his employment contract terminated by operation of 12 C.F.R. § 563.39(b)(5). On June 5, 1992, the Office of Thrift Supervision ("OTS") declared that Republic was in an unsafe and unsound condition, and placed Republic in receivership. OTS designated RTC as the receiver for Republic.
Subsequent to Crocker's termination from his employment with Republic by operation of law, he filed a proof of claim with RTC pursuant to 12 U.S.C. § 1821(d)(3)(A) demanding a sum of money allegedly owed to Crocker under the Agreement. Crocker maintained that he is entitled to $ 250,000 as a consulting fee under paragraphs 4(c)
of the Agreement. Additionally, Crocker claimed that he is entitled to $ 116,320 as bonus for the year 1990 and an undetermined sum for the year 1992 under paragraphs 4(b)
and 8(a)(ii)(B) of the Agreement. Crocker made no claim for the bonus for the year 1991 and neither party provides an explanation for the non-claim. Crocker further claimed that he is entitled to the various benefits detailed under paragraphs 6
of the Agreement.
RTC reviewed the proof of claim submitted by Crocker and determined that he was not entitled to any of the claims because Republic's obligations under the Agreement terminated on the date of the insolvency. As a result, Crocker filed a complaint seeking relief identical to the demands he made in his proof of claim. Crocker brings this instant action pursuant to 12 U.S.C. § 1821(d)(6)(A).
Rule 56(c) of the Federal Rules of Civil Procedure provides that for a party to prevail on a summary judgment motion "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, [must] show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56(c). Even though all reasonable inferences are drawn in favor of the party opposing the motion, Beraha v. Baxter Health Care Corp., 956 F.2d 1436, 1440 (7th Cir. 1992), a scintilla of evidence in support of the nonmovant's position will not suffice to oppose a motion for summary judgment. Brownell v. Figel, 950 F.2d 1285, 1289 (7th Cir. 1991). Instead, the nonmoving party must elucidate specific facts demonstrating that there is a genuine issue for trial. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 89 L. Ed. 2d 538, 106 S. Ct. 1348 (1986). Moreover, to preclude summary judgment the disputed facts must be those that might affect the outcome of the suit, First Indiana Bank v. Baker, 957 F.2d 506, 508 (7th Cir. 1992), and a dispute about a material fact is "genuine" only if the evidence is such that a reasonable jury could return a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986).
"One of the principal purposes of the summary judgment rule is to isolate and dispose of factually unsupported claims and defenses . . . ." Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). Accordingly, the nonmoving party is required to go beyond the pleadings, affidavits, depositions, answers to interrogatories and admissions on file to designate specific facts showing a genuine issue for trial. Bank Leumi Le-Israel, B.M. v. Lee, 928 F.2d 232, 236 (7th Cir. 1991).
In the instant action, the material facts are not in dispute. The contested issue is whether Crocker possessed a vested interest in certain monetary compensation and benefits under the Agreement prior the termination of his employment with Republic by operation of 12 C.F.R. § 563.39.
Before analyzing that issue, the court must first resolve the issue of whether Illinois or federal law govern the instant action. Crocker asserts that the issue of whether certain benefits were vested prior to the termination of the Agreement must be governed by Illinois law. The basis for the contention is found under paragraph 15 of the Agreement which provides that "this Agreement and the rights and obligations of the parties hereunder shall be governed by and construed in accordance with the laws of the State of Illinois." Agreement P 15. Crocker cites no authority to support his argument that a mere choice-of-law provision within a contract controls the applicable law when maintaining an action under 12 U.S.C. § 1821(d)(6)(A).
The court rejects Crocker's position. Federal law will govern the instant action. See Rush v. Federal Deposit Ins. Corp., 747 F. Supp. 575, 578 (N.D. Cal. 1990). Crocker filed his action under the Financial Institutions Reform, Recovery and Enforcement Act of 1989 ("FIRREA") 12 U.S.C. § 1821(d)(6)(A), invoking federal question jurisdiction. In addition, the issue of whether certain benefits were vested prior to the termination of the Agreement require the construction and application of 12 C.F.R. § 563.39(b)(5). The relevant language of 12 C.F.R. § 563.39(b)(5) provides that "all obligations under the [Agreement] shall be terminated . . . when the association is determined by the Director [of OTS] to be in an unsafe and unsound condition[; however,] any rights of the parties that have already vested . . . shall not be affected by such [termination]." 12 C.F.R. §§ 563.39(b)(5) and (b)(5)(ii). Therefore, the resolution of the issue present in the case at bar is subject to the federal provision containing an exception pertaining to the termination of obligations under employment contracts.
Further, applying Illinois law will impede the Congressional intent to regulate the savings and loan industry after its demise. FIRREA was enacted by the United States Congress to assist in stabilizing "the savings and loan industry which suffered huge losses in the years proceeding 1989 and [in] providing a mechanism for the federal government to recoup losses of federally insured deposits." Resolution Trust Corp. v. Gallagher, 1993 U.S. App. LEXIS 31894, No. 92-4023, slip op. at 3 n.2. (7th Cir. Nov. 9, 1993) (citing H.R. Conf. Rep. No. 222, 101st Cong., 1st Sess. 411 (1989), reprinted in 1989 U.S.C.C.A.N. 432, 450).
Moreover, the choice-of-law provision within the Agreement is not relevant in this context. Choice-of-law provisions included in contracts control the substantive law in the event state law governs the case. See Federal Savings & Loan Insurance Corp. v. Griffin, 935 F.2d 691, 698 (5th Cir. 1991); Federal Deposit Ins. Corp. v. Petersen, 770 F.2d 141, 142 (10th Cir. 1985). However, in the instant case, federal law governs the issues. Thus, the choice-of-law provision within the Agreement does not dictate the applicable law in the instant action.
The propriety of RTC's exercise of its authority under 12 C.F.R. § 563.39 to deny Crocker's claims for compensation and benefits hinges upon whether the disputed claims had "vested" prior to RTC's termination of the Agreement.
The regulation itself does not define the term "vested." Federal Savings & Loan Insurance Corp. v. Quinn, 711 F. Supp. 366, 378 (N.D. Ohio 1989), vacated and remanded on other grounds, 922 F.2d 1251 (6th Cir. 1991). Black's Law Dictionary defines "vested" as follows:
Having the character or given the rights of absolute ownership; not contingent; not subject to be defeated by a condition precedent. To be "vested," a right must be more than a mere expectation based on an anticipation of the continuance of an existing law; it must have become a title, legal or equitable, to the present or future enforcement of a demand, or a legal exemption from the demand of another.