Resolution Trust Corp. v. Sharif-Munir-Davidson Development Corp.

theOn of incarceration. his term the end of CORPORATION, to be good reason TRUST hand, Payan has RESOLUTION other Sav free long he will remain Receiver for Southwest as how about concerned Plaintiff-Appellee, Association, volitionally refus- if he ings release supervised (or fide at least bona make restitution es to so) his completion of prior do efforts to DEVEL SHARIF-MUNIR-DAVIDSON government Apparently, prison term. al., CORPORATION, et OPMENT immediately to en- proceedings could start Defendants, restitution, pro- those of order force the Payan’s in eventually result ceedings could DEVEL SHARIF-MUNIR-DAVIDSON restitution, of An order prison. return to Ramsey CORPORATION, M. OPMENT if no mecha- all, meaningless be Louay E. Shar and the Estate Munir haveWe its enforcement. nism existed Plaintiffs-Ap if, Defendants-Counter of one that, if institution to believe reason no pellants, neces- mechanisms becomes those more or case, they will not be instant sary in the CORPORATION, TRUST RESOLUTION they are But manner. a lawful applied in Savings Asso Receiver for Southwest review not, free to seek Payan will be Intervening ciation, Defendant- Counter courts. Appellee. No. 91-7304. III Appeals, United States CONCLUSION Fifth Circuit. nor Rule neither the Wharton find that We 14, 1993. were violated Jeopardy Clause Double conspiracy to for both Payan’s conviction underlying property

transport stolen find that also offenses. We substantive (1) error reversible committed no

trial court gov- grant a after the refusing to mistrial to an out-of-court referred witness

ernment’s non-testifying code- Payan’s

statement (2) allowing government

fendant, two courtroom unse- to remain

witnesses the trial. Nei- duration of

questered for the abuse its discretion court

ther did district or in Payan to restitution ordering make ordered. restitution thus

the amount

Finally, find that the district did we Payan’s release su- condition

improperly spe- payment of the

pervised release on his assessment, fine, For the or restitution.

cial reasons, and sen- the convictions

foregoing Payan AF- are of Pedro Carrillo

tence

FIRMED. Keiffer, Dallas, Wright, TX,

E.P. Burke & for defendants. Dupuy,

Robert W. Brown McCarroll & Hartline, Dallas, TX, Jeffrey Ehrlich, Oaks RTC, DC, Washington, for plaintiff-appellee. GOLDBERG, SMITH, Before GARZA, Judges. EMILIO M. Circuit GOLDBERG, Judge: Circuit Development Sharif-Munir-Davidson Cor- poration (“SMD”), (“Mu- Ramsey M. Munir nir”) Louay and the Estate of E. Sharif (“Sharif’), were sued Southwest (“Southwest” Savings “Bank”), Association a conservatorship1 of the Resolution Trust (“RTC”), Corporation aon guaranties Summary thereon. plaintiff, was entered for after defendants respond plaintiffs failed to motion for summary judgment by the deadline set operation of the local rules. Defendants claim that the improperly grant- court below summary judgment plaintiff. ed Specifi- for cally, argue defendants that under the cir- cumstances, the district court’s extension of the deadline for operated as an response extension of the deadline for plaintiffs they required that as a result were not to file 56(f) any affidavit under Fed.R.Civ.P. in or- complete der to obtain more time to discov- ery prior to the court’s consideration of the motion judgment. for Defendants also contend that the district court erred in refusing them leave to amend answer to plaintiffs complaint year more than one after litigation began. Defendants seek rever- sal of and a remand for damages trial on the amount of owed under case, placed guaranties De- 1. Southwest was first the Federal the note and issue ("FDIC") posit Corporation Insurance into RTC having purchased and assumed these assets from Later, conservatorship. placed FDIC Southwest Southwest in a bulk transaction. receivership. into RTC RTC-Receiver now owns However, May have been even would Plaintiff contends guaranty. response to the not file their and the evi- did answer considering the amended (filed until affidavits motion in defendants’ dence for sum- to the motion deadline technically expired), judgment had mary 1991, 22, defendants several May On fact or affirma- material no issue of is there with- have their current counsel moved to outcome affect the could defense which tive That new counsel. and to substitute draw agree, and trial. if it went to We case 23, 1991, the May granted on motion was district court. affirm the

