UNITED STATES COURT OF APPEALS

Tenth Circuit

Byron White United States Courthouse

1823 Stout Street

Denver, Colorado 80294

(303) 844-3157

Patrick J. Fisher, Jr. Elisabeth A. Shumaker

Clerk Chief Deputy Clerk

May 17, 1999

TO: ALL RECIPIENTS OF THE OPINION

RE: 98-1021, FDIC v. Noel

Filed on May 14, 1999

The slip opinion filed on May 14, 1999, contains a word processing error on

page 14, footnote number 5. Please disregard the gray shading around footnote

number 5.

A copy of the corrected page 14 is attached.

Sincerely,

Patrick Fisher, Clerk of Court

By: Keith Nelson

Deputy Clerk

encl.
F I L E D

United States Court of Appeals

Tenth Circuit

MAY 14 1999

PATRICK FISHER

Clerk

PUBLISH

UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

FEDERAL DEPOSIT INSURANCE

CORPORATION, as receiver for

Western Gulf Savings and Loan

Association, a Texas savings and loan

association,

Plaintiff-CounterDefendant-Appellee,

v.

WALLACE R. NOEL,

Defendant-CounterClaimant-Appellant.

No. 98-1021

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLORADO

(D. Ct. No. 90-B-2066)

David M. Berrett, Barnett, Berrett, King & Southam, LLC, Aurora, Colorado

(Scott Rothenberg, Law Offices of Scott Rothenberg, Bellaire, Texas, on the

opening brief), appearing for Appellant.

Maria Beatrice Valdez, Counsel, Federal Deposit Insurance Corporation,

Washington, DC (Ann S. DuRoss, Assistant General Counsel, and Lawrence

Richmond, Acting Senior Counsel, Federal Deposit Insurance Corporation,

Washington, DC, and James R. Miller and Paul R. Wood, Miller & Welch, LLC,

Denver, Colorado, with her on the brief), appearing for Appellee.

Before TACHA, HENRY, and MURPHY, Circuit Judges.
- 2 -

TACHA, Circuit Judge.

The Resolution Trust Corporation (“RTC”), as receiver for Western Gulf

Savings and Loan Association, brought this action against Wallace R. Noel for

breach of a promissory note, deceit, and other claims arising out of a failed real

estate transaction. Noel asserted numerous defenses and counterclaims against

the RTC. The Federal Deposit Insurance Corporation (“FDIC”) statutorily

succeeded the RTC and moved for summary judgment, arguing that the D’Oench,

Duhme & Co. v. FDIC, 315 U.S. 447 (1942), doctrine barred defendant’s

affirmative defenses and counterclaims. The district court granted its motion,

holding that Noel breached the promissory note as a matter of law. The FDIC’s

claims for deceit and other tort causes of action were tried to a jury. The jury

found in favor of the FDIC, and the court entered final judgment in accordance

with the jury verdict and rejected defendant’s motion for new trial or judgment as

a matter of law. Defendant appeals from these orders. We affirm.

I. Background

In 1982, Noel bought a piece of undeveloped property near the Colorado

State University campus in Fort Collins, Colorado, which he sought to develop. 

Soon after purchasing the land, Noel met Ray Pogue, who presented himself as a

developer with contacts at several institutions that could arrange financing for the
- 3 -

development of Noel’s land. Noel entered into an agreement to form University

Courts Partnership Ltd. (“University Courts”), a limited partnership consisting of

Mile High Mortgage and Investment Company of Colorado, Inc. (“Mile High”),

Noel, and others. Mile High, the general partner, owned a 50% interest, Noel, a

limited partner, owned 25%, and various other limited partners cumulatively

owned 25%. Western Gulf Service Corporation (“WGSC”) owned 51% of Mile

High, while Pogue owned the other 49%. WGSC was a subsidiary of Western

Gulf Savings and Loan Association (“Western Gulf”).

