Opinion ID: 673431
Heading Depth: 3
Heading Rank: 1

Heading: Whether the Insurance Policies Are Assets Under Sec. 1821(d)(13)(D)

Text: 26 As a preliminary matter, we consider whether the insurance policies issued by National Union and Gulf to CityFed and its subsidiaries are assets of City Savings as that term is used in Sec. 1821(d)(13)(D)(i). Section 1821(d)(13)(D) provides that no court shall have jurisdiction over--(i) any claim or action for payment from, or any action seeking a determination of rights with respect to, the assets of any depository institution for which the Corporation has been appointed receiver.... Sec. 1821(d)(13)(D)(i) (emphasis added). If the insurance policies are not assets of the bank, then National Union and Gulf's declaratory judgment action for and affirmative defenses of rescission of those insurance policies would not be barred under Sec. 1821(d)(13)(D)(i). 27 FIRREA does not provide a definition of assets as that term is used specifically in Sec. 1821(d)(13)(D)(i). In the absence of a specific definition, we refer to the definition of the term assets in common legal usage: 28 Property of all kinds, real and personal, tangible and intangible.... The entire property of a person, association, corporation, or estate that is applicable or subject to the payment of his or her or its debts. 29 Black's Law Dictionary 117 (6th ed. 1990). Insurance policies which a bank has purchased and under which it is an insured fall neatly within this definition of assets. Insurance policies obviously are important property interests of individuals and economic entities. Furthermore, we believe that business people consider an insurance policy to be an asset of the named insured, as the term asset is commonly used in the business world. Finally, reported court decisions have assumed that insurance policies are assets of institutions which are holders of the policies. See, e.g., FDIC v. Aetna Casualty & Surety Co., 947 F.2d 196, 199 (6th Cir.1991); A.H. Robins Co. v. Piccinin, 788 F.2d 994, 1001-02 & n. 10 (4th Cir.), cert. denied, 479 U.S. 876, 107 S.Ct. 251, 93 L.Ed.2d 177 (1986); FDIC v. Gulf Life Ins. Co., 737 F.2d 1513, 1514-20 (11th Cir.1984); Samuels v. Acme Market, 845 F.Supp. 292, 294 (E.D.Pa.1994); Holloway v. New Jersey, 237 N.J.Super. 71, 566 A.2d 1177, 1180 (Law Div.1989). 30 Whether City Savings will ultimately be entitled to collect under the insurance policies is not relevant to the threshold question of whether the insurance policies issued to CityFed and its subsidiaries are assets of the banks. An insurance policy is of value to the owner and named insured of the policy, even though it is possible that the owner and named insured will ultimately be found not to be entitled to a particular recovery under the policy. For all of the above reasons, we conclude that the plain meaning of the term assets contained in Sec. 1821(d)(13)(D)(i) includes the insurance policies issued by National Union and Gulf to CityFed and its subsidiaries. 31 Having concluded that the insurance policies are assets of City Savings, we must examine the jurisdictional bar contained in Sec. 1821(d)(13)(D) to determine whether it deprived the district court of jurisdiction to hear (1) National Union and Gulf's declaratory judgment action for rescission of the insurance policies and (2) their affirmative defenses of rescission of the insurance policies. 32