therefore specified the local rules day on which same plaintiffs motion for sum- response to that a FACTS mary judgment due. 29, 1985, and Southwest SMD October On That same agreement. into a loan entered 24, 1991, parties May requested both On entered and Munir day, Sharif defendants discovery deadline extension securing the guaranty agreement into a 3,1991, 2,1991, agreeing that August to giving South- of trust a deed and executed discovery interposed was not the extension building in an office security interest awest enabling purpose delay, for but for addition, defen- In by defendants. owned new counsel to become “acclimat- defendants’ “Assignment of Leases an executed dants timely and to institute to the case and ed” “Equity Participation and an and Rents” 29, 1991, May complete discovery. On addi- the Bank certain Agreement,” giving extending dead- an order court entered build- respect to office rights with tional filing of a “trial discovery and for lines for securing note. ing 2, August 1991. until length estimate” in 1987. on the defaulted SMD 8, 18, again July and On June inwas SMD that SMD notified Southwest 1991, moved to their have several default, to cure. When failed but SMD coun- and to substitute new counsel withdraw building, it on the office foreclosed Southwest 27, were on June These motions sel. owing the full to collect amount was unable 1991, 8, 1991, July respectively. and 1988, July, filed Southwest on the note. col- court to against defendants state suit 22, 1991, July the defendants made On deficiency. lect the answer for leave to file an amended motion 1991, 24, July both complaint. defendants, On South- sued After Southwest extension of the parties moved for second into RTC placed the FDIC west was (from 1991, 2, August into receiver- conservatorship, and then RTC deadline 1991). 17, day, That same Substantially September all of assets ship. Southwest’s denying opinion at issue in (including guaranty and and order the note court entered case) by way of were transferred RTC to amend their defendants leave answer transaction. assumption purchase granting plaintiffs and complaint, and plaintiffs pending state RTC then intervened summary judgment. The discov- motion for against defen- action Southwest court in its order of ery set deadline dants, to federal court the case removed 29, 1991, and days away. No May was still nine Defendants counter- on June scheduled on the hearing had ever been date de- asserted various affirmative claimed and motion, and no defendant fenses, including failure of consideration any response to that motion. The had filed sharing agreement. profit of a breach judg- summary district court stated ripe for ment had been consideration (hereinafter motion “South- and RTC Southwest May The court did men- since filed a motion for “plaintiff’) wesVRTC” 29,1991, extending order discov- May its tion May 1991. Local summary judgment on 2, 1991, August nor did ery until for rules in the United States District 23, 1991, May any mention of its orders specify that a of Texas District Northern counsel leave with- granting defendants’ response to a motion for new counsel. substitute filing, which draw twenty days of its is due within July provided defendants moved for tion whether the court On the notice required by granting of the order sum- reconsideration Fed.R.Civ.P. 56. Inter 1263; mary judgment plaintiff. Shortstop, On national 939 F.2d at Acker parties man the date which the had chosen v. Federal (5th Cir.1992); approved the court had as the deadline Krim v. BancTex (1993). discovery, Group, completion of the defendants Summary plaintiffs appropriate submitted “[t]he argu- pleadings, depositions, judgment, interroga which included the answers to tories, sought file, together ments that defendants had to make and admissions on with answer, affidavits, any amended as well as affidavits ... demonstrate there is no support argument issue as to material fact meant South- and that alleged moving party judgment had violated its “bilateral obli- is entitled to west agreements. loan matter gations” Ayo under one of law.” v. Johns-Manville (5th Cir.1985). 902, Sales 771 F.2d 904 The motion for reconsideration of sum- A “might “material” fact is one that affect 11, mary judgment was denied on November governing the outcome of the suit under the 2, 1991, appellants December filed 1991. On Inc., Liberty Lobby, law.” Anderson v. 477 appeal. appeal At the heart of this is this 242, 248, 2505, 2510, U.S. 106 S.Ct. 91 whether certain defenses to enforcement of (1986). performing L.Ed.2d 202 In our anal timely guaranty were made or ysis light we look at the evidence in the most would have been effective. See, nonmoving party. favorable to the Matsushita Elec. Indus. Co. v. Zenith Radio DISCUSSION 574, 587-88, 1348, Corp., 475 U.S. 106 S.Ct. review of the district court’s Our 1356-57, (1986). 89 If no L.Ed.2d 538 ration discovery preclude to further before decision possibly al trier of fact could find for the summary judgment granting is limited to nonmoving party, then is the district court abused its discret whether proper. Id. See, e.g., ion.2 Solo Serve v. Wes Cir.1991); (5th Assoc., 160, towne 929 F.2d 167 Defendants did not make a written or oral Sears, Co., specifying why they riere v. Roebuck & 893 statement to the court Car (5th Cir.), denied, 98, complete discovery by cert. could not on F.2d 102 498 U.S. date 817, 60, (1990); specified 112 111 S.Ct. L.Ed.2d 35 which the local rules that their re Co., 1190, Upjohn sponse plaintiffs summary judgment F.2d to mo 780 1193 Fontenot (5th Cir.1986). due, reasonably appears discovery If it that tion was and how further discovery produce oppose plaintiffs further would not evidence would enable defendants to fact, summary creating judgment issue of material motion. Interna See preclusion Shortstop, district court’s of further discov tional 939 F.2d at 1266-67. How ever, ery prior entering summary judgment to is defendants contend that it was reason See, e.g., rely not an abuse of discretion. Netto v. able for them to on the court’s extension (5th Amtrak, Cir.1989) 1210, discovery as a simulta 863 F.2d 1216 deadline for (but Kadair, (citing Sony Corp. inexplicit) Inc. v. neous extension of the time in Paul America, 1017, summary respond which to to motion for 694 F.2d 1983)); Shortstop, judgment International Inc. v. Ral and in which to amend their an Cir.1991), ly’s, 939 F.2d swer. — denied, U.S. —, 936, 117 cert. S.Ct. Ordinarily, comply failure to defendants’ Serve, (1992); at L.Ed.2d 107 Solo 929 F.2d 56(f) requirements with the of Fed.R.Civ.P. Co., 167; Washington v. Allstate Ins. preclude arguing them (5th Cir.1990). 