Opinion ID: 546380
Heading Depth: 2
Heading Rank: 2

Heading: D'Oench Doctrine Protections Extend to the FSLIC as Receiver

Text: 31 Given that we have identified the FSLIC as the real party in interest at the time of the district court's final judgment, the next question to be addressed is whether the FSLIC as receiver for a failed savings and loan institution is entitled to rely upon the D'Oench doctrine and raise federal common law defenses to defeat state law claims of fraudulent inducement and failure of consideration when suing upon a note in default. Although not published until after briefs were filed with this court, a panel of this court has recently resolved this issue in the affirmative, holding that the FSLIC in its capacity as receiver is entitled to raise federal common law defenses premised upon the D'Oench doctrine. Two Rivers Associates, 880 F.2d at 1274-77. 32 In reaching this conclusion, the Two Rivers Associates court first observed that the policy reasons underlying the Supreme Court's decision in D'Oench leading to the development of a federal common law estoppel defense for the FDIC were equally applicable to the FSLIC: since the FSLIC has parallel duties and power with respect to savings and loans as the FDIC has with banks, the federal policy should protect the FSLIC to the same extent it protects the FDIC. Two Rivers Associates, 880 F.2d at 1274-75 (footnote omitted). Next, the Two Rivers Associates court rejected the suggestion appearing in our prior cases that the D'Oench doctrine should be available to the FSLIC or the FDIC only when it litigates in its capacity as corporate insurer and not in its receivership capacity. See Trigo v. FDIC, 847 F.2d 1499, 1502 n. 4 (11th Cir.1988); Gunter v. Hutcheson, 674 F.2d 862 (11th Cir.), cert. denied, 459 U.S. 826, 103 S.Ct. 60, 74 L.Ed.2d 63 (1982). Drawing upon recent Supreme Court authority, see Langley v. FDIC, 484 U.S. 86, 108 S.Ct. 396, 98 L.Ed.2d 340 (1987), the Two Rivers Associates court discerned no basis for distinguishing between whether suit was being brought in the FSLIC's corporate or receivership capacity. In either instance, the Two Rivers Associates court noted that the federal policy underlying the D'Oench doctrine supported its application. The court observed that the D'Oench doctrine embodies the recognition that an unrecorded agreement hinders the ability of the federal regulatory authorities to make swift and reliable evaluations of the assets of a given financial institution and that the ability to make such assessments was imperative both when the FDIC or the FSLIC was insuring a bank and when the FDIC or the FSLIC was taking over a failed bank. In short, the federal policy protects the FDIC or the FSLIC's reliance on the bank records even before the institution fails.... [O]ne of the harms which this rule protects against occurs no later than the time at which [the FSLIC] conducts its first bank examination that is unable to detect the unrecorded agreement. 880 F.2d at 1277 (citations, quotations, and footnote omitted). 33