by the 

failed bank. See Twin Constr., Inc. v. Boca Raton, Inc., 925 F.2d 

378, 382–84 (11th Cir. 1991). We discuss Twin Construction as it 

(1) rejected arguments that D’Oench bars only borrowers’ claims; 

(2) concluded that D’Oench applies to collateral pledge agreements 

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securing a loan; and (3) emphasized that D’Oench requires courts 

“to look beyond contract law.” See id.

A shopping center owner obtained a loan from Old Vernon

bank and pledged the property as collateral in a mortgage. Id. at 

379–80. Twin Construction built the shopping center. Id. at 380. 

A document in the bank’s official records, entitled “Contractor’s 

Consent,” stated that the bank would reserve sufficient funds in the

owner’s loan to pay and satisfy the owner’s agreement with Twin 

Construction (the “bank document”). Id. Twin Construction 

signed Old Vernon’s bank document. Id.

When Old Vernon did not pay, Twin Construction sued the 

bank: (1) to foreclose its mechanic’s lien for $1.5 million and to 

elevate that lien above Old Vernon’s mortgage; (2) for breach of 

the bank’s written contract to reserve funds to pay Twin 

Construction; and (3) for fraud. Id. In a separate action, Old 

Vernon sued the shopping center owner for defaulting on its loan 

and mortgage. Id. Old Vernon alleged its mortgage had priority 

over Twin Construction’s lien. Id. Twin Construction joined that 

lawsuit, making similar allegations as those in its own suit. Id. 

Thereafter, the bank failed. Id.

Ultimately, the FSLIC, as receiver, took over, consolidated 

the cases, and contended D’Oench barred Twin Construction’s 

claims against Old Vernon (now the FSLIC). Id. Twin 

Construction responded that D’Oench did not apply to its claims 

based on an official bank record and barred only (1) claims asserted 

by the borrower (the shopping center owner), and (2) unwritten 

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agreements between the borrower and the failed bank. Id. at 381. 

Because the bank document in the failed bank’s own records

represented Old Vernon would reserve loan funds to pay Twin 

Construction, Twin Construction contended there was no secret 

agreement. Id. at 383.

This Court held D’Oench barred Twin Construction’s 

claims. Id. at 384–85. In doing so, ourCourt outlined the evolution 

of the federal “D’Oench common law” and how it protects the 

FDIC, the FSLIC, and their successors “from claims of state and 

common law fraud, violation of state or federal securities laws, and 

the affirmative defenses of waiver, estoppel, unjust enrichment, 

failure of consideration and usury.” Id. at 382 (emphasis added).

We rejected Twin Construction’s argument that D’Oench

applies only to claims asserted by a borrower. Id. We pointed out 

that “D’Oench and section 1823(e) have affected monetary 

obligations including a mortgage, a letter of credit or personal 

guaranty or collateral pledge agreement securing a loan, rental 

payments under a lease, and a refund provision in an insurance 

contract.” Id. (emphasis added). D’Oench applies to any asset of 

the failed bank acquired by the FDIC or FSLIC because “[f]ederal 

regulatory authorities need to make reliable evaluations of the 

assets of a financial institution.” Id.

As to whether D’Oench barred Twin Construction’s claims

against the FSLIC based on a document in the failed bank’s records,

this Court made clear that D’Oench requires courts “to look 

beyond normal contract law.” Id. at 383 (emphasis added). Since

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Old Vernon’s bank document was signed by only Twin 

Construction and not by the bank, it “does not establish that the 

non-signatory [bank] is required to perform any obligations 

contained in the document. Instead, it would be necessary to 

resort to an assessment of the non-signatory’s words or acts in 

order to determine whether that party is so bound.” Id. at 384.

This Court also stressed that “[b]ank examiners must 

reliably evaluate the worth of a bank’s assets ‘with great speed, 

usually overnight, in order to preserve the going concern value of 

the failed bank and avoid an interruption in banking services.’” Id.

(quoting Langley, 484 U.S. at 92, 108 S. Ct. at 401). “That a 

document is written and in the bank’s records is not enough to 

bring the case outside D’Oench and section 1823(e).” Id. at 383. In 

order to impose any legal obligation of the bank on the FSLIC, the 

document must be “executed,” i.e., signed, by the bank, as well as 

in the bank’s records. Id. at 384; see 12 U.S.C. § 1823(e)(2).

F. FSLIC v. Gordy 

In a similar vein, this Court in Federal Savings & Loan 

Insurance Corp. v. Gordy held that D’Oench protected the FSLIC 

from a guarantor’s fraud claim that the failed bank had falsely 

misrepresented its financial statements. 928 F.2d at 1559–60, 1566. 

In Gordy, two individuals (guarantors of a letter of credit)

negotiated a plan to acquire and develop a hotel. Id. at 1560. 

During the negotiations, the bank provided them with “a written 

statement of [the bank’s] financial condition,” portraying “a sound 

financial condition,” even though the bank was insolvent. Id.

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After the bank failed, the FSLIC sought payment from the 

guarantors. Id. The guarantors argued D’Oench was inapplicable 

because the bank’s own misrepresentations constituted fraud in the 

factum. Id. at 1561.

The Gordy Court held that D’Oench applied to bar the 

guarantor’s fraud claim. Id. at 1564. The bank’s financial statement

in Gordy was a “condition of payment” that was not

“memorialized in writing or otherwise made explicit such that the 

FSLIC or the FDIC would have knowledge of the bank’s 

obligations during an evaluation of the bank’s records.” Id.

(quotation marks omitted). So D’Oench applied to protect the 

FSLIC from the guarantor’s fraudulent misrepresentation claim. 

Id.

D’Oench applied “even in the absence of bad faith, 

recklessness or negligence” on the part of the guarantors seeking 

to invalidate their guaranty. Id. at 1566; see Baumann v. Savers 

Fed. Sav. & Loan Ass’n, 934 F.2d 1506, 1515 (11th Cir. 1991) (“[T]he 

D’Oench doctrine applies even where the customer is completely 

innocent of any bad faith, recklessness, or negligence.”).

Similar to the Supreme Court’s Langley, this Court 

explained the material difference between fraud in the factum and 

fraud in the inducement. Gordy, 928 F.2d at 1565. The Gordy

Court held that the false financial statement was not fraud in the 

factum, but was “fraud in the inducement,” and D’Oench applied. 

Id. at 1566. This Court described fraud in the factum “as ‘the sort 

of fraud that procures a party’s signature to an instrument without 

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knowledge of its true nature or contents,’” rendering the 

agreement entirely void. Id. at 1565 (quoting Langley, 484 U.S. at 

93, 108 S. Ct. at 402). Conversely, fraud in the inducement “does 

not go to the very essence of the agreement but rather merely 

induces the party to enter the agreement,” rendering the 

agreement “voidable and thus capable of transfer.”6 Id.

G. First Union National Bank of Florida v. Hall 

Significantly, this Court has instructed that the 

“common-law” D’Oench doctrine serves as a super-charged parol 

evidence rule that precludes evidence of an agreement that tends 

to diminish or defeat the FDIC’s interest in any asset acquired from 

a failed bank. First Union Nat’l Bank of Fla. v. Hall, 123 F.3d 1374,

1379 n.9, 1380–81 (11th Cir. 1997). In Hall, First Union sued Hall

to collect on his defaulted note that it acquired through a purchaseand-assumption agreement with the FDIC. Id. at 1376. Hall

claimed that the insolvent bank “had agreed to limit its remedies in 

the event of default.” Id. Hall offered affidavits and documents to 

prove that such an agreement existed, including the affidavit of 

Harrison, a former bank officer. Id. at 1380. First Union argued 

that D’Oench barred Hall’s claim and evidence. Id. at 1376.

6 To be complete, this Court has created an exception to D’Oench for “free

standing tort claims that are not related to a specific asset acquired by the 

FDIC.” Vernon v. Fed. Deposit Ins. Corp., 981 F.2d 1230, 1233–34 (11th Cir. 

1993); Vernon v. Resol. Tr. Corp., 907 F.2d 1101, 1108 (11th Cir. 1990). Here, 

no party relies on this free standing tort exception, so we need not discuss it.

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This Court ruled that the “common-law” D’Oench doctrine 

“flatly prohibits parol evidence.” Id. at 1380. “Allowing Hall to 

present parol evidence, such as Harrison’s affidavit, would force 

the FDIC and its transferees to look beyond the plain terms of the 

documents. That is a burden of which the D’Oench, Duhme

doctrine seeks to relieve them.” Id. at 1381. This Court, therefore,

held that Hall’s parol evidence was barred by the “common-law” 

D’Oench doctrine. Id. at 1379 n.9, 1381.

Although this concludes our outline of relevant Circuit 

precedent, we review one state decision because it applies the 

federal D’Oench doctrine to bar a lack-of-authority claim.

H. Federal Financial Co. v. Holden 

Applying federal common law, the Georgia Supreme Court 

has held that D’Oench protects the FSLIC as receiver from a 

property owner’s claim that a partner lacked authority to pledge a 

security interest in property. Fed. Fin. Co. v. Holden, 485 S.E.2d 

481, 483 (Ga. 1997). In Holden, three brothers, who were three of 

the four members of a partnership, executed a security deed 

conveying to a bank title to property owned by the partnership. Id.

at 482. The three brothers lacked authority to convey the 

partnership property. Id. The bank failed, the FSLIC became 

receiver, and Federal Financial, as the FSLIC’s successor, became 

the assignee of the security deed and the note it secured. Id.

Plaintiff Holden was not paid for his work on the property. 

Id. He filed a lien and sued to set aside the failed bank’s senior 

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security deed. Id. Holden claimed the bank’s security deed was 

worthless because the three brothers lacked authority from the 

partnership to pledge the property as security. Id. Fact issues 

existed as to who owned the property, what authority the brothers 

had, and what the bank knew. See id. A jury found “that the 

property was partnership property, that the bank had knowledge

that the property was partnership property, and that the brothers 

did not have authority from the partnership to execute the security 

deed.” Id. (emphases added). The state trial court canceled the 

bank’s security deed and established Holden’s lien. Id.

Based on the federal D’Oench doctrine, the Georgia 

Supreme Court reversed and entered judgment as a matter of law

for Federal Financial, the FSLIC’s successor. Id. at 483. The Court 

pointed out that Holden’s attack on the security deed was based on 

“two unrecorded agreements” that were not in the bank’s official 

records: (1) the partnership agreement, and (2) the agreement 

between the brothers and the bank permitting them to pledge 

partnership property. See id. Even where the failed bank knew the

property was partnership property and the brothers lacked 

authority to pledge it, the Georgia Supreme Court concluded that 

D’Oench still protected the FSLIC from claims based on 

documents that were not in the bank’s official records. Id.

We now apply these D’Oench principles.

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IV. APPLICATION OF D’OENCH TO THIS CASE 

To begin, the factual scenario here fits squarely within 

D’Oench. Overnight, the FDIC as receiver took over the failed 

Crescent and sold its assets (loans) and liabilities (deposits) to 

Renasant. See Langley, 484 U.S. at 91, 108 S. Ct. at 401. 

Undisputedly, the Hardwick note and the pledged CD collateral are 

loan assets the FDIC sold to Renasant.

A. Failed Bank’s Records 

Next, to apply D’Oench, we must examine what the failed 

bank’s records showed.

Those records contained the security agreement that

unambiguously and unconditionally pledged the Hardwick law 

firm’s CD to Crescent as security for Hardwick’s personal loan. See

McCullough, 911 F.2d at 600. Hardwick executed the agreement 

as managing member of the Hardwick law firm. Crescent even 

had the law firm’s corporate resolution as to the CD, which listed 

Hardwick as the managing member and authorized party to sign 

for the law firm. For D’Oench purposes, the agreement itself 

appeared facially valid.

Then for over three years, and after the FDIC’s sale to 

Renasant in 2010, Hardwick continued to pay on his loan, and 

Renasant continued to hold the law firm’s CD as collateral for 

Hardwick’s personal loan. When Hardwick defaulted in 2014, the 

terms of the security agreement plainly permitted Renasant to 

liquidate the CD to pay off Hardwick’s personal loan balance.

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B. Landcastle’s Evidence Outside the Bank’s Records 

Now applying D’Oench, we conclude that Landcastle’s 

claims against the FDIC and Renasant—that Hardwick lacked 

authority to sign the security agreement—are barred because they 

rely on evidence outside the bank’s records. D’Oench “flatly 

prohibits” consideration of Landcastle’s “parol evidence.” See Hall, 

123 F.3d at 1380. For purposes of summary judgment, we accept

that (1) those outside documents prohibited Hardwick, although

President and 50% owner of MHSLAW, P.C. and a manager of the 

Hardwick law firm, from guaranteeing debt over $10,000 without 

the vote of another shareholder; (2) the testimony states that no

such vote occurred; and (3) Hardwick lacked authority to enter 

into and execute the security agreement.

However, none of the law firm’s documents, nor any of this

testimony, was in the failed bank’s own records. The D’Oench

doctrine thus protects the FDIC from a claim or defense that relies

on documents and evidence not found in the failed bank’s official 

records. Resol. Tr. Corp. v. Dunmar Corp., 43 F.3d 587, 595 (11th 

Cir. 1995) (en banc); see Two Rivers, 880 F.2d at 1274;

McCullough, 911 F.2d at 600; Hall, 123 F.3d at 1379.

Throughout its brief, Landcastle argues that D’Oench

applies only to oral and written “agreements” outside the bank’s 

records. Landcastle mistakenly focuses narrowly on the word 

“agreement” in § 1823(e). As explained above, D’Oench is a federal 

common-law doctrine that extends well beyond § 1823(e) and 

broadly protects the FDIC from a claim or defense based on fraud, 

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34 Opinion of the Court 20-13735

undisclosed conditions, failure of consideration, and pre-conditions 

to payment, when based on documents not in the bank’s records. 

Landcastle’s claims fit that description, as they rely on outside law 

firm documents and testimony to show that Hardwick lacked 

authority to sign the security agreement with the failed bank.

C. Crescent’s Lack of Documentation 

Shifting its argument, Landcastle asserts that it is not the law 

firm’s governance documents but Crescent’s lack of 

documentation from the law firm that makes D’Oench

inapplicable. Landcastle contends that (1) the corporate resolution 

did not go far enough and expressly authorize Hardwick to pledge 

the law firm’s CD as collateral; (2) the insolvent bank thus lacked 

adequate documentation that Hardwick had authority; and

(3) because Hardwick was pledging his law firm’s CD for his 

personal loan, the loan transaction was suspicious and should have

placed Crescent on notice that Hardwick lacked authority.

To be clear, nothing herein addresses what claims or 

evidence the Hardwick law firm might have made or used against 

Crescent if Crescent had not failed and had liquidated the CD. 

Rather, this case is only about what claims and evidence can be 

made or used against the FDIC as receiver (and Renasant).

As to the FDIC, Landcastle attempts to impose a 

pre-condition—the bank’s obtaining a written authorization of 

Hardwick’s authority from the law firm—on the otherwise 

unconditional terms of the security agreement. Landcastle’s 

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20-13735 Opinion of the Court 35

authority requirement would condition the validity and 

enforceability of the security agreement on obtaining something 

outside the bank’s records. Nothing in the terms of the security 

agreement required a law firm or corporate resolution for its 

validity. As to the FDIC, the security agreement was facially valid.

Regarding the lack of documentation, both parties debate 

the legal effect of the Hardwick law firm’s corporate resolution that 

was in the bank’s records. However, as the district court found:

“[I]t is beyond dispute that Crescent Bank did not know that 

Hardwick lacked authority to pledge the CD.” 

We need not resolve the debate over the legal effect of the 

corporate resolution, if any, because nothing in the corporate 

resolution limits or disclaims Hardwick’s authority to pledge the 

CD. Nothing in the corporate resolution varies, contradicts, or 

alters the plain terms of the security agreement.

At bottom, Landcastle’s claims—that Hardwick lacked 

authority to unilaterally pledge the CD—rely on MHSLAW, P.C.’s 

and the law firm’s documents and testimony outside the failed 

bank’s records and are thus barred by the D’Oench doctrine.

V. LANDCASTLE’S CLAIMS ARE SUBJECT TO D’OENCH 

What Landcastle is left to argue all revolves around its 

attempt to escape D’Oench’s estoppel doctrine altogether.

Landcastle isolates the loan-CD transaction and argues that 

Hardwick’s lack of authority rendered the security agreement 

entirely “void,” a legal nullity, and non-existent back in 2009, and 

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36 Opinion of the Court 20-13735

incapable of being transferred to the FDIC. From that, Landcastle 

argues the FDIC obtained nothing from Crescent—no title to or 

interest in the security agreement—and thus the FDIC sold nothing 

to Renasant and D’Oench has no application here. Landcastle also 

argues that Hardwick’s exceeding his authority constitutes fraud in 

factum. 

In response, Renasant and amici (the FDIC and the 

American and Georgia Bankers Associations) argue persuasively

that: (1) no fraud in factum occurred; (2) agent Hardwick’s lack of 

authority, at most, rendered the security agreement potentially

“voidable” by the principal law firm, but not “void”; and (3) thus 

Crescent had and did transfer an interest in the security agreement. 

They emphasize Langley which instructed: “Fraud in the 

inducement . . . renders the note voidable but not void. The bank 

therefore had and could transfer to the FDIC voidable title, which 

is enough to constitute ‘title or interest’ in the note” for D’Oench

purposes. Langley, 484 U.S. at 94, 108 S. Ct. at 402 (emphases 

added and citation omitted). 

We address each of Landcastle’s arguments in turn.

A. Fraud in the Factum 

We first reject Landcastle’s claims that Hardwick’s 

exceeding his authority constitutes fraud in the factum. The 

Supreme Court in Langley made clear that “fraud in the factum” is

only the narrow sort of real fraud that “procures a party’s signature 

to an instrument without knowledge of its true nature or 

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contents.” Id. at 93, 108 S. Ct. at 402. Similarly, this Court has 

described “fraud in the factum” as “fraud which occurs within the 

instrument itself, and as fraud arising when a party signs a 

document without full knowledge of the character or essential 

terms of the instrument.” Gordy, 928 F.2d at 1565 (quotation 

marks and citation omitted). There must be fraud in the 

procurement of a person’s signature itself that leaves the signer 

unaware of the nature of the document he has signed. See Langley, 

484 U.S. at 93, 108 S. Ct. at 402.

Landcastle does not dispute that Hardwick actually signed 

the security agreement and knew what he was signing. There is no

allegation that Crescent engaged in the fraudulent procurement of 

Hardwick’s signature, and accordingly there is no forgery or fraud 

in the factum here. Just the opposite, Hardwick’s apparent fraud—

purportedly lacking authority to pledge the CD—induced Crescent 

to make him a loan because it was fully collateralized by a CD in 

precisely the same amount of $631,276.71.7

B. Landcastle’s “Void” Claim 

To avoid D’Oench altogether, Landcastle also argues that 

Hardwick’s lack of authority rendered the security agreement 

7 There is no fraud in the factum here, so we need not address whether a fraudin-the-factum claim is an exception to the D’Oench doctrine. See 

McCullough, 911 F.2d at 602 n.7 (“Although it is possible that a claim of fraud 

in the factum would survive [the] FSLIC’s invocation of the D’Oench doctrine, 

we need not decide this issue.” (citation omitted)).

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38 Opinion of the Court 20-13735

“void,” a legal nullity, and non-existent, and incapable of transfer 

to the FDIC. From that, Landcastle contends the FDIC obtained 

nothing, and D’Oench categorically does not apply here.