1281, 1285 F.2d permit discovery further court’s refusal summary prior considering summary for grant the motion We review novo, including ques- judgment was an abuse of discretion. judgment itself de case, template approv- would be en the court issued an order 2. , 1991, prior August ing parties' joint tered but the court motion to extend 2 summary July judgment August parties entered until 1991. The did not con- 1257; summary judgment had been F.2d Shortstop, 939 e.g., International earlier, nonmoving party year Co., filed over a 901 F.2d at Washington v. Allstate that “as of given reason to believe was never 1285-86; Exchange Comm. v. Securities date, court would take certain the district Co., 612 F.2d Spence & Green Chemical Films, Capital the case under advisement.” denied, (5th Cir.1980), 449 U.S. cert. 628 F.2d at 392.4 (1981); 101 S.Ct. case, Krim, In this 1442-43. F.2d at Procedure 56 con Rule of Civil already im however, court had days the district notice to the templates “ten advance need ... be acknowledged the defendants’ the matter will plicitly adverse day.” as of a certain discovery prior responding taken under advisement for further Hampton, summary judgment.3 Kibort plaintiffs motion Cir.1976). also Fernandez-Montes about Any reasonable doubt whether Assn., 278, 283 n. 7 Allied Pilots on notice that the defendants were cases). (5th Cir.1993) Summary (collecting plaintiff prior judgment might be “[tjhere was no rea improper in favor must be resolved [nonmoving party] suspect for the son Industries, See, e.g., NL of the defendants. rule on the motion.” the court was about to 957, 965 Energy Corp., 940 F.2d Inc. v. GHR Kibort, Had the defendants — denied, —, (5th Cir.1991), cert. U.S. court’s intention to consider learned of the (1992). 873, In 112 S.Ct. pri- summary judgment plaintiffs motion for Corp. v. Fries Pro Capital Films Charles the court had expiration the of the time or to (5th 387, ductions, Inc., 628 F.2d 390-91 discovery, the defen previously approved for Cir.1980), recognized that when a this court responsive might have submitted their dants party a to rea actions induce district court’s prior the court’s pleading and evidence to to sonably has additional time believe he matter, they might have ruling the summary judgment, respond to a motion for pursu request for a continuance submitted summary judgment prior to the entry of the 56(f).5 had Defendants ant to Fed.R.Civ.P. abuse that additional time is an expiration of they needed to file no reason to believe Films, Capital the defen In of discretion. 56(f) stating their need affidavit Fed.R.Civ.P. summary judgment a motion for dant filed discovery prior opposing to for further year the district court than a before more summary judgment, because the motion for grant granted the motion. We reversed already effectively ac court had district summary judgment because certain ac discovery knowledged need for further induced rea by 29, court had tions district May 1991. That order in an order dated go to reliance that the case would (extending discovery) sonable had entered on been response the case on the day trial. The court had carried to the same that defendants’ summary judgment jury plaintiffs for several consecutive motion trial docket Moreover, rules. was due under the local granting months before oppor- Although had the court pretrial issued a order. and had Corp., 932 specified Mut. Ins. Co. v. Aries Marine very day rules ton 3. that the local On Mfrs. Cir.1991) (5th (criticizing Capital plaintiff's response motion for F.2d defendants’ 23, 1991), (May as it held that a district court summary judgment Films insofar was due sponte; ap- summary judgment extending discovery sua never enter an order court issued Capital presume proving Films insofar as it stated August We deadline to rules, proper summaiy judgment notice to must involve aware the local the district court was taking will be adverse that the court presume that the district and therefore we also date, and extending advisement as of certain deadline case under it was court was aware respond). opportunity to completion discovery past deadline set respond the local rules for defendants summary judgment. We plaintiff's motion for why dis would have had to state 5. The affidavit that before and after the extension also note completed, further covery what had not been discovery, approved the substitution of discovery proposed, how that was counsel for some defendants. new summaiy oppose would enable the nonmovant See, Shortstop, e.g., Inc. (5th judgment. International Rally’s, F.2d 1266-67 disapproved Capital subsequently Films was Cir.1991). grounds. Arkwright-Bos- this court on other May, in new counsel late due course. The federal holder in tunity to substitute due course July of 1991. doctrine “bars makers of 1991, 24, July in it in the same order which prejudice opposing party by due to the virtue of granted plaintiff. for amendment, futility allowance of the amendment, of the Davis, etc....” Foman v. 371 U.S. nonmovant, 7. When there is no notice to the 178, 182, 227, 230, 83 S.Ct. 222 9 L.Ed.2d