Federal Reserve Bank v. Gray-United Stores Inc.

The defendant made three promissory notes to the order of Exchange Trust Company, two for $50,000 each and one for $30,000, dated February' 12, 1932, and payable in ninety days. On April 12 and April 20, 1932, before maturity of the notes, Exchange Trust Company borrowed large sums of money from the plaintiff, giving promissory notes therefor, and as collateral security for *78such notes indorsed in blank the three notes made by the defendant, and delivered them to the plaintiff. The Exchange Trust Company still owes the plaintiff nearly $200,000 on said loans.

On April 12, 1932, the defendant,…