Landcastle’s arguments fail to recognize the material 

differences between “void” and “voidable” contracts. As explained 

below, even if Hardwick lacked authority, the security agreement 

was not a “void” contract but, at most, a “voidable” contract. 

Here’s why.

It is axiomatic that a “void” contract, as distinct from a 

“voidable” one, is “a legal nullity.” 1 Williston on Contracts § 1:20

(4th ed. Oct. 2022 Update). A void contract has “no legal effect”

whatsoever. Void, Black’s Law Dictionary (11th ed. 2019). 

“Whenever technical accuracy is required, void can be properly 

applied only to those provisions that are of no legal effect 

whatsoever—those that are an absolute nullity.” Id. “A contract 

may be void because it is technically defective, contrary to public 

policy, or illegal.” Void Contract, Black’s Law Dictionary (11th ed. 

2019). 

While voidable contracts are “a common occurrence in the 

law,” 1 Williston on Contracts, supra, § 1:20, examples of wholly 

void contracts “are not very numerous,” 1 Corbin on Contracts 

§ 1.7 (Rev. ed. 2018). They include illegal bargains or bargains that 

are contrary to express statutes or that violate public policy. 1 

Williston on Contracts, supra, § 1:20; see, e.g., O.C.G.A. §§ 13-8-1 

(“A contract to do an immoral or illegal thing is void.”), 13-8-2(a) 

(“A contract that is against the policy of the law cannot be 

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20-13735 Opinion of the Court 39

enforced.”), 13-8-3(a) (“Gambling contracts are void[.]”). Void 

promises are not legally binding, have no legal effect, and therefore 

are not contracts. 1 Williston on Contracts, supra, § 1:20; see

Restatement (Second) of Contracts § 7 cmt. a (Am. L. Inst. 1981) 

(“A promise for breach of which the law neither gives a remedy nor 

otherwise recognizes a duty of performance by the promisor is 

often called a void contract.”).

In contrast, the term “voidable” contract is defined as 

“[v]alid until annulled,” and “capable of being affirmed or rejected 

at the option of one of the parties.” Voidable, Black’s Law 

Dictionary (11th ed. 2019). Our Court has distinguished void from 

voidable contracts: “A contract is void ab initio if it seriously 

offends law or public policy, in contrast to a contract that is merely 

voidable at the election of one party to the contract.” Griffin v. 

Coca-Cola Refreshments USA, Inc., 989 F.3d 923, 934 n.6 (11th Cir. 

2021) (citing Black’s definitions of void and voidable).

The treatises agree that a “voidable” contract is one where a 

party may elect to reject and avoid the legal relations created by 

the contract or by ratification may extinguish the power to avoid.

Restatement (Second) of Contracts, supra, § 7 (“A voidable 

contract is one where one or more parties have the power . . . to 

avoid the legal relations created by the contract, or by ratification 

of the contract to extinguish the power of avoidance.”); 1 Williston 

on Contracts, supra, § 1:20 (same, quoting Restatement (Second) 

of Contracts § 7); 1 Corbin on Contracts, supra, § 1.6. It bears 

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40 Opinion of the Court 20-13735

repeating that a “voidable contract is a common occurrence.” 1 

Williston on Contracts, supra, § 1:20. 

Further, “a voidable contract imposes on the parties the 

same obligations as if it were not voidable. If a contract is voidable, 

it remains intact until the party who has the power of avoidance 

elects to exercise it, and a party who has the power of avoidance 

may extinguish that power by ratification of the contract.” Id.

(footnote omitted); 1 Corbin on Contracts, supra, § 1.6 (“In the case 

of a voidable contract, there is usually both a power to avoid and a 

power to validate by ratification.”).

The concept of a voidable contract “rests primarily on the 

traditional view that the transaction is valid and has its usual legal 

consequences until the power of avoidance is exercised.” 

Restatement (Second) of Contracts, supra, § 7 cmt. e; see also 1 

Williston on Contracts, supra, § 3:6 (“When a contract is ‘voidable’

as a result of an invalidating cause, it nevertheless remains valid and 

enforceable unless and until the party entitled to avoid the 

obligation exercises that right.”).

Examples of voidable contracts include situations where an 

invalidating cause, like duress, fraud, mental illness, or minor 

status, render a facially valid contract “voidable.” Restatement 

(Second) of Contracts, supra, § 7 cmt. b; 1 Williston on Contracts, 

supra, § 1:20; see, e.g., O.C.G.A. §§ 13-3-20 (minor status), 

13-3-24(a) (mental illness or incompetency), 13-3-25 (intoxication), 

13-5-5 (fraud), 13-5-6 (duress). 

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The same is true for lack of authority. Specifically, if an 

agent without authority signs a written contract on behalf of a 

principal, the resulting contract is “voidable” by the principal, but 

it is not “void.” 2A C.J.S. Agency § 163 (Nov. 2022 Update) (“Acts 

or transactions in excess of the agent’s authority ordinarily do not 

bind the principal, subject to ratification by the principal, and are 

generally voidable but not void.”); id. § 56 (same); 3 Am. Jur. 2d 

Agency § 164 (2d ed. & Nov. 2022 Update) (explaining that an 

agent’s execution of a contract “that exceeds the scope of the 

agency” is “merely voidable, not void,” and that “without the 

principal’s subsequent ratification, the contract must be set aside”). 

Both state and federal courts applying state law have held an 

agent’s lack of authority renders a contract voidable, not void. See, 

e.g., Reinagel v. Deutsche Bank Nat’l Tr. Co., 735 F.3d 220, 226 

(5th Cir. 2013) (stating that, under Texas law, “a contract executed 

on behalf of a corporation by a person fraudulently purporting to 

be a corporate officer is, like any other unauthorized contract, not 

void, but merely voidable at the election of the defrauded 

principal”); Fejta v. GAF Cos., 800 F.2d 1395, 1396 (5th Cir. 1986) 

(stating that, under Louisiana law, “a contract entered into by an 

agent, though voidable for lack of authority to act, may be ratified 

by the principal”); Eaglebank v. BR Pro. Sports Grp., Inc., 649 

F. App’x 209, 211 n.1 (3d Cir. 2016) (“[T]he effect of an officer 

exceeding the scope of his or her authority in entering into a 

contract is to make that contract voidable . . . .”); Perri v. United 

States, 53 Fed. Cl. 381, 401 (2002) (stating that when an official 

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42 Opinion of the Court 20-13735

makes an agreement without actual authority to bind the 

government, the resulting contract is “voidable at the option of the 

government” and citing Restatement (Second) of Contracts, supra, 

§ 7), aff’d, 340 F.3d 1337 (Fed. Cir. 2003); Stamatakos v. Wells Fargo 

Bank, Nat’l Ass’n, 2018 WL 1441233, at *7 (D. R.I. Mar. 22, 2018) 

(“The law of Rhode Island is clear that, even if the signatory to an 

assignment (or other contract) lacks the proper authority, the 

assignment is rendered voidable rather than void.”); Sauers v. Bank 

of Am., N.A., 2013 WL 12108140, at *3 (W.D. Tex. Oct. 3, 2013) 

(explaining that the “lack of authority makes th[e] assignments 

merely voidable, not void”); Deutsche Bank Tr. Co. v. Beesley, 

2012 WL 5383555, at *5 (D. Haw. Oct. 30, 2012) (concluding 

plaintiffs’ challenge to assignment of their mortgage based on 

signing agents’ lack of authority was a challenge to “a voidable, not 

void, contract”); Scott v. United States, 2011 WL 13308717, at *2 

(M.D.N.C. June 2, 2011) (“[A]n agreement entered into by an 

unauthorized agent is a voidable, not void, agreement.”); Ristic 

Elec. LLC v. AH Holdings LLC Series A, 2016 WL 4161966, at *10 

(Ill. App. Ct. Aug. 4, 2016) (concluding a company agent’s lack of 

authority to execute a deed “would merely render it voidable” and 

“the company may later ratify the contract”); see also Roberson 

Advert. Serv., Inc. v. Winnfield Life Ins. Co., 453 So. 2d 662, 665 

(La. Ct. App. 1984) (acknowledging that a contract entered by an 

agent is voidable for lack of authority).

While we do not apply state law here, we note these state 

law cases are consistent with the general void/voidable principles 

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established in the treatises and legal dictionary definitions, 

discussed above, which draw a demarcation more easily applied. 

Applying these general principles here, we conclude that the 

written and facially valid security agreement, signed by Hardwick 

as agent and manager, created legal relations until it was avoided 

or ratified by agent Hardwick’s principal. Hardwick’s lack of 

authority, even if proven, would at most render the security 

agreement voidable.8 And Langley teaches us that a failed bank has 

and can transfer a voidable interest or title in an asset to the FDIC, 

and that is enough to constitute an interest in the asset to trigger

D’Oench protection of the FDIC. See Langley, 484 U.S. at 94, 108 

S. Ct at 402. 

Tellingly, Landcastle’s brief argues only that the security 

agreement was “void,” never mentions “voidable” contracts, and 

never acknowledges the void-voidable dichotomy. We readily 

reject Landcastle’s argument that the security agreement, like a 

gambling contract or illegal bargain, was void, of no legal effect, 

nonexistent, and incapable of transfer. Rather, as Renasant and the 

amici agree, the security agreement was, at most, voidable and 

capable of transfer to the FDIC.

8 Notably, before the FDIC took over Crescent, the Hardwick law firm took 

no steps to avoid the security agreement. After the FDIC took over and sold 

the security agreement, Renasant continued to hold the law firm’s CD as 

collateral for five years. When Renasant notified the law firm of the loan 

default and CD liquidation, it received no response, much less any objection, 

from the law firm.

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44 Opinion of the Court 20-13735

C. Fraudulent Inducement Does Not Prevent Transfer of an 

Interest to the FDIC, and Neither Should Hardwick’s 

Lack of Authority 

Landcastle’s attempt to categorically exclude lack-ofauthority claims from D’Oench is also inconsistent with the broad 

equitable protection afforded the FDIC from claims based on 

evidence outside the bank’s official records. As noted earlier, the 

Supreme Court has held that D’Oench protects the FDIC from

even fraud-in-the-inducement claims and defenses. Id. at 93, 108 S. 

Ct. at 402 (holding that a claim based on the failed bank’s fraud—

that induced the borrower to borrow money and sign a note—was 

barred by D’Oench and § 1823(e)); see McCullough, 911 F.2d at 

599–600 (holding that D’Oench bars fraud-in-the-inducement 

claims); Twin Constr., Inc., 925 F.2d at 382 (stating the D’Oench

doctrine broadly protects the FDIC and its successors “from claims 

of state and common law fraud”).

Under Langley, a failed bank’s fraud against its own bank 

customer renders the customer’s note only “voidable” and does 

not prevent the bank from transferring title to or an interest in that 

customer’s note to the FDIC for D’Oench purposes. By analogy, 

Hardwick’s lack of authority also renders the security agreement at 

most “voidable” and capable of transfer to the FDIC.

Let’s remember that D’Oench is an estoppel doctrine. We 

do not consider legal issues, such as lack of authority in this

D’Oench setting, in the abstract or in a vacuum, but in the context 

of the factual circumstances presented in this case. Our decision as 

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20-13735 Opinion of the Court 45

to a legal issue can reach only as far as the factual circumstances 

frame the precise issue presented. See Edwards v. Prime, Inc., 602 

F.3d 1276, 1298 (11th Cir. 2010); Chavers v. Sec’y, Fla. Dep’t of 

Corr., 468 F.3d 1273, 1275 (11th Cir. 2006); Watts v. BellSouth 

Telecomms., Inc., 316 F.3d 1203, 1207 (11th Cir. 2003).

Three contextual facts surround Landcastle’s lack-ofauthority claims in this D’Oench setting: (1) at a minimum, 

Hardwick was an agent and manager of the Hardwick law firm; 

(2) the failed bank had no knowledge that Hardwick lacked 

authority to pledge the CD; and (3) Hardwick induced the bank to 

make a loan by securing it with his law firm’s CD in the same 

amount of $631,276.71.

Under these circumstances, we reject Landcastle’s argument

that Hardwick’s lack of authority prevented Crescent’s transfer of 

an interest in the security agreement to the FDIC as receiver.

D. Equities Protect the FDIC 

Landcastle’s approach—categorically excluding lack-ofauthority claims from D’Oench’s prohibition of non-bank-records 

evidence—would defeat D’Oench’s equitable purposes. 

Our thorough review of D’Oench precedent above 

demonstrates that courts consistently have applied D’Oench as a 

federal equitable doctrine that protects the FDIC as receiver from 

a broad array of claims and defenses to a facially valid and 

unconditional note, guaranty, or collateral pledge acquired by the 

FDIC from a failed bank. See, e.g., Langley, 484 U.S. at 92–93, 108 

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46 Opinion of the Court 20-13735

S. Ct. at 401–02 (protecting the FDIC from claims raising 

“undisclosed conditions” and “fraud in the inducement”); 

McCullough, 911 F.2d at 601–02 (protecting the FDIC from 

“defenses of failure to perform a condition precedent, failure of 

consideration, and fraudulent inducement”); Twin Constr., Inc., 

925 F.2d at 382 (protecting the FDIC “from claims of state and 

common law fraud, violation of state or federal securities laws, and 

the affirmative defenses of waiver, estoppel, unjust enrichment, 

failure of consideration and usury”).

Landcastle’s lack-of-authority claims pale in comparison to 

the severity of the other types of claims already held barred by 

D’Oench’s prohibition of non-bank-records evidence. These 

claims already barred by D’Oench nonetheless provide a close 

analog, certainly a much closer analog than anything Landcastle or 

the dissent proposes.

Think about this, too. Landcastle’s categorical approach

would mean every facially valid and unconditional bank 

transaction assumed and sold by the FDIC as receiver can now be 

subjected to exhaustive litigation by alleging that a manager or 

officer of a business lacked authority to enter into the transaction. 

As here, a manager or officer often does have considerable 

authority to handle the affairs of the business but may allegedly 

exceed that authority in a particular transaction. 

Yet under Landcastle’s proposed categorical rule, when 

deciding whether to sell or liquidate a failed bank, the FDIC would

no longer be able to rely on the bank’s official records but would

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have to look beyond the plain terms of each and every note, 

guaranty, or security agreement and investigate whether each 

party in each transaction in fact possessed the precise authority to 

execute a particular agreement that their signature and title imply. 

That is precisely the burden of which the D’Oench doctrine 

relieves the FDIC when it must quickly sell a failed bank in order 

to provide customers’ access to their deposits without interruption

and protect the federal funds it administers. The FDIC’s ability to 

rely on the official failed bank records is the purpose of D’Oench’s 

federal estoppel doctrine.

Here, in taking over and selling Crescent’s assets to 

Renasant, the FDIC was entitled to rely on Crescent’s official 

records, which contained the unqualified and facially valid security 

agreement pledging a CD for $631,276.71 as collateral for a 

$631,276.71 loan. Barring under D’Oench Landcastle’s lack-ofauthority claims—based on non-bank-records evidence—properly 

allocatesthe risk to the principal (MHSLAW, P.C. and the law firm) 

who hired Hardwick—as its President, director, and manager—

rather than to the FDIC as receiver of a failed bank.9 Severing 

Hardwick’s lack of authority from his fraudulent inducement of the 

9 Indeed, the law firm failed to give Crescent its corporate governance 

documents that limited Hardwick’s authority as President and Director of 

MHSLAW, P.C., or as Manager of his law firm. By doing so, the law firm lent 

itself to an arrangement—the purchase of a CD for $631,276.71 and a loan for 

$631,276.71 collateralized by the CD—that would tend to mislead the bank 

examiners and the FDIC.

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48 Opinion of the Court 20-13735

bank would favor the interests of borrowers over the interests of 

depositors by shifting, in the context of FDIC receivership, the risk 

of internal corporate-governance problems from the business 

entity (here a law firm) to the FDIC.

As the Supreme Court emphasized in Langley, the equities 

that the D’Oench doctrine regards as predominant are those 

protecting the FDIC. 484 U.S. at 94–95, 108 S. Ct. at 403. We need 

go no further than rejecting Landcastle’s attempt to exclude its

lack-of-authority claims—which are based on non-bank records—

from D’Oench’s estoppel doctrine.

VI. RESPONSE TO THE DISSENT 

The bulk of the dissent is not about D’Oench cases but is a 

discussion of different agency and contract principles. Dissenting 

Op. at 14–36. The dissent insists we create a “radical” new rule that 

an agent without authority binds its principal in contract. Id. at 1, 

10, 36–38. The dissent uses various forms of the word “bind” 55

times. But that is not what we rule, say, or intend to do here. 

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A. Agreement on Basic D’Oench Principles 

Before addressing the core dispute, let’s list D’Oench

principles the dissent does not dispute:

(1) the D’Oench doctrine protects the FDIC from claims or

defenses based on evidence outside the failed bank’s records, 

Dissenting Op. at 1, 11; 

(2) the D’Oench doctrine applies when the claim or defense 

based on outside evidence “tend[s] to diminish or defeat” the 

FDIC’s interest in an asset of the failed bank, id. at 11; 

(3) the D’Oench doctrine protects only interests the failed 

bank already had at the time of the takeover; it does not create new 

interests, id. at 12; and

(4) a “voidable” contract is enough to constitute an interest 

that is transferable to the FDIC, and the D’Oench shield would bar 

claims that seek to defeat a “voidable” contract, id. at 13–14.

What the dissent does hotly dispute is that the security agreement 

was voidable. Our core dispute is over whether for D’Oench

purposes the security agreement was (1) automatically void, a 

nullity, and non-existent at execution, or (2) merely voidable by the 

law firm at its option and transferable. 

Deciding this case does not require the dissent’s lengthy 

debate about agency and contract principles. See id. at 14–36. 

Rather, this case can be narrowly decided using the void-voidable 

dichotomy for D’Oench-transfer purposes. As discussed in Section 

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50 Opinion of the Court 20-13735

V.B., the general definitions of void and voidable found in treatises 

and legal dictionaries draw a clear demarcation easily applied to 

this case. The security agreement was not an illegal contract; it did 

not contravene a statute or violate public policy. Under Langley, 

it was a facially valid, unqualified agreement, held by Crescent and

transferable to the FDIC.

The dissent tries to expand the issues and make this case 

about whether the law firm was bound by that contract. The bulk 

of the dissent is under this heading: “An Agent Without Authority 

Cannot Bind a Principal in Contract.” Id. at 14–36. The dissent

argues that no binding contract was formed because Hardwick 

lacked authority, and Crescent had nothing to transfer. 

Here, though, we need not, and do not, decide what 

evidence would have been allowed if Crescent had not failed and

the law firm challenged the enforceability of the agreement. What 

D’Oench precludes is not the challenge itself, but the law firm’s

(now Landcastle’s) use of documents outside the failed bank’s 

official records to mount that challenge. 

It is undisputed that Landcastle’s lack-of-authority claims are 

based on non-bank records. Accordingly, our holding, as already

stated, is: 

Applying the Supreme Court’s and our Circuit’s 

D’Oench precedent, we hold that Landcastle’s lackof-authority claims are barred because they rely on 

evidence that was outside Crescent’s records when 

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the FDIC took over that failed bank and sold the 

Hardwick loan and CD collateral to Renasant.

Majority Op. at 5, 33.

