Document: 489 U.S. 561 109 S.Ct. 1361 103 L.Ed.2d 602 COIT INDEPENDENCE JOINT VENTURE, Petitionerv.FEDERAL SAVINGS AND LOAN INSURANCE CORPORATION, as Receiver of FirstSouth, F.A. No. 87-996. Argued Nov. 1, 1988. Decided March 21, 1989. Syllabus Due to disagreements about loans petitioner by F.A., a federal savings and loan association, etitioner filed suit against FirstSouth in state court, alleging various law causes action seeking damages equitable relief. Two months later, the Federal Home Loan Bank Board (Bank Board) determined that was insolvent appointed receiver Savings Insurance Corporation (FSLIC), which substituted itself for petitioner's removed case District Court. That court dismissed lack subject matter jurisdiction under North Mississippi & Assn. v. Hudspeth, 756 F.2d 1096 (CA5), held Congress, virtue 12 U.S.C. §§ 1464(d)(6)(C) 1729(d), had granted FSLIC exclusive adjudicate claims assets an association receivership, only review then limited judicial Administrative Procedure Act. Shortly before Court Appeals affirmed dismissal on basis petitioner, day established deadline filing creditor its proof claim approximately $113 million. Six notified been "retained further review." There has no claim. Held: 1. The statutes governing do not grant adjudicatory power over creditors' associations receivership divest courts consider those de novo. Pp. 572-579. (a) plain language 1729(b) (d) cannot be read confer upon with force law. § 1729(d) "settle, compromise, or release" is distinguishable from some extent inconsistent it, since body say "yes" "no" little need settle compromise. Similarly, 1729(b)(1)(B)'s directive "pay all valid credit obligations" preclude claimants resorting determination their claims' validity; it simply empowers FSLIC, much like ordinary insurance company, pay proved satisfaction. statutory framework 1729 appears demonstrates clearly when Congress meant authority did so explicitly, enacting detailed provisions procedural substantive rights providing review. 572-574. (b) Judicial resolution would "restrain affect" FSLIC's exercise functions violation 1464(d)(6)(C), states that, "[e]xcept otherwise provided this subsection, may take any toward removal . receiver, or, except at instance Board, restrain affect powers receiver." This does add adjudication powers, but prohibits restraining affecting "powers functions" have other sources, none power. Moreover, context relationship 1464(d)(6)(A)—which specifies grounds Board's appointment authorizes placed bring district within 30 days challenge appointment—§ must prohibit untimely challenges receiver's collateral attacks attempting carrying out basic functions, juri diction determine validity institutions receivership. reading reinforced fact time statute's enactment well common suits establish amount debtor interfere functions. Hudspeth erred assuming such "restrain" delaying prompt liquidation failed loans, can make interim distribution pending disputed courts. 574-577. (c) envisaged demonstrated several provisions, including allowing sue sued 1725(c)(4), establishing statute limitations actions enforce deposit claims, 1728(c). Most significantly, 1730(k)(1) provides explicit contemplates state-chartered associations. indication intended treat federally chartered differently respect. 577-579. 2. Creditors are required exhaust current administrative procedure bringing because place reasonable limit consideration claims. 579-587. Under procedure, entire process claimant whose allowed full could year first until completes final places retained "further review," length far longer even indefinite. Nevertheless, available after exhaustion these procedures. 579-583. Although explicitly mandate remedies, broad rules conduct receiverships, 1464(d)(11), entirely consistent Congress' clear intent liquidate "in orderly manner," 1729(b)(1)(A)(v), if regulations give notice wait period while decided whether pay, settle, disallow reasonably decide perform function unless array association's rational judgments regarding 583-585. However, present exceeds placing renders inadequate, allows delay processing indefinitely, thereby denying litigants runs; enable coerce unfair settlements depleted other, distributions gets court; often main thus incentive decisions large petitioner's. Because inadequate remedy exhausted, proceed di ectly novo merits 586-587. 