author: BORDEN, J.

text:
    STATE OF CONNECTICUT v. VASKA ANDERSON
    (SC 16225)
    McDonald, C. J., and Borden, Norcott, Sullivan and Vertefeuille, Js.

      Argued October 26, 2000
    officially released March 13, 2001

      Nancy L. Chupak, assistant state’s attorney, with whom, on the brief, were James E. Thomas, state’s attorney, and Victor Carlucci, Jr., assistant state’s attorney, for the appellant (state).

      Wesley S. Spears, for the appellee (defendant).

       Although Chief Justice McDonald reached the mandatory age of retirement before the date that this opinion was officially released, his continued participation on this panel is authorized by General Statutes § 51-198 (c). The listing of justices reflects their seniority status on this court as of the date of oral argument.

   Opinion

BORDEN, J.

The state appeals, following our grant of certification, from the judgment of the Appellate Court reversing the defendant’s conviction on drug possession and distribution charges. The state claims that the Appellate Court improperly concluded that: (1) certain juror misconduct occurring during the course of the trial required the exercise of the Appellate Court’s supervisory authority so as to require a new trial; and (2) the jury misconduct in this case constituted a structural defect that required a new trial. We reverse the judgment of the Appellate Court.

The defendant, Vaska Anderson, was charged with possession of more than one kilogram of marijuana with intent to sell by a person who is not drug-dependent in violation of General Statutes § 2 la-278 (b), conspiracy to distribute more than one kilogram of marijuana by a person who is not drug-dependent in violation of General Statutes §§ 53a-48 (a) and 21a-278 (b), possession of more than one kilogram of marijuana with intent to sell within 1500 feet of a school in violation of General Statutes § 21a-278a (b), assault on a peace officer in violation of General Statutes § 53a-167c (a) (1), and failure to appear in the first degree in violation of General Statutes § 53a-172 (a). During the state’s case, the defendant moved for a mistrial, based upon improper statements allegedly made by one of the jurors to the other jurors. The trial court denied the motion. The jury found the defendant guilty of all charges, except assault on a peace officer and failure to appear, and the trial court rendered a judgment of conviction. The defendant appealed to the Appellate Court contending, inter alia, that the trial court improperly had denied his motion for a mistrial based on juror misconduct.* The Appellate Court reversed the defendant’s conviction and ordered a new trial. State v. Anderson, 55 Conn. App. 60, 738 A.2d 1116 (1999). This certified appeal followed.

The underlying facts, as set forth by the Appellate Court, are as follows: “On August 14, 1993, a Connecticut state police detective received notice from the Drug Enforcement Administration in Los Angeles, California, that a black woman in white clothing named Brenda McCoy, suspected of carrying narcotics, would be arriving at Bradley International Airport on TWA flight 290 at 8:30 p.m. that evening. Officers detained a woman at the airport fitting this description after a narcotics-detecting canine indicated that her suitcases contained narcotics. Her identification revealed that she was Brenda McCoy, and upon searching her suitcases, the officers found inside each a large bundle wrapped in cellophane and sheets covered with a blanket. The bundles weighed a total of 18.48 kilograms or 40.75 pounds and tested positive for marijuana. The officers placed McCoy under arrest.

“McCoy told the police that she was instructed to call a beeper number when she had the suitcases, and that a person would pick up the suitcases and give [to] her $1500. McCoy called the beeper number and arranged the pickup. The police in unmarked cars watched while a Pontiac Grand Am with a woman in the driver’s seat and a male, later identified as the defendant, seated next to her, parked in front of McCoy’s apartment building. The defendant exited the vehicle and, after meeting McCoy at the front entrance, followed her to her apartment. As the defendant exited the building with the suitcases, the police ordered him to stop. The defendant, instead, dropped the suitcases and ran out of the building. While outside, he shouted to the woman in the car that they had been set up by the police. The defendant and the woman were apprehended and placed under arrest.” Id., 62-63.

The following additional facts, as set forth by the Appellate Court, are relevant to the defendant’s claim on appeal that he was denied a fair trial by an impartial jury because the trial court improperly had denied his motion for a mistrial due to juror misconduct. “The trial was conducted in front of six jurors and three alternate jurors. After the conclusion of the third day of trial, the trial judge was approached by an alternate juror, M, who indicated that she wanted to speak to the judge. The trial judge instructed the courtroom clerk to speak with the juror. M told the clerk that one of the jurors, L, had stated to the other jurors that he knew the defendant or had seen him ‘on the street,’ that the defendant was not a nice person and that ‘they’re going to get this guy for something.’ The clerk informed the trial judge of M’s statements, and the trial judge called counsel into court and had the clerk disclose M’s statements to them. The next day when court reconvened, the trial judge instructed the clerk to state for the record the statements M made to him. The trial judge decided that it would be necessary to call M into open court to ascertain exactly what she overheard or what had been said to her. Counsel would be given the opportunity to submit questions to the court for the court to ask the juror.

“M testified that L stated to the other jurors that he knew the defendant and had seen him ‘on the street,’ that the defendant was ‘not a very nice person’ and that ‘they’re going to get this guy for something.’ She testified that when she heard the statements, she thought that it did not seem right to her and that she should bring this matter to the court’s attention. She said that she realized that L did not know the defendant personally. M also said that at a subsequent break in the jury deliberating room, another juror asked her what she thought about what L had said and then commented that ‘it didn’t seem right.’ When M was asked by the trial judge if she could sit fairly and impartially and decide the case solely on the basis of the evidence presented, M answered, ‘Yes.’

“The court then examined L. L stated that he had realized after the trial began that he recognized the defendant as a man he had seen once before when L worked as an automobile mechanic, towing vehicles. L stated that he told the other jurors in the jury room that he knew the defendant. L also stated that he had no idea if the defendant was a nice person because he had never spoken with him and saw him only on that one occasion for a short period of time. L twice denied telling the other jurors that the defendant was not a very nice person and that ‘they’ would get him for something.

“On the basis of the testimony of M and L, the trial judge determined that a separate inquiry of the remaining five jurors and two alternates would be necessary. Juror W testified that another juror, while in the jury room, said that he knew the defendant on the street in the past. She stated that she could keep an open mind and decide the case on the basis of the evidence. Juror T testified that in the jury room with all the jurors present, another juror said that he thought he saw the defendant once and that the defendant was ‘a pretty tough fellow.’ T said that he ‘tightened up a little bit’ when he heard the statements. When asked if he could decide the case fairly, T replied, ‘Absolutely yes.’ He also stated that he could put aside what he had heard and decide the case on the basis of the evidence.

“Jurors P and R testified that they did not hear any statements concerning the defendant. Juror K testified that she heard a juror mention that he passed the defendant on the street once and that she heard the juror say something to the effect that the defendant ‘did bad’ and ‘he knows he is in trouble.’ When asked if she could be fair and impartial, K responded, ‘Oh, sure. It hasn’t changed anything.’ She stated that she could put the statements aside and decide the case on the basis of the evidence. Juror A, an alternate, testified that he heard one juror state that he had seen the defendant on the street, but that no statements were made concerning what kind of person the defendant was or what should happen to the defendant, and that what he heard would in no way affect his decision. Juror C, another alternate, testified that one juror stated that he knew the defendant, not personally, but that he had seen the defendant ‘on the street.’ C also testified that nothing was said as to whether the defendant was a bad person or concerning what should happen to him.

“Thus, three of the jurors testified to hearing [some or all of] L’s statements regarding the defendant, namely, that the defendant was ‘not a very nice person,’ that the defendant is ‘a pretty tough fellow,’ that ‘he did bad’ and ‘he knows he is in trouble,’ and that ‘they’re going to get this guy for something.’ Two jurors had no recollection whatsoever; the rest of the jurors and alternate jurors who heard something heard statements to the effect that L either knew the defendant or had seen him ‘on the street.’ The trial judge instructed all of the jurors and the alternate jurors that they must decide the case solely on the basis of the evidence, and all of them testified that they could decide the case fairly and impartially.

“Subsequent to the court’s questioning of the jurors, the defendant requested that L be removed from the jury panel. The state did not object and agreed that L should be discharged and replaced with one of the alternates. Before ruling, the trial court recessed so that defense counsel could confer with the defendant. After the recess, the defendant moved for a mistrial. The defendant acknowledged that the trial court had fully complied with the mandates of State v. Brown, 235 Conn. 502, 668 A.2d 1288 (1995), and had made an adequate inquiry into the alleged juror misconduct. The defendant also admitted that L’s statement that he knew the defendant from the street, if considered alone, was not prejudicial to the defendant. He claimed, however, that when combined with the other comments, the statements compromised the defendant’s right to a fair and impartial jury, and that no action short of a mistrial would be sufficiently curative. The state agreed that L should be removed, but argued that the trial should proceed with the remaining jurors and alternate jurors. Thereafter, the trial court discharged L from the juror panel and reserved decision on the motion until the following day.

“The next day, the trial court denied the defendant’s motion because it concluded that the grounds for a mistrial did not exist. The trial court explained that it did not take extensive notes when the jurors were testifying because the court ‘wanted to look right at the jurors, observe them as they were talking, observe their reactions and form [its] opinion . . . .’ The court stated that case law mandates that consideration of extrinsic evidence by a juror is presumptively prejudicial to a defendant because it implicates a defendant’s constitutional right to a fair trial by an impartial jury. The court noted, however, the distinction in the law between the mere expression of opinion as opposed to a positive expression of fact, and that in the former instance a mistrial is not warranted. The court stated that in the present case the kind of statements made were not of particular facts but rather statements of an opinion type.

“The court also stated: ‘I did observe all of these jurors very closely and I thought all of them were being very honest and very candid and very genuine and sincere in their statement to the court .... [T]his would not in any way affect their judgment in the case . . . .’ The court found the jurors’ statements to be ‘very credible.’ The court stated that ‘based on my assessment of the jurors that came in to take the stand and aware of the jurors’ oath . . . we do not have a situation where they have formed an opinion of the accused . . . that is going to affect the way they view the accused or impact on their ability to be objective and impartial.’

“The alternate juror who had called the court’s attention to the improper remarks, M, was not selected as a juror to replace L. Alternate juror C became a regular member of the jury. The final deliberating body consisted of four jurors who had heard some of the remarks of L about the defendant and two jurors who had not heard anything said by L. . . .

“The defendant claims that the statements made were so prejudicial to him that he was denied his constitutional right to a fair trial. The defendant claims that L expressed ‘specific personal knowledge that the defendant was not a nice person and that the jury will get the defendant on something,’ and that those statements were tantamount to the juror’s becoming a witness and prosecutor against the defendant. The defendant, who is black, also claims that the fact that the juror who made the statements was the only black juror gave credibility to the statements and ‘would likely influence the remaining jurors to convict a black defendant.’ The defendant argues that the trial court abused its discretion in denying his motion for a mistrial, necessitating a new trial. The defendant urges, in the alternative, that, if no abuse of discretion is involved, this court exercise its supervisory authority over the administration of justice and grant him anew trial.” State v. Anderson, supra, 55 Conn. App. 63-69.