summary judgment will be considered harmless (1962). pending The instant case had been be the additional evidence or if if nonmovant has no year fore the district court for over a when the additional evidence is all of the nonmovant’s granted summary judgment court and refused by appellate reviewed the court and none of the answer, defendants leave to amend their which presents of material evidence issue suggests that the district believed leave to States, 1576, v. United 849 F.2d fact. See Powell being sought purposes amend the answer was for (5th Cir.1988). infra, 1582 As discussed the af- delay, allowing or that amendment sought firmative defenses to be asserted are inef- prejudice plaintiff. cause undue to the The fact against plaintiff. per- fective the The affidavits require that an amendment would present do not tain to those defenses and as such plaintiff necessarily the would not amount possibly issues of material fact which could affect itself, by prejudice to undue however. See Wil Liberty the of the Anderson v. outcome case. See Inglis Baking liam & Sons Co v. ITT Continental 248, Inc., 242, 2505, Lobby, 477 106 S.Ct. U.S. Co., 1014, (9th Baking 668 F.2d 1053 n. 68 2510, (1986). 91 L.Ed.2d 202 amendment, Cir.1981) (delay proposing even normally pretrial proceedings, after extensive is 15(a)provides 8. Fed.R.Civ.P. that leave to amend by prejudice insufficient to constitute to itself freely given responsive pleading "shall be when justify adverse amend), denial of leave to that would However, "[wjhcther justice requires." so such denied, 825, 57, cert. 459 U.S. 103 S.Ct. an amendment should is within the be (1982). cogent The more reason judge’s Overseas Inns S.A. district discretion.” denying would have the for the amendment been States, 1146, (5th P.A. v. United 911 F.2d 1150 However, futility proposed of the amendment. 1990) (finding no abuse of discretion where permitted the court had new counsel to substi plaintiff’s district court denied leave to amend May, tute for some of defendants’ counsel in proceedings complaint pretrial after extensive July, proceeded pro and One defendant se including filing already place, had taken of mo 1991, July, at which time he obtained coun until defendant) summary judgment by (citing tion Davis, It unclear what role new counsel was sel. v. 371 U.S. 83 S.Ct. Foman expected play anticipated entering (1962); 222 Nat'l 9 L.Ed.2d Union Planters Woods, pleadings basis Leasing, Inc. v. Cir.1982); Mitchell, prior appearance and evidence adduced to the Gregory v. (5th Cir.1981)). counsel for the defendants. The denial of leave to amend is new prior writ- any without the proposed tenant announced policy was first 1248. This provision Deposit This D’Oench, approval v. Federal of Southwest.10 & Co. ten Duhme Bank, 62 S.Ct. Corp., 315 U.S. included for the benefit of was Ins. (1942), Supreme in which the debtors, that the L.Ed. 956 does not state not the of a note not a maker held that approve tenants. any obligation to Bank has by FDIC based to collection defenses assert Hence, by the clause obligation created could which FDIC agreements of on secret is, approval of tenants on its pertaining to reviewing rec- made aware have been not However, face, argue unilateral. the bank. on file at ords pre- tenants be requirement approval created D’Oench, sented Southwest not bar all defenses Duhme does parties only obligations It bilateral between Cir.1991). Laguarta, 939 F.2d 1238 claiming person ... an adverse and the bank id. at n. 18. See also 1239 thereunder, contemporaneously with interest bank, (3) by acquisition of the asset the the approval agreement required Southwest’s 10. The approved by di- the board of have been shall guarantors of the tenant's as to the tenant and all committee, or its loan rectors of the bank lease, lease, the and the terms and conditions of approval be reflected in the min- which shall the written lease form to be used. committee, (4) and shall board or utes of said been, continuously, time of its from the have execution, Presumably, find defendants would have us the bank. an official record of However, they obligation under state law. 1989, 1823(e) technically apply § did not Prior to any authority proposition. cite for this do not receiver, acting capacity of to the FDIC unnecessary it to decide We find whether 1823(e)'s counterpart § "common-law” but law, obligation because would exist under state D'Oench, Duhme) (based applied. Federal Assignment and we believe that the of Leases McClanahan, Corp. Deposit v. Ins. provide sufficient notice on its’ Rents does not (5th Cir.1986); Beighley Deposit v. Federal potential defense. face of such (5th Cir.1989). Corp., Ins. 868 F.2d 776 1823(e) applicable § to the FDIC act was made discov ing 12. On the date on which role of receiver. Financial Institutions Reform, (FIR- May ery Recovery Act was to conclude under the court’s Enforcement and order, 101-73, REA), their Stat. 183. defendants submitted Pub.L. No. D'Oench, apply plaintiff's § Duhme and 1823 also incorporated only ar Corporation. v. which not the defendants’ Oliver Resolution Trust plaintiff's guments Corp., in their amended answer Trust 955 F.2d 583 Resolution 1992); per complaint, proffered also affidavits from Trust but Ward Resolution — denied, —, (8th Cir.1992), applied tenancy had in the office cert. U.S. sons who (1993); by building and had been turned down Bank. S.Ct. Resolu- selling price approved the build- proposed low of ants must be ten- for the blame reasonable,” larger deficiency ancy “commercially than would be resulting in a ing, agreement only says the ease had the Bank defendants assert. The have been approved right approve the tenants. ten- Bank.has language ants. We do not believe that the Assignment Assuming arguendo agreement would be sufficient on its face Rents, Participation Equity and of Leases put potential the receiver on of