In 1983, Pogue and Noel applied for a $2.5 million construction loan from

Western Gulf. Pogue sent Western Gulf Noel’s financial statement, showing a net

worth in excess of $5 million, asking that Western Gulf “add this ‘strength’ to the

documents [it] had on University Courts.” Appellant’s App., Vol. II, tab A3. The

loan closed on May 25, 1983. Mile High, through its executive vice-president

Pogue, signed the note for University Courts as its general partner. Noel signed

the note both as a limited partner of University Courts and in his individual

capacity. At the closing, Pogue and Noel entered into an written agreement in

which Pogue agreed to indemnify Noel for any liability Noel might incur on the

note. Western Gulf, however, never released Noel from liability on the note. 

Shortly after the closing, University Courts paid Noel $610,000 out of the loan

proceeds for his land.
- 4 -

Although payable to Mile High, Mile High immediately assigned the note

to Western Gulf. In October 1983, WGSC bought Pogue’s 49% share in Mile

High. Mile High thus became a wholly-owned subsidiary of Western Gulf.

When the promissory note became due on May 25, 1984, Western Gulf

extended the note, over Noel’s objection, until November 25, 1984, and again to

May 25, 1985. According to the terms of the note, Western Gulf did not need

Noel’s permission to extend the payment date. University Courts did not pay the

note, and it went into default. By mid-1985, Western Gulf took control of the

property. It also ceased the operations of WGSC and Mile High. In March 1990,

Western Gulf foreclosed on the property. It bid $863,655.90 at the foreclosure

sale, leaving a deficiency of $2,552,799.13 on the note. On November 8, 1990,

the RTC was appointed receiver of Western Gulf, and it filed this lawsuit against

Noel on November 21, 1990. Thus began this lawsuit’s lengthy sojourn through

the court system.

RTC’s original complaint alleged one claim based on the promissory note,

and another claim for unjust enrichment based on the fact that Noel received the

benefit of a $2.5 million loan without repaying it. Noel filed an answer, asserting

several affirmative defenses, including his right to set-off or recoupment, and five

counterclaims. The RTC amended its complaint on July 27, 1992, adding four

claims based on false representation, non-disclosure and concealment, civil
1

 The amended complaint also contained a new claim for breach of the covenant of good

faith and fair dealing. This claim was later dismissed when the RTC confessed Noel’s motion to

dismiss that particular claim.

- 5 -

conspiracy to commit false representation, and civil conspiracy to commit

nondisclosure and concealment.1

 The RTC premised these new allegations on

Noel’s deposition testimony in which he stated that when he signed the note, he

did not intend to ever make payments.

Noel filed a motion to dismiss, arguing that the statute of limitations barred

the fraud claims, the unjust enrichment claims were unfounded, and RTC’s claim

against him based on the promissory note was subject to set-off because he was

entitled to indemnification from Western Gulf, which he claimed acted as the alter

ego of Mile High. The district court granted summary judgment in favor of Noel. 

In an unpublished order and judgment, we affirmed the district court’s dismissal

of the RTC’s unjust enrichment claims, but reversed the district court’s grant of

summary judgment on the RTC’s fraud claims and Noel’s claims based on the

alter ego doctrine, holding that genuine issues of material fact precluded summary

judgment. See Resolution Trust Corp. v. Noel, No. 94-1195, 1995 WL 490293, at

*4 (10th Cir. Aug. 16, 1995). We also noted that the district court order

contained no mention of D’Oench, Duhme & Co. v. FDIC, 315 U.S. 447 (1942). 

See id.