The Appellate Court specifically concluded that there had been no abuse of discretion by the trial court. “[W]e want to emphasize that the trial court conducted an exemplary examination of the jurors and alternates to determine the scope of the juror misconduct.” Id., 68. The Appellate Court determined, however, that the facts of this case required that it “exercise [its] supervisory authority over the administration of justice and order a new trial because we view the juror misconduct here as a contaminant affecting the structural integrity of the defendant’s trial.” Id., 69.

I

The state first claims that the Appellate Court improperly invoked its supervisory authority in reversing the judgment of the trial court and ordering a new trial. We agree.

We begin with the standard of review that governs this case. “In our review of the denial of a motion for mistrial, we have recognized the broad discretion that is vested in the trial court to decide whether an occurrence at trial has so prejudiced a party that he or she can no longer receive a fair trial. The decision of the trial court is therefore reversible on appeal only if there has been an abuse of discretion.” (Internal quotation marks omitted.) State v. Newsome, 238 Conn. 588, 628-29, 682 A.2d 972 (1996).

“Jury impartiality is a core requirement of the right to trial by jury guaranteed by the constitution of Connecticut, article first, § 8, and by the sixth amendment to the United States constitution. . . . [T]he right to juiy trial guarantees to the criminally accused a fair trial by a panel of impartial, indifferent jurors. . . . The modern jury is regarded as an institution in our justice system that determines the case solely on the basis of the evidence and arguments given [it] in the adversary arena after proper instructions on the law by the court. . . . Consideration [by the jury] of extrinsic evidence is presumptively prejudicial because it implicates the defendant’s constitutional right to a fair trial before an impartial jury.” (Internal quotation marks omitted.) State v. Santiago, 245 Conn. 301, 330, 715 A.2d 1 (1998).

“It is well established, however, that not every incident of juror misconduct requires a new trial. State v. Newsome, [supra, 238 Conn. 627], [D]ue process seeks to assure a defendant a fair trial, not a perfect one. . . . [T]he constitution does not require a new trial every time a juror has been placed in a potentially compromising situation . . . [because] it is virtually impossible to shield jurors from every contact or influence that might theoretically affect their vote. . . . State v. Tomasko, 242 Conn. 505, 513, 700 A.2d 28 (1997). The question is whether or not the misconduct has prejudiced the defendant to the extent that he has not received a fair trial. . . . The defendant has been prejudiced if the misbehavior is such to make it probable that the juror’s mind was influenced by it so as to render him or her an unfair and prejudicial juror.” (Internal quotation marks omitted.) State v. Rhodes, 248 Conn. 39, 47, 726 A.2d 513 (1999). “Ultimately, however, [t]o succeed on a claim of [juror] bias the defendant must raise his contention of bias from the realm of speculation to the realm of fact. . . . State v. Myers, 242 Conn. 125, 141, 698 A.2d 823 (1997).” (Internal quotation marks omitted.) State v. Mukhtaar, 253 Conn. 280, 297, 750 A.2d 1059 (2000); see also State v. Cubano, 203 Conn. 81, 89, 523 A.2d 495 (1987).

“Our review of the scope of the trial court’s preliminary inquiry into allegations of jury misconduct is governed by State v. Brown, supra, 235 Conn. 502. In Brown, we exercised our supervisory authority over the administration of justice to hold that ... a trial court must conduct a preliminary inquiry, on the record, whenever it is presented with any allegations of jury misconduct in a criminal case, regardless of whether an inquiry is requested by counsel. Id., 526. We reiterated that the trial court has broad discretion to determine the form and scope of the proper response to allegations of jury misconduct; id., 523-24; and instructed that [i]n exercising that discretion, the trial court must zealously protect the rights of the accused. Id., 524. Our role as an appellate court is limited . . . to a consideration of whether the trial court’s review of alleged jury misconduct can fairly be characterized as an abuse of its discretion. Id.

“We instructed that the trial court should consider the following factors in exercising its discretion as to the form and scope of a preliminary inquiry into allegations of jury misconduct: (1) the criminal defendant’s substantial interest in his constitutional right to a trial before an impartial jury; (2) the risk of deprivation of the defendant’s constitutional right to a trial before an impartial jury, which will vary with the seriousness and the credibility of the allegations of jury misconduct; and (3) the state’s interests of, inter alia, jury impartiality, protecting jurors’ privacy and maintaining public confidence in the jury system. Id., 530-31.” (Internal quotation marks omitted.) State v. Santiago, supra, 245 Conn. 331.

We conclude that the inquiry conducted by the trial court in the present case was adequate to safeguard the defendant’s right to a fair trial before an impartial jury. The court’s inquiry consisted of interviews with each of the jurors and alternate jurors, in which it assessed their state of mind and determined whether they could be fair and impartial. The court determined that the jurors were credible in their assertions that they could be impartial and could base their decisions only on the evidence presented. See State v. Newsome, supra, 238 Conn. 631 (“[w]e are not inclined to disregard the statements of those jurors interviewed as inevitably suspect” [internal quotation marks omitted]). The trial court, moreover, was in the best position to assess the credibility of the jurors; id. (“the trial court that conducts [an inquiry] is in the best position to assess the testimony of those on the jury panel”); State v. Cubano, supra, 203 Conn. 92 (“we are aware of the broad discretion of a trial judge which includes his determination of the credibility to be given a juror’s statement”); and acted within its discretion when it decided that the jurors could be impartial.

The trial court also determined that juror L’s statements that “he knew the defendant from the street,” that “he was not a nice guy,” that “he is a tough fellow,” that “he did bad” and that “they’re going to get him for something,” were expressions of opinion, and not statements of fact. The jurors who heard the comments, and juror L himself, acknowledged that he did not personally know the defendant. “In State v. McCall, [187 Conn. 73, 81, 444 A.2d 896 (1982)], we said: Mere expression of opinion, as opposed to positive expression of facts, does not warrant a mistrial. Even where a juror has formed some preconceived opinion as to the guilt of an accused, a juror is sufficiently impartial if he or she can set aside that opinion and render a verdict based on evidence in the case.” (Internal quotation marks omitted.) State v. Cubano, supra, 203 Conn. 91. “It is enough if a juror is able to . . . decide the case on the evidence presented and the instructions given by the court.” Id., 92.

It is undisputed, moreover, that the trial court conducted a proper Brown inquiry into the allegations of juror misconduct. See State v. Anderson, supra, 55 Conn. App. 68. On the basis of this inquiry, the trial court reasonably concluded that juror L’s statements regarding the defendant did not prejudice the defendant, and reasonably determined that a mistrial was not warranted.

We disagree with the defendant’s contention that the Appellate Court properly reversed the trial court’s judgment and ordered a new trial based on its supervisory authority. “Appellate courts possess an inherent supervisory authority over the administration of justice. . . . The standards that [are] set under this supervisory authority are not satisfied by observance of those minimal historic safeguards for securing trial by reason which are summarized as due process of law .... Rather, the standards are flexible and are to be determined in the interests of justice. . . . [0]ur supervisory authority is not a form of free-floating justice, untethered to legal principle. . . . State v. Pouncey, 241 Conn. 802, 812-13, 699 A.2d 901 (1997). Rather, the integrity of the judicial system serves as a unifying principle behind the seemingly disparate use of our supervisory powers. See State v. Hines, 243 Conn. 796, 815, 709 A.2d 522 (1998) ([o]ur supervisory powers are invoked only in the rare circumstance where [the] traditional protections are inadequate to ensure the fair and just administration of the courts); State v. Coleman, 242 Conn. 523, 540, 700 A.2d 14 (1997) ([w]e previously have exercised our supervisory powers to direct trial courts to adopt judicial procedures that will address matters that are of utmost seriousness, not only for the integrity of a particular trial but also for the perceived fairness of the judicial system as a whole).” (Internal quotation marks omitted.) State v. Santiago, supra, 245 Conn. 332-33.

“Although [w]e previously have exercised our supervisory powers to direct trial courts to adopt judicial procedures; State v. Coleman, supra, 242 Conn. 540; we also have exercised our authority to address the result in individual cases, notably those involving instances of prosecutorial misconduct because we recognize that such conduct, although not rising to the level of constitutional magnitude, is unduly offensive to the maintenance of a sound judicial process.” (Internal quotation marks omitted.) State v. Santiago, supra, 245 Conn. 334.

This case does not present an appropriate situation in which to exercise our supervisory authority. The procedure set forth in Brown, namely, that “atrial court must conduct a preliminary inquiry, on the record, whenever it is presented with any allegations of jury misconduct in a criminal case”; State v. Brown, supra, 235 Conn. 526; adequately addressed this situation. The trial court conducted a proper Brown inquiry, made credibility determinations, and denied the defendant’s motion for a mistrial. “We recognize that the trial judge has a superior opportunity to assess the proceedings over which he or she personally has presided; State v. Ross, [230 Conn. 183, 227, 646 A.2d 1318 (1994), cert. denied, 513 U.S. 1165, 115 S. Ct. 1133, 130 L. Ed. 2d 1095 (1995)]; State v. Rodriguez, [210 Conn. 315, 326, 554 A.2d 1080 (1989)]; and thus is in a superior position to evaluate the credibility of allegations of jury misconduct, whatever their source.” State v. Brown, supra, 527-28.

We also have exercised our supervisory authority to adopt “rules intended to guide the lower courts in the administration of justice in all aspects of the criminal process. See, e.g., State v. Coleman, [supra, 242 Conn.] 542 (judicial explanation required for imposition of greater sentence after trial than after plea); State v. Gould, 241 Conn. 1, 15, 695 A.2d 1022 (1997) (videotaped deposition must be played in open court, not in jury room); State v. Brown, supra, 235 Conn. 528 (judicial inquiry on the record into allegations of juror misconduct); State v. Breton, 235 Conn. 206, 250, 663 A.2d 1026 (1995) (special verdict form submitted to jury in capital sentencing case must include brief statement of jury’s responsibility for determining whether defendant is sentenced to death); State v. Jones, 234 Conn. 324, 346-47, 662 A.2d 1199 (1995) (bifurcation of jury proceedings in certain death penalty cases); State v. Patterson, 230 Conn. 385, 397-400, 645 A.2d 535 (1994), on appeal after remand, 236 Conn. 561, 674 A.2d 416 (1996) (trial judge must continuously be present to oversee voir dire); State v. Holloway, 209 Conn. 636, 645-46, 553 A.2d 166, cert. denied, 490 U.S. 1071, 109 S. Ct. 2078, 104 L. Ed. 2d 643 (1989) (where defendant asserts claim under Batson v. Kentucky, 476 U.S. 79, 106 S. Ct. 1712, 90 L. Ed. 2d 69 [1986], state must make prima facie showing of neutral jury selection method).” State v. Santiago, supra, 245 Conn. 333-34.

This aspect of the use of our supervisory authority would be inappropriate in the present case because it would not have sufficient boundaries to guide future trial courts. Rather, it would more likely create confusion as to the proper procedures to follow in jury misconduct cases.