It’s hard to know what to respond to and what to ignore 

because the dissent strays so far afield from the narrow D’Oench

path that decides this case. Yet the dissent cannot go wholly 

unanswered because it asserts that the majority (1) relies on a 

“radical . . . interpretation of agency law” that allows the FDIC to 

“steal assets from third parties when it takes over a failed 

bank,” (2) “creates serious Takings Clause concerns,” (3) adopts a 

“new rule” that “greatly disrupts commercial relationships” in 

Georgia, and (4) fails to get the message of the Supreme Court and 

three sister Circuits that “the Deposit Corporation cannot acquire 

an interest that is void before the Deposit Corporation purports to 

acquire it.” Dissenting Op. at 1–2, 40, 42, 47. 

Oh my goodness. “[L]ike most apocalyptic warnings,” the 

dissent “proves a false alarm.” Epic Sys. Corp. v. Lewis, 584 U.S. 

—, 138 S. Ct. 1612, 1630 (2018).10 Nonetheless, given the dissent’s 

accusations, we must respond and do so in seven parts. 

10 As to the Takings Clause, the dissent accuses the majority of “licens[ing]

governmental theft” and “creat[ing] serious constitutional problems without 

any discussion.” Dissenting Op. at 47. We do not discuss the Takings Clause 

because Landcastle never mentioned it in the district court or in its appellate 

briefs. That’s why the dissent resorts to suggesting that “Landcastle should be 

free on remand” to raise a Takings Clause claim. Id. at 43.

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First, we address three D’Oench decisions that the dissent 

cites to charge we failed to get the message of our sister circuits. 

Dissenting Op. at 14, 46–47. Those cases support our ruling, not 

the dissent.

Second, we refute the dissent’s groundless accusation that 

we “greatly disrupt[] commercial relations” in Georgia. Id. at 40. 

Third, we reply to the dissent’s baseless charge that we 

invent a new rule and rely on “a radical” interpretation of agency 

law that allows the FDIC to “steal assets from third parties.” Id. at

1. We explain how contracts are formed by agents, and how if an 

agent exceeds his authority, the principal (here, the law firm) 

always has the option to reject or affirm that contract, which 

renders the contract voidable, not void. No radical ideas here. 

Fourth, we respond to the dissent’s no contract or void 

contract arguments. Id. at 14–36. None of the dissent’s authorities, 

including the three cited Eleventh Circuit cases, involve failed 

banks, D’Oench issues, or whether a contract is void or voidable 

for D’Oench transfer purposes. Rather, the cases involve whether 

a principal was bound by an agent’s unauthorized act. The dissent

also relies on conflicting state law, which we view as unnecessary 

and unwise to unravel.

Fifth, we address the dissent’s cites to Federal Arbitration 

Act (“FAA”) cases that are not on point.

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Sixth, we discuss how the security agreement was ratifiable 

and thus voidable and why the dissent’s void-contract claim is

incorrect.

Seventh, we explain why the Restatement comments the 

dissent cites do not support its argument that the security 

agreement was void.

B. Dissent’s Claim that Three Other Circuits “Got the 

Message” that the “Majority Misunderstands” 

The dissent alleges “[t]he majority misunderstands the 

D’Oench doctrine, even though . . . at least three of our sister 

circuits got the message: the Deposit Corporation cannot acquire 

an interest that is void before the Deposit Corporation purports to 

acquire it.” Id. at 47 (citing Fed. Deposit Ins. Corp. v. Bracero & 

Rivera, Inc., 895 F.2d 824, 830 (1st Cir. 1990); Grubb v. Fed. Deposit 

Ins. Corp., 868 F.2d 1151, 1158 (10th Cir. 1989); Andrew D. Taylor 

Tr. v. Sec. Tr. Fed. Sav. & Loan Ass’n, 844 F.2d 337, 342–43 (6th 

Cir. 1988) (“Taylor Trust”)); see id. at 14 (citing same). The dissent 

claims these cases show the security agreement here was void and 

not transferable. These cases support our ruling, not the dissent.

The dissent summarily dismisses the fact that these cases 

concerned bank assets that were already voided by a court 

judgment, paid, or fully extinguished before the FDIC took over as 

receiver. That total cancellation of the asset before the takeover is 

what precluded the FDIC from acquiring an interest in the 

contract. In stark contrast, here there was no change to, 

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54 Opinion of the Court 20-13735

cancellation of, or diminishment of the security agreement before 

the FDIC took over.

In Grubb, for instance, the Tenth Circuit held that the FDIC 

could not “claim the protection of D’Oench” because, before the 

bank in that case failed, i.e., before the FDIC took over as receiver, 

the district court had entered a judgment for the plaintiff and 

explicitly “voided” the asset at issue. 868 F.2d at 1158–59. Here, if 

the Hardwick law firm had sued Crescent while the bank was still 

solvent, and a court had entered judgment voiding the 2009 

security agreement before the FDIC took over as receiver in 2010, 

then Crescent would not have had a transferrable interest in the 

security agreement when it failed. The Hardwick law firm did not 

challenge the 2009 security agreement before the FDIC took over 

or during the next seven years. For over five years Renasant Bank 

held the law firm’s CD as collateral and liquidated it in 2014—all 

without objection by the law firm. The law firm’s actions belie the 

dissent’s claims of no transferable interest. It was only in 2017 that 

Landcastle (who bought potential claims in the law firm’s 

bankruptcy) challenged the 2009 security agreement. 

The dissent’s next case—Bracero & Rivera—also supports 

our holding. The First Circuit held that D’Oench did not apply to 

a canceled mortgage note in the bank’s records before the FDIC 

took over. 895 F.2d at 829–30. The First Circuit concluded that the 

D’Oench doctrine did not apply because (1) “the note was 

discharged by the payment and cancellation of the underlying debt 

before [the] FDIC ever obtained it,” and (2) bank documents 

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evidencing that discharge and cancellation “were in the hands of 

[the] FDIC at all relevant times.” Id. The note was paid and not 

an asset protected by D’Oench or § 1823(e). Id. at 830. 

Just the opposite is true here. The security agreement was 

never challenged—much less canceled—before the FDIC took

over, and Landcastle’s challenge came seven years later. That the 

dissent resorts to Grubb and Bracero & Rivera to discredit the 

majority reveals how baseless the dissent’s accusations are.

Likewise, Taylor Trust does not help the dissent because the 

Sixth Circuit held the agent trustee acted with authority. Taylor 

was the trustee of his minor son’s savings account. Taylor Tr., 844 

F.2d at 339. However, Taylor, as president of Security Trust, 

executed collateral agreements pledging, inter alia, his minor son’s 

savings-account trust. Id. Taylor executed the pledge agreements 

to secure advances made by Security Trust to two Hawaiian real 

estate ventures under lines of credit. Id. at 340. After Taylor was 

discharged as president and both Hawaiian real estate ventures 

defaulted, Security Trust claimed the pledged accounts. Id. The 

minor’s savings-account trust then sued Security Trust to have the 

pledge agreements declared invalid, arguing that Taylor lacked 

authority to pledge the minor’s trust. Id. at 340, 343. While the 

action was pending, Security Trust was declared insolvent, and the 

FSLIC took over as receiver. Id. at 340.

The Sixth Circuit summarized the trust’s argument that 

because Taylor lacked authority to pledge his son’s trust, the 

pledge agreements were void ab initio, taking them out of the 

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D’Oench doctrine. Id. at 342–43. The Sixth Circuit did not decide 

that issue because it concluded that Taylor had the authority to 

revoke the minor’s trust. Id. at 344. Thus, the Sixth Circuit 

concluded D’Oench applied, and the FSLIC prevailed. Id.11

C. Dissent Misstates Georgia Law 

As discussed later, the dissent largely cites state cases and 

federal diversity cases—applying applicable state law—to support 

its proposition that the security agreement was void because no 

contract is ever formed when an agent lacks authority. As part of 

that argument, the dissent alleges: “Georgia law dictates that lack 

of authority prevents contract formation,” and therefore “the 

majority’s new rule greatly disrupts commercial relationships.” 

Dissenting Op. at 40. That is not Georgia law, nor what we do 

here. 

In claiming an agent’s lack of authority always prevents 

contract formation, the dissent cites four Georgia cases and 

O.C.G.A. § 10-6-51. Id. at 40–41. See Hagan v. Asa G. Candler, 

Inc., 5 S.E.2d 739 (Ga. 1939); Lynn v. Lowndes Cnty. Health Servs., 

LLC, 840 S.E.2d 623 (Ga. Ct. App. 2020); Berger v. Ga. Power Co., 

11 In a parenthetical, the dissent notes that Taylor Trust “stat[ed], though in 

dicta, that an agent’s lack of authority . . . renders the contract void ab initio, 

rather than merely voidable.” Dissenting Op. at 36 (quotation marks omitted). 

That was not even dicta. The Sixth Circuit was merely reciting the party’s 

argument, not opining itself. Taylor Tr., 844 F.2d at 342–43. Taylor Trust did 

not explore the differences between void and voidable agreements. There was 

no reason to do so because it concluded Taylor had authority to act.

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49 S.E.2d 668 (Ga. Ct. App. 1948); Buena Vista Loan & Sav. Bank 

v. Stockdale, 192 S.E. 246 (Ga. Ct. App. 1937). 

Those Georgia cases relied on by the dissent have nothing 

to do with the contract-formation issue here. The Berger and 

Buena Vista cases involved (1) the endorsements of checks and not 

formation of a contract between two parties, (2) the effect of a third 

party’s unauthorized signature endorsement on a check under a 

former Georgia statute, and (3) whether the third party’s 

endorsements were forged or genuine. See Berger, 49 S.E.2d at 

669; Buena Vista, 192 S.E. at 247. Plus, neither case involved an 

agent, much less one who exceeded his authority. 

Contrary to the dissent, Georgia law recognizes that an 

agent routinely forms a contract on a principal’s behalf, and if an 

agent acted without authority, the principal may either repudiate 

or ratify that contract. See, e.g., O.C.G.A. § 10-6-51 (“The principal 

shall be bound by all the acts of his agent within the scope of his 

authority; if the agent shall exceed his authority, the principal may 

not ratify in part and repudiate in part; he shall adopt either the 

whole or none.” (emphasis added)).

Further, Lynn and Hagan, the dissent’s agency law cases, do 

not support the dissent’s no-contract-formed or void-contract 

argument. The Georgia court in Lynn explained that, under 

Georgia law, where the principal is fully informed of the agent’s 

unauthorized act and does not repudiate it within a reasonable 

time, ratification is presumed and takes effect as if originally 

authorized. 843 S.E.2d at 631. The Lynn court did not mention 

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the terms “void” or “void contract.” And the Lynn court ultimately 

concluded that the principal, a mentally disabled, 50-year-old man 

with Down Syndrome who could not read, write, or speak, was 

incapable of forming an agency relationship with his mother. See 

id. at 628–31. Here though, Hardwick was an admitted agent of his 

law firm and for years the law firm’s CD was held and then 

liquidated without objection of the law firm. Lynn is wholly 

inconsistent with the dissent’s interpretation of Georgia law. 

Hagan also does not help the dissent because the alleged 

principal there was non-existent. 5 S.E.2d at 740. The issue was 

whether “an agent who executes a contract on behalf of a 

non-existent principal is himself liable on the contract.” Id.

Instead, as discussed before, the more informative case as to 

void contracts is our Griffin decision applying Georgia law. In 

Griffin, this Court expressly addressed whether assignments of 

certain benefits were void or “merely voidable,” where the 

assignors’ benefit plans contained an anti-assignment provision. 

Griffin, 989 F.3d at 934 (11th Cir. 2021). We observed that whereas 

void contracts are “[o]f no legal effect” and “void,” voidable 

contracts are “[v]alid until annulled.” Id. at 934 & n.6 (quoting 

Black’s 2019 definitions of void and voidable). 

We held the assignments were “merely voidable” because 

they were not illegal, did not contravene public policy, and had 

nothing to do with gambling—the three “void” contracts under 

Georgia law. Id. at 934 (citing O.C.G.A. §§ 13-8-1, 13-8-2, 13-8-3).

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Griffin is instructive. First, Griffin observed that, unlike void 

contracts, voidable contracts are valid until annulled. Id. at 934 & 

n.6. Second, Griffin demonstrates that the security agreement here 

was not a void contract under Georgia law because it was not 

illegal, did not contravene public policy, and had nothing to do 

with gambling. See id. at 934.

Tellingly too, the Georgia Supreme Court held in Holden

that D’Oench protects the FSLIC as receiver from a property 

owner’s claim based on non-bank records that a partner lacked 

authority to pledge a security interest in the partnership’s property. 

485 S.E.2d at 483 (applying federal common law). The Georgia 

Supreme Court reasoned that invalidating the agreement in 

Holden would strip away the D’Oench doctrine’s protection of 

bank depositors, bank authorities, and guarantors. Id. This 

reasoning is equally applicable to the case at bar: Invaliding the 

security agreement defeats D’Oench’s equitable purposes and 

protects Landcastle and the Hardwick law firm at the expense of 

bank depositors, bank authorities, and guarantors. Therefore, the 

dissent’s allegation that we “greatly disrupt[] commercial 

relationships” in Georgia is wholly unfounded. Dissenting Op. at 

40.12 

12 Speaking of commercial relationships, banks fail, the FDIC sells them 

overnight to successor banks like Renasant, who open them the next day

without interruption. For years, Hardwick made his loan payments to 

Renasant but then defaulted, and Renasant liquidated the CD collateral. 

Landcastle now, many years later, wants to use parol evidence—outside the 

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D. How Contracts Are Formed by Agents 

Next, we respond to the dissent’s charge that we invent a 

new, radical agency rule. This accusation also is baseless.

To set things straight, general agency principles recognize 

that there can be (1) “agents” who have some actual authority from 

a principal but may act outside of it or outside of their apparent 

authority; (2) other actors who appear to third parties to be 

“agents” but who lack any actual authority and therefore are not 

“agents” for the principal at all; and (3) persons, either agents or 

actors purporting to be agents, whose acts can be ratified by the 

principal such that “the act is given effect as if done by an agent 

acting with actual authority.” Restatement (Third) of Agency, 

§§ 3.01, 3.03, 4.01(1), 4.03 (Am. L. Inst. 2006).

According to the certified question, Hardwick was the law 

firm’s “agent.” He was not merely an actor appearing or 

purporting to be an agent. No one disputes that Hardwick was an 

agent of both the law firm (as a manager) and MHSLAW, P.C. (as 

President and a director). Therefore, we look first to those agency 

principles applicable to “agents.”

It is a “basic principle that when an agent enters into a 

contract on behalf of a disclosed principal, the principal and the 

third party are parties to the contract. A principal is disclosed when 

failed bank’s records—to set aside the 2009 security agreement. That’s what

would be disruptive.

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the third party has notice that an agent is acting for a principal and 

has notice of the principal’s identity.” Id. § 6.01 cmt. a. 

A valid contract requires “a bargain in which there is a 

manifestation of mutual assent to the exchange and a 

consideration.” Restatement (Second) of Contracts, supra, § 17(1) 

(emphases added); 1 Williston on Contracts, supra, § 3:2 (same). 

Mutual assent and consideration are required elements for contract 

formation. In the agency context, however, it is the agent who 

manifests the assent to the exchange with the third party, not the 

principal. Restatement (Third) of Agency,supra, § 6.01 cmt. b (“An 

agent enters into a contract on behalf of the agent’s principal by 

manifesting assent to an exchange that constitutes valid 

consideration.”). The principal does not manifest the assent to the 

exchange because that is the agent’s job. See id. A contract is 

formed upon the agent’s manifestation of assent to the exchange 

on the principal’s behalf.

Whether the contract so formed by the agent later subjects 

the principal to liability (i.e., binds the principal) or later is voidable 

by the principal is a separate legal matter. As discussed earlier, if it 

turns out the agent was acting outside the scope of his authority 

when he manifested assent to the exchange with the third party, 

the resulting contract is voidable by the principal, not entirely 

“void.”

At the risk of beating a dead horse, an agent who lacks 

authority merely forms a contract that is voidable at the option of 

the principal. A voidable contract is not the same as a binding 

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contract. Whether a voidable contract ultimately will be binding 

is a decision for the wronged party in the transaction. Upon notice 

of the contract, the principal has the power to either ratify and be 

bound by it or disaffirm and avoid it. And the contract becomes 

either enforceable or unenforceable against the principal upon the 

principal’s exercise of this power. 

For D’Oench purposes, the fact that the principal retains this 

power to ratify or disaffirm means the contract formed by the agent 

is merely “voidable,” and not void at inception. That distinction 

matters because D’Oench recognizes voidable interests are 

transferrable from the failed bank to the FDIC.

E. Dissent’s No Contract or Void Contract Arguments 

In an attempt to escape D’Oench altogether, the dissent 

claims the security agreement is no contract or a void contract.13 

Dissenting Op. at 14–36. 

13 Specifically, the dissent argues: (1) that because “an agent cannot bind a 

principal in contract when he lacks the authority to do so,” the “resulting 

purported contract is void”; (2) “for present purposes, there is no meaningful 

difference between saying that the agent formed no contract” or “formed a 

void contract”; and (3) “[n]o contract is formed between the principal and the 

third party because a principal is not subject to liability when an agent acts 

without authority.” Dissenting Op. at 16–19, 25 (emphases added) (quotation 

marks omitted). The dissent frames the issue as whether there is a binding 

contract or whether the principal is bound and subject to liability. Once again, 

that’s a very different issue than whether the bank had an interest in the 

security agreement, even if voidable, that was transferable to the FDIC.

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First, the dissent states that “when an agent purports to 

‘enter[] into [a] contract on [its] principal’s behalf . . . without 

actual or apparent authority,’ the ‘principal is not a party to [that] 

contract.’” Id. at 16 (alterations in original) (emphasis omitted) 

(quoting Restatement (Third) of Agency, supra, § 6.05 cmt. b). 

That quoted comment b to § 6.05, however, addresses only 

the circumstances under which the principal “is subject to liability” 

when the agent makes a contract with a third party that is 

unauthorized in part. Restatement (Third) of Agency, supra, 

§ 6.05(1) & cmt. b (emphasis added). Comment b speaks to the 

principal’s liability under the contract the agent makes, not to 

whether a contract was formed in the first place or the effect of an 

agent’s lack of authority on the formation of a contract. See id. 

Next, the dissent cites three Eleventh Circuit cases for its no 

contract or void contract argument. Dissenting Op. at 17–19, 31–

32 (citing GDG Acquisitions LLC v. Gov’t of Belize, 849 F.3d 1299 

(11th Cir. 2017) (“GDG”); In re JLJ Inc., 988 F.2d 1112 (11th Cir. 

1993) (“JLJ”); Gymco Constr. Co. v. Architectural Glass & 

Windows, Inc., 884 F.2d 1362 (11th Cir. 1989) (“Gymco”)). By 

taking these cases wholly out of context, the dissent makes it 

appear they apply here, but they do not. We therefore must discuss 

these cases in detail. As we shall see, none of these precedents 

involve application of the D’Oench doctrine, none discuss the voidvoidable dichotomy, all are materially and easily distinguishable, 

and one actually supports our position.

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Gymco v. Architectural Glass 

The dissent relies heavily on our 1989 Gymco decision, 

applying Georgia law, but, unlike the Georgia Supreme Court’s 

1997 Holden decision, Gymco did not involve a failed bank, the 

FDIC, or D’Oench. In any event, Gymco is about whether the 

principal was bound by its agent’s oral contract when the other 

party to the contract knew the agent lacked authority. 

In Gymco, a written contract between Gymco Construction 

(“Gymco”) and Architectural Glass & Windows (“AGW”) required 

AGW to install a glass façade for Gymco. 884 F.2d at 1363. Gymco 

knew that AGW’s President signed the written contract, submitted 

all the pay orders, and negotiated the conditions. Id. at 1366. Yet 

Gymco claimed that Young, a sales representative for AGW, orally 

agreed to substitute stainless steel, and Gymco sued AGW when it 

refused to provide a stainless steel façade. Id. at 1364–65. 

