WeSAV Financial Corp. v. Lingefelts

Gardner, Judge:

WeSav Financial Corporation (WeSav) sued Billy L. and Ethel Lingefelts (the Lingefelts) for claim and delivery of a mobile home. The Statement of the Case notes that WeSav’s parent corporation went into receivership during the pendency of this case. The Resolution Trust Corporation (RTC) is the receiver of WeSav’s parent.

The Lingefelts argue that the trial court should not have granted WeSav summary judgment once it had notice that WeSav, through its parent, had been put into receivership. The Lingefelts further contend that the RTC is the proper party to enforce the rights of WeSav.

The RTC is a “mixed-ownership government corporation” created by the Financial Institutions Reform, Recovery, and Enforcement Act of 1989. 12 U.S.C. § 1441a(b)(l) & (2) (1989 & Supp. 1992). When the RTC becomes a receiver for a failed corporation, it takes “title to the books, records, and assets” of the corporation. 12 U.S.C. § 1821(d)(2)(A)(ii) (1989). We conclude from this that the RTC owns the assets of WeSav, including the note and security interest upon which WeSav’s claim against the Lingefelts is based.

In Insurance Commission v. New South Life Ins. Co., our Supreme Court addressed a similar issue regarding the real party in interest when an entity ceases to exist. 270 S.C. 612, 244 S.E. (2d) 289 (1978). In New South, the insurance commission appointed a rehabilitator to take over New South Life. Although the issue was “not directly on appeal,” the Court found that the “[insurance company] may not sue or be sued. It has no litigation identity.” Id. at 633-34,244 S.E. (2d) at 300. We have come to a similar conclusion in the instant case.

Rule 17(a) SCRCP, requires all actions to be prosecuted in the name of the real party in interest, otherwise, the court is without jurisdiction. See Wilson v. Gibbes Mach. Co., 189 S.C. 426, 1 S.E. (2d) 490 (1939) (Rule 17) has been modified since Wilson to require all actions to be “prosecuted” rather than “instituted” in the name of the real party in interest). The word “prosecution,” in reference to civil litigation, is defined as including “every step in action, from its commencement to its final determination.” Black’s Dictionary 1099 (5th ed. 1979). RTC falls within the requirement of Rule 17(a) because during the pending action it became the receiver for WeSav and the owner of its assets. We hold that, under Rule 17(a) the RTC, as the real party in interest, must be joined.

We, accordingly, remand to the trial court so that the RTC may be joined and its interests may be protected.

For the reasons above, we remand this case to the trial court so that the Lingefelts may move to join or substitute the RTC.

Remanded.

Littlejohn, Acting Judge, concurs. Goolsby, J., dissents in separate opinion.