There is nothing in the record, moreover, that supports the contention that this is an extraordinary case requiring this court to invoke its supervisory authority. The defendant argues that this is the type of misconduct that cannot be cured because it goes to the core of a criminal defendant’s right to a trial by an impartial jury. We are unpersuaded. It is true that the jurors were exposed to extrinsic evidence, namely, juror L’s opinions regarding the defendant’s character. Extrinsic evidence, however, is only presumptively prejudicial; State v. Asherman, 193 Conn. 695, 736, 478 A.2d 227 (1984), cert. denied, 470 U.S. 1050, 105 S. Ct. 1749, 84 L. Ed. 2d 814 (1985); and the trial court, by conducting an exemplary Brown inquiry, determined that the defendant had suffered no actual prejudice. See State v. Cubano, supra, 203 Conn. 90 (“defendant’s burden to prove actual bias on behalf of the juror”). Indeed, this case presents precisely one of the prototypes of juror misconduct that Brown and its progeny are designed to address.

The defendant also contends that, because both juror L and the defendant were black, and because juror L was the only black juror, the juror’s comments must be deemed to be prejudicial. The defendant contends that this racial identity between juror L and the defendant requires the conclusion that the other jurors, despite their disclaimers, must have credited juror L’s remarks. We reject this contention. First, the defendant did not make this contention when the trial court conducted its Brown inquiry. If that were truly such a powerful contention that it required the trial court’s exercise of discretion to declare a mistrial despite crediting the jurors’ testimony to the contrary, we would expect the defendant to have brought this argument to the trial court’s attention. Second, there is nothing in the record to suggest that race played any part in either the jurors’ deliberations or in the defendant’s conviction.

We are, nevertheless, mindful of racial discrimination, and take every precaution to guard against racism in our courtrooms. “We previously have exercised our inherent supervisory authority to safeguard against the improper consideration of race in criminal trials; see State v. Holloway, supra, 209 Conn. 645-46; and we will not hesitate to do so again if necessary.” State v. Pouncey, supra, 241 Conn. 816-17.

In Pouncey, four women were attacked by the defendant after exiting a restaurant. Id., 805. In her closing statement, the assistant state’s attorney stated: “[The victims were] minding their own business when they were confronted with what suburbanites would call the ultimate urban nightmare.” Id., 806. On the basis of these and other remarks, the defendant moved for a mistrial, which the trial court denied. Id. This court affirmed the Appellate Court’s decision not to invoke its supervisory authority because we found that the defendant had not shown a “pattern or practice of misconduct . . . among the state prosecutors” warranting reversal of his conviction so as to “serve the important purpose of demonstrating that such conduct cannot, and will not, be tolerated.” Id., 815-16. Similarly, we have not been presented with a pattern or practice of misconduct, or any improper racial implications, by any party, that would be deterred in future cases by invoking our supervisory authority in the present case.

Furthermore, we already have created a procedure for dealing with allegations of racial bias, based specifically on Brown. See State v. Santiago, supra, 245 Conn. 301. In Santiago, a juror allegedly referred to the defendant as a “spic.” Id., 324. The trial court conducted a Brown inquiry and found that the allegations were not credible. Id., 332. The defendant argued that the trial court abused its discretion in not conducting a more thorough inquiry. Id., 324. This court determined that the trial court had not abused its discretion in conducting its preliminary inquiry, but given the importance of the issue, exercised its supervisory authority to expand the scope of the preliminary inquiry. Id., 336. This court held that in future cases involving allegations of racial bias, a more extensive inquiry than that prescribed in Brown is required: “Such inquiry should include, at a minimum, an extensive inquiry of the person reporting the conduct, to include the context of the remarks, an interview with any persons likely to have been a witness to the alleged conduct, and the juror alleged to have made the remarks.” Id., 340. We didnot, however, create a per se rule of reversal for allegations of racial bias.

In the present case, even though none of the parties treated the misconduct in question as involving allegations of racial bias, the trial court conducted, in essence, a Santiago inquiry. The trial court not only interviewed the juror who reported the remarks, but also the juror who allegedly had made the remarks. The trial court also interviewed all of the persons who might have overheard juror L’s allegations, namely, each of the other jurors and the alternate jurors. The court questioned each juror regarding the context of the remarks, while being careful not to influence any juror’s answers. Both the state and defendant, as well as the Appellate Court, believed that the trial court conducted a thorough inquiry into the allegations. Moreover, it could not have escaped the trial court’s attention that juror L was the only juror who was black, and that the defendant was black. Thus, the trial court complied with the procedures created in Santiago, and did not abuse its discretion under that standard.

II

The state next claims that the Appellate Court improperly determined that the jury misconduct in this case created a structural defect in the trial, necessitating anew trial regardless of the harmlessness of the misconduct. The defendant argues, to the contrary, that the Appellate Court was correct in its assessment that extrinsic evidence of the defendant’s character is a defect in the trial mechanism itself that requires automatic reversal. We agree with the state.

The United States Supreme Court has recognized that “most constitutional errors can be harmless.” (Internal quotation marks omitted.) Neder v. United States, 527 U.S. 1, 8, 119 S. Ct. 1827, 144 L. Ed. 2d 35 (1999); see also Arizona v. Fulminante, 499 U.S. 279, 306, 111 S. Ct. 1246, 113 L. Ed. 2d 302 (1991). “The harmless error doctrine is essential to preserve the principle that the central purpose of a criminal trial is to decide the factual question of the defendant’s guilt or innocence, and promotes public respect for the criminal process by focusing on the underlying fairness of the trial.” Arizona v. Fulminante, supra, 308; see also Rose v. Clark, 478 U.S. 570, 577, 106 S. Ct. 3101, 92 L. Ed. 2d 460 (1986). In contrast, the Supreme Court has found structural errors in only a “very limited class of cases. Johnson v. United States, 520 U.S. 461, 468 [117 S. Ct. 1544, 137 L. Ed. 2d 718] (1997) (citing Gideon v. Wainwright, 372 U.S. 335 [83 S. Ct. 792, 9 L. Ed. 2d 799] (1963) (complete denial of counsel); Tumey v. Ohio, 273 U.S. 510 [47 S. Ct. 437, 71 L. Ed. 749] (1927) (biased trial judge); Vasquez v. Hillery, 474 U.S. 254 [106 S. Ct. 617, 88 L. Ed. 2d 598] (1986) (racial discrimination in selection of grand jury); McKaskle v. Wiggins, 465 U.S. 168 [104 S. Ct. 944, 79 L. Ed. 2d 122] (1984) (denial of self-representation at trial); Waller v. Georgia, 467 U.S. 39 [104 S. Ct. 2210, 81 L. Ed. 2d 31] (1984) (denial of public trial); Sullivan v. Louisiana, 508 U.S. 275 [113 S. Ct. 2078, 124 L. Ed. 2d 182] (1993) (defective reasonable-doubt instruction)).” (Internal quotation marks omitted.) Neder v. United States, supra, 8.

Structural defect cases defy analysis by harmless error standards because the “entire conduct of the trial, from beginning to end, is obviously affected . . . .” Arizona v. Fulminante, supra, 499 U.S. 309-10. These cases “contain a defect affecting the framework within which the trial proceeds, rather than simply an error in the trial process itself. [Id.] 310. Such errors infect the entire trial process, Brecht v. Abrahamson, 507 U.S. 619, 630 [113 S. Ct. 1710, 123 L. Ed. 2d 353] (1993), and necessarily render a trial fundamentally unfair, Rose [v. Clark, supra, 478 U.S. 577], Put another way, these errors deprive defendants of basic protections without which a criminal trial cannot reliably serve its function as a vehicle for determination of guilt or innocence . . . and no criminal punishment may be regarded as fundamentally fair.” (Internal quotation marks omitted.) Neder v. United States, supra, 527 U.S. 8-9.

This court, as well as the United States Supreme Court, has expressly held that the procedure to be followed for resolving claims of jury bias is an inquiry into the allegations and a determination of whether there was actual prejudice to the defendant. See State v. Booth, 250 Conn. 611, 649, 737 A.2d 404 (1999), cert. denied sub nom. Brown v. Connecticut, 529 U.S. 1060, 120 S. Ct. 1568, 146 L. Ed. 2d 471 (2000) (“[t]he question is whether or not the misconduct has prejudiced the defendant to the extent that he has not received a fair trial” [internal quotation marks omitted]); State v. Newsome, supra, 238 Conn. 628 (same); see also Smith v. Phillips, 455 U.S. 209, 215, 102 S. Ct. 940, 71 L. Ed. 2d 78 (1982) (“[t]his Court has long held that the remedy for allegations of juror partiality is a hearing in which the defendant has the opportunity to prove actual bias”).

Under the standards set by this court and the United States Supreme Court, this case does not present a structural defect. Juror L’s statements did not present a defect that affected the framework within which the trial proceeded, but rather, affected the trial process. The defendant’s trial was not fundamentally unfair from start to finish, such as when members of the defendant’s race are unlawfully excluded from grand jury selection; Vasquez v. Hillery, supra, 474 U.S. 254; where a defendant is denied the right to counsel at trial; Gideon v. Wainwright, supra, 372 U.S. 335; or where the judge receives compensation for convictions; Tumey v. Ohio, supra, 273 U.S. 510. Rather, the misconduct in this case was the introduction of extrinsic evidence several days into the trial. Although extrinsic evidence is presumptively prejudicial; State v. Santiago, supra, 245 Conn. 330; it is the defendant’s burden to prove actual bias. State v. Newsome, supra, 238 Conn. 628 (“[wjhere, however, the trial court was in no way responsible for the juror misconduct . . . we have repeatedly held that a defendant who offers proof of juror misconduct bears the burden of proving that actual prejudice resulted from that misconduct” [internal quotation marks omitted]).

The trial court conducted an exemplary inquiry into the allegations of jury misconduct and determined that the jury could be impartial, based on its own observations and the statements of the jurors. We previously have determined that jurors’ own statements that they can remain impartial even after being introduced to extrinsic evidence are to be given some weight. Id., 631 (“[w]e are not inclined to disregard the statements of those jurors interviewed as inevitably suspect” [internal quotation marks omitted]); State v. Cubano, supra, 203 Conn. 92 (“[w]hile we recognize that a juror’s assurances that he or she is equal to the task are not disposi-tive of the rights of an accused . . . we are aware of the broad discretion of a trial judge which includes his determination of the credibility to be given a juror’s statement in this context” [citation omitted]); see also Smith v. Phillips, supra, 455 U.S. 217 n.7 (“surely one who is trying as an honest man to live up to the sanctity of his oath is well qualified to say whether he has an unbiased mind in a certain matter” [internal quotation marks omitted]).

We disagree with the defendant and the Appellate Court that “[t]his case involves a systemic flaw the nature of which makes it difficult to assess its effects on the defendant.” State v. Anderson, supra, 55 Conn. App. 75. The development of our case law in this area provides for just this sort of assessment. Well before we exercised our supervisory authority in State v. Brown, supra, 235 Conn. 502, trial courts were called upon to use their discretion to protect criminal defendants’ rights to a fair trial when there were allegations of jury misconduct. See, e.g., State v. Cubano, supra, 203 Conn. 81 (juror shocked that personal friend would associate with defendant); State v. Asherman, supra, 193 Conn. 695 (juror copied definition from dictionary; jurors conducted experiment during deliberations with articles brought from home); State v. McCall, supra, 187 Conn. 73 (juror’s son had psychiatric symptoms similar to defendant’s).