a notice guaranty agreement, prom Agreement, by obligation defense reason of the bilateral contract,13 single issory part were of a Hence, D’Oench, applies asserted.14 Duhme question Assign whether the the crucial affirmative bar the defense asserted. any obli ment of Leases and Rents created gations part on the of the Bank which could Hamilton, Corp. In Federal by of the defense asserted de be the basis Cir.1991), 939 F.2d 1225 the FDIC sued here If the defense asserted arises fendants. note, owing to collect amount on a obligation express written undertak from defendant claimed the bank from by agreement Bank in its loan with en FDIC obtained the failed to which note had defendants, may as then the defendants discharge duty prevailing banking- its under notwithstanding affirmative defense sert the customs to extend the defendants’ line of D’Oench, Deposit Ins. Duhme. See Federal (which timely credit fashion resulted Laguarta, 939 F.2d alleged damages). certain setoff This court (5th Cir.1991). D’Oench, held that Duhme barred the de- fense to FDIC’s collection on the be- reading Assignment A of the of Leas- close duty implied part cause the on the Rents reveals that it does create es and explicit Bank from the terms of the obligations part on the of the Bank. certain agreement between the Bank and the debtor. provided The that Southwest (5th Cir.1991). 1225, 1229-30, any and all would be held harmless from Although equity argu- this court noted that liability might be incurred strongly supported the ments defendants’ Leases, or under or reason of “under the D’Oench, claim, Duhme nevertheless barred Assignment, and all [the] explained policy it. We considerations claims and demands whatsoever D’Oench, application which favored against reason of [Southwest] be asserted bar the defendants’ claim: Duhme to any alleged obligations undertakings on its or First, discharge any there is the concern that bank exam- part perform terms, agreements may rely on the banks’ records to covenants or contained in iners misconduct, Leases, all of the insolvent banks’ obli- except for the willful ascertain “Fundamentally, at- negligence gations____ faith D’Oench gross [Southwest].” or bad language tempts to examiners can import of this is that the defen- ensure FDIC The misconduct, accurately gross assess the condition of bank dants could assert willful (but means against the Bank based on its books. The doctrine negligence or bad faith RTC) duty com- necessarily any government in has no connection with not terms, pile histories of the customers agreements or con- oral bank’s of the covenants Nor the FDIC approved agreement in The and loan officers. must tained leases. linguists cryptologists to tease specifically potential ten- retain not state does law). Deposit "Assignment Ins. See also 13. Defendants claim that Cir.1991) Rents,” Laguarta, "Equity Participation 939 F.2d Leases (assuming guaranty agreement that several loan documents Agreement,” were and the integral were to the cross-referenced one another part all note, of the same contract as question). loan transaction in are cross-refer because the documents the loan on enced and because the Bank made Moreover, provided we do not believe that the affidavits in the other the basis of the assurances law, establish that the with- submitted Under Texas contract documents. unreasonable, holding approval multiple writings, was or all of which are consist of integral building a result agreement. Thigpen Sparks, diminished in value as the office to the 1993) (reviewing withholding approval. Tex- (5th Cir.1991), is Laguarta, 939 F.2d 1231 facially-unencumbered meaning of out Each of these cases involved doc misplaced. notes.” explicit statements uments which contained v. Federal (quoting Bowen Id. at obligations to the debt of the bank’s bilateral 1013, 1016 Howell, 747; Laguarta, or. See Cir.1990)). argument to the In Howell, In the Sev F.2d at FDIC to be onerous for would be less it D’Oench, inappli Duhme enth Circuit found banking prevailing investigate required to affirmative defense of cable to bar the required to FDIC to be than for customs had by FDIC. The FDIC defendant sued or agreements side investigate possible oral explicitly a lease which obtained from a bank (the obligation prohibited writings collateral obligated to obtain stated that the bank was Duhme) D’Oench, explained: we in equipment which the defen title to certain arguably obligation investigative burden is dant would then be under While (former) context, right law FDIC asserted the the case lease. When less in the D’Oench, payments due collect from the defendant doctrine Duhme interpreting the lease, permitted under the the defendant policy prevent such evidences affirmative defense that to assert hair-splitting to avoid investigations and equip title to the bank had never obtained type that will inquiries of the fact-based Laguarta, court reversed a ment. In this assessing obligations im- ensue when summary judgment and remanded case banking practices. plied prevailing from D’Oench, Duhme with instructions n. 5. Id. at 1230 asserting an bar the debtor from would not justification applying collection on a affirmative defense to FDIC’s The second D’Oench, loan ex when the recorded is that debtors who wish Duhme was entitled to plicitly stated that the debtor collateral terms in have certain defenses particular certain funds on a be advanced banks are in a better agreements with timetable, refused to ad and the bank had than is the protect themselves position to funds, vance the which contributed that the collat- ] can FDIC. Debtors “insist! on the note. debtor’s default writing properly put in eral terms be Id. at 1230. For by the bank.” recorded claimed that the un Defendants also reason, obligor and not the FDIC or “the derlying non-negotiable note and debt was depositors or creditors innocent the bank’s subject to