On appeal, this Court held that AGW was not liable for 

damages to Gymco because (1) Young lacked actual authority to 

enter a new oral contract for steel; and (2) it was unreasonable for 

Gymco to assume Young had authority because it was AGW’s 

President who had demonstrated his complete authority over the 

contract terms. Id. at 1366. We explained: “The evidence of the 

parties [sic] dealings makes clear that Gymco knew that Young 

only had limited authority.” Id. at 1367. We stressed that 

substituting stainless steel for glass would be enforcing a new oral 

contract with “a materially different obligation,” and because 

“Young lacked the authority to enter into a new contract obligating 

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AGW to install the stainless steel,” we held that “there was no oral 

contract between Gymco and AGW.” Id. at 1365–67.

We also rejected Gymco’s argument that Young could 

orally agree to modify the written contract given that the contract 

required modifications to be in writing. Id. at 1367. We also 

pointed out that AGW had “repudiated” Young’s oral agreement 

to provide steel in lieu of glass as soon as it learned of it and 

terminated Young immediately. Id. at 1364, 1366. 

So that’s the case. Now let’s look at how the dissent uses 

Gymco wholly out of its context. The dissent cites Gymco for this 

purported principle: “that because an agent ‘lacked authority to 

enter into a . . . contract’ between his principal and a third party, 

‘there was no [such] contract.’” Dissenting Op. at 17 (alterations in 

original). The first quote leaves out the word “oral,” and the latter 

quote changes “there was no oral contract” to “there was no [such] 

contract.” Gymco involved an oral contract that the third party 

knew the agent lacked authority to enter and that the principal 

promptly repudiated. These facts alone are sufficient reasons to 

discard it. 

Gymco is further materially distinguishable because there is 

no analysis of contract-formation principles, much less contract 

formation by an agent where: (1) the agent executed a facially valid 

written contract, with plain and clear terms; (2) the agent who 

signed for the principal was its President, manager, and director; 

and (3) the other party (Crescent) undisputedly had no knowledge 

of any limits on the officer’s authority. Significantly, too, Gymco

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was about whether AGW was bound by Young’s oral acts when 

Gymco knew he lacked authority. To repeat ad nauseam, whether 

the principal law firm was bound by agent Hardwick’s acts is not 

the narrow issue here.

Gymco never used the word “void.” Gymco did not 

suggest, much less hold, that Young’s oral agreement was a void 

contract, as the dissent implies. Id. Gymco is but one example of 

how the dissent’s cites do not support the proposition offered. 

Holden, not Gymco, is relevant here.

In re JLJ Inc. 

The dissent argues JLJ is relevant because it shows an agent 

lacking authority “cannot bind a principal in contract” and “the 

resulting purported contract is void.” Id. at 18–19. Of course, the 

inquiry in JLJ was whether the contract was binding on the 

principal. JLJ did not address the void-voidable dichotomy or even 

mention the term voidable. Also, JLJ did not involve a failed bank, 

the FDIC, or D’Oench. Here’s what happened. 

In a bankruptcy adversary proceeding, Karen Rush and her 

estranged husband’s company RBC both claimed they owned the 

debtor’s note. 988 F.2d at 1115. Her husband had Karen’s power 

of attorney and assigned the note to RBC. Id. The issue was 

whether the assignment contract was valid against Karen. Id. at 

1116. The bankruptcy court awarded the note to RBC, but the 

district court reversed and entered judgment for Karen, finding she 

had impliedly revoked the power of attorney. Id. at 1114–15. 

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This Court vacated the district court’s judgment and 

remanded for the bankruptcy court to make factual findings 

regarding whether Karen had orally revoked the power of attorney 

before her husband assigned the note. Id. at 1117. Applying federal 

procedural rules, our Court held that the district court “exceeded 

the proper scope of review” and invaded “the province of the 

bankruptcy court as the trier of fact” when it “independently found 

that Karen’s and Edward’s estrangement impliedly revoked the 

power of attorney.” Id. 

We reasoned that “[i]f Karen orally revoked the power of 

attorney when she fled [her husband] Edward’s threats of violence, 

then the assignment Edward executed one week later would be 

void.” Id. at 1116. 

We conclude JLJ is not instructive here. First, the validity of 

the assignment in JLJ involved substantive Alabama law. See id. at 

1116–17.14 Second, and in any event, the JLJ Court did not address 

14We know that the JLJ Court applied substantive Alabama law because both 

our Court and the bankruptcy court cited Alabama law. See JLJ, 988 F.2d at 

1116–17; In re JLJ, Inc., 115 B.R. 324, 333 (Bankr. N.D. Ala. 1990) (applying 

Alabama law to determine whether Karen revoked the power of attorney). It 

is well settled that “[t]he interpretation of private contracts is ordinarily a 

question of state law” and “[t]he substantive law of the forum state [Alabama 

here] governs issues of state law that arise in bankruptcy proceedings.” In re 

Chira, 567 F.3d 1307, 1311 (11th Cir. 2009) (quotation marks omitted); see In 

re Northington, 876 F.3d 1302, 1310 (11th Cir. 2017) (“Even in the uniquely 

‘federal’ bankruptcy context, ‘[p]roperty interests are created and defined by 

state law.’” (alteration in original) (quoting Butner v. United States, 440 U.S. 

48, 55, 99 S. Ct. 914, 918 (1979))). The dissent acknowledges JLJ expressly 

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the issue presented in this case: whether an agreement entered by 

an agent without authority is void or merely voidable. 

Third, our Court, albeit in an unpublished opinion, recently 

singled out Alabama court decisions for using the word “void” 

imprecisely, including when the court means a contract is voidable. 

See United States v. Ruan, 796 F. App’x 672, 675–76 (11th Cir. 

2020). Our Court observed that “Alabama ‘judges and text-book 

writers have frequently used the words voidable and void 

indiscriminately’” when referring to contracts. Ruan, 796 F. App’x 

at 675 (quoting Ex parte Banks, 64 So. 74, 75 (Ala. 1913)). 

Fourth, many have lamented that courts imprecisely use 

“void” where “voidable” is meant. For example, Black’s Law 

Dictionary has explained that “[t]he distinction between void and 

voidable is often of great practical importance,” and although the 

“strict meaning of void” is “[o]f no legal effect,” “the word [void] is 

often used and construed as bearing the more liberal meaning of 

‘voidable.’” Void, Black’s Law Dictionary (11th ed. 2019); see also

Void Contract, Black’s Law Dictionary (11th ed. 2019) (again 

acknowledging that “the word ‘void’ has been used, even by judges 

and the framers of statutes, where ‘voidable’ is meant”).

relied on Alabama law “to determine under what circumstances the power of 

attorney could be revoked,” but the dissent attempts to separate from 

Alabama law JLJ’s statement the contract would be void if the agent’s power 

of attorney was revoked. Dissenting Op. at 19. However, the entire question 

as to the validity of the assignment in JLJ involved substantive Alabama law, 

meaning that JLJ is not instructive here.

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This is not a new phenomenon. See Ham v. Blankenship, 

194 F.2d 430, 432 (5th Cir. 1952) (observing a “lack of preciseness” 

in the use of the word void, which causes confusion generally); 

Haggart v. Wilczinski, 143 F. 22, 27 (5th Cir. 1906) (“The word 

‘void’ is so often used in the sense of ‘voidable’ . . . .”). Recently, 

our Court pointed out the imprecise use of void where voidable is 

meant. See Griffin, 989 F.3d at 934 & n.7 (11th Cir. 2021).

For these reasons, JLJ is not helpful guidance here. 

GDG v. Government of Belize 

The dissent’s final case from this Circuit is GDG. The 

dissent argues GDG shows an agent’s unauthorized contract is 

“void” until ratified. Dissenting Op. at 31. GDG hurts, not helps,

the dissent. GDG supports our conclusion that a contract entered 

by an agent without authority is not “void” ab initio. 

GDG involved a contract dispute between the government 

of Belize and a company leasing equipment. 849 F.3d at 1302. A 

Belizean minister executed a lease waiving sovereign immunity. 

Id. at 1302–03. When GDG sued Belize for rent, Belize argued its 

minister lacked authority to waive immunity. Id. at 1302. 

Applying agency ratification principles, this Court concluded Belize 

ratified its minister’s actions by performing, making payments, and 

retaining equipment. Id. at 1302, 1312.

Importantly, we rejected Belize’s argument that the lease 

was “void ab initio” and could not be ratified. Id. at 1310. We 

stated Belize “misapprehend[ed] the nature of ratification,” which 

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“starts with the assumption that the agent did not have actual 

authority at the time he acted.” Id. Therefore, it was “of no 

moment” that the minister lacked authority when he entered the 

agreement. Id.

GDG is entirely consistent with our reasoning here. 

Specifically, GDG reasoned that even if an agent enters a contract 

without authority, that contract is not void ab initio because the 

principal can ratify the contract. 

Contrary to the dissent’s claims, our Court did not 

“recognize[] that a contract entered by an agent who lacked 

authority initially ha[s] no legal effect on the principal, but the 

principal [is] empowered to ratify it later.” Dissenting Op. at 32. 

Quite the opposite. We rejected Belize’s argument that the lease 

was “void ab initio” and could not “be enforced against [it] under a 

ratification theory.” 849 F.3d at 1310 (quotation marks omitted). 

Nothing in GDG’s reasoning suggested, much less held, that the 

lease was “initially” void and somehow rendered not void by 

Belize’s ratification. 

Other Federal and State Court Cases Cited by the Dissent 

In Section V.B, we cited many state law decisions holding 

that a contract signed by an agent without authority makes that

contract merely voidable at the election of the principal, but not 

void. However, we recognize that the dissent cites other state 

court cases, a Fifth Circuit case applying Mississippi law, and a First 

Circuit case applying Puerto Rico law for the inverse proposition 

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that a contract signed by an agent without authority is void. 

Dissenting Op. at 20–21. 

Candidly, both we and the dissent are citing conflicting, but 

non-binding, state court and federal cases applying state law. And 

we appreciate the dissent’s frankness in observing that agency law 

in this area is not a model of clarity, not always precise, and easily 

gives rise to confusion. Id. at 15, 27, 30, 32.

Given this landscape and that D’Oench is a federal estoppel 

doctrine, it is unnecessary and unwise to take on the difficult, if not 

impossible, task of reconciling this divergent state agency law. 

Instead, in deciding this case, we rely on: (1) Langley’s 

holding that D’Oench bars evidence outside the bank’s records 

because even fraud in the inducement renders a contract merely 

voidable, not void, and transferable to the FDIC; (2) our own 

well-developed circuit precedent squarely applying the D’Oench

parol-evidence-like bar to a broad array of claims and defenses to a 

facially valid and unconditional note or collateral pledge acquired 

by the FDIC from a failed bank; and (3) the general definitions of 

“void” and “voidable” found in treatises and legal dictionaries, as 

discussed earlier, which demonstrate that the security agreement 

was a voidable contract. To repeat, Landcastle’s lack-of-authority 

claims based on non-bank records pale in comparison to the 

severity of other types of claims this Court has held subject to 

D’Oench’s prohibition on non-bank-records evidence. Our 

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D’Oench precedent on those claims provides a much closer analog 

than anything the dissent proposes.15

F. Federal Arbitration Act Cases 

Although the parties’ briefs do not discuss any arbitration 

cases, the dissent tries to employ FAA cases as “informative.” 

Dissenting Op. at 21. The cases are not on point or instructive.

The dissent’s reliance on Buckeye Check Cashing, Inc. v. 

Cardegna is misplaced because the Court declined to address 

whether an arbitration agreement is valid when the signor lacked 

authority to commit the principal. 546 U.S. 440, 444 n.1, 126 S. Ct. 

1204, 1208 (2006) (“Our opinion today . . . does not speak 

to . . . whether the signor lacked authority to commit the alleged 

principal . . . .”); see also Rintin Corp., S.A. v. Domar, Ltd., 476 F.3d 

1254, 1259 (11th Cir. 2007) (recognizing that the Supreme Court in 

Buckeye Check Cashing, Inc. “deemed irrelevant” the distinction 

between void and voidable contracts). Our decision in Chastain v. 

Robinson-Humphrey Co., also relied upon by the dissent, provides 

no guidance here, as the parties in that case agreed the appellee 

never signed the arbitration clauses at issue—a situation akin to 

fraud in the factum that would render a contract void. 957 F.2d 

15 We already know from D’Oench itself and our McCullough precedent that 

the D’Oench estoppel doctrine bars even a failure of consideration claim if 

based on non-bank records. See D’Oench, 315 U.S. at 456, 460–61, 62 S. Ct. at 

679, 681; McCullough, 911 F.2d at 601–02. 

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851, 853, 855 (11th Cir. 1992), abrogated on other grounds by First 

Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 115 S. Ct. 1920 (1995). 

We need not wade into the quagmire of FAA law to 

recognize a fundamental difference between this case and the FAA 

cases cited by the dissent. For D’Oench purposes, we must 

determine whether the FDIC had an interest (including a voidable 

interest) that could be diminished or defeated. See Langley, 484 

U.S. at 92–93, 108 S. Ct. at 401–02. In the arbitration context, 

however, courts look at whether an arbitration agreement is 

binding on the principal. See, e.g., Nat’l Fed’n of the Blind v. 

Container Store, Inc., 904 F.3d 70, 79–80 (1st Cir. 2018) (“A party 

seeking to compel arbitration must demonstrate that . . . the other 

party is bound by th[e arbitration] clause . . . .” (emphasis added 

and quotation marks omitted)). The dissent’s FAA cases, therefore, 

have no bearing on whether an agent lacking authority enters a 

void or voidable contract for purposes of D’Oench transfers.

G. That the Security Agreement Was Ratifiable Shows It 

Was Voidable, Not Void 

The dissent concedes, as it must, that a principal can ratify 

an agent’s unauthorized act and the security agreement was 

ratifiable by the law firm. Dissenting Op. at 15, 29–30. Even so, 

the dissent argues that “capacity for ratification does not 

undermine the [dissent’s] conclusion that contracts purportedly 

formed by agents who lack authority are void.” Id. at 29. We 

disagree.

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74 Opinion of the Court 20-13735

Fundamental principles of agency and contract law establish 

that only a voidable contract is capable of ratification. Restatement 

(Second) of Contracts, supra, § 7 cmt. e (“[T]he term voidable 

contract is appropriate if ratification by one of the parties would 

terminate his power of avoidance and make the contract 

enforceable against him.”); Voidable, Black’s Law Dictionary (11th 

ed. 2019) (defining “voidable” as “capable of being affirmed or 

rejected at the option of one of the parties”); 1 Williston on 

Contracts, supra, § 1:20 (observing that because a voidable contract 

“is capable of ratification, it affects from the outset the legal 

relations of the parties” and “is properly defined as a contract”); 1 

Corbin on Contracts, supra, § 1.6 (explaining that “[i]n every case 

[of a voidable contract], . . . it will be found that one of the parties 

has a legal power, either of avoidance or of ratification, or of both” 

and that it is equally accurate to describe such contracts as 

“ratifiable”).16

In stark contrast, a truly void contract cannot be ratified and 

become enforceable. 1 Williston on Contracts, supra, § 1:20 (“[I]f 

a promise is void, it creates no legal obligation[,] and the promisor 

is without power to ratify promise [sic].”); Restatement (Second) 

16 Even if agent Hardwick manifests an assent to a contract with Crescent 

without authority, the principal in turn has two choices: it may elect to ratify—

that is, manifest an assent to be bound by—the contract, or to avoid it. 12 

Williston on Contracts, supra, § 35:22 (“When an agent lacks actual authority 

to agree on behalf of the principal, the principal may still be bound if it 

acquiesces in the agent’s action, or fails promptly to disavow the unauthorized 

conduct after acquiring knowledge of the material facts.”).

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of Contracts, supra, § 163 cmt. c (explaining, as to the distinction 

between void and voidable contracts, that “the recipient of a 

misrepresentation may be held to have ratified the contract if it is 

voidable but not if it is ‘void’”). It is, was, and always will be a legal 

nullity that is enforceable against no one. 

We do recognize that the dissent identifies decisions, 

applying state law, that conclude that void contracts can be ratified. 

Dissenting Op. at 30.17 On the other hand, we located many other 

decisions, applying state law, which held a “void” contract is 

incapable of ratification. See, e.g., Wamsley v. Champlin Refin. & 

Chems., Inc., 11 F.3d 534, 539 (5th Cir. 1993) (“Promises that are 

void cannot be ratified.”)18; Kelley v. Kelley, 798 S.E.2d 771, 777 

(N.C. Ct. App. 2017) (“It is well settled that a void contract cannot 

be the basis for ratification or estoppel.”); Kellar v. Est. of Kellar, 

291 P.3d 906, 917 (Wash. Ct. App. 2012) (“[A] contract that is void 

at its inception, as opposed to merely voidable, is an absolute 

17 The dissent cites mostly state cases, but its cited federal case also applies

state law. See Jensen v. Ray Kim Ford, Inc., 920 F.2d 3, 4 (7th Cir. 1990) 

(applying Illinois law).

18 The Fifth Circuit’s explanation is apt here:

Promises that are void cannot be ratified. The reason for this 

is simple: Void promises are not legally binding and thus, are 

not contracts. [Restatement (Second) of Contracts, supra,] § 7 

cmt. a. Without an antecedent contract to ratify, there can be 

no ratification. 

Wamsley, 11 F.3d at 539.

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76 Opinion of the Court 20-13735

nullity and is incapable of ratification.”); Ockey v. Lehmer, 189 P.3d 

51, 56 (Utah 2008) (“A contract or a deed that is void cannot be 

ratified or accepted, and anyone can attack its validity in court. In 

contrast, a contract or deed that is voidable may be ratified at the 

election of the injured party.” (footnotes omitted)); Est. of Molino, 

81 Cal. Rptr. 3d 512, 521 (Cal. Ct. App. 2008) (“Void contracts 

cannot be ratified.”); Richmond Printing v. Port of Hous. Auth., 

996 S.W.2d 220, 224 (Tex. Ct. App. 1999) (“As a general rule, void 

contracts cannot be ratified.”). In sum, we are faced with 

nonbinding authority on both sides of that issue.

Again, it is unnecessary and unwise to enter this state-law 

fray. As we observed in Section VI.E, courts sometimes use the 

terms “void” and “voidable” interchangeably. See Griffin, 989 F.3d 

at 934 n.7. And if we take this case authority at face value and 

assume that courts always correctly use the terms “void” and 

“voidable,” the conflicting decisions—void contracts can versus 

cannot be ratified—seem impossible to reconcile. 

Instead of trying to reconcile these decisions applying state 

law, we again rely on Langley, our D’Oench precedent, and the 

general definitions of “void” and “voidable,” found in treatises and 

legal dictionaries, which establish that a principal’s power to elect 

to ratify an agent’s unauthorized contract by definition makes the 

contract merely voidable. See Voidable, Black’s Law Dictionary 

(11th ed. 2019); Restatement (Second) of Contracts, supra, § 7 cmt. 

e; 1 Williston on Contracts, supra, § 1:20. While the principal may 

elect to avoid the contract, the contract is not “void” in the 

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20-13735 Opinion of the Court 77

technically accurate meaning of that term. See Griffin, 989 F.3d at 

923; Haggart, 143 F. at 27. Because all agree that the Hardwick law 

firm could have ratified the security agreement in this case, that 

agreement was voidable and constituted an interest that was 

capable of transfer for purposes of D’Oench. See Gordy, 928 F.2d 

at 1565.