829 563 (CA5 1987), reversed remanded. O'CONNOR, J., delivered opinion unanimous respect Parts I, II, III, Part IV, REHNQUIST, C.J., BRENNAN, WHITE, MARSHALL, STEVENS, KENNEDY, JJ., joined. BLACKMUN, post, p. 588, SCALIA, opinions concurring part judgment. Robert E. Goodfriend, Dallas, Tex., petitioner. Jeffrey P. Minear, Washington, D.C., respondent. Justice O'CONNOR 1 presents question asserted association. We hold creditors entitled court. also inadequate. 2 * From 1983 1986, Coit Independence Joint Venture (Coit), real estate concern, borrowed money Subsequent led file October 1986 95th Dallas County, Texas. In complaint, alleged received two $20 million $30 purchase parcels undeveloped land. "profit participation" interest profits derived sale property condition receiving loans. fee added regular accrued rate, made usurious Texas Complaint &Par; 4-13, App. 17-22. orally agreed allow draw down funds improve purchased loan, carry executing necessary renewal notes, least five years sold earlier. charged violated agreement August refusing renew notes threatening foreclose property. 3 sought usury. Alternatively, declaratory judgment Coit's partner profit sharing joint venture breached fiduciary duty implied good faith fair dealing. 11-16, 21-23. declaration outstanding note unenforceable. 4 On December 4, receiver. Substituting suit, February 1987, jurisdiction, relying 1985), cert. denied, 474 1054, 106 790, 88 768 (1986). 5 Fifth Circuit F.2d, 1103. relied reaching conclusion. First, conservator Second, "[i]n connection insured institutions, [FSLIC] shall release favor things therewith, regulation Board." reasoned should able act quickly liquidating "not interfered regulatory authorities." 1101. 6 rejected Hudspeth's argument debtor, opposed allocation satisfy function, "resolution facial assets" "such 'restraint' scope statute." Id., 1102. found support giving "proved satisfaction," CFR 549.4, 569a.8 (1988), took mean 1102, n. 5. 7 Since decided, successfully urged dismiss variety jurisdiction. Those included contract tort see, e.g., Resna Associates, Ltd. Financial Equity Mortgage Corp., 673 F.Supp. 1371, 1372 (N.J.1987), antitrust violations, Red Fox Industries, Inc. 832 340 racketeering Baer Abel, 637 343, 347 (W.D.Wash.1986). 8 instant case, appealed Court's Circuit. acknowledged intend enjoy Morrison-Knudsen Co. CHG International, Inc., 811 1209 (CA9 dism'd sub nom. Stevenson Assocs., 488 935, 358, 102 349 (1988); Glen Ridge I Condominiums, 734 S.W.2d 374 (Tex.App.1986), writ error 750 757 (Tex.1988), pending, 88-659. bound suit. concluded constitutional were ripe 563, 565 (1987). 9 September 28, 10 certiorari resolve conflict lower 485 933, 108 1105, 99 267 (1988). now reverse. II 11 Resolution requires us interpret enacted span 50 years. embedded complex framework. Prior Great Depression 1930's, regulated States alone. face heavy withdrawals accounts, mortgage defaults, home mortgages during depression, passed Act, 47 Stat. 725, codified, amended, 1421 et seq. Act creation up banks throughout country certain lenders. 726, 1423. created oversee raise them selling bonds. 736, 1437. See T. Marvell, 20 (1969). One Owners' 1933 (HOLA), empowered organize, regulate, charter 48 128, 1461 HOLA gave prescribe "reorganization, consolidation, merger, associations, appoint charge affairs association." HOLA, 5(d), 133, 1464(d)(11). 13 1934, insure accounts National Housing (NHA), 402(a), 1256, 1725(a). If institution default, NHA either depositors account transfer default. NHA, 405(b), 1259, 1728(b). authorized "(1) operate (2) put sound solvent condition, (3) merge another institution, (4) organize new assets, (5) manner, whichever appear best interests members default; event section 405 obligations 406(b), 1260, 1729(b)(1). accept same duties institution. 