federal holder due hence caused the record should suffer the loss Amberboy protection. v. Societe course omissions.” Id. (Tex. Privee, Banque de S.W.2d Court, 1992), Supreme answering a the Texas support policies the result These Circuit, question the Fifth de certified put to the If FDIC cannot be instant case. Texas law a variable-inter cided that under researching every possible defense trouble instrument, negotiable pro rate note is a est (some banking of which are on customs based the interest rate can be deter vided that law), can in state then neither embodied publicly available mined reference to every required possible to research FDIC be promissory note in this case sources. The law, on state at least when the defense based negotiable instru description of a fits explicitly not stated of the defense is basis provided Amberboy.15 ment question. on the face of the documents Finally, the affir Defendants’ reliance Howell Conti defendants assert guaranty agreement the Corp., 655 F.2d 743 Cir. mative defense that nental Credit 1981), Corp. facially illegal it contains a clause Deposit Ins. is because and Federal Although fluctuating general the promissory reference rate of interest.” note carries a rate 15. The using complicat- which is calculated a promissory specifically of interest ed schedule based that the base states on a "base rate." The term change specific may notice to the rate without note, rate,” the "base as used in clearly "pub- is maker of the lic, the base rate the variable rate of interest established “means readily by ascertainable either known to or by RepublicBank as its from time to time Dallas 56(e). genuine for trial.”1 policy under Texas law.16 We issue Fed.R.Civ.P. against public places “party Rule 56 also the burden on the illegality the of the not decide whether need opposing why “par- the motion” to state such to RTC-Receiver would be obvious clause ty present ... ... itself, cannot facts essential to guaranty face of the such from the justify party’s opposition.”2 the D’Oench, Fed. the apply Duhme would not to bar 56(f). by majority R.Civ.P. As noted the illegality, the defense of because affirmative opinion, local for the the rules Northern Dis- merely ancillary illegal clause is allegedly require response trict of Texas within guaranty agreement and therefore sever- the twenty days filing of a motion for Texas law.17 able under summary Maj. judgment. op. at 1400. Such local rule is sufficient-for the notice CONCLUSION required under Rule 56. See Kibort v. which No material issue of fact remains (5th Cir.1976) Hampton, 91 n. trial, facts require a and on the ad- would (“Procedures provided, by local rule some duced, summary judgment for defendants summary requiring districts motions for Therefore, judgment the proper. the of judgment accompanied to be briefs and court is AFFIRMED. district requiring opposing affidavits and briefs to be period days within a of not than 10 filed less GARZA, Judge, M. Circuit EMILIO the court will consider the motion part dissenting part: concurring in appear submitted for decision would to afford adequate hearing meaning within the of Rule judgment I concur in the of the Court 56.”). majority’s opinion except holding its summary grant disagree majority’s “court’s I with the assertion that the district judgment implicitly notice that the con- that “the district court ... ac- without summary templated ruling knowledged on the motion for the defendants’ need for further Maj. discovery prior responding plaintiffs judgment was an abuse of discretion.” Maj. op. judgment.” op. Rules of motion for at 1402. Rule 56 of the Federal added).3 separate places (emphasis the burden on the The issue Civil Procedure discovery dispositive: party to file a which “must is not Rule 56 re- adverse specific showing quires filing equiva- an affidavit or set forth facts that there is “some may any person." Amberboy, party upon mere 831 S.W.2d adversc not rest interested allegations party’s at 797-98. denials of the adverse or party’s response, by pleading, but the adverse guaranty agreement guar- states that the The rule, provided affidavits or as otherwise in this waived, obligations antor’s shall not be dis- showing specific must set forth facts there reduced, being guar- charged if or even the debt party issue for trial. the adverse is If illegal way (e.g., for- anteed is some involves respond, does not so gery). against appropriate, entered the adverse shall be added) party, (emphasis parties to con 17. If it is clear that intended involving legal purpose, tract for a illegal purpose Co., a clause an 56(f) 2. Rule states: is severable. Panasonic Zinn, Div. Matsushita Elec. party appear it from the affidavits of a Should (5th Cir.1990); Williams v. F.2d Williams, opposing that the cannot for the motion (Tex.1978); Rog S.W.2d present reasons stated affidavit facts essen- Wolfson, (Tex.App.— ers v. 763 S.W.2d justify party’s opposition, tial to case, denied). as in Dallas writ may application refuse Zinn, pre evidence Panasonic v. there was no may permit affidavits to order continuance parties suggest not have sented to depositions be taken or dis- be obtained or allegedly entered into the absent covery such other to be had or make illegal provision. See 903 F.2d at 1041. None of just. order as is parties allege promissory note that the actual guaranties respect secured is in ille extending court's order 3. Aside from the district gal, did not or that defendants Sharif and Munir deadline, discovery evidence in there no actually guaranty agreement. execute suggest record states, 56(e) part: give in relevant 1.Rule extension to the defendants more plaintiff's respond for sum- summaty judgment time to motion When a motion for is made rule, supported provided mary judgment. in this why states reasons lent statement” Individually KELLEY, present Cynthia facts es party cannot Ann