On remand, the FDIC, RTC’s statutory successor, filed a motion for
- 6 -

summary judgment, asserting that the D’Oench doctrine and 12 U.S.C. § 1823

barred Noel’s counterclaims and affirmative defenses. The common law D’Oench

doctrine and its statutory codification, 12 U.S.C. § 1823, prohibit claims based on

agreements not reflected in the official records of a failed bank or savings and

loan institution. Noel responded that his counterclaims and affirmative defenses

met the requirements of D’Oench. On June 17, 1996, the district court granted

summary judgment in favor of the FDIC on its promissory note claim. It held that

Noel could not use the alter ego doctrine against the FDIC because the FDIC was

not culpable for Western Gulf’s behavior and no inequity would result from it

recovering. It further held that D’Oench and 12 U.S.C. § 1823(e) barred his

counterclaims and defenses, despite Noel’s argument that a bank regulator would

have been on notice that Noel had legal claims against Western Gulf, because

none of the documents proffered by Noel met the § 1823(e) requirements.

Noel moved for reconsideration, which the district court denied on April

25, 1997. The court, on motion by Noel, clarified its summary judgment order,

noting that Noel’s motion for clarification was, “in essence, a thinly veiled third

motion for reconsideration of [its] June 17, 1996, order.” Dist. Ct. Order at 3

(May 13, 1997). It stated that it had granted the FDIC’s motion for summary

judgment on Noel’s counterclaims for breach of fiduciary duty and accounting

and dissolution of partnership. It also dismissed Noel’s counterclaim for punitive
2

 Noel had previously withdrawn his other two counterclaims for fraud and fraud in the

inducement.

- 7 -

damages,2 leaving for trial the FDIC’s claims for fraud and conspiracy. 

The FDIC’s remaining claims proceeded to trial, and the jury returned a

verdict in favor of the FDIC for $2,552,779.13. The court entered judgment in

accordance with the jury verdict. Noel subsequently moved for judgment as a

matter of law, for new trial, and to alter or amend the judgment. Noel again

argued that the district court erred in granting summary judgment on the FDIC’s

promissory note claim and attendant dismissal of Noel’s defenses and

counterclaims. He argued, in part, as he did in his motion for reconsideration of

the summary judgment order, that the court ignored evidence of the FDIC’s

involvement with Western Gulf in acts that form the basis for his claims

predicated on the alter ego doctrine. Noel also asserted that the district court

erroneously applied § 1823(e) retroactively. In his reply brief to this motion,

Noel, for the first time, argued that D’Oench does not apply to the FDIC in its

receivership capacity. The court denied Noel’s motion. 

Noel timely filed his notice of appeal. He argues on appeal that the district

court erred when it applied § 1823(e) to this case. He further argues that the

common law D’Oench doctrine does not apply to the FDIC in its receivership

capacity. In his reply brief on appeal, he asserts that if the D’Oench doctrine does

apply, his alter ego/breach of fiduciary duty counterclaim meets its requirements.
- 8 -

II. Waiver

“[A] federal appellate court [will] not consider an issue not passed upon

below.” Singleton v. Wulff, 428 U.S. 106, 120 (1976). Consequently, when a

litigant fails to raise an issue below in a timely fashion and the court below does

not address the merits of the issue, the litigant has not preserved the issue for

appellate review. See Lyons v. Jefferson Bank & Trust, 994 F.2d 716, 722-23

(10th Cir. 1993) (recognizing that an “untimely motion . . . is not sufficient to

preserve an issue for appellate review,” and not addressing on appeal an issue that

defendant raised for the first time below in a post-trial motion); Melton v. City of

Oklahoma City, 879 F.2d 706, 718 n.15 (10th Cir. 1989) (finding issue that party

did not properly raise before district court until Motion for Judgment N.O.V. was

not properly preserved for appeal); Burnette v. Dresser Indus., Inc., 849 F.2d

1277, 1285 (10th Cir. 1988) (declining to address arguments on appeal not

considered below because litigant first raised them in a motion for

reconsideration). In this case, Noel failed to timely present the issue of whether

the D’Oench doctrine applies to the FDIC as receiver to the district court. Noel

did not argue that the D’Oench doctrine does not apply to the FDIC when it acts

in its receivership capacity until his reply brief in support of a motion for new

trial, judgment as a matter of law, and to alter or amend judgment. He filed this

motion after completion of the trial and nearly seventeen months after the district
- 9 -

court entered summary judgment pursuant to the D’Oench doctrine. Moreover,

Noel did not even raise this issue in his initial brief in support of his post-trial

motion; he waited until his reply brief. The district court, not surprisingly, did

not address the merits of this issue in its one-page order denying Noel’s motion. 