406(c), 1729(c)(1)(A). liquidated provided: 14 "[FSLIC] business collect public having matter." 406(d), 1729(d). 15 1954, amended both HOLA. 5(d) setting forth specific insolvency, regulation, concealment books records, unsound operation. 503, 68 635-636, 1464(d)(6)(A). formal hearings, appointed. 636. 16 major amendments 1934 Institutions Supervisory 1966 (FISA), Pub.L. 89-695, 80 1028, 1036, 1464, 1730 (1982 Supp. V). more flexible enforcement short thrifts terminating insurance, prevent violating laws engaging unsafe practices. FISA authority, ex parte without existed, substantial dissipation due violations practices, willful cease-and-desist order, books, papers, assets. FISA, 1032-1033, 17 could, days, United "for order requiring remove Ibid. It following language, appeared: 18 "Except 1033, 1464(d)(6)(C). 19 greater regulations, receiverships. 1035, extended thrifts. Protection 1968, 90-389, 6, 82 295-296, 1729(c)(2), 1729(c)(3); Garn-St Germain Depository 1982, 97-320, 122(d), 96 1482, 1729(c)(1)(B); Competitive Equality Banking 100-86, 509(a), 101 635, 1464 ed., 21 Once steps into shoes takes control liquidates promptly reimburse fund. satisfied depositor's claim, "it require competent paying claim." satisfies uninsured permit so. subrogated whom reimbursed, normally single largest generally recoups portion payouts Co., 1215-1216; Note, W.New Eng.L.Rev. 227, 229-230 III 22 argues incorrectly 551 Altho gh argued below, invoking lacked Solicitor General endorse position. Brief Respondent 16, 17, 20, 13, 39-40. concedes "the conferred characterized 'adjudication,' " id., claim.1 16-17, 39. oral suing "de determination" Tr. Oral Arg. 36. agree. nor they 23 capacity include Section 406 traditional "to institutio[n]," association," 1729(b)(1)(B). essential changed 1934. disputes it. As Ninth 1219: 24 "Settlement compromise strongly suggest presence party dispute Settlement avoid result. A 'yes' 'no' less compromise." 25 "shall association" provision law; 26 exist isolation, Stafford Briggs, 444 527, 535, 100 774, 780, 63 (1980) (" '[I]t settled interpreting statute, will look merely particular clause general words used, whole statute' ") (quoting Brown Duchesne, How. 183, 194, L.Ed. 595 (1857)). indicates set relevant procedures considerable detail. For example, role supervisor ongoing thrift together law, issue orders, officers directors, impose civil sanctions. 1464(d), 1730. recision agency followed remedies available, reference 1464(d)(7)(A), 1730(j)(2). infer capacity, similar B 27 decision rested primarily provision, introduced (Emphasis added.) disagree. 28 powers. sources. discussed above, 29 examined, meaning attributed 1464(d)(6)(A) sets expressly appointment. Following comes prohibiting courts, subsection," taking functions." When context, Eng.L.Rev., 257-260; Baxter, Life Track: Adjudication Claims Against Institution Receiverships, 1988 Duke L.J. 422, 484-485. existence possession insolvent's Morris Jones, 329 545, 549, 67 451, 454-455, 91 (1947); Riehle Margolies, 279 218, 224, 49 310, 312-313, 73 669 (1929). Morris: 31 "No one obtain right application But allowance matters distinct distribution. 'The latter spoken cla m, strictly proceeding personam.' establishment way disturbs affects title property, necessarily involve what priority have." U.S., S.Ct., 454-455 (citations omitted). 32 national bank seen interfering Bethel Pahquioque Bank, Wall. 383, 401-402, 840 (1872). 33 Looking practical effects process, erroneously assumed postponed courts: "The fix decline postpone awaiting disposition litigation contested 313. R. Clark, Law Practice Receivers 649(c) (3d ed. 1959). Indeed, own provide distributions. 549.4(d) (1988) (allowing paid "from time, manner amounts direct"). 34 Finally, delayed constituted "restraint" explanation why resulting constitute "restraint." sum, C 35 Several indicate "sue sued, complain defend, equity, State Federal." 