At bottom, the dissent fails to distinguish voidable contracts 

from binding contracts. Rather, the dissent conflates binding 

contracts with voidable contracts and applies a binding v. void 

dichotomy. For example, the dissent argues that: “The status of a 

contract executed by an agent as void or voidable turns on whether 

the agent has the authority to bind the principal.” Dissenting Op. 

at 15. As we have explained, the question is not whether the 

contract was ultimately binding on the Hardwick law firm. 

Instead, the proper and narrow inquiry for D’Oench transfer 

purposes is whether the facially valid and fully executed written 

contract was already void or merely voidable when the FDIC took 

over. The void-voidable dichotomy should be applied here, and 

the security agreement was voidable because it was capable of 

being affirmed or rejected at the option of the law firm. See supra 

Section V.B at 37–43. 

H. Comment c to § 4.01 of the Third Restatement of 

Agency (2006) and comment a to § 82 of the Second 

Restatement of Agency (1958) 

Finally, we address the dissent’s reliance on Restatement 

comments. The dissent attempts to “mak[e] sense of the 

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78 Opinion of the Court 20-13735

conflicting authority in this area of law,” but admits that “is no easy 

task.” Dissenting Op. at 32. To do so, the dissent cites (1) comment 

c to § 4.01 of the Third Restatement of Agency; and (2) comment a 

to § 82 of the Second Restatement of Agency. Id. at 33–34. While 

the dissent purports to “shed[] light on the matter,” it misconstrues 

these two comments to support its arguments that no contract, or 

only a void contract, was formed. See id. at 32.

Neither comment states, or even suggests, an agent’s 

unauthorized contract is void unless ratified by the principal. 

Indeed, the dissent alleges only that comment a to § 82 of the 

Second Restatement “strongly implies that a contract entered by 

an agent who lacks authority, prior to ratification, is void.” Id. at 

32–33. There is also no use of the term “void” in the corresponding 

text of the Restatement where these comments appear. At a 

minimum, these comments do not bear the heavy weight the 

dissent places on them.

The dissent also argues that under agency law “a principal 

must take affirmative steps to ratify a contract formed by an agent 

who lacked authority.” Id. at 35. The Third Restatement, 

however, makes clear that ratification can also result from a 

principal’s failure to act. Restatement (Third) of Agency, supra, 

§ 4.01 cmt. f. Specifically, a principal with notice “may ratify an act 

by failing to object to it or to repudiate it” or by delaying 

“expressing an objection to an unauthorized act.” Id. In fact, the 

principal need not even communicate the ratification to the agent 

or the third party for it to be effective. Id. § 4.01 cmt. d. It is telling 

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20-13735 Opinion of the Court 79

that the dissent fails to explain how ratification-by-silence is an 

affirmative act that binds the principal.

In addition, even assuming for sake of argument that the 

principal must affirmatively manifest assent to ratify a contract 

entered by an agent, that contract still would be ratifiable and thus 

voidable. The Restatements’ commentary does not support the 

dissent’s contention that “a contract entered by an agent who lacks 

authority, prior to ratification, is void, not voidable.” Dissenting 

Op. at 32–33. 

VII. CONCLUSION 

We conclude that Landcastle’s lack-of-authority claims are 

barred under D’Oench because they rely on evidence that was 

outside Crescent’s records when the FDIC took over and sold the 

Hardwick loan and CD collateral to Renasant. 

We do not “invent” any new, much less “radical and 

untenable,” rules of agency or contract law. Id. at 1, 37–38. Rather, 

we also conclude that Hardwick’s acting outside the scope of his 

authority did not render the security agreement void but, at most, 

only voidable. As Langley teaches, a voidable interest is sufficient 

to pass the CD security agreement to the FDIC and to trigger the 

D’Oench shield. See 484 U.S. at 94, 108 S. Ct. at 402.

Accordingly, we reverse the district court’s order, dated June 

8, 2020, and remand with instructions to enter final judgment in 

favor of Renasant. 

REVERSED AND REMANDED.

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20-13735 WILLIAM PRYOR, C.J., dissenting 1

WILLIAM PRYOR, Chief Judge, dissenting:

This appeal concerns whether the Federal Deposit Insurance 

Corporation can steal assets from third parties when it takes over a 

failed bank. Named after the Supreme Court decision in which it 

was first recognized, D’Oench, Duhme & Co. v. Federal Deposit 

Insurance Corp., 315 U.S. 447 (1942), the D’Oench doctrine bars 

private parties from raising claims or defenses that rely on evidence 

outside the failed bank’s records. But the doctrine applies only 

when the claim or defense would “diminish or defeat” an “interest” 

that the failed bank transferred to the Deposit Corporation. See 12 

U.S.C. § 1823(e); see also Lindley v. Fed. Deposit Ins. Corp., 733 

F.3d 1043, 1052–53 (11th Cir. 2013). Here, a private party argues 

that its agent lacked the authority to enter into a purported agreement on its behalf and that the principal was not bound, so the 

failed bank obtained no “interest” in the purported agreement that 

could have been transferred to the Deposit Corporation in the first 

place. See 12 U.S.C. § 1823(e). In that context, the D’Oench doctrine is not implicated, so I would affirm the judgment of the district court.

The majority erroneously determines, as a matter of federal 

common law, that the D’Oench doctrine applies anyway. To reach 

this conclusion, it relies on a radical and untenable interpretation 

of agency law. According to the majority, an agent acting without 

actual or apparent authority can nevertheless bind its purported 

principal. The principal must then take affirmative steps if it wishes 

to avoid the contract the unauthorized agent made. Because the 

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2 WILLIAM PRYOR, C.J., dissenting 20-13735

majority’s decision relies on fundamental misunderstandings about 

agency relationships and contract formation, creates serious Takings Clause concerns, and contradicts Supreme Court precedent, I 

respectfully dissent. 

I. BACKGROUND 

The relevant facts in this appeal are largely undisputed. Nathan Hardwick was a named partner at Morris Hardwick Schneider, LLC, a law firm wholly owned by MHSLAW, P.C. MHSLAW 

was the sole member of Morris Hardwick. Hardwick and the firm’s 

other named attorneys, Arthur Morris and Randolph Schneider, 

were managers of Morris Hardwick and owners of MHSLAW. 

Hardwick owned 50% of MHSLAW, and Morris and Schneider 

each owned 25%.

Morris Hardwick’s operating agreement and MHSLAW’s 

bylaws governed how the respective companies’ assets could be 

pledged. Morris Hardwick’s operating agreement prohibited any 

manager from causing the company to guarantee the obligation of 

a person “without the affirmative vote of the [m]embers holding a 

[m]ajority [i]nterest.” (Emphasis omitted.) Because MHSLAW was 

the sole member of Morris Hardwick, the operating agreement effectively required MHSLAW to vote to pledge Morris Hardwick’s 

assets to guarantee a third party’s obligation. MHSLAW’s bylaws, 

in turn, prohibited directors from pledging assets “without the affirmative vote of the majority of . . . the shareholders.” (Emphasis 

omitted.) So, none of the named attorneys, including Hardwick, 

could pledge any firm asset to guarantee a third party’s obligation 

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20-13735 WILLIAM PRYOR, C.J., dissenting 3

unless Hardwick and at least one of the other named attorneys 

voted to authorize the guarantee. 

In 2009, Hardwick entered into several agreements with 

Crescent Bank & Trust Company, some of which he signed in his 

personal capacity and some of which he signed as a “managing 

member” of Morris Hardwick. First, he used $631,276.71 to purchase a certificate of time deposit from Crescent. The parties dispute who owned the funds that Hardwick used to purchase the certificate, but both parties agree that Crescent issued the certificate 

to Morris Hardwick. Hardwick then took out a personal loan from 

Crescent for the same amount, $631,276.71. Next, to secure his personal loan with sufficient collateral to satisfy Crescent, Hardwick—

purporting to act as “managing member” of Morris Hardwick even 

though he was not a member—pledged the certificate to Crescent. 

Hardwick executed four separate documents. He executed 

a commercial security agreement, which listed the certificate as his 

personal property and as collateral on the personal loan. He also 

executed several documents as a “managing member” of Morris 

Hardwick: a corporate resolution, an assignment of the certificate 

to Crescent, and a hypothecation agreement. Robert Driskell, Morris Hardwick’s Chief Financial Officer, also signed the corporate 

resolution as an “authorized signer” for the certificate-of-deposit 

account. Neither party disputes that no shareholder vote authorized Hardwick to execute these documents, and there is no evidence that Morris or Schneider knew about these particular transactions. 

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4 WILLIAM PRYOR, C.J., dissenting 20-13735

The corporate resolution “grant[ed] . . . [d]eposit authority 

by the governing body of the business entity to specified individuals.” The document is formatted as a checklist of possible authorizations. The resolution specifies that the “[w]ords or phrases preceded by a [box] are applicable only if the [box] is marked.” No 

boxes on the document were marked even though some authorizations specified whether Hardwick and Driskell—instead of Hardwick alone—were given the particular authorization. The potential 

authorizations included the authorization to make “deposits to” 

and “withdrawals from” the certificate account and to “[t]ransfer 

funds from the account[] . . . to any account” and “[t]ransfer funds 

to the account[] . . . from any account.” From the document, we 

can infer that those authorizations were not granted. 

Hardwick purported to execute the assignment and hypothecation agreement on behalf of Morris Hardwick. The assignment—the key document of interest in this case—represented that 

Morris Hardwick “assign[ed] and transfer[red] to [Crescent Bank], 

and . . . [gave Crescent] a security interest” in the certificate. The 

assignment was “to secure the payment of . . . all present and future 

debts” Hardwick personally owed Crescent. The hypothecation

agreement provided that in the event of default, Crescent could 

marshal the certificate to satisfy the debt.

In 2010, Crescent failed. The Federal Deposit Insurance Corporation closed Crescent and put it into receivership. Renasant 

Bank then purchased Crescent’s assets. 

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20-13735 WILLIAM PRYOR, C.J., dissenting 5

The Deposit Corporation administers the federal deposit insurance system, which was created by Congress in 1933 and works 

to insure deposits at banks and savings institutions. See 12 U.S.C. 

§ 1811(a). The Deposit Corporation supervises and regulates banks 

to identify and address risks to the insurance funds. When a bank 

fails, the Deposit Corporation must quickly decide whether to liquidate the failed bank’s assets to pay its depositors and other creditors or to enter into a purchase-and-assumption agreement where 

another institution purchases the assets and assumes the liabilities 

of the failed bank. 

Because these decisions must “usually” be made “overnight,” a combination of federal common law and statute called the 

D’Oench doctrine helps the Deposit Corporation make informed 

decisions. See Gunter v. Hutcheson, 674 F.2d 862, 865 (11th Cir. 

1982), abrogated on other grounds by Langley v. Fed. Deposit Ins. 

Corp., 484 U.S. 86, 93 (1987). The most accurate “method of evaluating” the options “is relying on the books and records of the 

failed bank to estimate what assets would be returned by a purchasing bank and to estimate which of those assets ultimately would be 

collectible.” Id. at 870. The D’Oench doctrine aids the Deposit Corporation by barring private parties from seeking to defeat or diminish its interests by relying on evidence outside the failed bank’s records. See Langley, 484 U.S. at 93. By relying on the failed bank’s 

official records, the Deposit Corporation is able to more easily obtain a reliable estimate of the failed bank’s assets. See Gunter, 674 

F.2d at 870. If it could not obtain such an estimate, the purchaseUSCA11 Case: 20-13735 Document: 59-1 Date Filed: 01/12/2023 Page: 84 of 126
6 WILLIAM PRYOR, C.J., dissenting 20-13735

and-assumption option might be “effectively foreclosed,” see id., 

because potential purchasers might hesitate before accepting that 

level of risk. 

Although the record does not establish when Hardwick 

stopped making payments on the loan, Renasant determined in 

2014 that Hardwick was in default and applied the proceeds of the 

certificate to offset the amount that Hardwick owed. That same 

year, Morris Hardwick assigned its interest in the certificate to 

Landcastle Acquisition Corporation. 

Landcastle then filed an administrative claim with the Deposit Corporation to recover the amount of the certificate. After 

the Deposit Corporation refused to pay the claim, Landcastle sued 

Renasant for conversion and breach of contract, alleging that Renasant did not have the right to liquidate the certificate or to use 

the proceeds to offset Hardwick’s personal loan. Landcastle and 

Renasant both moved for summary judgment. 

Landcastle contended that Hardwick lacked the authority to 

pledge the certificate as collateral for his personal loan. It argued 

that Hardwick lacked actual authority because the governing documents of Morris Hardwick and MHSLAW conditioned actual authority on a shareholder vote. Landcastle further argued that Hardwick lacked apparent authority because his pledge of a firm asset as 

collateral for a personal loan was not “apparently for the carrying 

on in the usual way the business and affairs” of Morris Hardwick. 

See GA.CODE § 14-11-301(c)–(d). Landcastle asserted that self-interested transactions are categorically not “carrying on . . . the 

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20-13735 WILLIAM PRYOR, C.J., dissenting 7

business and affairs” of a company “in the usual way.” See id. § 14-

11-301(c). 

Renasant agreed that Hardwick lacked actual authority to 

bind Morris Hardwick, but it argued that he had apparent authority 

to execute the agreements because Morris Hardwick had not satisfied its burden to offer facts about its usual way of business. Renasant also argued that Hardwick had apparent authority because 

the managers collectively failed to observe corporate formalities, 

the company and managers commingled the managers’ personal 

finances with company funds, and Crescent was familiar with Morris Hardwick and Hardwick individually. 

Renasant also made an alternative argument about the 

D’Oench doctrine. It argued that even if Hardwick lacked authority, the D’Oench doctrine barred Landcastle from asserting its 

claim because Landcastle necessarily relied on evidence outside the 

bank’s records to defeat its interest in the certificate. And it argued 

that Hardwick’s lack of authority rendered the agreements at worst 

voidable, and not void, so the D’Oench doctrine applied. 

The district court denied Renasant’s motion. It first concluded that the D’Oench doctrine does not bar private parties from 

asserting as a claim or defense that the agent who executed the 

agreement lacked authority to do so. The district court reasoned 

that enforcing a claim (or establishing a defense) based on lack of 

authority does not require a court to enforce an agreement with or 

obligation against the bank that is not within its records. It determined that, in those circumstances, the bank is the party that is 

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8 WILLIAM PRYOR, C.J., dissenting 20-13735

trying to enforce the agreement or obligation that might or might 

not exist. The district court likened lack of authority to forgery, 

which it concluded resembles fraud in the factum. And the district 

court relied on the Supreme Court’s decision in Langley v. Federal 

Deposit Insurance Corp., which stated that the D’Oench doctrine 

would not bar a “fraud in the factum” defense because fraud in the 

factum renders an agreement entirely void. See 484 U.S. at 93. 

The district court also denied Landcastle’s motion for summary judgment. It reasoned that, under Georgia law, Landcastle 

had the initial burden of proving the absence of apparent authority. 

It then explained that Landcastle had flipped the burden to Renasant to establish the presence of apparent authority because 

Landcastle had established that Hardwick entered the transaction 

for personal purposes. And it concluded that Renasant had satisfied 

that burden with enough evidence to create a genuine dispute of 

fact but not enough to warrant summary judgment in its favor.

The district court certified its summary-judgment order for 

immediate appeal. See 28 U.S.C. § 1292(b). The district court stated 

that there were two controlling questions of law for which there 

are substantial grounds for difference of opinion and that an interlocutory appeal would materially advance the litigation. See id.

First, “[d]oes D’Oench bar a claim (or defense) that the agent who 

signed the agreement with the bank purportedly lacked authority 

to do so?” And second, “[u]nder [Georgia Code Section] 14-11-301, 

who bears the burden to demonstrate whether an agent who 

pledged company assets for personal use was ‘apparently carrying 

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20-13735 WILLIAM PRYOR, C.J., dissenting 9

on in the usual way the business and affairs’ of the [limited liability 

company], and what is the nature of that burden?” 

Renasant timely filed a petition for interlocutory appeal but 

chose to pursue only the D’Oench question. We granted review 

and clarified that we would consider only whether the D’Oench

doctrine “bar[s] a claim (or defense) that the agent who signed the 

agreement with the bank purportedly lacked authority to do so.” 

The parties briefed whether the D’Oench doctrine bars a claim or 

defense based on lack of authority, and, if so, whether the doctrine 

would bar Landcastle’s claim in this case. 

II. STANDARD OF REVIEW 

We review certified questions of law de novo. Johnson v. 

City of Fort Lauderdale, 148 F.3d 1228, 1229 n.3 (11th Cir. 1998); 

see also 28 U.S.C. § 1292(b). But our appellate jurisdiction is not 

limited to the question of law identified by the district court. Barrientos v. CoreCivic, Inc., 951 F.3d 1269, 1275 (11th Cir. 2020). Instead, we have jurisdiction over the order certified, and we “may 

address any issue fairly included within the certified order.” Id.

(quoting Yamaha Motor Corp., U.S.A. v. Calhoun, 516 U.S. 199, 

205 (1996)). But we have counseled that the “legal question” in a 

section 1292(b) appeal “must be stated at a high enough level of 

abstraction to lift the question out of the details of the evidence or 

facts of a particular case and give it general relevance to other cases 

in the same area of law.” See McFarlin v. Conseco Servs., LLC, 381 

F.3d 1251, 1259 (11th Cir. 2004). So, we have the discretion to limit 

our review to the “discrete and abstract legal issue the district court 

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10 WILLIAM PRYOR, C.J., dissenting 20-13735

identified.” Barrientos, 951 F.3d at 1275; Moorman v. UnumProvident Corp., 464 F.3d 1260, 1272 (11th Cir. 2006); see also 16 

CHARLES ALAN WRIGHT ET AL., FEDERAL PRACTICE & PROCEDURE

§ 3929 (3d ed. Apr. 2022 update). To the extent that we review the 

order beyond the pure question of law identified by the district 

court, we employ our normal standards of review. Here, the district court denied both parties’ motions for summary judgment, so 

we review that order de novo. See Tillis ex rel. Wuenschel v. 

Brown, 12 F.4th 1291, 1296 (11th Cir. 2021). 

III. DISCUSSION 

I divide my discussion into three parts. First, I explain why 

Landcastle’s claims are not barred by the D’Oench doctrine. Second, I explain the basic principles of agency law that prevent an 

agent who lacks authority from binding a principal in contract. 

Third, I explain the problems created by the majority’s new rule. 

A. The D’Oench Doctrine Does Not Apply to Lack of Authority, 

Which Prevents a Failed Bank from Obtaining an Interest That 

Can Be Transferred to the Deposit Corporation.

Although the D’Oench doctrine is a messy combination of 

common law and statute, it “is simply a rule” that protects federal 

deposit insurers and their successors in interest from some claims 

or defenses that the insurers could not have discovered by examining the failed bank’s records. See Lindley, 733 F.3d at 1051; Vernon 

v. Resol. Tr. Corp., 907 F.2d 1101, 1106 (11th Cir. 1990). It applies 

when a private party who has “lent himself to a scheme or 

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20-13735 WILLIAM PRYOR, C.J., dissenting 11

arrangement whereby” the bank insured by the federal deposit insurer “was or was likely to be misled,” D’Oench, 315 U.S. at 460, 

asserts a claim or defense that “tends to diminish or defeat the interest” of the federal deposit insurer, 12 U.S.C. § 1823(e); see also 

Lindley, 733 F.3d at 1052–53. 

