Leeds v. Perpetual Building & Loan Ass'n

Citations

• 61 Pa. Super. 542
• 1915 Pa. Super. LEXIS 369

Syllabus

<p>Building and loan associations — Equitable interest in stock— Pledge — Notice—Misapplication of stock.</p> <p>Where a building and loan association has through its solicitors full knowledge of an outstanding equitable interest in its own stock which has been pledged for a debt with the equitable owner’s consent, and the association as pledgee, without the consent of the equitable owner, and at the direction of the person in whose name the stock stands misapplies the pledged stock, the association will be liable for such misappropriation, and the Act of IVlay 5,1911, P. L. 130, will not protect it from such liability.</p> <p>In such a case the building and loan association is guilty of a misappropriation, if it forecloses the mortgage for which the stock was specifically pledged, and from the proceeds of the sale of the real estate retains an amount equal to the surrender value of the stock on which the equitable owner had paid all the fines and fees, in order that it might apply the amount of such surrender value to the payment of an entirely different loan made by the association to the person in whose name the stock in question stood.</p>