such adverse opposition. See justify party’s Her Minor Children Jerred on Behalf of sential Kelley, Cindy Lynn Stop, Rally’s Kelley Inc. v. Short International Seth (5th Cir.1991), Cross-Appellee, cert. Plaintiff-Appellant 1266-67 — —, denied, S.Ct. U.S. (1992) (“Although preferred L.Ed.2d PRICE-MACEMON, INC., sup- present an affidavit procedure is to Defendants, al., et continuance, long so as requested port of the nonmoving party indicates to Systems, Refrigerated Industrial statement, preferably equivalent by ‘some Inc., Defendant-Appellee discovery, need for additional writing’ of its Cross-Appellant. in- to have nonmoving party is deemed omitted)). (citations A mo- the rule.” voked No. 92-3511. complete discov- of time tion for extension Appeals, Court of United States which fails to state ery especially one — Fifth Circuit. comply with is needed such id. insufficient. See Rule 56 —is (stating nonmov- “[t]he 939 F.2d at 1267 how the additional dis-

ing party must show

covery defeat the will is, dispute

motion, that will create fact.”).4 the dictates material Given

as to a local rule —and defen-

of Rule 56 and the dis- comply with either —the

dants’ failure to not abuse its discretion

trict court did judgment.5 summary

ruling the motion for Mut. v. Aries Arkwright-Boston Mfrs. (5th 442, 445 Cir. Corp., 932 F.2d

Marine 1991) (“As [Supreme] stated: acknowledged widely courts are

‘[District summary judg

possess power enter losing party long sponte, so

ments sua that she had to come forward

was on notice ” (quoting Celotex all of her evidence.’ with Catrett, 477 106 S.Ct.