We have determined that the introduction of extrinsic evidence does not automatically necessitate a new trial, and we are not persuaded that the particular facts of the present case are so extraordinary as to require special consideration. “[T]he Constitution entitles a criminal defendant to a fair trial, not a perfect one.” (Internal quotation marks omitted.) Rose v. Clark, supra, 478 U.S. 579. The trial court conducted the proper inquiry, made a reasonable determination based on its inquiry, and the defendant received a fair trial. There is simply no basis to cast this case in the mold of a structural defect.

The judgment of the Appellate Court is reversed and the case is remanded to that court with direction to consider the defendant’s remaining claims.

In this opinion the other justices concurred.

       On appeal, the defendant also claimed that the trial court had improperly: (1) failed to give a curative instruction concerning the juror misconduct; (2) denied the defendant’s motion for a mistrial when the jury indicated that it was deadlocked; and (3) instructed the jury concerning proof beyond a reasonable doubt. Because the Appellate Court concluded that the defendant’s motion for a mistrial due to juror misconduct should have been granted, it did not reach the other issues. Therefore, on our remand, the Appellate Court will be required to consider these claims.

       We granted the state’s petition for certification to appeal, limited to the following issues: “Did the Appellate Court properly conclude that the juror misconduct involved in this case (1) required it to exercise its supervisory authority so as to order a new trial, and (2) was a structural defect that required a new trial without an inquiry into its harmlessness?” State v. Anderson, 251 Conn. 926, 742 A.2d 363 (1999).


source: Caselaw Access Project

author: KATZ, J.

license: Public Domain

text:
    OCI MORTGAGE CORPORATION v. CAROLE N. MARCHESE ET AL.
    (SC 16300)
    Borden, Norcott, Katz, Palmer and Vertefeuille, Js.

      Argued December 5, 2000
    officially released March 20, 2001

      Matthew B. Woods, for the appellant (plaintiff).

      Edward T. Mumane, Jr., with whom, on the brief, was Gary A. Mastronardi, for the appellees (named defendant et al.).
   Opinion

KATZ, J.

The issue presented in this certified appeal is whether the Appellate Court properly concluded that 12 U.S.C. § 1823 (e), codifying the doctrine established in D’Oench, Duhme & Co. v. Federal Deposit Ins. Corp., 315 U.S. 447, 62 S. Ct. 676, 86 L. Ed. 956 (1942) (D’Oench, Duhme doctrine), did not apply to the defendants Carole N. Márchese and Anthony J. Márchese to bar their defenses of setoff and payment of a mortgage note issued by them to a savings and loan association that later had been declared insolvent. The plaintiff, OCI Mortgage Corporation (OCI), had acquired the mortgage note after the savings and loan association’s failure, and initiated this foreclosure action on the defendants’ property. The Appellate Court concluded that, because the defendants, pursuant to a subsequent debenture agreement, had loaned the savings and loan association substantially more than the original mortgage note, and because the savings and loan association had defaulted on the interest payments under the debenture, which, subsequent to the debenture, had been tied to the mortgage payments, the defendants had executed a valid setoff prior to the savings and loan association’s insolvency. OCI Mortgage Corp. v. Marchese, 56 Conn. App. 668, 682, 745 A.2d 819 (2000). We conclude that no setoff occurred in this case prior to the savings and loan association’s insolvency and that 12 U.S.C. § 1823 (e) applies to bar that defense. Accordingly, we reverse the judgment of the Appellate Court.

The opinion of the Appellate Court reveals the following facts. On September 13, 1985, the defendants “executed a promissory note in the amount of $220,000, payable to Community Federal Savings and Loan Association [association], and secured by a mortgage on property that the defendants owned in Southport. While the note was still outstanding, the defendant Carole N. Márchese lent [the association] $900,000 pursuant to a subordinated debenture agreement. Thereafter, [the defendant] Carole N. Márchese and [the association] agreed that the defendants’ mortgage note would be paid by applying [the association’s] interest payments on the debenture to the defendants’ monthly mortgage payments. In October, 1989, [the association] defaulted on its interest payments.” (Internal quotation marks omitted.) Id., 670.

“The defendants mailed a letter to [the association] on November 14, 1989, giving written notice pursuant to § 10.01 of the [subordinated debenture] agreement. The letter stated that if the default was not cured [within the fifteen day grace period provided in the agreement], the defendants ‘will exercise all rights available to them not only under Section 10.02 of the foregoing Subordinated Debenture Agreement, but also under statutory and common law.’ No further letter or notification followed before [the association’s] demise.” Id., 676 n.3.

On December 7, 1989, the association “was declared insolvent and the Resolution Trust Corporation [Resolution Trust] was appointed as its receiver in bankruptcy. [Resolution Trust] assigned the defendants’ mortgage and loan documents to Fairfield Affiliates, the original plaintiff [in this action], Fairfield Affiliates then assigned the defendants’ note and mortgage to [OCI] and OCI was substituted as the plaintiff.

“The trial court referred the case to an attorney trial referee [who heard testimony on June 21, 1996 and accepted the parties’ stipulation of facts and exhibits]. After the trial concluded, the attorney trial referee filed her report, in which she recommended that judgment enter in favor of the defendants. Specifically, the attorney trial referee found that [Resolution Trust] knew about the agreements between [the association] and the defendants, and that [a]ll subsequent assignees of the [defendants’] mortgage note . . . including the plaintiff, OCI, accepted assignment of the note with notice of the $900,000 debt owed to the defendants, as well as the defendants’ claim of set-off and payment.

“[OCI] moved to correct various portions of the attorney trial referee’s report. The attorney trial referee, however, denied the majority of [OCI’s] requests. [OCI] then filed exceptions to the attorney trial referee’s report, as well as an objection to the acceptance of the report.

“The trial court sustained [OCI’s] objection to the acceptance of the attorney trial referee’s report. The [trial] court ruled that, pursuant to 12 U.S.C. § 1823 (e), [Resolution Trust] is entitled to the same protection as the Federal Deposit Insurance Corporation (FDIC). According to 12 U.S.C. § 1823 (e), [n]o agreement which tends to diminish or defeat the interest of the [FDIC] in any asset acquired by it . . .as receiver of any depository institution, shall be valid against the [FDIC] unless such agreement . . . [is] executed by the depository institution and any person claiming an adverse interest thereunder, including the obligor, contemporaneously with acquisition of the asset by the depository institution. The [trial] court concluded that because the execution of the defendants’ mortgage and the execution of the subordinated debenture agreement were not contemporaneous, the subordinated debenture agreement was not valid against [Resolution Trust], and, therefore, it was not valid against [Resolution Trust’s] assignees. The trial court remanded the case to the attorney trial referee, directing the referee to proceed in a manner not inconsistent with the trial court’s memorandum of decision.” (Internal quotation marks omitted.) OCI Mortgage Corp. v. Marchese, supra, 56 Conn. App. 670-71.

The defendants appealed from that decision to the Appellate Court, which dismissed the appeal, concluding that, because the trial court had sustained the objection to the attorney trial referee’s report and ordered that the case “ ‘proceed in a manner not inconsistent with’ ” that determination, no appealable final judgment had been rendered. OCI Mortgage Corp. v. Marchese, 48 Conn. App. 750, 752-54, 712 A.2d 449 (1998). Thereafter, the parties entered into a stipulation in order to obtain a final judgment from which the defendants properly could appeal, and, in accordance with that stipulation, the trial court rendered a judgment of strict foreclosure. The defendants then appealed from that judgment to the Appellate Court. See OCI Mortgage Corp. v. Marchese, supra, 56 Conn. App. 672.

The Appellate Court determined that the balance of the mortgage note had been set off against the subordinated debenture by operation of law and that, therefore, no agreement existed as a predicate to the application of 12 U.S.C. § 1823 (e). Id., 679. Similarly, the Appellate Court concluded that the setoff had extinguished the mortgage note, thereby eliminating it as an asset of the association, before the association had been declared insolvent. Id. In addition, the court determined that the mortgage note and the debenture had been “sufficiently bound together to constitute a bilateral agreement for purposes of avoiding [12 U.S.C. § 1823 (e) and] the D’Oench, Duhme doctrine.” Id., 682. Finally, citing equitable considerations, the court concluded that allowing OCI to foreclose on the mortgage when the defendants had been owed far more than the balance due on the note by OCI’s predecessor in interest would “[shock] the judicial conscience.” Id., 683. The Appellate Court reversed the judgment of strict foreclosure and remanded the case with direction to render judgment for the defendants. Id.

We granted OCI’s petition for certification, limited to the following issue: “Did the Appellate Court properly conclude that 12 U.S.C. § 1823 (e) and the doctrine of D’Oench, Duhme & Co. v. Federal Deposit Ins. Corp., [supra, 315 U.S. 447], did not apply to the defendants so as to bar their defenses of setoff and payment of the mortgage note?” OCI Mortgage Corp. v. Marchese, 253 Conn. 903, 753 A.2d 937 (2000). This appeal followed.

I

This case has its origins in the widespread failure of banks and savings and loan associations during the mid-1980s and early 1990s. The federal government, as the insurer of these institutions through the FDIC and the Federal Savings and Loan Insurance Coiporation and its successor, Resolution Trust; see footnote 6 of this opinion; stepped in to bail out the vast majority of these failed institutions. See 1 Federal Deposit Insurance Corporation, Managing the Crisis: The FDIC and RTC Experience 1980-1994 (1998) pp. 4—5 (Managing the Crisis) (noting that at height of banking crisis between 1988 and 1992, there was average of one federally insured bank or savings and loan association failure per day). The FDIC and Resolution Trust successfully controlled, liquidated and resolved literally thousands of federally insured banks and savings and loan associations and, while avoiding any major disruptions, managed to stabilize the nation’s banking system. Id., pp. 4, 46.

“The Financial Institutions Reform, Recovery and Enforcement Act of 1989 . . . gives the receivers of failed savings and loan institutions wide-ranging powers to consolidate and liquidate those institutions.” Nashville Lodging Co. v. Resolution Trust Corp., 59 F.3d 236, 241 (D.C. Cir. 1995). As the receiver of a failed savings and loan association, Resolution Trust attempts to maximize the return for its assets, often selling them as quickly as possible for the highest available price. See Suffield Bank v. Berman, 228 Conn. 766, 778, 639 A.2d 1033 (1994) (discussing FDIC’s role as receiver of failed bank); see also 12 U.S.C. § 1821 (d) (13) (E); Managing the Crisis, supra, p. 8; 11 Am. Jur. 2d 181, Banks and Financial Institutions § 1062 (1997). One significant weapon in Resolution Trust’s arsenal for achieving its objectives is the D’Oench, Duhme doctrine, codified at 12 U.S.C. § 1823 (e). Prior to the enactment of § 1823 (e) in 1950, D’Oench, Duhme & Co. v. Federal Deposit Ins. Corp., supra, 315 U.S. 447, was the leading case in this field, holding that certain side agreements that would have the effect of deceiving bank examiners in reviewing a failed institution’s records could not be the basis of a defense against the FDIC. Langley v. Federal Deposit Ins. Corp., 484 U.S. 86, 92, 108 S. Ct. 396, 98 L. Ed. 2d 340 (1987).

