Chase Nat. Bank of New York v. Fidelity & Deposit Co. of Maryland

SWAN, Circuit Judge.

Toward the end of the year 1926 the plaintiff (hereafter referred to at times as the Chase Bank) loaned $600,000 to Seminole County Bank,1 taking as security for the borrower’s notes certificates of indebtedness to the same amount of the city of Sanford, Fla., payable to the borrower and by it indorsed. Thereafter the notes fell due, the Seminole County Bank became insolvent, and the Chase Bank made a settlement with its liquidator (with the consent of the present defendant), leaving $500,000 of the indebtedness still unpaid. Meanwhile the certificates of indebtedness…