Doyle v. Resolution Trust Corporation

Michael Doyle (plaintiff) signed a note with Trinity Savings and Loan (defendant) at an 11.375% interest rate; Trinity later altered the note to 15.875% and forged Doyle's initials next to the change. Trinity then sold the note, along with many similarly altered notes, to FNMA (defendant), guaranteeing the notes were valid. FNMA checked that each note's alterations bore initials matching the borrower's, but because such alterations were common in the batch, FNMA did not suspect the initials had been forged without Doyle's actual consent. After extended litigation - including a remand triggered by an intervening Oklahoma Supreme Court decision holding adjustable-rate notes were negotiable instruments after all - the district court held an evidentiary hearing and found FNMA purchased the note in good faith and without notice of the forgery, making FNMA a holder in due course entitled to enforce the note as originally executed. Doyle appealed.