See Dist. Ct. Order (Dec. 19, 1997).

Noel argues that despite his tardiness in raising it below, we should not

preclude this argument because it stems from two opinions, Atherton v. FDIC,

117 S. Ct. 666 (1997), and Ledo Fin. Corp. v. Summers, 122 F.3d 825 (9th Cir.

1997), issued after the court’s ruling on summary judgment. In Ledo, the Ninth

Circuit, relying on the principles enunciated in O’Melvany & Myers v. FDIC, 512

U.S. 79, 83-85 (1994) and Atherton, 117 S. Ct. at 673, concluded that “no unique

federal interest exists to justify application of federal common law.” Ledo, 122

F.3d at 829. Thus, it held that the common law D’Oench doctrine does not apply

to the FDIC as receiver. See id. Noel argues that we should follow the reasoning

of the Ninth Circuit.

Although new law often justifies an untimely motion, this exception does

not apply in this case. Even assuming, without deciding, that Atherton changed

the legal landscape in applying the common law D’Oench doctrine and even if we

were to accept the Ninth Circuit reasoning, Noel could have raised these

arguments in the district court prior to June 1996. Related arguments regarding
- 10 -

the vitality of D’Oench as it applies to the FDIC in its receivership capacity have

been argued since O’Melveny & Myers v. FDIC, 512 U.S. 79 (1994). See

Motorcity of Jacksonville, Ltd. v. Southeast Bank, 83 F.3d 1317, 1327, 1329-30

(11th Cir. 1996) (en banc), vacated by Hess v. FDIC, 519 U.S. 1087 (1997);

DiVall Insured Income Fund Ltd. Partnership v. Boatmen’s First Nat’l Bank of

Kansas City, 69 F.3d 1398, 1401-03 (8th Cir. 1995); Murphy v. FDIC, 61 F.3d 34,

38-40 (D.C. Cir. 1995). Indeed, the Ninth Circuit in Ledo explicitly relied, in

part, on O’Melvany & Myers. See Ledo, 122 F.3d at 828-29. The Supreme Court

issued O’Melveny & Myers on June 13, 1994, two years prior to the district

court’s grant of summary judgment in this case. Noel has no excuse for failing to

timely raise this argument.

Moreover, even if we accepted Noel’s argument, he has failed to assert any

reason for his failure to include this argument in his initial post-verdict motion. 

Both decisions upon which Noel purportedly relies were issued months before he

filed his motion for new trial, judgment as a matter of law, and to alter or amend

judgment. In choosing not to assert this argument until his reply, Noel precluded

a response by the FDIC and prevented reasoned consideration by the district

court. Therefore, we hold that Noel has waived the argument that the D’Oench

common law doctrine does not apply to the FDIC as receiver.

III. 12 U.S.C. § 1823(e) and D’Oench
- 11 -

Noel argues that the district court erred in granting FDIC’s motion for

summary judgment by retroactively applying 12 U.S.C. § 1823(e) and rejecting

his argument that the D’Oench doctrine does not bar his defenses and

counterclaims because they arise from documents contained in the records of

Western Gulf. We review de novo the district court’s grant of summary

judgment, construing the factual record and the reasonable inferences drawn from

it in the light most favorable to the nonmoving party. See, e.g., Kaul v. Stephan,

83 F.3d 1208, 1212 (10th Cir. 1996). In deciding the appropriateness of summary

judgment, “[w]e are not limited to the grounds upon which the trial court relied

but may base summary judgment on any proper grounds found in the record to

permit conclusions of law.” Sports Racing Servs., Inc. v. Sports Car Club of

Am., Inc., 131 F.3d 874, 882 (10th Cir. 1997) (internal quotation marks and

citation omitted)). Thus, we “affirm the district court’s decision to grant

summary judgment if the record contains any basis to do so.” Morgan v. Hilti,

Inc., 108 F.3d 1319, 1321 (10th Cir. 1997) (quoting Jones v. Unisys Corp., 54

F.3d 624, 628 (10th Cir. 1995)).