Corp. v. U.S. (1986))). significant "finding day quires no] notice and supra 4. See also [v. and the Enochs this case distinction between Industries, Energy Corp., 940 5. NL Inc. v. GHR Cir.1962)] Sisson, (5th and Kibort F.2d 125 Cir.1991) (holding that 965-66 Cir.1976)] Hampton, 538 F.2d 90 [v. grant summary permits a court to Rule 56 cases.”), (holding Hampton, supra and Kibort request judgment that did not in favor of day contemplates but notice Rule it, only proper adverse upon notice to the but requires distinguishing where local rule cases party), Capital ductions, Inc., Corp. v. Fries Pro Charles Films filed within a opposing affidavits to be briefs days which the period than 10 of not less 1980) (holding sponte entry of that sua summary judg a motion for court will consider plaintiff's on causes of action added ment) inapposite. are complaint after motion for (also 56) holding Rule 56 re- violates Rule notes asserting “personal” against defenses circumstances, we find light of these [government] pur connection with grant of that the court’s contemplated assumption chase and involving without notice transactions ruling on the motion for insolvent Savings banks.” However, an abuse of discretion. was Corp. Kralj, Loan Ins. 508 n. arguments in error was harmless. The de- (5th Cir.1992). Campbell See also Leas plain- fendants’ ing, Inc. v. Federal Ins. summary judgment,6 and the tiffs Cir.1990); F.2d Federal Sav. thereto, present do not appended affidavits and Loan Murray, genuine issue of material fact.7 Cir.1988); Porras v. Pe question We do not reach the whether the Assn., troplex Sav. 903 F.2d 379 district court’s denial of leave to amend de- 1990). complaint plaintiffs fendants’ answer to strong There is a policy favoring federal an abuse of discretion.8 Even it was an allowing the FDIC collect on the obli- discretion, abuse of the error would have gations regard owed to failed thrifts without been harmless because the affirmative de- agreements which tend to diminish or sought fenses to be asserted defendants’ Porras, right. defeat that against amended answer cannot be asserted Southwest/RTC, 380-81; Campbell Leasing, which is a federal holder 901 F.2d at arguments 6. These include the affirmative de- not an abuse of discretion if there has been sought delay, dilatory fenses that defendants had to assert in an “undue bad faith or motive on the July, movant, part amendment to their answer in 1991. The repeated failure to cure defi allowed, court denied the motion to amend on defendants' previously ciencies amendments un

Notes

notes the FDIC. collection on loan which FDIC could the face of the defenses of which were obvious on bars those by reviewing on notice put been contend records documents. Defendants have Deposit the bank. See on file with all tenants under the right approve Bank’s 1231, 1237 Laguarta, 939 F.2d Corp. subject Ins. and Rents was Assignment of Lease (5th Cir.1991) Deposit (citing Federal Ins. requirement approval not be McClanahan, Corp. v. They that in unreasonably claim withheld.11 Cir.1986)).9 case, unreasonably approval was the instant contend that Defendants do not withheld.12 helped claim Southwest Defendants generated approval of tenants would have proper- on the secured the foreclosure cause prevent default on rent monies to sufficient pursuant to by failing approve tenants ty that when but contend “Assignments of Leases Rents.” occurred, low occu- foreclosure on the note of Leases and Rents stated Assignment The building partly to pancy in the office space office could not rent that defendants 9. D'Oench, Juergens, 965 F.2d 149 at 12 tion Trust was later codified Duhme Cir.1992); 1823(e), Realty Develop & provides: Adams Madison § U.S.C. ment, Inc., (D.N.J.1990), aff'd, F.Supp. agreement or de- which tends to diminish No (3d Cir.1991). It is unclear wheth 937 F.2d 845 title, Corpora- right, or interest of feat the 1823(e), statutory counterpart § er acquired by it under asset [FDIC] tion D’Oench, D'Oench, Duhme, with is coextensive section, security for a loan or either as Duhme, give generally inter but "courts similar against Corpo- by purchase, valid shall be 1823(e) pretations and the doctrine of to section (1) shall be in unless such ration D'Oench, Corp. v. Duhme." Federal (2) writing, executed shall have been

Case Details

Case Name: Resolution Trust Corp. v. Sharif-Munir-Davidson Development Corp.

Court Name: Court of Appeals for the Fifth Circuit

Date Published: Jun 9, 1993

Citation: 992 F.2d 1398

Docket Number: 91-7304

Court Abbreviation: 5th Cir.