When the doctrine applies, a private party is barred from relying on any evidence outside the failed bank’s records to support 

his claim or defense. See Lindley, 733 F.3d at 1051. And when the 

asset at issue is an instrument, federal deposit insurers and their 

successors in interest have “a quasi-holder-in-due-course status,” 

see Vernon, 907 F.2d at 1106, even when they would not be entitled to holder-in-due-course status under state law, see Fed. Deposit Ins. Corp. v. McCullough, 911 F.2d 593, 603 n.10 (11th Cir. 

1990). This status benefits the Deposit Corporation and its successors in interest because “[t]he right of . . . holder[s] in due course to 

enforce the obligation of a party . . . is subject” only to a limited 

number of “real defenses.” See U.C.C. § 3-305(a)(1), (b) & cmt. 1 

(AM. L. INST. & UNIF. L. COMM’N 2002) (internal quotation marks 

omitted). 

The D’Oench doctrine does not protect federal deposit insurers from all claims and defenses. See, e.g., Langley, 484 U.S. at 

93–94; Vernon, 907 F.2d at 1106 n.4. The doctrine applies only to 

claims and defenses that “tend[] to diminish or defeat the interest” 

of the federal deposit insurer in an asset. See 12 U.S.C. § 1823(e); 

Lindley, 733 F.3d at 1052–53. The D’Oench doctrine does not apply 

where the failed bank did not have and could not have transferred 

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12 WILLIAM PRYOR, C.J., dissenting 20-13735

an interest to the insurers. See Langley, 484 U.S. at 93–94. That is, 

the D’Oench doctrine protects preexisting interests; it does not create new ones. 

The Supreme Court explained this limitation in Langley. 

W.T. and Maryanne Grimes Langley had executed a facially unqualified promissory note in favor of a bank, which later transferred the note to the Deposit Corporation. Id. at 88–89, 93. Defending against the enforcement of the note, the Langleys argued 

that the note was “procured by [the bank’s] misrepresentations.” 

Id. at 88–89. The Langleys argued that the D’Oench doctrine did 

not apply to fraudulent representations or warranties at all. Id. at 

93. The Court rejected that broad argument but explained that

“[t]he presence of fraud could be relevant . . . [to] the requirement 

that the agreement in question tend to diminish or defeat the . . . 

interest” of the federal deposit insurer. Id. (alteration adopted) (internal quotation marks omitted). 

The Supreme Court concluded that the D’Oench doctrine 

does not bar private parties from asserting a fraud-in-the-factum 

defense, id., even though that defense will almost always be based 

on evidence “not found in the failed bank’s official records,” see 

Maj. Op. 33. It explained that “the real defense of fraud in the factum” would “render the instrument entirely void,” and an instrument that is “entirely void” creates “no . . . ‘interest’” that “c[an be] 

transfer[red] to the” Deposit Corporation. Langley, 484 U.S. at 93–

94 (quoting 12 U.S.C. § 1823(e)); see also RESTATEMENT (SECOND)

OF CONTRACTS § 163 & cmt. a (AM. L. INST. 1981); Laborers’ 

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20-13735 WILLIAM PRYOR, C.J., dissenting 13

Pension Fund v. A&C Env’t, Inc., 301 F.3d 768, 780 (7th Cir. 2002) 

(“[A]ssent procured by fraud in the [factum] renders the agreement 

void and the purported contract . . . nonexistent.”). And because 

there is no interest in a void instrument that can be transferred to 

the Deposit Corporation, establishing a fraud-in-the-factum defense would not “ten[d] to diminish or defeat” the Deposit Corporation’s “interest” in the asset. Langley, 484 U.S. at 93–94 (alteration in original) (quoting 12 U.S.C. § 1823(e)). 

But the Supreme Court concluded that the D’Oench doctrine does apply to defenses that render a contract voidable—as opposed to void—such as fraud in the inducement. See id. at 94, 96. 

It explained that the bank’s alleged misrepresentations in Langley

“constitute[d] only fraud in the inducement,” not “fraud in the factum.” See id. at 94. It then examined whether, if the note were procured by fraud in the inducement, the bank would have obtained 

any interest in the note that it could have transferred to the Deposit 

Corporation. See id. Fraud in the inducement “renders [a] note 

voidable but not void.” Id. A voidable note is a contract that “is 

valid and has its usual legal consequences until” a party elects to 

avoid it. See RESTATEMENT (SECOND) OF CONTRACTS § 7 cmt. e. So, 

in Langley, the failed bank obtained “voidable title” in the note. 

Langley, 484 U.S. at 94. That is, the bank obtained an “interest,” 12 

U.S.C. § 1823(e), in the note that was “valid . . . until” the Langleys 

elected to void it, see RESTATEMENT (SECOND) OF CONTRACTS § 7 

cmt. e. The Supreme Court concluded that voidable title is an “interest” that can be “diminish[ed] or defeat[ed]” for purposes of the 

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14 WILLIAM PRYOR, C.J., dissenting 20-13735

D’Oench doctrine. Langley, 484 U.S. at 94 (alterations in original) 

(quoting 12 U.S.C. § 1823(e)). 

B. An Agent Without Authority Cannot Bind a 

Principal in Contract.

Because the D’Oench doctrine applies only to preexisting interests, courts must first determine whether, if the claim or defense 

is successful, the failed bank ever had an interest in the asset that 

could be “diminish[ed] or defeat[ed].” See 12 U.S.C. § 1823(e); accord Andrew D. Taylor Tr. v. Sec. Tr. Fed. Sav. & Loan Ass’n, 844 

F.2d 337, 342–43 (6th Cir. 1988); Grubb v. Fed. Deposit Ins. Corp., 

868 F.2d 1151, 1158 (10th Cir. 1989); Fed. Deposit Ins. Corp. v. 

Bracero & Rivera, Inc., 895 F.2d 824, 830 (1st Cir. 1990). So, the 

outcome of the present case turns on whether, if Hardwick lacked 

authority to pledge Morris Hardwick’s certificate, Crescent ever 

held an interest in the certificate that it could have transferred to 

the Deposit Corporation.

To answer that question, we look to general commercial 

law. The asset at issue in Langley, a promissory note, was governed 

by Louisiana law. See Langley, 484 U.S. at 88. But the Supreme 

Court, as a matter of federal common law, looked to general commercial law in considering the legal effect that fraudulent inducement and fraud in the factum would have had on the note, with 

reference to the Uniform Commercial Code, the Second Restatement of Contracts, and Farnsworth’s casebook on contracts. Id. at 

93–94. 

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20-13735 WILLIAM PRYOR, C.J., dissenting 15

The common law of agency and contracts is not always a 

model of clarity, but we can still derive a few fundamental principles that suffice to resolve the case before us. First, a contract cannot be formed without the mutual assent of the parties bound by 

it. Second, an agent who purports to form a contract on a principal’s behalf—but, in fact, lacks the authority to do so—does not 

form a contract enforceable against the principal. Third, the purported contract becomes enforceable against the principal only if 

he takes affirmative steps to ratify it, which manifest his assent to 

the agreement. 

The status of a contract executed by an agent as void or voidable turns on whether the agent has the authority to bind the principal. Contra Maj. Op. 50. A voidable contract binds the parties until it is repudiated, but a void contract never binds the parties. And 

whether a contract is void or voidable, in turn, determines whether 

an interest was ever created for purposes of the D’Oench doctrine. 

Langley, 484 U.S. at 93–94. So, the following discussion, which addresses when an agent can bind a principal in contract, is not “far 

afield” from the certified question but rather goes to the very heart 

of it. Contra Maj. Op. 51. 

According to the first key principle, a contract can only be 

formed with the consent of the parties bound by it. With limited 

exceptions not relevant here, “the formation of a contract” under 

general contract law “requires . . . mutual assent to the exchange.” 

RESTATEMENT (SECOND) OF CONTRACTS § 17(1). “The manifestation of mutual assent . . . ordinarily takes the form of an offer or 

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16 WILLIAM PRYOR, C.J., dissenting 20-13735

proposal by one party followed by an acceptance by the other party 

or parties.” Id. § 22(1). An agent can act on behalf of a principal to 

make or accept an offer in accordance with the law of agency. See 

id. § 52 cmt. c. For this act to occur, the following steps are required: the principal “manifest[s] assent to the agent’s power”; the 

“agent enters into a contract on behalf of [his] principal by manifesting assent to an exchange”; and “[t]he third party manifests assent . . . to the agent.” See RESTATEMENT (THIRD) OF AGENCY § 6.01 

cmt. b (AM. L. INST. 2006). 

According to the second key principle, when an agent lacks 

authority to form a contract on the principal’s behalf, no contract 

results. So, when an agent purports to “enter[] into [a] contract on 

[its] principal’s behalf . . . without actual or apparent authority,” 

the “principal is not a party to [that] contract.” Id. § 6.05 cmt. b 

(emphasis added). In other words, “[a]n agent can bind its principal 

to a contract” only if “the agent has actual authority” or if the “contract[] [is] made by the agent . . . within the scope of the agent’s 

apparent authority.” 3 AM.JUR. 2D Agency § 83 (Nov. 2022 Update); 

see also RESTATEMENT (THIRD) OF AGENCY § 6.01. An agent acting 

without authority cannot bind a principal unless the principal takes 

an affirmative step to bind himself, known as “ratification.” 

An agent’s false representation of authority does not alter 

the fact that he lacks authority. It is a “basic proposition that a principal is not accountable simply because the agent has succeeded in 

misleading the third party about the extent or nature of the agent’s 

authority.” Id. § 2.03 cmt. c. No contract is formed between the 

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20-13735 WILLIAM PRYOR, C.J., dissenting 17

principal and the third party because “[a] principal is not subject to 

liability when an agent” acts without authority, even if the agent 

“defrauds a third party.” See id. § 7.08 cmt. c(2); see also id. 

§ 6.11(1) (“When an agent for a disclosed . . . principal makes a false

representation about the agent’s authority to a third party, the principal is not subject to liability unless the agent acted with actual or

apparent authority in making the representation and the third party

does not have notice that the agent’s representation is false.”).

Settled precedent recognizes this principle. As long ago as 

1852, the Supreme Court held that “it is a well-settled principle of 

law, and nowhere controverted, that if an agent exceed[s] his authority his acts in such excess do not bind his principal.” Very v.

Levy, 54 U.S. 345, 349 (1852). More recently, we held in Gymco 

Construction Co. v. Architectural Glass & Windows, Inc. that because an agent “lacked authority to enter into a . . . contract” between his principal and a third party, “there was no [such] contract.” 884 F.2d 1362, 1367 (11th Cir. 1989). 

The majority’s attempts to distinguish our precedent in 

Gymco are unavailing. The Gymco decision rested on alternative 

holdings. We held that the agent “lacked authority to enter into a 

new contract,” and we alternatively held that the agent “could not 

agree to modify the written contract orally.” Id. That the purported 

contract between the agent and the third party was an oral contract 

was necessary only to the latter alternative holding. Contra Maj. 

Op. 64–65. The former holding confirms that an agent cannot create a contract on a principal’s behalf without authority—a

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18 WILLIAM PRYOR, C.J., dissenting 20-13735

fundamental principle that does not depend on the details of 

Gymco’s facts. Our holding also did not rely on a determination 

that the principal had repudiated the contract, as opposed to the 

fact that no contract was formed, to reach its conclusion. Contra

id. at 65. We mentioned repudiation only to support the proposition that the agent lacked actual authority, but we proceeded to 

assess apparent authority separately. See Gymco, 884 F.2d at 1366. 

That the third party could not reasonably have believed that the 

agent had authority was necessary to establish that apparent authority did not exist. See Maj. Op. 64–65. Our holding was clear: 

the agent formed no contract because he lacked the authority to do 

so. And that principle applies beyond the facts of Gymco. 

In In re JLJ Inc., 988 F.2d 1112 (11th Cir. 1993), we likewise 

held that a contract purportedly made by an agent who lacked authority to bind the principal was “void.” We considered the validity 

of an assignment of debt by an agent acting under power of attorney. We held that “[i]f [the principal] orally revoked the power of 

attorney . . . , then the assignment [the agent] executed one week 

later would be void.” Id. at 1116 (emphasis added). We remanded 

the case “to the bankruptcy court for factual findings regarding 

whether [the principal] orally revoked the power of attorney before [the agent] assigned the debtor’s promissory notes . . . on [the 

principal’s] behalf.” Id. at 1117. Although the agent in JLJ allegedly 

lacked authority because the principal had revoked it—in contrast 

with the agent here, who allegedly exceeded his authority—the 

same principle applies: an agent cannot bind a principal in contract 

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20-13735 WILLIAM PRYOR, C.J., dissenting 19

when he lacks the authority to do so. The resulting purported contract is void. 

The majority’s attempt to distinguish JLJ is also unavailing. 

This Court reasoned that the assignment “would be void if [the 

principal] orally revoked the power of attorney before [the agent] 

executed the assignment.” Id. at 1116. So, it directly stated that an 

agreement entered by an agent who lacked authority is void. Contra Maj. Op. 67–68. Because that determination was necessary to 

the disposition of the appeal—in fact, it was the only reason this 

Court remanded the case to the district court, JLJ, 988 F.2d at 

1117—it constituted part of our holding, see United States v. Kaley, 

579 F.3d 1246, 1253 n.10 (11th Cir. 2009) (“What matters in discerning whether a rule of law expounded by a court is in fact holding is 

whether it was necessary to the result reached . . . .”). The JLJ 

Court expressly relied on Alabama law only to determine under 

what circumstances the power of attorney could be revoked. See 

JLJ, 988 F.2d at 1116–17 (citing Cooper v. Cooper, 91 So. 82, 84 

(Ala. 1921)). Contra Maj. Op. 67 & n.14. But it did not suggest that 

its holding that the assignment of the notes would be void if the 

agent’s power of attorney had been revoked depended on a peculiarity of Alabama law. And our statement in a separate, unpublished 

opinion that courts in general, and Alabama courts in particular, 

tend to use the terms “void” and “voidable” imprecisely does not 

alter the weight of existing precedent. Contra Maj. Op. 68 (citing 

United States v. Ruan, 796 F. App’x 672, 675–76 (11th Cir. 2020)). 

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20 WILLIAM PRYOR, C.J., dissenting 20-13735

Many courts have similarly concluded that when an agent 

who lacks authority purports to bind a principal in contract, the 

resulting instrument is void. See, e.g., United States v. Marin, 651 

F.2d 24, 29 (1st Cir. 1981) (“Since [the agent] lacked authority to 

contract for the corporation, and since the corporation never ratified his action, the . . . lease [that the agent had purportedly signed 

on the principal’s behalf] was void.”); Woods v. Wells Fargo Bank

Wyo., 90 P.3d 724, 733 (Wyo. 2004) (explaining that “[u]ltra vires 

acts of a corporate president or other agent are void unless” apparent authority existed or the act was later ratified); Spengler v. Sonnenberg, 102 N.E. 737, 739 (Ohio 1913) (“If the agent assumes to 

make a contract in excess of this authority, the agreement is void 

and unenforceable.”); Siena at Old Orchard Condo. Ass’n v. Siena

at Old Orchard, L.L.C., 75 N.E.3d 420, 442 (Ill. App. Ct. 2017) (“A 

contract executed by a party that does not have authority is void 

ab initio.” (Citation omitted)); O’Neal v. O’Neal, 803 S.E.2d 184, 

189 (N.C. Ct. App. 2017) (holding, where an agent acted under an 

invalid grant of power of attorney, that “the deeds that [the agent] 

executed pursuant to [the purported agency relationship] were 

void ab initio”); 1230 Park Assocs., LLC v. N. Source, LLC, 852 

N.Y.S.2d 92, 93 (N.Y. App. Div. 2008) (holding that a third-party 

lender “did not have a valid and enforceable security interest in the 

[principal’s] collateral, as [the agent] had no authority, apparent or 

otherwise, to pledge [the principal’s] property as collateral for the 

loans”).

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20-13735 WILLIAM PRYOR, C.J., dissenting 21

Notably, the Fifth Circuit concluded in a context particularly 

analogous to this appeal that a contract purportedly formed by an 

agent who lacks authority is void. See In re Northlake Dev. L.L.C., 

643 F.3d 448 (5th Cir. 2011). At issue was whether a contract made 

by a minority member of an LLC, who deeded “substantially all of 

the LLC’s real estate” to his own company “without authority,” 

was “(i) voidable, such that it [was] subject to the intervening rights 

of a subsequent bonafide purchaser for value and without notice, 

or (ii) void ab initio, i.e., a legal nullity[.]” Id. at 450 (quoting In re

Northlake Dev., L.L.C., 614 F.3d 140, 145 (5th Cir. 2010)). Based on 

the Mississippi Supreme Court’s answer to its certified question, 

the Fifth Circuit determined that “the deed was . . . ‘void and of no 

legal effect’ because” the agent “lacked actual or apparent authority 

to convey” the property “and [the principal] never ratified the purported transfer.” Id. at 450 (quoting Northlake Dev. L.L.C. v. BankPlus, 60 So.3d 792, 794 (Miss. 2011). It cogently explained that 

“[w]here no actual or apparent authority exists to transfer a principal’s property, . . . the deed is void unless and until later ratified.” 

Id. at 451 (alteration adopted) (quoting Northlake Dev. L.L.C., 60 

So.3d at 797). 

An informative line of caselaw also arises under the Federal 

Arbitration Act. These decisions address whether courts or arbitrators should decide disputes over whether a contract that includes

an arbitration clause was formed by an agent who lacked authority.

If no contract exists, no agreement to arbitrate binds the parties.

Although it did not address the issue on the merits, in a footnote,

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22 WILLIAM PRYOR, C.J., dissenting 20-13735

the Supreme Court classified the question “whether the signor 

lacked authority to commit the alleged principal” as bearing on 

“whether any agreement between the alleged obligor and obligee 

was ever concluded.” Buckeye Check Cashing, Inc. v. Cardegna, 

546 U.S. 440, 444 n.1 (2006) (emphasis added). So, the Supreme 

Court—in a decision applying “federal substantive law,” id. at 445–

47 (quoting Southland Corp. v. Keating, 465 U.S. 1, 12 (1984))—

understood that an agent who purports to form a contract on behalf of his principal but lacks authority to do so forms no contract 

at all. 

The majority’s attempt to undermine our reliance on Cardegna is unavailing. See Maj. Op. 72. In Rintin Corp., S.A. v. Domar, Ltd., we recognized that the Cardegna Court “held that under 

the Federal Arbitration Act, a challenge to the validity of a contract 

containing an arbitration clause, rather than to the arbitration 

clause itself, should be determined in the first instance by the arbitrators.” 476 F.3d 1254, 1259 (11th Cir. 2007). So, the distinction 

between void and voidable contracts was ultimately “irrelevant.” 

Id. But we, like the Supreme Court, recognized a distinction “between challenges to the validity of a contract with an arbitration 

clause and arguments that a party never consented to such a contract.” Id. at 1259 n.3; see also Cardegna at 444 n.1. Because Rintin 

did not argue that it had “never effectively consented to the Agreement,” we determined that “we need not pursue the line of cases 

mentioned in [the Cardegna footnote].” Rintin Corp., 476 F.3d at 

1259 n.3. The statements in both Cardegna and Rintin

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20-13735 WILLIAM PRYOR, C.J., dissenting 23

distinguishing questions of contract validity from questions of contract formation—and, in Cardegna, the statement indicating that 

an agent’s lack of authority created an issue of contract formation—are informative, even if only dicta. 