Noel contends that the district court erred by retroactively applying the

requirements of 12 U.S.C. § 1823(e) to this case. We agree. Prior to the

Financial Institutions Reform, Recovery, and Enforcement Act (“FIRREA”)

amendments in 1989, § 1823(e) applied only to the FDIC in its corporate capacity. 
3

 In his opening brief, Noel states that “if the common law permutation of 1823(e), that

is, D’Oench Duhme applies to Noel’s claims, then Noel is not entitled to relief herein.” 

Appellant’s Br. at 15. Although we could appropriately consider the argument regarding whether

Noel can meet the requirements of D’Oench waived for not arguing, indeed conceding, it in his

opening brief, see State Farm Fire & Cas. Co. v. Mhoon, 31 F.3d 979, 984 n.7 (10th Cir. 1994),

we reach the merits of his argument. Noel vigorously argued to the district court that his

defenses and counterclaims met the requirements of D’Oench. He further asserted this argument

in his reply brief, characterizing his opening brief concession as error. Given the particular

circumstances of this case, including the thorough examination of the argument by the FDIC

contained in the record, we do not deem this argument waived.

4

 To the extent that Noel may have desired us to consider affirmative defenses and

counterclaims beyond the alter ego/breach of fiduciary duty claim, we decline to do so. Noel did

not argue in his opening brief, nor his reply brief, that he could meet the requirements of the

common law D’Oench doctrine with respect to additional counterclaims and other defenses

originally raised in his answer. Thus, he has waived those issues on appeal. See, e.g., Mhoon,

31 F.3d at 984 n.7 (finding waiver when defendant fails to raise issue in opening brief). 

- 12 -

We have previously held that “the 1989 statute’s extension to the FDIC as

receiver of section 1823(e)’s provisions . . . does not apply retroactively.” 

Oklahoma Radio Assocs. v. FDIC, 987 F.2d 685, 690 (10th Cir. 1993). Because

the conduct of the parties and the agreements at issue here took place prior to

1989, the district court erred in applying § 1823(e) to this case. Nevertheless, we

may affirm the district court’s grant of summary judgment if § 1823(e)’s common

law counterpart, the D’Oench doctrine, bars defendant’s claim.3

On appeal, Noel argues that Western Gulf, as an alter ego of Mile High,

breached the fiduciary duties articulated in University Court’s partnership

agreement.4 He asserts that the records of Western Gulf contained the partnership

agreement and other documents sufficient to preclude the D’Oench doctrine from

barring his breach of fiduciary duty claim. He also argues that the FDIC cannot
- 13 -

assert the D’Oench doctrine because Western Gulf was acting under an operating

agreement with RTC when Western Gulf breached the partnership agreement.

The federal common law D’Oench doctrine, first set forth by the Supreme

Court in D’Oench, Duhme & Co. v. FDIC, 315 U.S. 447 (1942), “prohibits claims

based upon agreements which are not properly reflected in the official books or

records of a failed bank or thrift.” Young v. FDIC, 103 F.3d 1180, 1187 (4th

Cir.) (internal quotation marks omitted), cert denied, 118 S. Ct. 329 (1997). In

D’Oench, the FDIC sued the maker of a demand note payable to Bellville Bank

and Trust Company, a failed institution. The maker defended against the claim by

presenting receipts for the notes which indicated an agreement between the maker

and bank that the bank would not call the notes for repayment. In concluding that

the maker could not raise a “secret” agreement with the bank to defend against the

FDIC’s suit, the Court recognized a “federal policy to protect [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 [it] insures or to which it makes

loans.” D’Oench, 315 U.S. at 457. Therefore, the Supreme Court stated:

The test [for the doctrine’s applicability] is whether the note was

designed to deceive the creditors or the public authority[,] or would

tend to have that effect. It would be sufficient in this type of case

that the maker lent himself to a scheme or arrangement whereby the

banking authority on which respondent relied in insuring the bank

was or was likely to be misled.