In D’Oench, Duhme & Co., a securities dealer had sold bonds to a bank and later defaulted on those bonds. See D’Oench, Duhme & Co. v. Federal Deposit Ins. Corp., supra, 315 U.S. 454. In order to accommodate the bank and allow it to avoid showing the defaulted bonds on its books, the securities dealer gave the bank promissory notes with a separate understanding that they would never be repaid. Id. The parties had included a written receipt evidencing their agreement that the notes would not be called for payment. Id. The FDIC subsequently acquired one of the notes as collateral for a loan that it had issued to the failing bank and attempted to collect from the securities dealer. Id., 453-54. In rejecting the securities dealer’s defense of lack of consideration for the note, the United States Supreme Court held that, because the securities dealer had lent itself to a scheme to mislead the FDIC, it could not assert that defense to deny liability on the note. Id., 460. The court reasoned that, “one who gives such a note to a bank with a secret agreement that it will not be enforced must be presumed to know that it will • conceal the truth from the vigilant eyes of the bank examiners.” Id. Given the federal policy of protecting the FDIC from misrepresentations relating to the records of banks that it insures, the court stated that “[t]he test is whether the note was designed to deceive the creditors or the public authority or would tend to have that effect.” Id.; see also Duraflex Sales & Service Corp. v. W.H.E. Mechanical Contractors, 110 F.3d 927, 932 (2d Cir. 1997) (“[p]ut simply, the D’Oench, Duhme doctrine precludes obligors from asserting side deals or secret agreements which may mislead bank examiners against [Resolution Trust]” [internal quotation marks omitted]).

Title 12 of the United States Code, § 1823 (e), expanded the common-law D’Oench, Duhme doctrine and “Congress opted for the certainty of the requirements set forth in § 1823 (e).” Langley v. Federal Deposit Ins. Corp., supra, 484 U.S. 95; see also Federal Deposit Ins. Co. v. State Bank of Virden, 893 F.2d 139, 143 (7th Cir. 1990) (noting that § 1823 [e] gives “statutory backing to the holding of D’Oench, Duhme [& Co.] that oral side agreements do not bind the FDIC” or Resolution Trust); Gunter v. Hutcheson, 674 F.2d 862, 872 n.14 (11th Cir.), cert. denied, 459 U.S. 826, 103 S. Ct. 60, 74 L. Ed. 2d 63 (1982) (concluding that § 1823 [e], as Congress’ response to holding in D’Oench, Duhme & Co. represents broadening protection for FDIC founded on federal policies of protecting banking system).

“One purpose of § 1823 (e) is to allow federal and state bank examiners to rely on a bank’s records in evaluating the worth of the bank’s assets.” Langley v. Federal Deposit Ins. Corp., supra, 484 U.S. 91. While examining an institution’s records in conjunction with a liquidation of its assets, or other means of handling the insolvency, the FDIC and Resolution Trust must move “with great speed, usually overnight, in order to preserve the going concern value of the failed bank and avoid an interruption in banking services.” (Internal quotation marks omitted.) Id.; see also Volges v. Resolution Trust Corp., 32 F.3d 50, 52 (2d Cir. 1994), cert. denied, 515 U.S. 1162, 115 S. Ct. 2618, 132 L. Ed. 2d 860 (1995) (“[o]ne of [Resolution Trust’s] primary functions is to dispose of a failed institution’s assets in a way that ‘maximizes the net present value return from the sale or other disposition’ of assets under its control”). In addition, the statutory requirements of 12 U.S.C. § 1823 (e); see footnote 1 of this opinion; “ensure the mature consideration of unusual loan transactions by senior bank officials, and prevent fraudulent insertion of new terms, with the collusion of bank employees, when a bank appears headed for failure.” Langley v. Federal Deposit Ins. Corp., supra, 92.

Some courts and commentators have recognized that the common-law holding in.D’Oench, Duhme & Co. and the provisions of 12 U.S.C. § 1823 (e) embody the same principle, and hence, require a similar, if not identical, analytical approach; see, e.g., Resolution Trust Corp. v. Dunmar Corp., 43 F.3d 587, 593 (11th Cir.), cert. denied, 516 U.S. 817, 116 S. Ct. 74, 133 L. Ed. 2d 33 (1995) (“The purposes underlying the [D’Oench, Duhme] doctrine and § 1823 [e] [are] the same, thus permitting utilization of the same analysis under each. . . . Accordingly, cases interpreting the common law doctrine as well as its statutory counterpart are applicable precedent.” [Citations omitted.]); while others carefully have distinguished between the common-law holding in D’Oench, Duhme & Co. and the statutory provision. See, e.g., Resolution Trust Corp. v. Midwest Federal Savings Bank, 36 F.3d 785, 793-94 (9th Cir. 1993) (addressing claims under common-law doctrine and 12 U.S.C. § 1823 [e] separately); accord Federal Deposit Ins. Corp. v. O’Neil, 809 F.2d 350, 353 (7th Cir. 1987) (noting that 12 U.S.C. § 1823 [e] “makes the common law principle both more encompassing and more precise”). In addition, the common-law holding in D’Oench, Duhme & Co. had been expanded in some federal circuits to afford, as a matter of federal common law, holder in due course status to the FDIC and Resolution Trust. See generally Gunter v. Hutcheson, supra, 674 F.2d 874; see also Resolution Trust Corp. v. Maplewood Investments, 31 F.3d 1276, 1290 n.28 (4th Cir. 1994) (noting that D’Oench, Duhme & Co. decision and holder in due course protections are matters of federal common law); Resolution Trust Corp. v. Marshall, 939 F.2d 274, 278 (5th Cir. 1991) (Resolution Trust is holder in due course as matter of federal law); but see Federal Deposit Ins. Corp. v. Houde, 90 F.3d 600, 605 n.5 (1st Cir. 1996) (federal holder in due course doctrine applicable only to FDIC in certain circumstances).

Whether either of these federal common-law doctrines remains a viable source for consideration in a case such as this is questionable after subsequent decisions of the United States Supreme Court in O’Melveny & Meyers v. Federal Deposit Ins. Corp., 512 U.S. 79, 85, 114 S. Ct. 2048, 129 L. Ed. 2d 67 (1994) (refusing to create federal common-law rule “to supplement federal statutory regulation that is comprehensive and detailed; matters left unaddressed in the Financial Institutions Reform, Recovery and Enforcement Act of 1989 are presumably left subject to the disposition provided by state law”) and Atherton v. Federal Deposit Ins. Corp., 519 U.S. 213, 225-27, 117 S. Ct. 666, 136 L. Ed. 2d 656 (1997) (finding “no significant conflict with, or threat to, a federal interest” that would require federal common-law rule for gross negligence; 12 U.S.C. § 1821 [k] does not supplant state law). Currently, there is a split among the federal circuit courts of appeals that have addressed the issue. Compare Federal Deposit Ins. Corp. v. Deglau, 207 F.3d 153, 171 (3d Cir. 2000) (D’Oench, Duhme doctrine is not applicable common law in light of O’Melveny & Meyers and Atherton; § 1823 [e] is comprehensive and detailed and D’Oench, Duhme doctrine need not supplement it as separate common-law doctrine), DiVall Insured Income Fund, L.P. v. Boatmen’s First National Bank, 69 F.3d 1398, 1402 (8th Cir. 1995) (holding that O’Melveny & Meyers removes federal common-law D’Oench, Duhme doctrine and federal holder in due course doctrine as separate bars to defenses against FDIC) and Murphy v. Federal Deposit Ins. Corp., 61 F.3d 34, 40 (D.C. Cir. 1995) (O’Melveny & Meyers removes federal common-law D’Oench, Duhme doctrine) with Murphy v. Federal Deposit Ins. Corp., 208 F.3d 959, 964 (11th Cir. 2000) (“ ‘Congress did not intend [Financial Institutions Reform, Recovery and Enforcement Act of 1989] to displace the D’Oench [Duhme] doctrine, but rather intended to continue the harmonious, forty-year coexistence of [§ 1823 (e)] and the D’Oench [Duhme] doctrine’ ”), Federal Financial Co. v. Hall, 108 F.3d 46, 49 (4th Cir.), cert. denied, 522 U.S. 858, 118 S. Ct. 157, 139 L. Ed. 2d 102 (1997) (noting that D’Oench, Duhme doctrine may be one of few federal common-law rules viable after O’Melveny & Meyers), Inn at Saratoga Associates v. Federal Deposit Ins. Corp., 60 F.3d 78, 82 (2d Cir. 1995) (although “asset” requirement for application of § 1823 [e] not satisfied, common-law equitable estoppel rule in D’Oench, Duhme & Co. applied) and Federal Deposit Ins. Corp. v. McClanahan, 795 F.2d 512, 514 n.l (5th Cir. 1986) (no reason to suppose that Congress intended to supplant common-law D’Oench, Duhme doctrine of estoppel with § 1823 [e]); accord Ledo Financial Corp. v. Summers, 122 F.3d 825, 829 n.2 (9th Cir. 1997) (not reaching question of whether D’Oench, Duhme doctrine overruled by O’Melveny & Meyers and Atherton); Federal Deposit Ins. Corp. v. Houde, supra, 90 F.3d 605 n.5 (noting split in circuits regarding viability of federal common-law holder in due course doctrine).

We need not resolve the matter, however, because the Appellate Court did not draw a distinction, instead referring to both 12 U.S.C. § 1823 (e) and the D’Oench, Duhme & Co. decision “collectively.” OCI Mortgage Corp. v. Marchese, supra, 56 Conn. App. 672. Moreover, the provisions of § 1823 (e) obviate the need to do so under the facts of the present case. That is, because we conclude herein that the requirements of § 1823 (e) have not been met, it is unnecessary for this court to consider whether the common-law D’Oench, Duhme doctrine would stand as a separate bar to the defendants’ claims. See Langley v. Federal Deposit Ins. Corp., supra, 484 U.S. 95 (“An agreement that meets [the requirements of § 1823 (e)] prevails even if the FDIC did not know of it; and an agreement that does not meet them fails even if the FDIC knew. It would be rewriting the statute to hold otherwise.”).

II

Our scope of review in the present appeal is familiar: whether the Appellate Court properly concluded that 12 U.S.C. § 1823 (e) and the D’Oench, Duhme doctrine did not apply in this case is a question of law subject to plenary review. Powers v. Olson, 252 Conn. 98, 105, 742 A.2d 799 (2000); Steelcase, Inc. v. Crystal, 238 Conn. 571, 577, 680 A.2d 289 (1996).