What’s more, a majority of our sister circuits have agreed 

that if an agent was not authorized to form the contract, no contract exists, nor does an agreement to arbitrate. See, e.g., Nat’l

Fed’n of the Blind v. Container Store, Inc., 904 F.3d 70, 81 (1st Cir. 

2018) (“A challenge to formation can also be done by showing that 

. . . a signatory did not possess the authority to commit the principal . . . .”); Sandvik AB v. Advent Int’l Corp., 220 F.3d 99, 109 (3d 

Cir. 2000) (explaining that a “failure to demonstrate how the arbitration agreement exists if [the agent] lacked authority to bind [the 

principal] places the [arbitration] clause’s validity in dispute”);

Berkeley Cnty. Sch. Dist. v. Hub Int’l Ltd., 944 F.3d 225, 238 (4th 

Cir. 2019) (“[I]f the agent . . . lacks authority to bind his principal 

. . . to a contract with a third party . . . yet purports to do so anyway, no contract is formed between the principal and the third 

party.”); Arnold v. Homeaway, Inc., 890 F.3d 546, 550 (5th Cir. 

2018) (“[T]he Supreme Court has suggested that the category of 

arguments that question the very existence of an agreement include[s] . . . whether the signor lacked authority to commit the alleged principal . . . .” (Internal quotations marks omitted)); Sphere

Drake Ins. Ltd. v. All Am. Ins. Co., 256 F.3d 587, 591 (7th Cir. 2001) 

(Easterbrook, J.) (explaining that, when a contract was purportedly 

formed by “a faithless agent who lacked authority to make that 

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24 WILLIAM PRYOR, C.J., dissenting 20-13735

commitment,” “no contract came into being”); GP3 II, LLC v. Litong Cap., LLC, 35 F.4th 1124, 1127 (8th Cir. 2022) (“[A] signor’s 

authority to bind a purported principal is an issue of contract formation . . . .”); Three Valleys Mun. Water Dist. v. E.F. Hutton &

Co., 925 F.2d 1136, 1140 (9th Cir. 1991) (explaining that the question of “whether the signatory had authority to bind the plaintiffs 

to the agreement” must be decided by a district court because it 

“go[es] to the very existence of a contract that a party claims never 

to have agreed to”); see also Chastain v. Robinson-Humphrey Co., 

957 F.2d 851, 854 (11th Cir. 1992) (explaining, in a forgery case, that 

the determination of whether a “non-signing party can nonetheless 

be bound by the contractual language,” including under agency 

principles, goes to “the very existence of any agreement”).

The majority’s attempt to disregard this entire line of 

caselaw is unpersuasive. See Maj. Op. 72–73. It contends that the 

Federal Arbitration Act cases are irrelevant because “[f]or D’Oench

purposes, we must determine whether the FDIC had an interest

(including a voidable interest) that could be diminished or defeated,” whereas “[i]n the arbitration context . . . courts look at 

whether an arbitration agreement is binding on the principal.” Id.

at 73. But the majority identifies two sides of the same coin. An 

interest can be created only through a binding contract. So, authorities that address when an agent forms a binding contract to arbitrate inform our understanding of when an agent forms a binding 

contract that creates an interest for the purposes of the D’Oench 

doctrine. 

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20-13735 WILLIAM PRYOR, C.J., dissenting 25

Like our precedents and many persuasive authorities, I refer 

to a purported contract created by an agent who lacks authority 

alternatively as either “no contract” or “void.” A “void” contract is 

“[a] promise for breach of which the law neither gives a remedy 

nor otherwise recognizes a duty of performance by the promisor.” 

RESTATEMENT (SECOND) OF CONTRACTS § 7 cmt. a. “[S]uch a promise is not a contract at all; it is [a] ‘promise’ or ‘agreement’ that is 

void of legal effect.” Id. (emphasis added); see also 1 WILLISTON ON 

CONTRACTS § 1:20 (4th ed. Oct. 2022 Update) (“Void promises are 

not legally binding, have no legal effect, and, therefore, are not contracts.”). Likewise, where the Restatement of Agency refers to “an 

agent mak[ing] a contract with a third party” without authority, 

RESTATEMENT (THIRD) OF AGENCY § 6.05(1), the comments clarify 

that “[o]rdinarily[] a principal is not a party to [such] a contract,” 

id. cmt. b (emphasis added). At least for present purposes, there is 

no meaningful difference between saying that the agent formed no 

contract, formed a void contract, or formed a contract to which the 

principal was not party. In any event, no valid contract was formed 

involving the principal.

Yet the majority concludes that a contract can be formed in 

this circumstance. Renasant, and the amici that support it, argue 

that the D’Oench doctrine applies because an unauthorized agent 

can form a voidable contract between his purported principal and 

a third party. So, they determine that the failed bank obtained an 

interest in the contract that it could transfer to the Deposit Corporation. See Langley, 484 U.S. at 93–94. 

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26 WILLIAM PRYOR, C.J., dissenting 20-13735

I have already explained why, based on fundamental principles of contract and agency law, an agent who lacks authority cannot form a contract that is enforceable against the principal. By contrast, the formation of a voidable contract would lead to very different implications. According to the Restatement of Contracts, 

“[t]he propriety of calling a transaction a voidable contract rests primarily on the traditional view that the transaction is valid and has 

its usual legal consequences until the power of avoidance is exercised.” RESTATEMENT (SECOND) OF CONTRACTS § 7 cmt. e; see also 

1 WILLISTON ON CONTRACTS, supra, § 1:20 (“Unless rescinded, a 

voidable contract imposes on the parties the same obligations as if 

it were not voidable.”); Voidable, BLACK’S LAW DICTIONARY (11th 

ed. 2019) (defining “voidable” as something that is “[v]alid until annulled” and as “a valid act that may be voided rather than an invalid 

act that may be ratified” (emphasis added)). To hold that an agent 

who lacks authority to bind the principal can create a presumptively valid contract contravenes the most basic tenets of agency 

and contract law.

The majority attempts to take a middle road. It contends 

that “[a] voidable contract is not the same as a binding contract.” 

Maj. Op. 61–62. And it asserts that I “conflate[] binding contracts 

with voidable contracts.” Id. at 77. Here, the majority invents a 

new category of contract: neither void nor binding. No such category exists. See Griffin v. Coca-Cola Refreshments USA, Inc., 989 

F.3d 923, 934 (11th Cir. 2021) (“[I]f the assignments are merely 

voidable, then they are effective unless and until they are 

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20-13735 WILLIAM PRYOR, C.J., dissenting 27

challenged.”). Even the majority elsewhere acknowledges that “a 

voidable contract imposes on the parties the same obligations as if 

it were not voidable” and that a voidable contract “remains intact 

until the party who has the power of avoidance elects to exercise 

it.” Maj. Op. 40 (quoting 1 WILLISTON ON CONTRACTS, supra,

§ 1:20); see also id. at 39 (quoting Black’s Law Dictionary for the 

proposition that “voidable” means “[v]alid until annulled”). In 

other words, a voidable contract binds the parties unless and until 

the party who enjoys the power of avoidance chooses to exercise 

it. 

With respect to terminology, agency law is not always as 

precise as one might hope. See generally Void, BLACK’S LAW DICTIONARY, supra (explaining that “[t]he distinction between void and voidable is often of great practical importance” but 

that “the word [void] is often used and construed as bearing the 

more liberal meaning of ‘voidable’”). The majority identifies some 

nonbinding authorities that refer to contracts formed by agents 

who lack authority as “voidable.” See Maj. Op. 41–42. But the majority has not cited a single judicial decision holding a principal 

bound, over its objection, by the act of an agent who lacked authority unless the principal later ratified the contract. See id. at 41–

42, 75–76.

And some of the authorities that the majority cites expressly 

state that an agent cannot bind the principal without some affirmative act of ratification. For instance, one authority states that 

“[t]he principal is not bound by any act that exceeds the agent’s 

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28 WILLIAM PRYOR, C.J., dissenting 20-13735

authority, . . . unless the principal ratifies the agent’s acts.” 2A 

C.J.S. AGENCY § 163 (footnotes omitted). Another explains that 

“[w]ithout authority for an agent to bind its principal in a contract 

with a third party, or without the principal’s subsequent ratification, the contract must be set aside.” 3 AM. JUR. 2D Agency, supra, 

§ 164; see also 12 WILLISTON ON CONTRACTS,supra, § 35:22 (“[R]atification . . . supplies original authority to execute the contract.”); 

Fejta v. GAF Companies, Inc., 800 F.2d 1395, 1396–97 (5th Cir. 

1986) (holding that, when an agent was not authorized to “transact[] the sale or ratify[] the contract, . . . under Louisiana law the 

contract to sell was unenforceable”).

In theory, I share considerable common ground with the 

majority. I maintain—and at times the majority appears to agree—

that a contract created by an agent who lacks authority cannot be 

enforced against the principal without his consent. See Maj. Op. 

61–62. But we disagree as to the characterization of the resulting 

purported agreement. By logical implication, and consistent with 

our precedent, the purported agreement is a void contract that is 

unenforceable unless ratified, not a “voidable” contract that is 

“[v]alid until annulled.” Voidable, BLACK’S LAW DICTIONARY, supra. I also maintain—and the majority agrees—that such an agreement can be ratified by the principal. See generally Maj. Op. 73–74. 

We again disagree regarding what the principal’s power to ratify 

implies about the nature of the purported contract, an issue to 

which I now turn. 

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20-13735 WILLIAM PRYOR, C.J., dissenting 29

According to the third key principle, a principal can become 

bound by a contract that his agent who lacks authority purports to 

enter on his behalf, but only if he takes an affirmative step to bind 

himself. “Through ratification, a person may become a party to a 

contract purportedly made on that person’s behalf by another who 

acted without actual or apparent authority.” RESTATEMENT 

(THIRD) OF AGENCY § 6.01 cmt. b. (emphasis added). “When the 

prior act did not otherwise affect the legal relations of the ratifier, 

ratification provides the basis on which the ratifier’s legal relations 

are affected by the act.” Id. § 4.01 cmt. b. Ratification in this context 

is a retroactive manifestation of assent that “creates claims not otherwise present ” and “giv[es] . . . the third party enforceable rights.” 

3 AM. JUR. 2D Agency, supra, § 186 (emphases added). Ratification 

may occur by silence, but only when the principal “has notice that 

others are likely to draw such an inference from silence.” RESTATEMENT (THIRD) OF AGENCY § 4.01 cmt. f. In those circumstances, silence is an affirmative choice. See Maj. Op. 78–79. Ratification 

binds a principal to an agreement to which he was not bound before; it forms a contract where none earlier existed.

The majority erroneously states that the very possibility of 

ratification establishes that the contract was not void but voidable. 

Id. at 73–75. It contends that “only a voidable contract is capable of 

ratification.” Id. at 74. Though it does not matter to this appeal 

whether a void contract can be ratified, I explain why the capacity 

for ratification does not undermine the conclusion that contracts 

purportedly formed by agents who lack authority are void. Again, 

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30 WILLIAM PRYOR, C.J., dissenting 20-13735

imprecise language in some authorities easily gives rise to confusion. In our effort to apply the general commercial law, we must 

hew closely to fundamental principles and follow the guidance of 

our own precedent. 

Although the majority cites some decisions—none of which 

are binding on this Court—that state that only voidable contracts 

can be ratified, see id. at 75–76, other courts have reached the opposite conclusion, see, e.g., Jensen v. Ray Kim Ford, Inc., 920 F.2d 

3, 4 (7th Cir. 1990) (holding that a “contract is a nullity and does 

not bind” the plaintiffs because “a forged note is by the common 

law absolutely void, unless it has in some way been ratified by the 

payor” (citation omitted)); Scott D. Erler, D.D.S. Profit Sharing

Plan v.Creative Fin. & Invs., L.L.C., 203 P.3d 744, 754 (Mont. 2009) 

(“While acknowledging that void contracts do not legally exist and 

transfer no rights, we have nonetheless permitted ratification of 

such contracts.”); Bush v. Evans, 598 So. 2d 952, 954 (Ala. Civ. App. 

1992) (“Where the statute of frauds applies, a contract made by an 

agent without authority in writing from his principal is void unless 

ratified by the principal.”); Bethune v. Larson, 544 N.E.2d 49, 52 

(Ill. App. Ct. 1989) (“A void act of an agent can be ratified by a principal where the principal has knowledge of the facts.”); cf. Hancock

v. Kulana Partners, LLC, 452 P.3d 371, 374 n.4 (Haw. 2019) (“We 

note that the courts are split as to whether a void deed can be ratified.”). See generally Voidable, BLACK’S LAW DICTIONARY, supra 

(“[Voidable] describes a valid act that may be voided rather than an 

invalid act that may be ratified.” (Emphasis added)).

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20-13735 WILLIAM PRYOR, C.J., dissenting 31

Indeed, some decisions in analogous cases have concluded 

that a contract purportedly formed by an agent without authority 

is void until ratified. E.g., Marin, 651 F.2d at 29 (“Since [the agent] 

lacked authority to contract for the corporation, and since the corporation never ratified his action, the . . . lease was void.” (Emphasis added)); In re Northlake Dev. L.L.C., 643 F.3d at 450–51 

(“Where no actual or apparent authority exists to transfer a principal’s property, . . . the deed is void unless and until later ratified.” 

(Quoting Northlake Dev. L.L.C., 60 So.3d at 797 (alterations 

adopted) (emphasis added)); Northlake Dev. L.L.C., 60 So.3d at 797 

(explaining that when a contract is void for lack of authority, 

“[a]bsent ratification—and prior to ratification—nothing 

changes”); Woods, 90 P.3d at 733 (explaining that “[u]ltra vires acts 

of a corporate president or other agent are void unless under 

agency principles” there has been “ratification [by] the corporation” or apparent authority exists).

Our precedent supports the same conclusion. In GDG Acquisitions LLC v. Government of Belize, Belize argued that a minister who signed a contract “lacked the authority to waive sovereign immunity.” 849 F.3d 1299, 1302 (11th Cir. 2017). Nonetheless, 

we held that Belize was bound by the contract because it had ratified the waiver. Id. We observed that “[w]hile ‘[o]nly interactions 

that are within the scope of an agency relationship affect the principal’s legal position,’ the principal may also ratify his agent’s unauthorized actions, thus becoming bound by their legal consequences.” Id. at 1308 (internal citation omitted) (quoting 

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32 WILLIAM PRYOR, C.J., dissenting 20-13735

RESTATEMENT (THIRD) OF AGENCY § 1.01 cmt. c). Belize objected 

that “an agreement that is void ab initio cannot be enforced against 

a sovereign under a ratification theory because subsequent payments cannot create actual authority that did not exist at the time 

of the actions.” Id. at 1310 (internal quotation marks omitted). Instead of holding that the agreement was not void, we explained 

that Belize’s “argument misapprehends the nature of ratification.” 

Id. “It is precisely on account of the principal’s subsequent consent 

that the prior unauthorized act ‘is given effect as if done by an agent 

acting with actual authority.’” Id. (quoting RESTATEMENT (THIRD)

OF AGENCY § 4.01(1)). Contrary to the majority’s response, our 

Court did not “reject[] Belize’s argument that the lease was ‘void 

ab initio.’” Contra Maj. Op. 69 (citation omitted). We instead rejected the argument that a contract formed without authority 

could not be ratified. GDG, 849 F.3d at 1310. We recognized that a 

contract entered by an agent who lacked authority initially had no 

legal effect on the principal, but the principal was empowered to 

ratify it later.

Making sense of the conflicting authority in this area of law 

is no easy task, but a comment to the definition of “ratification” in 

the Restatement (Second) of Agency, which we have cited favorably, sheds light on the matter. See RESTATEMENT (SECOND) OF 

AGENCY § 82 (AM. L. INST. 1958); see also McDonald v. Hamilton

Elec., Inc. of Fla., 666 F.2d 509, 514 (11th Cir. 1982) (citing the Restatement provision favorably). The first comment to Section 82 

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20-13735 WILLIAM PRYOR, C.J., dissenting 33

strongly implies that a contract entered by an agent who lacks authority, prior to ratification, is void, not voidable. 

It explains that ratification in the agency context is unique—

it must be “distinguished from the affirmance of a voidable transaction,” and it binds the principal to a contract that previously had 

no legal impact on him:

Ratification, as the word is here used, represents a legal concept in the law of agency describing 

the relations between the parties after affirmance by 

a person of a transaction done or purported to be 

done for him. . . . Ratification is to be distinguished 

from the affirmance of a voidable transaction because 

of fraud or mistake, and from the affirmance of a 

transaction, voidable because of partial lack of capacity. . . . In the sense in which the word is used in the 

Restatement of this Subject, ratification connotes that 

the act was done or purported to be done for a person 

who acquired no rights or liabilities because of it, except the right to elect to become a party to it.

RESTATEMENT (SECOND) OF AGENCY § 82 cmt. a (emphasis 

added).

The comments to the Third Restatement’s definition of “ratification” offer the same explanation. A comment entitled 

“[r]elated doctrines apart from agency” states that an affirmative 

action is necessary in order for a principal to be bound by the “legal 

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34 WILLIAM PRYOR, C.J., dissenting 20-13735

consequences” of the contract purportedly entered by the agent, 

unlike in other legal contexts: 

The agency-law doctrine of ratification is not 

the exclusive instance in the law of a person choosing 

to become bound by a transaction not otherwise 

binding or becoming subject to the legal consequences of another’s act. For example, a person may 

elect to become bound by a contract that is voidable 

because assent was induced by fraud, mistake, or duress. See Restatement Second, Contracts § 7, Comment b. A minor, or a person who otherwise lacks capacity, may elect to be bound by a voidable contract 

once capacity is present. See id. The agency-law doctrine of ratification, in contrast, requires manifesting 

assent or otherwise consenting to a prior act done by 

another person and thereby adopting its legal consequences.

RESTATEMENT (THIRD) OF AGENCY § 4.01 cmt. c (emphasis 

added). The next comment further explains that “[r]atification requires an objectively or externally observable indication that a person consents that another’s prior act shall affect the person’s legal 

relations.” Id. § 4.01 cmt. d. In this way, ratification in the agency 

context is distinct from ratification in other areas of law. 

For these reasons, the majority’s attempts to compare ratification in the agency-law context to ratification in other contexts 

are unavailing. See Maj. Op. 74–75. In agency law, ratification is 

different in kind from the mere termination of the power of avoidance described by contract-law authorities. See RESTATEMENT 

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20-13735 WILLIAM PRYOR, C.J., dissenting 35

(SECOND) OF CONTRACTS § 7 cmt. e; Maj. Op. 74. In other contexts,

“action may be necessary in order to prevent the contract from producing the ordinary legal consequences of a contract.” RESTATEMENT (SECOND) OF CONTRACTS § 7 cmt. e. Such is not the case 

when an agent who lacks authority purports to form a contract, 

because the purported contract is void. 

To be sure, not all void contracts can be ratified. Several of 

the authorities that the majority cites for the proposition that a void 

contract cannot be ratified fall into this category. See Maj. Op. 75–

76. For instance, a contract that violates public policy can never be 

ratified. Est. of Molino v. Boldt, 81 Cal. Rptr. 3d 512, 519, 520–21 

(Cal. Ct. App. 2008). Nor can one that is “substantively and procedurally unfair.” Kellar v. Est. of Kellar, 291 P.3d 906, 918 (Wash. Ct. 

App. 2012). In these cases, the problem is not a lack of mutual assent but rather a defect that ratification cannot cure. 

