Broadway Savings Trust Co. v. United States

Plaintiff is a Missouri corporation engaged in a general banking and trust business at St. Louis. In 1912 it purchased a bond or note of the Allegheny Improvement Company, which owned all the stock of a certain railroad. This bond had a face value of $10,000, for which plaintiff paid $9,500.

In 1916 the holders of the bonds or notes of the Allegheny Improvement Company foreclosed and reduced their claims to judgment, and also purchased the stock and bonds of the railroad, and became the pro rata owners thereof.

The stock of the railroad was deposited with a trust company which issued trust…