D’Oench, 315 U.S. at 460; accord Oklahoma Radio Assocs., 987 F.2d at 691.
5We recognize that several courts, relying on FIRREA’s enactment and/or the Supreme

Court’s opinions in O’Melveny & Myers v. FDIC, 512 U.S. 79 (1994), and Atherton v. FDIC,

117 S. Ct. 666 (1997), have found that the D’Oench common law doctrine no longer applies to

the FDIC in its receivership capacity. See Ledo Fin. Corp. v. Summers, 122 F.3d 825 (9th Cir.

1997); DiVall Insured Income Fund Ltd. Partnership v. Boatmen’s First Nat’l Bank of Kansas

City, 69 F.3d 1398 (8th Cir. 1995); Murphy v. FDIC, 61 F.3d 1995. Because Noel waived this

argument, we do not address the issue and assume for the purposes of this case only the

applicability of the common law D’Oench doctrine.

- 14 -

Since 1942, federal courts have expanded the common law doctrine beyond

the narrow facts of D’Oench, applying it, for example, to the FDIC as receiver

and to other federal banking agencies.5

 See, e.g., Castleglen, Inc. v. Resolution

Trust Corp., 984 F.2d 1571, 1576 (10th Cir. 1993); Motorcity of Jacksonville,

Ltd. v. Southeast Bank, 83 F.3d 1317, 1325 (11th Cir. 1996) (en banc) (citing

cases), vacated by Hess v. FDIC, 519 U.S. 1087 (1997). While the purpose

underlying the D’Oench doctrine, to “permit regulators to accurately appraise the

assets of savings institutions by allowing the regulators to rely on the assets’ face

value,” Castleglen, 984 F.2d at 1577, has remained constant during its evolution,

“its focus has shifted from the fraudulent, illegal, or secret character of the

debtor’s acts to the effect the acts have on the regulatory agency’s ability to

evaluate quickly and accurately a savings institution’s assets,” id. at 1576. Bank

examiners must often conduct these evaluations and decide the course of the

bank’s fate overnight. See Langley v. FDIC, 484 U.S. 86, 91-92 (1987). The

design of the D’Oench doctrine thus “favors the interests of depositors and

creditors of a failed bank, who cannot protect themselves from secret agreements,
- 15 -

over the interests of borrowers, who can.” Bell & Murphy & Assocs. v. Interfirst

Bank Gateway, N.A., 894 F.2d 750, 754 (5th Cir. 1990); see also Motorcity, 83

F.3d at 1325.

Given the overarching purposes behind the doctrine, courts have

consistently held that inferences that an examiner could feasibly draw from a

failed institution’s written records are insufficient to preclude the operation of

D’Oench. See Resolution Trust Corp. v. Allen, 16 F.3d 568, 575 (4th Cir. 1994)

(“Enforcement of agreements which must be inferred from written recorded

agreements is forbidden under D’Oench Duhme; explicit written documentation is

required.” (emphasis added)); Community Bank of the Ozarks v. FDIC, 984 F.2d

254, 257 (8th Cir. 1993) (“Neither section 1823(e) nor D’Oench is satisfied by

inferences drawn from a bank’s records.”); Clay v. FDIC, 934 F.2d 69, 72 (5th

Cir. 1991) (asserting that “where bank documents only raise an ‘inference’ of a

secret agreement, such an inference is insufficient to support a judgment where

the FDIC is one of the parties involved in the bank transfer”). Indeed, this circuit

has indicated that suggestive evidence arising from the bank’s written records is

insufficient to bar the operation of D’Oench. See Castleglen, 984 F.2d at 1578-

79. In short, the FDIC has no duty to scour a failed institution’s documents for

inferences and hidden duties supporting defenses or counterclaims that might

prevent the FDIC from collecting the full value of an otherwise facially valid
- 16 -

instrument. 