A

The Appellate Court determined that the D’Oench, Duhme doctrine and 12 U.S.C. § 1823 (e) did not apply because there was neither an “agreement” nor an “asset” at the time the association went bankrupt. That determination was premised on the court’s conclusion that the defendants’ mortgage note had been set off as a matter of law against the entire subordinated debenture before Resolution Trust took control of the association in receivership. See OCI Mortgage Corp. v. Marchese, supra, 56 Conn. App. 679. OCI contends that, in reversing the trial court’s judgment of strict foreclosure, the Appellate Court “blurred the distinction between a completed setoff and an inchoate setoff right.” OCI maintains that a setoff could not have occurred as a matter of law prior to the association’s insolvency because: (1) the debenture was, by its own terms, subordinated to other debts of the association; and (2) the explicit language of the subordinated debenture agreement, with which the defendants failed to comply, delineated the means by which the defendants could have accelerated the debenture. The defendants argue that, because the association had defaulted on the debenture by failing to make the quarterly interest payments thereon, the setoff occurred automatically upon default, “regardless of any contractual language” in the subordinated debenture agreement. We agree with OCI.

In Connecticut, a setoff may be legal or equitable in nature. See Connecticut Bank & Trust Co. v. Winters, 225 Conn. 146, 162, 622 A.2d 536 (1993); Savings Bank of New London v. Santaniello, 130 Conn. 206, 211, 33 A.2d 126 (1943). Legal setoff is governed by General Statutes § 52-139 et seq. and involves mutual debts between parties in any action: (1) to recover on a debt pursuant to § 52-139; (2) by an assignee of a nonnegotiable chose in action pursuant to General Statutes § 52-140; (3) for trespass to real or personal property or other tort committed without force pursuant to General Statutes § 52-141; or (4) involving joint debtors pursuant to General Statutes § 52-142. See also Practice Book § 10-54.

When the statutes governing legal setoff do not apply, a party may be entitled to equitable setoff, nonetheless, “only to ‘enforce the simple but clear natural equity’ ” in a given case. Connecticut Bank & Trust Co. v. Winters, supra, 225 Conn. 162, quoting Spurr v. Snyder, 35 Conn. 172, 174 (1868). “The right to setoff, although it may arise out of a written instrument, is a common law equitable right that is not itself a written instrument.” Normand Josef Enterprises, Inc. v. Connecticut National Bank, 230 Conn. 486, 494, 646 A.2d 1289 (1994).

An action to foreclose on a mortgage, circumscribed by statute; see General Statutes § 49-1 et seq.; is an equitable proceeding; New Milford Savings Bank v. Jajer, 244 Conn. 251, 256-57, 708 A.2d 1378 (1998); Federal Deposit Ins. Corp. v. Hillcrest Associates, 233 Conn. 153, 172, 659 A.2d 138 (1995); and as such, does not implicate the statutes governing setoff. Cf. Savings Bank of New London v. Santaniello, supra, 130 Conn. 211 (noting that strict foreclosure is not action on debt invoking statutory setoff and assuming, without deciding, that defendant had right to file cross complaint for equitable setoff).

Although we have discerned “no meaningful distinction” between setoff rights that may derive from common-law principles and contract versus those that are moored in statute; Fleet Bank Connecticut, N.A. v. Cari-llo, 240 Conn. 343, 351 n.10, 691 A.2d 1068 (1997); “ ‘[i]t is clear that a setoff does not occur automatically’ ” but, rather, it must be exercised affirmatively. Normand Josef Enterprises, Inc. v. Connecticut National Bank, supra, 230 Conn. 505.

In the usual case, setoff is “[t]he equitable right to cancel or offset mutual debts or cross demands . . . [and is] commonly used by a bank in reducing a customer’s checking or other deposit account in satisfaction of a debt the customer owes the bank.” (Internal quotation marks omitted.) Fleet Bank Connecticut, N.A. v. Cari-llo, supra, 240 Conn. 352. Setoff rights “are simply the vehicles by which a creditor may access bank accounts owned by its debtor” or cancel mutual debts. Id., 351-52 n.10. We previously have determined that a right of setoff in the deposit account context is effectuated “only after [a bank] has performed some binding overt act and has made a record to evidence that action. . . . [Consistent with the certainty and predictability required by banking operations in the commercial world, the act must be unequivocal, objectively ascertainable and final in order to be overt and binding.” (Citation omitted.) Normand Josef Enterprises, Inc. v. Connecticut National Bank, supra, 230 Conn. 506; see Citizens Bank of Maryland v. Strumpf 516 U.S. 16, 18-19, 116 S. Ct. 286, 133 L. Ed. 2d 258 (1995); see also Federal Deposit Ins. Corp. v. Marine Midland Realty Credit Corp., 17 F.3d 715, 722 (4th Cir. 1994) (claim for setoff must exist before insolvency; liability must be absolute and certain, and claim timely made); Federal Deposit Ins. Corp. v. State Bank of Virden, supra, 893 F.2d 143 (setoffs accomplished before assignment of debt to FDIC not automatically barred by § 1823 [e]).

The Appellate Court determined that, following the association’s default on the interest payments under the terms of the subordinated debenture agreement, the “defendants formally demanded full payment on the debenture and informed [the association] of their intention to exercise their right to set off the mortgage.” (Internal quotation marks omitted.) OCI Mortgage Corp. v. Marchese, supra, 56 Conn. App. 670. The court based this conclusion on the letter sent to the association by the defendants’ attorney on November 14,1989, which provided “written notice pursuant to § 10.01 of the [subordinated debenture] agreement [and stated that] if the default was not cured, the defendants ‘will exercise all rights available to them not only under Section 10.02 of the foregoing [subordinated [debenture [agreement, but also under statutory and common law.’ ” (Emphasis added.) Id., 676 n.3. As the Appellate Court noted, however, the subordinated debenture agreement defined events that constituted default thereunder and provided procedures for accelerating the debt if the association were to default. Id. The parties do not dispute that the language of the subordinated debenture agreement contemplated that a second notice, notice of acceleration of the debt, would be sent to the association after the initial notice of default and that no such notice of acceleration was provided prior to the association’s insolvency. See id. The defendants argue that, consistent with the Appellate Court’s conclusion, the contractual provisions are “irrelevant” because the association was in default and the setoff occurred by operation of law. Id.

This court has long recognized that “ [a] contract must be construed to effectuate the intent of the parties, which is determined from the language used interpreted in the light of the situation of the parties and the circumstances connected with the transaction. . . . Where the language of the contract is clear and unambiguous, the contract is to be given effect according to its terms.” (Internal quotation marks omitted.) Tallmadge Bros., Inc. v. Iroquois Gas Transmission System, L.P., 252 Conn. 479, 498, 746 A.2d 1277 (2000); see also Olean v. Treglia, 190 Conn. 756, 768-70, 463 A.2d 242 (1983) (“[j]udicial deference to freedom of contract is particularly appropriate in a case . . . where a private lender and a private borrower can be presumed to have had equal access to the financial marketplace when the [agreement] was first negotiated”; due-on-sale clause in mortgage enforceable; mortgage properly accelerated where intent to exercise option to accelerate was “ ‘crystal clear’ ”). Were we to accept the Appellate Court’s conclusion that the acceleration provisions in the subordinated debenture agreement were irrelevant, we essentially would eviscerate portions of the contract governing the subordinated debenture between the association and the defendants. The defendants necessarily rely on this contract, however, in support of their setoff claim.

The Appellate Court relied on Murphy v. Federal Deposit Ins. Corp., 38 F.3d 1490 (9th Cir. 1994), in its decision that the setoff had occurred by operation of law. In Murphy, the plaintiff, who was a beneficiary of a letter of credit, owed $100,000 on a promissory note secured from a bank. Id., 1496. The bank had issued letters of credit to the plaintiff to use as collateral for obligations with one of his commercial suppliers. Id., 1495. Following presentment and dishonor of the letters of credit, the supplier assigned the $585,000 letters of credit back to the plaintiff. Id., 1505. Eight months after the dishonor and assignment of the letters of credit, the bank failed and the FDIC sought to collect on the note while refusing to pay the letters of credit. Id., 1497.

The Ninth Circuit Court of Appeals determined that “set-offs arising by operation of law are not automatically barred by § 1823 (e), although a particular set-off, if it amounts to a claim based on breach of an agreement, may be barred.” Id., 1504-1505. The court concluded that, because the jury had determined that the plaintiffs supplier had complied strictly with the presentment requirements of the letters of credit, the plaintiff was entitled to set off the $100,000 note against the $585,000 owing on the letters of credit. Id., 1505.

In the present case, although the defendants and the association had agreed to set off quarterly interest pay-merits on the debenture against three months of payments on the mortgage note, the only way that the entire mortgage note balance could have been set off against the full amount of the subordinated debenture was if the debenture had been accelerated. As previously noted, the defendants never forwarded the required notice of acceleration under the terms of their agreement prior to the association’s insolvency. These facts distinguish the present case from Murphy v. Federal Deposit Ins. Corp., supra, 38 F.3d 1505. The letters of credit therein had been presented and dishonored to make them fully payable as a liability of the bank. Id. In the present case, the defendants never accelerated the subordinated debenture; the only notice that they had provided indicated that they would do so if the failure of the association to tender that quarter’s interest payment was not cured within the fifteen days provided in § 10.01 of the subordinated debenture agreement. See OCI Mortgage Corp. v. Marchese, supra, 56 Conn. App. 676 n.3.

In addition, the subordinated debenture agreement provided that no payment of principal may be accelerated without the approval of the Federal Savings and Loan Insurance Corporation, if after giving effect to such payment the association would fail to meet the net worth requirements of the applicable federal regulations. There is no evidence in the record to suggest that the defendants received that approval to accelerate and thereby set off the full amount of the debenture. See, e.g., Federal Deposit Ins. Corp. v. de Jesus Velez, 678 F.2d 371, 375 (1st Cir. 1982) (even if 12 U.S.C. § 1823 [e] had been followed, agreement to set off debentures against notes would be void as against public policy for circumventing FDIC approval requirement for payment of debentures). Although setoff rights do not necessarily require a written instrument, the defendants’ claim in this case “arise[s] from a written instrument,” and their failure to comply with the terms of the subordinated debenture agreement for accelerating the debt precludes any setoff herein. See Normand Josef Enterprises, Inc. v. Connecticut National Bank, supra, 230 Conn. 494. Accordingly, we conclude that the Appellate Court improperly determined that the debenture was set off against the mortgage note as a matter of law.