402(c)(4), 1725(c)(4). most type time. 501(2), 633, 1966, very contained receiver: 36 "Notwithstanding (B) action, deemed arise States, original thereof, regard controversy; (C) may, bond security, .: Provided, conservator, legal custodian State-chartered involves investors, creditors, stockholders, inst tution States." 1042, (emphasis added). 37 proviso types expected defend there See, 1729(c)(1)(A) (granting "same duties" defaulted associations). we conclude FSLIC. 38 reach violate Article Constitution Northern Pipeline Construction Marathon Pipe Line 458 50, 2858, 598 (1982). Seventh Amendment note, however, usury breach raised Coit, 1221, "private rights" "core" "matters reserved courts." Commodity Futures Trading Comm'n Schor, 478 833, 853, 3245, 3258, 92 675 (1986); Pipeline, supra, 69-72, 2870-2872. below adopted interpretation raises serious difficulties. our view, 841, 3251; Crowell Benson, 285 22, 62, 52 285, 296-297, 76 (1932). IV 39 respondent defends Circuit's narrower ground plainly leading allowance, settlement, disallowance" 13. voluntary procedure. contends, demonstrate congressional Reply Petitioner 3. A. 40 Our past cases recognized where imposes requirement statute. Weinberger Salfi, 422 749, 766, 95 2457, 2467, 45 522 (1975); Myers Bethlehem Shipbuilding 303 41, 50-51, 58 459, 463-464, 638 (1938). Where explicit, "courts guided determining doctrine scheme." Patsy Florida Regents, 457 496, 502, 2557, 2560, 172 "a defer intent." 501-502, 2560. 41 reorganize o using purpose. 1464(d)(6). responsibility 1729(b)(1)(B), "liquidate therewith," "power reorganization, liquidation, dissolution conservatorships receiverships." 42 Over ago, manner. Thus, 1941, acting pursuant rulemaking remained effect, largely unaltered, post-Hudspeth became operative. Fed.Reg. 4413, 4415 (1941). 43 At decision, once publish specified date. 549.4(a) date "disallowed, approve payment remaining undistributed approval." seasonably 549.4(b), "may wholly partly proved, notify disallowance reason therefor," ibid. After presenting expired, complete list presented, indicating character each 549.4(c). Creditor approved "paid direct." 549.5(d). 44 dramatically different elaborate "interim procedures" These used July 1986. 53 13105 (1988).2 procedures, notifies potential date, than 90 notice. 43854 (to codified 575.4). Properly assigned agent Special Representative initial 43854-43855 575.9(d), 575.10). six receipt properly (or end 90-day period, later) part, disallowed, 43855 575.11). review, disposition. reviewing submit additional documentation, answer written questions, sworn statement, memorandum addressing issues. 575.13). compiles "Receiver's record" ultimately prepares "proposed form proposed findings conclusions law." 43856 575.13(l)). object finding conclusion request reconsideration, facts "conclusively Claimant." 575.13(o)(2)). considering Receiver's record, issues 575.13(o)(6)). 46 disallowed determination. 575.13(n), 575.13(p)). Claimants 60 43857 576.3(a)). conducts preliminary information needed, completed days. 43858 576.4(b)). Generally record closed. 576.7). 180 based Record. 576.5(e)). "[j]udicial 43852 575.1(a)). just 5(d)(11) going contends unable fulfill manner" contest, opportunity centralized 25-30. precondition obligations," institutio[n], doubt receiverships respond changing circumstances needs, constraints. crisis, hundreds receivership,3 number small who thrift's possibly process. manner." reasons doctrine, exclusivity explicit," McKart 395 185, 193, 89 1657, 1662, 194 (1969), given decide, instance, contest liquidator expertise knowledge total situation. Only many resort costly litigation—the expense borne pool paid. 51 already receive Trial determine, discretion, stay proceedings factors stage assess possibility settling Landis American 299 248, 254-255, 57 163, 166, 81 153 (1936); Leyva Certified Grocers California, Ltd., 593 857, 863-864 1979); Marshall Hartford Fire Ins. 78 F.R.D. 97, 107 (Conn.1978). incorrect characterize analysis ruling enabling legislation "pre-empts" 588-589 (SCALIA, judgment). discussion purport predicated occupies field exclusion policies. 