In the end, our precedents make clear that contracts entered 

by agents who lack authority are void unless ratified, though capable of ratification. See generally Gymco, 884 F.2d 1362; JLJ, 988 

F.2d 1112; GDG Acquisitions, 849 F.3d 1299. Three fundamental 

principles of agency and contract law—that a contract cannot be 

formed without mutual assent, that an agent who lacks authority 

cannot bind a principal, and that a principal must take affirmative 

steps to ratify a contract formed by an agent who lacked authority—compel the same answer. The Supreme Court in Langley held 

that a “void” instrument falls outside of section 1823(e) because it 

“leav[es] no right, title or interest that could be diminished or 

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36 WILLIAM PRYOR, C.J., dissenting 20-13735

defeated.” Langley, 484 U.S. at 93–94 (alterations adopted) (internal 

quotation marks omitted). At bottom, a purported contract, executed by an agent who lacks authority and not ratified by the principal, cannot convey a right, title, or interest. 

Because a third party (here, Crescent) obtains no interest 

when it enters into a purported agreement with an agent (Hardwick) who lacks authority to bind his principal (Morris Hardwick), 

the D’Oench doctrine cannot apply. See Taylor Tr., 844 F.2d at 

342–43 (stating, though in dicta, that an agent’s lack of authority “is 

a real defense to the formation of a contract and renders the contract void ab initio, rather than merely voidable” in the context of 

a D’Oench analysis). The D’Oench doctrine is a powerful shield 

that the Deposit Corporation and its successors in interest can 

wield to protect interests they acquire from a failed bank. But it is 

not a sword that can be wielded to create an interest that the Deposit Corporation did not already have. If Landcastle can prove that 

Hardwick lacked the authority to pledge the firm’s certificate as 

collateral for his personal loan, then it would establish that Crescent never obtained an interest that it could have transferred to the 

Deposit Corporation. And if there is no interest, then the D’Oench

shield is of no use to Renasant.

C. The Majority’s New Rule Is Flawed.

The majority “reject[s] Landcastle’s argument that Hardwick’s lack of authority prevented Crescent’s transfer of an interest 

in the security agreement to the FDIC as receiver.” Maj. Op. 45. It 

does not “consider legal issues, such as lack of authority in this 

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20-13735 WILLIAM PRYOR, C.J., dissenting 37

D’Oench setting, in the abstract or in a vacuum.” Id. at 44; see also 

id. (asserting that “[w]e . . . consider legal issues . . . in the context 

of the factual circumstances presented in this case”). But see McFarlin, 381 F.3d at 1259 (explaining that the “legal question” in a section-1292(b) appeal “must be stated at a high enough level of abstraction to lift the question out of the details of the evidence or 

facts of a particular case”). The majority considers it relevant that 

Hardwick represented to Crescent that he had authority from Morris Hardwick. See Maj. Op. 45. And it invents a new rule that when 

an agent misrepresents to a third party that he has authority, he can 

form a voidable contract between the third party and his principal. 

Id. But that factual context is irrelevant, and the majority’s new rule 

is constitutionally dubious. 

The majority’s added “context[]” does not change the legal 

effect of Hardwick’s purported lack of authority. Id. That Hardwick “induced the bank to make a loan” also should not change the 

result. See id. Even where “an agent defrauds a third party,” his 

“principal is not subject to liability” for that fraud if the agent acts 

without authority. See RESTATEMENT (THIRD) OF AGENCY § 7.08 

cmt. c(2). And it is a “basic proposition that a principal is not accountable simply because the agent has succeeded in misleading 

the third party about . . . the agent’s authority.” Id. § 2.03 n.c. 

Although the majority does not dispute that an agent acting 

without authority does not have the same power to bind the principal as a duly authorized agent, see Maj. Op. 61–62, it somehow 

imagines that an agent’s misrepresentation creates a binding 

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38 WILLIAM PRYOR, C.J., dissenting 20-13735

contract between his principal and a third party that is “[v]alid until 

annulled,” see Voidable, BLACK’S LAW DICTIONARY, supra. Although it at times insists that the principal must ratify the agent’s 

action, see Maj. Op. 61–62, it nevertheless holds that the principal 

should be bound despite a lack of any authority, see id. at 45. In 

effect, it asserts that if the agent fraudulently represented his authority to a third party, the agent’s act would bind the principal 

unless the principal affirmatively acted to repudiate it. See id.

That rule does not come from Langley or any other source 

of law. Contra id. at 44–45. Because Langley ’s fraudulent-inducement rule does not apply here, the majority charts its own path 

even as it purports to apply Langley. And federal common law does 

not provide that a principal becomes a party to a contract and is 

bound when an unauthorized agent purports to enter into that contract on his behalf so long as that agent engages in fraudulent behavior. General agency law, like black-letter agency law in every 

American jurisdiction, rejects that proposition. 

Because the majority invents a new rule while purporting to 

rely on federal common law, it conveniently avoids engaging in the 

analysis required to create a new rule of federal common law. See 

In re Prudential of Fla. Leasing, Inc., 478 F.3d 1291, 1298 (11th Cir. 

2007). The decision to create a new federal common-law rule “is a 

matter of judicial policy dependent upon a variety of considerations always relevant to the nature of the specific governmental interests and to the effects upon them of applying state law.” Id.

(quoting United States v. Kimbell Foods, Inc., 440 U.S. 715, 728 

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20-13735 WILLIAM PRYOR, C.J., dissenting 39

(1979)). But before creating a new rule, we must consider at least 

three factors: “the need for uniformity,” whether and the extent to 

which “application of state law frustrates important federal policies, and the impact” the federal common-law rule would have “on 

preexisting commercial relationships premised on state law.” Id.; 

see also Kimbell Foods, 440 U.S. at 728–29.

When we have previously created new common-law rules 

to protect the Deposit Corporation, we have found it critical that 

the new rule did not disrupt commercial relationships. See, e.g., 

Gunter, 674 F.2d at 872; McCullough, 911 F.2d at 603–04; Fed. Deposit Ins. Corp. v. Gulf Life Ins. Co., 737 F.2d 1513, 1517–18 (11th 

Cir. 1984); see also In re Prudential, 478 F.3d at 1298 (“The presumption [against creating a federal common-law rule] ‘is particularly strong in areas in which private parties have entered legal relationships with the expectation that their rights and obligations 

would be governed by state-law standards.’” (Quoting Kamen v. 

Kemper Fin. Servs., Inc., 500 U.S. 90, 98 (1991))). Our decisions 

highlighted that the interests of the private parties there were not 

indefeasible. See Gunter, 674 F.2d at 872; McCullough, 911 F.2d at 

603–04; Gulf Life Ins., 737 F.2d at 1517–18; see also Langley, 484 

U.S. at 95–96 (explaining that section 1823(e) is in some respects 

similar to the requirement that a secured creditor record his security interest). So, giving a deposit insurer a quasi-holder-in-duecourse status defeased only that already-defeasible interest. See 

Gunter, 674 F.2d at 872; McCullough, 911 F.2d at 603–04; Gulf Life 

Ins., 737 F.2d at 1517–18.

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40 WILLIAM PRYOR, C.J., dissenting 20-13735

Here, by contrast, the majority’s new rule greatly disrupts 

commercial relationships. Georgia law dictates that lack of authority prevents contract formation. See Lynn v. Lowndes Cnty. 

Health Servs., LLC, 840 S.E.2d 623, 628–31 (Ga. Ct. App. 2020) (explaining that an agreement formed by a purported agent who 

lacked authority is unenforceable unless ratified by the principal);

GA. CODE § 10-6-51. The majority contends that “if an agent acted 

without authority,” Georgia law permits the principal to “either repudiate or ratify that contract.” Maj Op. 57. But the majority does 

not specify whether the principal is bound by default under Georgia law. The Georgia statute that the majority cites provides only 

that “if the agent shall exceed his authority, the principal . . . shall 

adopt either the whole or none [of the contract].” GA. CODE § 10-

6-51. I do not dispute the possibility of presumptive ratification by 

silence, for that doctrine further confirms that ratification is still 

necessary. See Maj. Op. 57 (citing Lynn, 840 S.E.2d at 631, for the 

proposition that “under Georgia law, where the principal is fully 

informed of the agent’s unauthorized act and does not repudiate it 

within a reasonable time, ratification is presumed”). But Georgia 

law has long been clear: “An agent, constituted for a particular purpose . . . cannot bind his principal by any act in which he exceeds

his authority; for that would be to say, that one man may bind another against his consent.” Hardeman & Hamilton v. Ford, 12 Ga. 

205, 207 (1852).

Without contract formation, the third party obtains no interest from the principal, and the principal loses no interest. See

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20-13735 WILLIAM PRYOR, C.J., dissenting 41

Gymco, 884 F.2d at 1365–67; Hagan v. Asa G. Candler, Inc., 5 

S.E.2d 739, 743 (Ga. 1939); see also Buena Vista Loan & Sav. Bank 

v. Stockdale, 192 S.E. 246, 247 (Ga. Ct. App. 1937). And a principal 

can raise a lack-of-authority defense to defend against the enforcement of a negotiable instrument by a holder in due course. See GA.

CODE §§ 11-1-201(b)(41), 11-3-302(a)(2)(iv), 305(a)–(b), 308(b), 

401(a), 402(a), 403(a); Buena Vista, 192 S.E. at 247; Berger v. Ga. 

Power Co., 49 S.E.2d 668, 669 (Ga. Ct. App. 1948); see also U.C.C. 

§§ 1-201(b)(41), 3-302(a)(2)(iv), 3-302 cmt. 2, 3-305(a)–(b), 3-308(b), 

3-401(a), 3-402(a), 3-402 cmt. 1, 3-403(a), 3-403 cmts. 1–2; UNIF. NEGOTIABLE INSTRUMENTS L. § 23, U.L.A. Appendix I (2020). So, the 

majority’s new rule gives the federal government an interest it did 

not have while depriving the private party of an interest it did have. 

In response, the majority cites Griffin, 989 F.3d 923, for the 

proposition that contracts formed by agents who lack authority are 

voidable under Georgia law. See Maj. Op. 58–59. That decision 

identifies three types of contracts that are rendered void under the 

Georgia Code: contracts “to do immoral or illegal things,” contracts that contravene public policy, and gambling contracts. Griffin, 989 F.3d at 934 (citing GA. CODE §§ 13-8-1, 13-8-2, 13-8-3). And 

it suggests that all other contracts are at most voidable. Id. at 935; 

see also Maj. Op. 58–59. But the decision has nothing to do with 

agency law or contract formation. If there were no contract—due 

to a lack of mutual assent or consideration or some other fundamental defect—a purported contract would not be simply voidable. On the contrary, under Georgia law, no contract would exist. 

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42 WILLIAM PRYOR, C.J., dissenting 20-13735

See GA. CODE § 13-3-1 (“To constitute a valid contract, there must 

be parties able to contract, a consideration moving to the contract, 

the assent of the parties to the terms of the contract, and a subject 

matter upon which the contract can operate.”). So, it is here, too. 

The majority also discusses the Georgia Supreme Court’s 

decision in Federal Financial Co. v. Holden, 485 S.E.2d 481 (Ga. 

1997). See Maj. Op. 30–31, 59. The majority cites Holden for the 

proposition that commercial relationships will not be disrupted by 

its decision. Maj. Op. 59. But the plaintiff in Holden was a creditor 

who sought “to establish his lien as senior.” Holden, 485 S.E.2d at 

482. That decision did not enforce an agreement executed by 

agents who lacked authority against a principal and over his own 

objection. So, Holden did not disrupt property rights in the way 

the majority does in this appeal.

Because the majority’s new rule deprives private parties of 

property rights and gives those rights to the federal government, it 

creates serious Takings Clause concerns. See Horne v. Dep’t of 

Agric., 135 S. Ct. 2419, 2426 (2015) (“[A]n appropriation . . . of personal property” “is a per se taking that requires just compensation.”); Webb’s Fabulous Pharmacies, Inc. v. Beckwith, 449 U.S. 

155, 164–65 (1980) (applying the Takings Clause to interest earned 

on a deposit fund); E. Enters. v. Apfel, 524 U.S. 498, 522–23 (1998) 

(plurality opinion) (applying the Takings Clause to required money 

payments). To illustrate, at time one, a principal has an indefeasible 

right to an asset, and a failed bank has no interest in that asset. At 

time two, the federal government acts and takes over the failed 

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20-13735 WILLIAM PRYOR, C.J., dissenting 43

bank. As a result of the federal government’s action, the federal 

government appropriates the asset, and the principal loses all rights 

in the asset. Courts ordinarily call that a “taking,” see, e.g., Horne, 

135 S. Ct. at 2426; the majority calls it “[e]quit[y],” Maj. Op. 45. 

The majority’s new rule gives Landcastle a plausible Takings 

Clause claim against the Deposit Corporation. In fact, Landcastle 

should be free on remand to argue that, because the D’Oench doctrine claim is unconstitutional as applied to its lack-of-authority 

claim, it can state claims for conversion and breach of contract. See 

City of Monterey v. Del Monte Dunes at Monterey, Ltd., 526 U.S. 

687, 717 (1999) (plurality opinion) (explaining that an uncompensated taking is “not only unconstitutional but unlawful and tortious 

as well”); Knick v. Twp. of Scott, 139 S. Ct. 2162, 2180 (2019) 

(Thomas, J., concurring) (explaining that “ordinary remedial principles [of] . . . common-law tort claims” are available in response to 

a taking). But the majority has apparently resolved that question 

sub silentio because it remands with instructions to enter judgment 

in favor of Renasant. Maj. Op. 79. Left for another day is whether 

Landcastle might still be able to bring a separate claim against the 

Deposit Corporation for an unconstitutional taking. See Knick, 139 

S. Ct. at 2170; City of Monterey, 526 U.S. at 717 (plurality opinion). 

Before today, the D’Oench doctrine did not implicate the 

Takings Clause because the Supreme Court limited its application 

to protect only those interests that the Deposit Corporation already 

had. See Langley, 484 U.S. at 93–94. But the majority’s extension of 

the D’Oench doctrine places it on much shakier constitutional 

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44 WILLIAM PRYOR, C.J., dissenting 20-13735

ground. Because the majority purports to apply the preexisting 

D’Oench doctrine, see Maj. Op. 44–45, it fails to engage in the Kimbell Foods analysis. And in that analysis, these Takings Clause problems would preclude creating this rule. 

Even after considering the three Kimbell Foods factors, the 

decision to create a new federal common-law rule is “a matter of 

judicial policy.” In re Prudential, 478 F.3d at 1298 (quoting Kimbell 

Foods, 440 U.S. at 728). So, we must balance the competing policy 

considerations before we exercise our limited discretion to create 

new rules. And in this respect, the majority’s new rule falls woefully short. 

Consider the following hypothetical. Butch Cassidy is the 

Vice President of Finance at Coca-Cola. He has authority to enter 

into many kinds of transactions on behalf of Coca-Cola. In fact, he 

has entered into several high-dollar agreements, taken out loans, 

and pledged collateral on behalf of Coca-Cola. Cassidy has a family 

and a house with a white picket fence in the suburbs. Everything 

appears to be going well, but he has badly mismanaged his finances. A bad turn of luck with a cryptocurrency investment and a 

nasty gambling habit have left him in dire straits. He is in default 

on his mortgage with no way to cure it and is days away from foreclosure. 

So, Cassidy finds a small Atlanta-area bank named Old Bank 

that is severely distressed. He borrows enough money to pay off 

his mortgage and give him a little breathing room. He signs a 

promissory note, but Old Bank, of course, demands collateral to 

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secure the loan. Cassidy, an agent of Coca-Cola for many purposes, 

signs an agreement as “Butch Cassidy, Vice President of CocaCola.” The agreement assigns all interests in Coca-Cola’s secret formula to Old Bank. Even though he lacks both actual and apparent 

authority, he falsely represents to Old Bank that, as a benefit to senior officers, Coca-Cola gave him the authority to pledge the secret 

formula to secure personal debts. Old Bank fails, and the Deposit 

Corporation takes over as receiver. Our main character, Butch Cassidy, then defaults on the loan because, unsurprisingly, he continues to mismanage his finances. 

Under the majority’s new rule, the federal government now 

owns Coca-Cola’s secret formula free and clear! The Deposit Corporation has legal title to the secret formula, and Coca-Cola is out 

of luck. And the majority does not even attempt to deny that its 

rule would require this absurd result. 

Perhaps the majority seeks to protect the Deposit Corporation because it believes the Deposit Corporation is more deserving 

than the private party in this case. A criminal, who has now been 

convicted for similar crimes, see United States v. Maurya, 25 F.4th 

829, 835–36 (11th Cir. 2022), misrepresented his authority to a 

small bank. On this misrepresentation, Hardwick pledged an asset 

of his law firm—which the majority suspects is at fault, see Maj. 

Op. 13 n.4, and which sold its interests at a discount to an acquisition firm—to secure a personal loan that he never repaid. The Deposit Corporation came to the rescue and found a benevolent 

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46 WILLIAM PRYOR, C.J., dissenting 20-13735

buyer who saved the residents of Georgia who had relied on the 

failed bank. 

But the majority is mistaken. The “[e]quities” do not favor 

the Deposit Corporation, contra id. at 45, because the equities cannot favor governmental theft. “If th[e] requirement[s] [of the Constitution] make[] some regulatory programs unworkable in practice, so be it—our role is to enforce the Takings Clause as written.” 

Cf. Knick, 139 S. Ct. at 2180 (Thomas, J., concurring) (citation and 

internal quotation marks omitted). 

Moreover, the Deposit Corporation is not powerless to defend itself against claims or defenses based on lack of authority. For 

example, it can require banks, as a condition of insurability, to keep 

records documenting an agent’s authority for every transaction. 

See 12 U.S.C. §§ 1815(a)(1), (4), 1816(5) (requiring the Deposit Corporation to consider “[t]he risk presented” by a bank before insuring it); id. § 1818(a)(2)(A)(i) (allowing the Deposit Corporation to 

terminate insurance if the bank is “engaging in unsafe or unsound 

practices”); cf. Langley, 484 U.S. at 95 (explaining that the Deposit 

Corporation is vulnerable only when it is “unable to detect” potential liability). If Crescent had required Morris Hardwick to provide 

documentation establishing Hardwick’s authority to engage in the 

transaction, we would not be here. 

IV. CONCLUSION 

The majority misunderstands the D’Oench doctrine, even 

though the Supreme Court has explained it and at least three of our 

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sister circuits got the message: the Deposit Corporation cannot acquire an interest that is void before the Deposit Corporation purports to acquire it. See Taylor Tr., 844 F.2d at 342–43 (stating, 

though in dicta, that an agent’s lack of authority “is a real defense 

to the formation of a contract and renders the contract void ab initio, rather than merely voidable” in the context of a D’Oench analysis); Grubb, 868 F.2d at 1158 (explaining that, because the notes at 

issue “already had been voided by [a] judgment when the FDIC 

purchased [the bank’s] assets,” “the FDIC acquired no right, title or 

interest” (citation and internal quotation marks omitted)); Bracero 

& Rivera, 895 F.2d at 830 (holding that, “because the note [at issue] 

was discharged by the payment and cancellation of the underlying 

debt before FDIC ever obtained it,” “the note was not an asset protected by section 1823(e)”). Similarly, in this appeal, no interest exists because the contract purportedly conveying the interest was 

void. The majority misunderstands the general commercial law of 

agency and contract. As a result, the majority’s decision licenses 

governmental theft, creates serious constitutional problems without any discussion, and contradicts Supreme Court precedent. I 

would affirm the judgment of the district court.

I respectfully dissent.

 

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