Opinion ID: 1286830
Heading Depth: 1
Heading Rank: 2

Heading: The Participating Banks

Text: Hettel asserts that the trial court erred in granting summary judgment to the participating banks because material fact questions exist concerning whether each bank had knowledge that the bond proceeds would be used for a fraudulent and unlawful purpose. [10] The participating banks contend that there are no disputed fact issues existing which could support a finding which would establish qui tam liability for any allegedly fraudulent or unlawful bond issue. Title 62 O.S.1991 §§ 372 and 373 provides the authority for qui tam liability. [11] Section 372 authorizes a triple penalty against state or municipal officers and every person, having notice of the facts who either makes a contract with the county or receives a benefit involving the improper payment of money or the improper transfer of property. Section 373 allows resident taxpayers to bring an action to recover the § 372 penalty, or to recover any money expended by the county if the appropriate officer fails or refuses to bring the action after demand by ten taxpayers. The taxpayer bringing the action is entitled under § 373 to one half of the amount recovered as a reward. [12] The qui tam statutes, like any penal statutes, are strictly construed. [13] In Dowler v. State ex rel. Prunty, 179 Okla. 532, 66 P.2d 1081, 1083 (Okla.1937) this Court, in the thirteenth syllabus, stated that: In an action for the penalty imposed by section 5964, O.S.1931 (62 Okl.St.Ann. § 372), against one not an officer of the municipality, the burden is on the plaintiff to show that the party receiving the money had notice that the contract under which it was paid, or the payment itself, was unlawful, fraudulent, or void. The contracts involved here are: 1) the agreement between the Authority and Carl-Built to issue the bonds; 2) the bond sale contract between Grady County and the Chickasha Bank; and 3) the 1986 note and related mortgage and security interest. Pursuant to Rule 13, 12 O.S.1991, Ch. 2 App., Rules for the District Courts, a motion for summary judgment may be filed if the pleadings, depositions, interrogatories, affidavits and other exhibits reflect that there is no substantial controversy pertaining to any material fact. [14] Summary judgment is proper only when the pleadings, affidavits, depositions, admissions, or other evidentiary materials establish that there is no genuine issue as to any material fact, and that the moving party is entitled to a judgment as a matter of law. [15] All conclusions drawn from the evidentiary material submitted to the trial court are viewed in the light most favorable to the party opposing the motion. [16] Summary judgments are not favored and they should be granted only where it is perfectly clear that there are no issues of material fact. [17] Hettel presented evidentiary material which alleges that: 1) each of the participating banks had a history of participating in the Greene loans prior to the bond issue; 2) bank officers of Security bank were aware of the financial condition of Greene and his businesses prior to and at the time the bond money was loaned to Carl-Built; 3) Greene's financial ability to pay the Chickasha Bank was questionable, and all of his businesses were cross-collateralized; 4) in addition to being the Chairman of the Grady County Industrial Authority and the president of the Chickasha Bank, Lindell Pettigrew was also the president of the Cement Bank; [18] 5) each of the participation agreements negotiated by the participating banks provided that they would make an independent determination of the financial information and creditworthiness of Carl-Built; and 6) all the banks received proceeds from the bond issue which allegedly paid-off antecedent debt. Considering the various circumstantial evidence Hettel presents and the intimate relationships between the banks, we cannot say that it is perfectly clear that these evidentiary materials totally eliminate fact issues concerning the participating banks' access to knowledge of the lawfulness of the bond issue and whether the public was defrauded. [19] Accordingly, the trial court erred in granting summary judgment.