578-579. minimal entailed unlikely "extinguish" usual case. today, address posited JUSTICE expire waiting exceed respects. binding "judicial review" presumably 43852, 43856, 575.1, 575.13(o)(6), above III. 54 allow, disallow, retain aptly puts it: "These virtually unlimited discretion bury unconscionably long purportedly objectives centralizing deciding not." 18. 55 1987. 18, 1988, being argument, months, yet dispose appeal, essentially relegated "black hole" emerge run. 56 exhausted. Greene 376 149, 84 615, 623, 576 (1964); Smith Illinois Bell Telephone 270 587, 591-592, 408, 410, 70 747 (1926) ("[P]ublic service company indefinitely await rate-making tribunal applying relief"). reasons. litigant runs. enter finally access concerns exacerbated Coit. directly g anted Accordingly, reversed, remanded opinion. 59 ordered. join refrain joining concur My concern seems me advisory do, surmise might someday 61 62 agree Court, through precedent my view policy justification (1) pre-empting imposing obligation rule exhaustion; pre-emption. To knowledge, never today's opinion, means apply entertain plaintiff resorted grievance underlying Renegotiation Bannercraft Clothing 415 20-26, 94 1038-1041, 123 (1974); McGee 402 479, 483-486, 1565, 1568-1570, (1971). assessment creating remedies. 64 contrast, applies purports wished assertible, assertion case—and, expect, involving thrifts—arise originally brought, removal, says exclude Texas-law acted passed. statement devoid effect (requiring remand courts), "unexhausted" well. 65 What enough maturing cause override repeatedly said pre-empts fields "that manifest purpose Congress," Rice Santa Fe Elevator 331 230, 1146, 1152, 1447 see Puerto Rico Dept. Consumer Affairs Isla Petroleum 495, 500, 1350, 1353, 582 Hillsborough County Automated Medical Laboratories, 471 707, 715, 105 2371, 2376, 85 714 (1985); Jones Rath Packing 430 519, 525, 97 1305, 1309, 604 (1977). urances meaningless directions interpreted authorization suspension arising state-court 66 is, understatement involved "suspension" state-created rights. becomes extinguishment if, pursuing his "exhaustion" expires. meet difficulty, pre-emption seem drastic, "place claims." Ante, 586. Of course completely solve problem. Even establishes flat limit, happens extinguished. solution tolling period—but obviously difficult conceal guise "exhaustion," avoids leaving occurred. achieve benefit, creates novel regret. know proposition agency's "arbitrary, capricious" "otherwise accordance law," 706(2)(A), precise acted. sure, arbitrary capricious too delayed, wherefore instructs "compel unlawfully withheld unreasonably delayed," 706(1) case-by-case basis. Sierra Club Thomas, 264 U.S.App.D.C. 203, 212-215, 828 783, 794-797 (1987); Public Citizen Health Research Group Commissioner, Food Drug Administration, 238 271, 740 (1984). equivalent, when, taken mind. 282, 32; Environmental Defense Fund, Hardin, 138 391, 397, 428 1093, 1099-1100 (1970). establish, cases, cut-off impose, contrary neither organic Vermont Yankee Nuclear Power Corp. Natural Resources Council, 435 524, 98 1197, 1202, 460 (1978). thing invention somewhat reduces harm caused requirement. distortion another. 69 labors courageously—but last unsuccessfully—to supply lacking cover extraordinary situation confronted. Ordinarily, lawsuit pose Service summons he interested granting settlement negotiations. hard imagine deny request. enormous volume thrifts, diversity makes impracticable fashion. think emergency enacted—and anyway, (even making bad law) succeeded meaningful problem, suspect, high assurances "reasonable time." Today's nothing that. currently directed towards so-called "Savings crisis," Reform, Recovery Enforcement 1989, S. 413, 101st Cong., 1st Sess. (1989), instead dicta legislative reasons, although reversal categorical pre-empt "every point" still arguing jurisdictional theory. 56. FirstSouth. minor modifications, 31, 43850 pts. 575, 576, 577), citations hereafter version. 228,

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