In this case, Noel contends that the written records of Western Gulf contain

information upon which he bases his alter ego/breach of fiduciary duty claim. In

order for Noel to prevail, we must find a genuine issue of material fact as to

whether the records would indicate to a bank examiner that Western Gulf had

duties and liabilities arising out of the University Courts’ partnership agreement. 

In his response to FDIC’s renewed motion for summary judgment, Noel argued

that documents from the permanent loan file show that Western Gulf (1) closed

Mile High in 1985; (2) took over the property through in substance foreclosure;

(3) did not maintain Mile High’s corporate existence; (4) listed the University

Court’s property in the Board of Directors’ minutes and books as real estate

owned; and (5) had been advised in an official meeting that Noel may have claims

against it. He asserts, “Each of these points may well satisfy the requirements of

D’Oench. Each was sufficient to put the regulators on notice of Noel’s claims. 

The totality of the records is sufficient to prevent summary judgment.” 

Appellant’s Reply Br. at 15.

However, the logical deductions which a bank examiner would have had to

make to conclude that the FDIC could not recover the full value of Noel’s facially

valid note due to his alter ego/breach of fiduciary duty claim are far from

straightforward. The bank examiner would, at a minimum, have to determine that
- 17 -

Western Gulf acted as an alter ego to Mile High and therefore had continuing

duties stemming from the University Courts’ partnership agreement. The written

documentation to which Noel points to advance such a determination is scattered

throughout various letters, ledgers, minutes, and other records. In fact, nowhere

in the record can we find one written agreement indicating any possibility of

Western Gulf’s liability under the partnership agreement. The agreement itself

does not reference Western Gulf, and Noel points to no document which clearly

shows that Western Gulf, through Mile High, had a continuing involvement in

University Courts.

The documents to which Noel refers, at best, make only scattered

references to University Courts. The “Real Estate Owned” lists and summaries

prepared monthly as part of Western Gulf’s financial statements indicate that

Western Gulf owned University Courts. Other records show the status of the loan

to Mile High and Noel. The Board of Directors’ minutes from November 13,

1986, indicate that Mile High was inactive, but not dissolved. Minutes from

December 15, 1988, indicate that Mile High existed at that time but that it would

automatically dissolve at the end of the year if Colorado tax returns were not

filed. The minutes also state:

Mr. Noel is a 50% partner [in University Courts], however we have

not heard anything from him in years. Mr. White stated that

apparently foreclosure has not occured [sic] previously due to

concern that Mr. Noel could have legal causes of action against
- 18 -

[University Courts]. Mr. White went on to state that he was of the

opinion that Western Gulf should automatically let Mile High

Mortgage dissolve, then Western Gulf could start foreclosure

proceedings.

Appellant’s App., Vol. II, tab E4. However, none of these records clearly suggest

that Mile High was actually dissolved or that Western Gulf acted as an alter ego

to Mile High or had an obligation under the University Courts’ partnership

agreement. Furthermore, we have carefully reviewed the other documents in the

record, and find that none would sufficiently put the FDIC on notice that Noel

had a breach of fiduciary duty claim against Western Gulf because it acted as an

alter ego to Mile High. In any event, the FDIC simply had no duty to ferret out

and piece together, from vague, scattered references of various unrelated writings,

the information necessary to draw such conclusions. Indeed, even when the

documents were neatly presented to us in the record, we had difficulty piecing

together a legal theory suggesting that Western Gulf could not recover the full

value of Noel’s facially valid note because he was entitled to a set-off. Placing

an affirmative duty on bank regulators to engage in a similarly tortured analysis

runs counter to the purpose of the D’Oench doctrine – to allow examiners to

accurately and quickly appraise a bank’s assets. Therefore, we hold, as a matter

of law, that this scattered evidence is insufficient to prevent the D’Oench

doctrine’s application. See Allen, 16 F.3d at 575; Clay, 934 F.2d at 72-73.

