Originally from:
Lender Liability - 4th Edition - Hardcover
Lender Liability - 4th Edition - Electronic
Availability of Lender Liability Claims and Defenses in Litigation with the Federal Government - Chapter 32 - Preview Page
§ 32.01 Overview
The barricades that have been constructed by Congress and the
federal courts to protect federal banking agencies from lender liability
claims and defenses are formidable. These include the D’Oench, Duhme
doctrine, 12 U.S.C. § 1823(e) under the Federal Deposit Insurance Act,
the federal holder-in-due-course doctrine, and the administrative claims
process.
These defenses have some cracks, many of which are the result of
judicial reluctance to enforce a defense that in effect rewards
wrongdoing and leaves innocent plaintiffs without recourse. This has led
to a disparity in what claims and defenses can be raised in various
jurisdictions. As the case law on these exceptions develops, greater
uniformity will no doubt be achieved.
§ 32.02 Impediments to Lender Liability Claims and Defenses
The Federal Deposit Insurance Corporation (FDIC) is appointed
receiver when a federally insured institution fails.1 This entity can then
liquidate the institution’s assets, enter into a purchase and assumption
transaction to sell some or all of the assets to a healthy bank, or organize
a bridge bank to purchase assets and assume liabilities and deposits.
Assets that cannot be sold are then transferred to the FDIC in its
corporate capacity.
A veritable wall exists that keeps lender liability claims and defenses
from the FDIC and its successors. The building blocks of that wall
consist of a Supreme Court case that has not been directly relied on by
the Supreme Court since it was decided in 1942; a statute that makes
invalid certain agreements, but has been very broadly interpreted; a
doctrine from commercial law that has been applied to federal banking
agencies; and statutory claims procedures that are rigidly enforced.
§ 32.01 Overview
§ 32.02 Impediments to Lender Liability Claims and Defenses
§ 32.03 --D'Oench, Duhme Doctrine
§ 32.04 --12 U.S.C. § 1823(e)
§ 32.05 --Combined Effects of D'Oench, Duhme and 12 U.S.C. § 182(e)
§ 32.06 --Federal Holder-in-Due-Course Doctrine
§ 32.07 --Failure to Exhaust Administrative Claims Process and Other Issues
§ 32.08 Borrowers' Strategies to Avoid Impediments
A. Barry Cappello, Managing Partner, of the Santa Barbara law firm of Cappello & Noël, LLP. Mr. Cappello, who founded the firm in 1977, is recognized as one of the nation's leading trial lawyers and authorities on complex commercial litigation specializing in lender liability. He has represented both large and small businesses against most of the nation's major banks in litigation nationwide. His practice also involves class actions against lenders and other large corporations, bad faith insurance litigation and other complex business and tort litigation matters.
A fierce advocate for his clients, Mr. Cappello has been described by California Lawyer magazine as "Santa Barbara's Resident Barracuda," a reputation Cappello does not dispute. He has successfully tried jury trials with total verdicts in excess of $300 million and negotiated more than $1 billion in settlements and workouts for his clients.
Mr. Cappello has contributed numerous articles on complex business litigation, lender liability andadvanced trial techniques to business, legal, accounting and trade publications. Publications include Trial, The Daily Journal, The National Law Journal, Small Business Advisor and The Commercial Real Estate Journal. Mr. Cappello speaks to legal and business audiences around the country.
Before entering private practice, Mr. Cappello served a seven-year tenure as City Attorney of Santa Barbara. He was the chief litigator against the oil companies that caused the massive 1969 Santa Barbara Channel oil spill. The disaster and the ensuing litigation awakened the nation's conscious to the dangers to our environment and the tragic consequences if not protected. The case was settled in 1974 shortly before trial for $9.45 million, considered a huge sum at the time.
Prior to being appointed City Attorney of Santa Barbara, he was Assistant District Attorney and Chief Trial Deputy in the Santa Barbara County District Attorney's Office. Mr. Cappello also served as a Deputy Attorney General for the State of California assigned to the Special Trials and Investigations Division. Mr. Cappello prosecuted numerous murder, business crime and major felony cases.
Mr. Cappello has been listed in Best Lawyers in America since 1992 and in Who's Who in America. He was named a "Super Lawyer" in 2007 - 2009, and he was selected as one of the Top 100 Trial Attorneys in California for 2007 by the American Trial Lawyers Association.