B

OCI next argues that the Appellate Court improperly concluded, as a further basis for its decision, that the subordinated debenture agreement and the mortgage note had been “sufficiently bound together to constitute a bilateral agreement for purposes of avoiding the D’Oench, Duhme doctrine.” OCI Mortgage Corp. v. Marchese, supra, 56 Conn. App. 682. We agree with OCI. The mortgage note, the subordinated debenture agreement and the subsequent agreement to apply the interest on the debenture to the payments due under the mortgage note were entered into on separate occasions without any single governing document reflecting their connection. Although we recognize that a single, bilateral contract may be valid because it may satisfy the requirements of 12 U.S.C. § 1823 (e); Howell v. Continental Credit Corp., 655 F.2d 743, 747 (7th Cir. 1981) (bilateral obligations in one document may serve as source of defense against FDIC; D’Oench, Duhme doctrine and § 1823 [e] apply only where defenses to facially valid notes and guarantees are based on undisclosed agreements); the mortgage note and separate subordinated debenture agreement in this case were not consolidated in a manner that would compel the conclusion that they embodied a single, bilateral agreement. See Appliances, Inc. v. Yost, 181 Conn. 207, 210-11, 435 A.2d 1 (1980) (“a promissory note is nothing more than a written contract for the payment of money”); see also Community Bank of the Ozarks v. Federal Deposit Ins. Corp., 984 F.2d 254, 259 (8th Cir. 1993) (bilateral agreement exception is narrow one); Federal Deposit Ins. Corp. v. Aetna Casualty & Surety Co., 947 F.2d 196, 206 (6th Cir. 1991) (blanket bonds, unlike promissory notes, impose bilateral obligations); Resolution Trust Corp. v. J.B. Centron Development Co., 92 Ohio App. 3d 643, 648, 637 N.E.2d 23 (1993) (“[I]f an agreement is bilateral, rather than unilateral, Section 1823 [e] may not apply. . . . Promissory notes, however, are unilateral contracts.” [Citations omitted.]). The Appellate Court improperly concluded otherwise.

C

OCI next contends that, because a set off did not occur by operation of law prior to the association’s insolvency, the defendants’ right to exercise a setoff thereafter was “cut off’ by the D’Oench, Duhme doctrine and 12 U.S.C. § 1823 (e). The defendants rely on the same arguments that support their theory of setoff and contend that, because “there was a default on the payment of the [subordinated] debenture agreement which operated to extinguish the defendants’ debt [on the mortgage note] by reason of setoff, and that setoff occurred upon the default,” § 1823 (e) could not apply. We conclude that § 1823 (e) applies and that, because the defendants failed to meet its requirements, they are precluded from asserting, as a defense to OCI’s strict foreclosure action on the mortgage, any agreement not memorialized that would allow them to exercise a set-off now.

Title 12 of the United States Code, § 1823 (e), provides that “[n]o agreement which tends to diminish or defeat the interest of the [FDIC] in any asset acquired by it under this section . . . shall be valid against the [FDIC] unless such agreement—(A) is in writing, (B) was executed by the depository institution and any person claiming an adverse interest thereunder, including the obligor, contemporaneously with the acquisition of the asset by the depository institution, (C) was approved by the board of directors of the depository institution or its loan committee, which approval shall be reflected in the minutes of said board or committee, and (D) has been, continuously, from the time of its execution, an official record of the depository institution.”

It is clear that “[a] condition to payment of a note ... is part of the ‘agreement’ to which the writing, approval, and filing requirements of 12 U.S.C. § 1823 (e) attach.” Langley v. Federal Deposit Ins. Corp., supra, 484 U.S. 96. At some time subsequent to the execution of the subordinated debenture agreement, the association and the defendants “agreed that the defendants’ mortgage note would be paid by applying [the association’s] interest payments on the debenture to the defendants’ monthly mortgage payments.” (Internal quotation marks omitted.) OCI Mortgage Corp. v. Marchese, supra, 56 Conn. App. 670. The parties in this case stipulated that the defendants and the association had “agreed” to satisfy the monthly payments due under the mortgage by applying the quarterly interest payments on the debenture thereto. This agreement, essentially tying the monthly mortgage payments to the debenture interest paid quarterly, significantly altered the terms of both the mortgage note and the debenture, and, according to the defendants, relieved them of any obligation to keep the monthly mortgage payments current in the event of the association’s default on the debenture. We conclude that this agreement conditioned the defendants’ obligation, as long as the debenture remained outstanding and interest payments were due thereon, to take affirmative steps to ensure that then monthly mortgage payments were current. It is precisely the type of side agreement contemplated by 12 U.S.C. § 1823 (e). The defendants may succeed only if they meet the requirements of the statute. See Langley v. Federal Deposit Ins. Corp., supra, 91-92 (“[n]either the FDIC nor state banking authorities would be able to make reliable evaluations if bank records contained seemingly unqualified notes that are in fact subject to undisclosed conditions”); see also Federal Deposit Ins. Corp. v. Bowles Livestock Commission Co., 739 F. Sup. 1364, 1370 (D. Neb. 1990), rev’d on other grounds, 937 F.2d 1350 (8th Cir. 1991) (“course of conduct and understanding” between bank and debtor is agreement for purposes of § 1823 [e]). Unless it satisfies 12 U.S.C. § 1823 (e), such an agreement is invalid because it would diminish Resolution Trust’s, and hence, OCI’s, interest in the mortgage note. See Alaska Southern Partners v. Prosser, 972 P.2d 161, 164 (Alaska 1999) (§ 1823 [e] “nullifies undocumented agreements that could diminish a loan’s worth by altering the terms of payment reflected in the bank’s loan file”); Federal Deposit Ins. Corp. v. O’Malley, 163 Ill. 2d 130, 148-49, 643 N.E.2d 825 (1994), cert. denied, 515 U.S. 1130, 115 S. Ct. 2554, 132 L. Ed. 2d 808 (1995) (“no asset” exception to § 1823 [e] cannot be invoked where payment depends upon agreement not reflected in bank records).

In concluding that the debenture and the mortgage note had been set off as a matter of law, the Appellate Court recognized that “the note, the debenture and the payments of the mortgage note by the application of the debenture interest to the mortgage note [were] all in the [association’s] records.” OCI Mortgage Corp. v. Marchese, supra, 56 Conn. App. 679. We conclude that any documents in the association’s records evidencing the agreement to apply the debenture interest to the sums due on the mortgage note do not satisfy the first two requirements of 12 U.S.C. § 1823 (e). See 12 U.S.C. § 1823 (e) (“[n]o agreement [to apply the debenture interest to the sums due on the mortgage note] . . . shall be valid . . . unless such agreement . . . (A) is in writing, [and] (B) was executed . . . contemporaneously with the acquisition of the asset”); Resolution Trust Corp. v. BVS Development, Inc., 42 F.3d 1206, 1213-14 (9th Cir. 1994) (noting that § 1823 [e] generally invalidates any rights based on alleged oral discussions or secret agreements not documented in records); Community Bank of the Ozarks v. Federal Deposit Ins. Corp., supra, 984 F.2d 257 (neither § 1823 [e], nor D’Oench, Duhme doctrine satisfied by inferences from bank’s records); Beighley v. Federal Deposit Ins. Corp., 868 F.2d 776, 783-84 (5th Cir. 1989) (where no single document provides terms of agreement, mere reference in various bank records does not satisfy writing requirement of § 1823 [e]).

The defendants and the association executed the mortgage note on September 13,1985. The subordinated debenture agreement was not executed until January 15, 1987. At some indefinite time thereafter, the defendants and the association agreed to apply the interest payments in the manner discussed previously. There is no written document evidencing the agreement to apply the interest on the debenture to the mortgage payments, nor is there any document referring to the mortgage note and the debenture that could be read as incorporating both into a subsequent agreement. See E & F Construction Co. v. Rissil Construction Associates, Inc., 181 Conn. 317, 319, 435 A.2d 343 (1980) (noting that when signatories execute contract referring to another instrument therein, two instruments may be read together as agreement of parties); RTC Mortgage Trust 1994-S3 v. Guadalupe Plaza, 918 F. Sup. 1441, 1447-48 (D.N.M. 1998) (insufficient evidence of any reasonable explicit written agreement in bank’s records that separated note, mortgage and lease constituted one transaction); see also Beighley v. Federal Deposit Ins. Corp., supra, 868 F.2d 783 n.ll (reference to loan in minutes of bank board meeting and other records of bank do not “by any stretch of the imagination” constitute agreement executed contemporaneously with loan). Because we conclude that neither the writing nor the contemporaneity contemplated under § 1823 (e) is fulfilled in this case, we need not consider whether the final two requirements of the statute are satisfied.

“When the failure to put in writing what was said orally is the gravamen of the objection to the bank’s conduct, it comes within both the letter and spirit of § 1823 (e).” Federal Deposit Ins. Corp. v. State Bank of Virden, supra, 893 F.2d 143. For the defendants to prevail under a setoff theory now, after the association’s insolvency, this court would be required to conclude that: (1) the debenture had been accelerated at some point and for some reason regardless of the notice and approval provisions therein and irrespective of the fact that the association had entered receivership almost one month after the defendants sent the first notice of default; and (2) the agreement tying the mortgage note and the debenture, which effectively modified both and purportedly relieved the defendants of the obligation to make any monthly payments on the mortgage note as long as the debenture remained outstanding, satisfies 12 U.S.C. § 1823 (e). We reach neither conclusion in this case. Accordingly, because the defendants agreed to tie their obligations under the mortgage note to the association’s obligations under the debenture and that agreement does not meet the requirements of § 1823 (e), they are precluded from asserting it against OCI in this foreclosure action.

D

Finally, OCI claims in its brief that “in what [is] manifestly the real reason” for the Appellate Court’s decision, that court improperly disregarded 12 U.S.C. § 1823 (e) because it would have “shockfed] the judicial conscience” to permit OCI to recover in this case. See OCI Mortgage Corp. v. Marchese, supra, 56 Conn. App. 683. Although the Appellate Court concluded that it would have been inequitable to allow OCI to prevail in a proceeding such as this mortgage foreclosure action; id., 677, 683; we note that there is no catchall equitable exception to the provisions of 12 U.S.C. § 1823 (e). See Langley v. Federal Deposit Ins. Corp., supra, 484 U.S. 95 (refusing to “engraft an equitable exception upon the plain terms of the statute”); Federal Deposit Ins. Corp. v. Fisher, 727 F. Sup. 1306, 1311 (D. Minn. 1989) (refusing to “weigh the equities” in light of Congress’ “measured decision” in passing unambiguous language of § 1823 [e]).

The judgment of the Appellate Court is reversed and the case is remanded to that court with direction to affirm the judgment of strict foreclosure, and to remand the case to the trial court to set new law days.

In this opinion the other justices concurred.

       Section 1823 (e) of title 12 of the United States Code provides: “No agreement which tends to diminish or defeat the interest of the [Federal Deposit Insurance] Corporation in any asset acquired by it under this section or under section 1821 of this title, either as security for a loan or by purchase or as receiver of any insured depository institution, shall be valid against the [Federal Deposit Insurance] Corporation unless such agreement—
      “(A) is in writing,
      “(B) was executed by the depository institution and any person claiming an adverse interest thereunder, including the obligor, contemporaneously with the acquisition of the asset by the depository institution,
      “(C) was approved by the board of directors of the depository institution or its loan committee, which approval shall be reflected in the minutes of said board or committee, and
      “(D) has been, continuously, from the time of its execution, an official record of the depository institution.”
      Section 1823 (e) has been amended since the time the subordinated debenture agreements at issue in this case were executed. See Financial Institutions Reform, Recovery and Enforcement Act of 1989, Pub. L. No. 101-73, § 217 (4), 103 Stat. 254; Riegle Community Development and Regulatory Improvement Act of 1994, Pub. L. No. 103-325, § 317, 108 Stat. 2223. The amendments were technical in nature and are not relevant to this case. For purposes of convenience and clarity, we refer to the current revision of § 1823 (e).