Finally, Noel asserts that the D’Oench doctrine does not bar his alter
- 19 -

ego/breach of fiduciary duty claim because federal regulators instigated, or at

least condoned, Western Gulf’s breaches of the partnership agreement. The

Federal Savings and Loan Insurance Corporation (“FSLIC”) entered into an

operating agreement with Western Gulf in February 1985. Shortly after entering

the operating agreement, Western Gulf classified the University Court’s property

as real estate it owned, and it ceased the operations of Mile High, the general

partner to University Courts. Noel deduces, “In other words, it appears that the

action which constituted a breach of the general partner’s duties was taken at the

direction of the federal regulatory authority.” Supplemental Submission in

Opposition to Plaintiff’s Renewed Motion for Summary Judgment, at 2. He

further argues that an October 8, 1986 letter from Western Gulf to the Federal

Home Loan Bank of Dallas shows that Western Gulf acted according to a federal

regulator’s instructions. That letter touted, as a cost-saving measure, the closure

of “the Western Gulf Service Corporation loan origination office in Denver.” 

Appellant’s Supp. App. tab 5. Noel claims this obviously references Mile High as

it was the only office maintained by Western Gulf in Denver. Finally, at a board

meeting during the time Western Gulf operated under the agreement with FSLIC,

the board discussed Mile High. The board decided that despite Mile High’s

present inactivity, it might have a future need for the corporation. Noel

acknowledges the board conducted no discussion regarding Mile High’s status as
- 20 -

the general partner of University Courts or the fiduciary obligations it may have

owed Noel.

Noel thus argues that because Western Gulf entered into an operating

agreement with FSLIC and the actions giving rise to Noel’s claims occurred while

the operating agreement was in effect, we can infer that Western Gulf acted at the

behest of federal regulators in allegedly breaching the partnership agreement

between Mile High and Noel. Under this theory, summary judgment is

inappropriate because “[i]t would be manifestly unjust to allow FDIC to invoke

D’Oench to shield itself from the actions of its predecessors in interest.” 

Supplemental Submission in Opposition to Plaintiff’s Renewed Motion for

Summary Judgment, at 5.

The language of the operating agreement, however, refutes Noel’s

implication that federal regulators instigated or condoned Western Gulf’s alleged

breaches of fiduciary duty. It states, “Nothing in this paragraph shall require the

Association to breach or abrogate any legally binding written contractual

commitments outstanding on or before the effective date of this Agreement.”

Appellant’s Supp. App. tab 5. Noel relies solely on the fact that Western Gulf

had entered into this operating agreement with FSLIC to show FSLIC complicity

in the alleged breaches. We refuse to impute Western Gulf’s actions to FSLIC

when the language of its agreement with Western Gulf explicitly states that
- 21 -

Western Gulf should not breach any agreements in an effort to comply with the

regulations. Moreover, we cannot impute to FSLIC any responsibility for the

closure of Mile High. The cited letter does not obviously reference Mile High. It

refers only to a loan origination office in Denver. This is insufficient to put

FSLIC on notice that the reference pertained to Mile High. Finally, even though

the Western Gulf’s board discussed the inactivity of Mile High at a meeting

during the period it acted under the FSLIC operating agreement, the board did not

mention that it had any continuing liability under the University Courts’

partnership agreement. Therefore, even assuming that the FDIC could not assert

the D’Oench doctrine if it were instrumentally involved in the actions of the

financial institution, we find no evidence here that the FDIC instructed Western

Gulf to breach any fiduciary duties that may have been owed to Noel. Hence,

Noel’s final argument also fails.

Accordingly, we AFFIRM the district court’s grant of summary judgment.