Opinion ID: 6503
Heading Depth: 4
Heading Rank: 1

Heading: in writing;

Text: 22 (2) executed by the depository institution and any person claiming an adverse interest thereunder, including the obligor, contemporaneously with the acquisition of the asset by the depository institution; 23 (3) approved by the board of directors of the depository institution or its loan committee, and the approval reflected in the minutes of the board or committee; and 24 (4) an official record of the depository institution continuously from the time of its execution. 25 12 U.S.C. Sec. 1823(e). 26 Morrison argues that the stringent requirements of Sec. 1823(e) need not be met in the case presented because he is not relying upon any unwritten side agreement; rather, he is attempting to enforce the parties' agreement as reflected clearly in the loan documents. Alternatively, he contends that the loan documents read together as a whole constitute a written agreement between the parties which satisfies Sec. 1823(e). As Morrison properly points out, neither D'Oench, Duhme nor Sec. 1823(e) requires that the agreement between the parties be confined to one document; rather, a collection of official bank documents can reflect the agreement reached. Sharif-Munir-Davidson, 992 F.2d at 1405 n. 13 (observing that Texas law permits a contract to consist of multiple writings, all of which are integral to the agreement); Oaks Apartments, 966 F.2d at 999 (The fact that an agreement between the failed lender and the borrower is manifested in more than one document does not automatically imply a deceptive secret agreement.); Laguarta, 939 F.2d at 1238-39 (holding that the loan documents that are integral to a given transaction are to be read together). With respect to the first Sec. 1823(e) requirement, it is undisputed that the loan documents are all in writing. The second prong of the inquiry is also met because (i) Baldwin, the MBank senior vice president handling the transactions, signed the loan applications, (ii) Morrison signed the promissory notes that were the result of, and in accordance with, the loan applications, and (iii) Baldwin tied the two sets of documents together by testifying that the loan applications he signed were the same ones which were eventually approved by the loan committee and which formed the basis of the $500,000 and subsequent $750,000 credit extensions. 27 With respect to the third requirement, Bank One pointed out at trial that the loan applications upon which Morrison relies are incomplete because there are no written indicia of committee approval. This court, however, has previously held that board approval can be established by testimony regarding the board's custom and routine practice. Park Club, Inc. v. RTC, 967 F.2d 1053, 1057 (5th Cir.1992). Baldwin testified that it was the custom and routine practice of MBank to obtain loan committee approval prior to the extension of credit under the circumstances presented. Baldwin was certain that the transaction would not have been effected in the manner it was absent both a completed application in the form of the one introduced at trial and committee approval. As noted above, he testified unequivocally that the loan applications in evidence--which clearly reflect no guarantors--were the ones upon which the loan was made and that the credit was extended without any guaranty. 5 Furthermore, the record contains other, committee-approved applications which resulted in letters of credit cross-collateralized with the loan at issue, and these applications again reflect that there were no guarantors. All of this evidence supports the view that the $750,000 loan at issue obtained the requisite approval, and Bank One did not offer any countervailing evidence. Cf. Park Club, 967 F.2d at 1057 (finding an issue of fact as to board approval where there was a dispute as to the normal procedures of the board and as to whether those procedures were followed). Consequently, the loan documents satisfy the third precondition. 28 Finally, with respect to the fourth Sec. 1823(e) factor, the evidence at trial was uncontroverted that these loan documents were continuously in the official MBank financial records since their inception. Accordingly, under the particular facts presented, D'Oench, Duhme and Sec. 1823(e) do not eliminate Morrison's defense that he did not guarantee the obligation at issue. 29 Moreover, and more fundamentally, in cases such as the one at bar where the parties' understanding is unequivocally embodied in the loan documents,  '[n]one of the policies that favor the invocation of [Sec. 1823(e) ] are present ... because the terms of the agreement that tend to diminish the rights of the FDIC appear in writing on the face of the agreement that the FDIC seeks to enforce.'  Laguarta, 939 F.2d at 1239 (quoting Riverside Park Realty Co. v. FDIC, 465 F.Supp. 305, 312-13 (M.D.Tenn.1978)). Time and time again, we have stated that the purpose of the D'Oench, Duhme doctrine is to safeguard the reliance of federal regulators upon the records of the financial institution, to the exclusion of any extraneous matters, so that they may evaluate accurately the assets and liabilities of the institution. Griffin, 935 F.2d at 697; see also Langley v. FDIC, 484 U.S. 86, 91-92, 108 S.Ct. 396, 401-02, 98 L.Ed.2d 340 (1987). Essentially, because the regulators must perform their analyses of an institution both quickly and accurately, the allowance of defenses or claims against a facially unqualified obligation based upon facts outside the document would eviscerate the federal policy underlying the doctrine. Langley, 484 U.S. at 91-92, 108 S.Ct. at 401-02; Bowen v. FDIC, 915 F.2d 1013, 1016 (5th Cir.1990). That purpose is not served here where all of the memoranda and supporting loan documents consistently reflect that the $500,000 and superseding $750,000 obligations were not guaranteed. E.g., Waggoner, 999 F.2d at 828 (holding that D'Oench, Duhme did not preclude borrower's reliance upon superseded notes clearly reflecting that his liability was non-recourse in defending against new note into which the superseded notes were rolled over and consolidated which failed to reflect that liability limitation). 30 Accordingly, under the circumstances of this case, we hold that D'Oench, Duhme and Sec. 1823(e) did not preclude the trial court from asking the jury to consider whether the parties intended that the $750,000 note be guaranteed by Morrison. The integrated loan documents which evidence the parties' agreement as to the $750,000 obligation satisfy the notoriety requirements of D'Oench, Duhme and Sec. 1823(e), resulting in a fact issue as to whether the parties intended the guaranty to apply. The jury's answer in the negative, which, as discussed above, is supported by the record, should therefore be upheld, and the district court erred in disregarding it. 31