Opinion
November 21, 1994
Appeal from the Supreme Court, Nassau County (Christ, J.).
Ordered that the order and judgment is affirmed, with one bill of costs payable by the appellants appearing separately and filing separate briefs.
The Resolution Trust Corporation (hereinafter RTC), as conservator for Central Federal Savings Bank, seeks to recover on a note evidencing a $4,000,000 loan given by the bank to the defendant Schlesinger Management Corp. and guaranteed by the defendants Richard Schlesinger and Mark David Associates, a partnership in which Schlesinger and the defendant William Weinstein were general partners. We agree with the Supreme Court that a later-executed side agreement releasing Schlesinger from personal liability on his guarantee was barred by 12 U.S.C. § 1823 (e), which protects the RTC's interest in assets acquired by it from such an agreement, unless it is in writing, was executed contemporaneously with the acquisition of the interest, was approved by the board of directors or loan committee and reflected in the minutes thereof, and was part of the official records of the lending institution (see, Langley v. Federal Deposit Ins. Corp., 484 U.S. 86).
Here, the side agreement which the appellants assert as a defense to their liability on the note and their guarantees was neither executed contemporaneously with the creation of the interest nor was approval of that agreement reflected in the minutes of the board of directors or loan committee. Accordingly, the agreement must fail (see, e.g., Resolution Trust Corp. v Allen, 16 F.3d 568, 574; Federal Deposit Ins. Corp. v Friedland, 758 F. Supp. 941, 943).
Moreover, the appellants' contentions that their situation falls within the recognized exceptions to the statute are unavailing. This is not a case where no asset was acquired by the RTC because the debt or obligation was extinguished by an independent act such as a judgment or complete satisfaction (see, Federal Deposit Ins. Corp. v. Merchants Natl. Bank, 725 F.2d 634, 639, cert denied 469 U.S. 829; see also, Federal Deposit Ins. Corp. v. Bracero Rivera, 895 F.2d 824, 830; Grubb v. Federal Deposit Ins. Corp., 868 F.2d 1151; Castleglen v Commonwealth Sav. Assn., 728 F. Supp. 656).
Nor do we find that the appellants are wholly innocent. In negotiating the side agreement and making a payment that enabled the bank to show the loan as current, they plainly lent themselves to the scheme or arrangement, and it is irrelevant whether or not they acted in good faith (see, Federal Deposit Ins. Corp. v. Caporale, 931 F.2d 1, 2; Bowen v. Federal Deposit Ins. Corp., 915 F.2d 1013, 1016; Philbin v. Federal Deposit Ins. Corp., 147 Misc.2d 70, 76; Central Natl. Bank v. Chalet Food Corp., 147 Misc.2d 237, 239). Equally unavailing are their arguments that the statute does not demand literal compliance and that equity should intervene (see, Langley v. Federal Deposit Ins. Corp., supra, at 94).
We have examined the appellants' remaining contentions and find them to be without merit. Miller, J.P., O'Brien, Joy and Krausman, JJ., concur.