Brooklyn Trust Co. v. Prudence Co.

MANTON, Circuit Judge.

March 1, 1927, the Prudence-Bonds Corporation, owner of bonds and mortgages, pledged the same as collateral security for the payment of its bonds amounting to $4,300,000. These bonds were sold to investors and guaranteed as to principal and interest by this debtor (Prudence Company). The Prudence-Bonds Corporation at the same time entered into a trust agreement with the appellant, pledging with it these bonds and mortgages for' the benefit of bondholders. This debtor was not a party to that agreement, but the Prudence-Bonds Corporation was the owner of the equity of the…