       Cadle Company, Southgate of Southport Condominium and the town of Fairfield were also named as defendants in the trial court. The action was withdrawn against the town of Fairfield and Southgate of Southport Condominium, and the Cadle Company is not involved in this appeal. References herein to the defendants are to Carole N. Márchese and Anthony J. Márchese.

       The subordinated debenture agreement, dated January 15, 1987, referenced the terms and provisions of a separate subordinated debenture agreement dated June 5, 1986. We refer to both these agreements as the “subordinated debenture agreement.”

       At oral argument before this court, counsel indicated that the quarterly interest payments on the debenture had been approximately $22,500 and that three months of payments on the mortgage note amounted to roughly $8000. Thus, as long as these payments were current, each quarter the defendants had received a net payment of approximately $15,000.

       Section 10.01 (a) of the subordinated debenture agreement provided that “[d]efault for a period of 15 business days in the payment of interest on any [debenture after written notice thereof by certified mail to the [ajssociation” constituted an event of default. The following section, § 10.02, provided that “[wjhen any event of default described in Section 10.01 above has occurred and is continuing any holder of any [djebenture may, by notice in writing sent by certified mail to the [ajssociation, declare the principal of and any accrued interest on such [djebenture to be immediately due and payable without further demand, presentment, protest, or notice of any kind, subject, however, to the approval of the [Federal Savings and Loan Insurance Corporation] if after giving effect to such accelerated payment the [ajssociation would fail to meet the net worth or Federal insurance reserve requirements set forth in [the federal regulations] . . . .”

       Under the Financial Institutions Reform, Recovery and Enforcement Act of 1989; Pub. L. No. 101-73, 103 Stat. 183 (codified in scattered sections of 12 U.S.C.); Congress expanded 12 U.S.C. § 1823 (e) to apply to the newly created Resolution Trust in its receivership capacity. See Duraflex Sales & Service v. W.H.E. Mechanical Contractors, 110 F.3d 927, 933 n.4 (2d Cir. 1997). Resolution Trust was given the same powers and rights as the Federal Deposit Insurance Corporation; 12 U.S.C. § 1441a (b) (4) (A); and had been “established by Congress as a temporary federal agency to clean up the savings and loan . . . crisis after the [Federal Savings and Loan Insurance Corporation] fund became insolvent.” 1 Federal Deposit Insurance Coiporation, Managing the Crisis: The FDIC and RTC Experience 1980-1994 (1998), p. 6. Resolution Trust merged or liquidated savings associations that had been insured by the Federal Savings and Loan Insurance Coiporation and eventually was eliminated, transferring its operations to the Federal Deposit Insurance Corporation, in 1995. See id., pp. 11, 13. The Federal Deposit Insurance Corporation, which had managed Resolution Trust, remains as one of the principal federal entities charged with administering financial institution insolvencies. See id., pp. 10-13; 12 U.S.C. §§ 1441a (b) and 1813 (q) (1) through (4); see also Securities Investor Protection Corp. v. BDO Seidman, L.L.P., 222 F.3d 63, 70 (2d Cir. 2000) (observing that similar regulatory roles of Federal Deposit Insurance Corporation, Federal Savings and Loan Insurance Corporation and Resolution Trust allow for interchangeable case law analysis).

       Although not a disputed issue in the present case, it is generally recognized that third party transferees and assignees of the Federal Deposit Insurance Corporation and Resolution Trust enjoy the same protections of 12 U.S.C. § 1823 (e) andthcD’Oench, Duhme doctrine. See Federal Financial Co. v. Hall, 108 F.3d 46, 49 (4th Cir.), cert. denied, 522 U.S. 858, 118 S. Ct. 157, 139 L. Ed. 2d 102 (1997); Federal Deposit Ins. Corp. v. Bledsoe, 989 F.2d 805, 811 (5th Cir. 1993); Newton v. Uniwest Financial Corp., 967 F.2d 340, 347 (9th Cir. 1992); AAI Recoveries, Inc. v. Pijuan, 13 F. Sup. 2d 448, 451 (S.D.N.Y. 1998).

       The FDIC and Resolution Trust formulated a variety of approaches for handling financial institution insolvencies, including purchase and assumption transactions, the use of bridge banks, deposit payoffs and forbearance programs. See generally Managing the Crisis, supra, pp. 13-28 (discussing various means of resolving bank and savings and loan association failures).

       See also F. Galves, “Might Does Not Make Right: The Call for Reform of the Federal Government’s D’Oench, Duhme and 12 U.S.C. § 1823 (e) Superpowers in Failed Bank Litigation,” 80 Minn. L. Rev. 1323, 1355 (1996) (noting that common law set forth in D’Oench, Duhme & Co. and § 1823 [e] have “merged into a single, powerful doctrine”); J. Echevarria, “A Precedent Embalms a Principle: the Expansion of the D’Oench, Duhme Doctrine,” 43 Cath. U. L. Rev. 745, 793 (1994) (noting that D’Oench, Duhme & Co. decision, 12 U.S.C. § 1823 [e] and subsequent case law “have become a seamless web”); note, “Defending the Indefensible: Exceptions to D’Oench and 12 U.S.C. § 1823 (e),” 63 Fordham L. Rev. 1337,1355 (1995) (“common law and statutory doctrines are directed to the same evils and share the same principles”).

       See footnote 5 of this opinion.

       Because we agree with OCI that the Appellate Court improperly concluded that the setoff had occurred automatically without reference to the acceleration provisions in the subordinated debenture agreement, we need not address whether the setoff also was improper because of the subordinated nature of the debentures. See generally Federal Deposit Ins. Corp. v. Texarkana National Bank, 874 F.2d 264, 269 (5th Cir. 1989), cert. denied, 493 U.S. 1043, 110 S. Ct. 837, 107 L. Ed. 2d 833 (1990) (setoff inappropriate where debentures not mutually extinguishable with notes “because the debentures were specifically made subordinate to the claims of all other depositors and creditors of the bank”); Federal Deposit Ins. Corp. v. de Jesus Velez, supra, 678 F.2d 376 (no setoff permitted where notes and debentures “not mutually extinguishable”).
      In addition, due to its conclusion that a setoff had been completed as a matter of law prior to the association’s insolvency, the Appellate Court reasoned that no agreement existed for an application of the D’Oench, Duhme doctrine and 12 U.S.C. § 1823 (e). See OCI Mortgage Corp. v. Marchese, supra, 56 Conn. App. 679. We reach a contrary conclusion in part II C of this opinion. The Appellate Court also reasoned that the setoff had extinguished the mortgage note as an asset of the association at the time of its insolvency. See id. Again, because the debenture had not been accelerated and, for that reason, no setoff occurred in this case, we reach the opposite conclusion. The mortgage note remained intact as a facially valid asset of the association at the time it failed. See Alaska Southern Partners v. Prosser, 972 P.2d 161, 164 (Alaska 1999) (loans are assets acquired by FDIC); Federal Deposit Ins. Corp. v. Adams, 187 Ariz. 585, 591, 931 P.2d 1095 (App. 1996) (“[i]t is well-settled that borrowers are precluded from disproving the existence of an ‘asset’ by resort to evidence that does not meet the stringent standards of § 1823 [e]”).

       We note that, as authority for the proposition that the mortgage, subordinated debenture agreement and subsequent interest payment arrangement had been bound into one bilateral agreement, the Appellate Court relied upon the report of the trial referee, to which the trial court had sustained OCI’s objection. OCI Mortgage Corp. v. Marchese, supra, 56 Conn. App. 682. The defendants rely solely upon the Appellate Court’s opinion to support their argument.

       It generally is recognized that the rights and liabilities of a financial institution are fixed at the time that institution is declared insolvent by the banking authorities. See American National Bank v. Federal Deposit Ins. Corp., 710 F.2d 1528, 1540 (11th Cir. 1983); Federal Deposit Ins. Corp. v. Grella, 553 F.2d 258, 262 (2d Cir. 1977); Bayshore Executive Plaza Partnership, LLC v. Federal Deposit Ins. Corp., 750 F. Sup. 507, 511 (S.D. Fla. 1990), aff'd, 943 F.2d 1290 (11th Cir. 1991) (per curiam).
      As noted previously, because 12 U.S.C. § 1823 (e) applies and directs our decision in this case, we need not decide whether federal common-law doctrines embodied in and stemming from the D’Oench, Duhme & Co. decision remain intact. See part I of this opinion; see also Weber v. New West Federal Savings & Loan Assn., 10 Cal. App. 4th 97, 107 n.6, 12 Cal. Rptr. 2d 468 (1992) (comparing common-law D’Oench, Duhme doctrine and § 1823 [e]).

       In addition, we note that the defendants argued before the trial court, in cor\junction with their affirmative defense of “accident, mistake and/or fraud,” which they abandoned on appeal, that they had entered into the mortgage “with the understanding” that the interest on the debentures would be applied to pay off the mortgage note. The defendants argued that they “would not have entered into the mortgage agreement . . . had they known that [the association] would not apply the interest due on the debentures, or part of the principal ... to the mortgage . . . .” Although not conclusive on the matter, these statements bolster our conclusion that the defendants understood that they would not be required to make affirmative payments on the mortgage in light of the outstanding debenture. See Home Ins. Co. v. Aetna Life & Casualty Co., 235 Conn. 185, 203-204, 663 A.2d 1001 (1995) (“ ‘a superseded pleading remains in the case as a part of its history and is available to the adverse party as an admission’ ”); Dreier v. Upjohn Co., 196 Conn. 242, 248-49, 492 A.2d 164 (1985) (judicial admissions in withdrawn or superseded pleadings still admissible).
      Furthermore, aside from the temporal malady from which the defendants’ argument suffers, the defendants assume that OCI herein is the proper party against whom to assert their claim for setoff. See Nashville Lodging Co. v. Resolution Trust Corp., supra, 59 F.3d 247. In fact, the defendants filed a timely proof of claim with Resolution Trust for administration of the debenture as a liability of the association. The record does not disclose the ultimate resolution of that claim in receivership.

       See part IIB of this opinion. The trial court, in sustaining OCI’s objection to the attorney trial referee’s report, recognized that the mortgage note and subordinated debenture agreement had been executed some sixteen months apart and that, therefore, the requirement that the agreement be executed “contemporaneously” with the acquisition of the mortgage note had not been satisfied.

       We do note, however, that there is no evidence in the record suggesting that the association’s board approved the agreement to apply the subordinated debenture to the mortgage note; nor is there evidence, other than perhaps the end result of the payment scheme in its quarterly statements, that the association kept any official record of the arrangement. See 12 U.S.C. § 1823 (e) (C) and (D).