Rauch v. Island Park Ass'n

Citations

• 226 Pa. 178
• 75 A. 202
• 1910 Pa. LEXIS 734

Syllabus

<p>Mortgage — Corporation mortgage — Mechanic’s lien — Priority Act of_ June 4, 1901, P. L. 431.</p> <p>Where a corporation mortgage is made for the security of all the bonds issued under it, and the bonds are issued, as far as anything appears to the contrary, to raise money for the general purposes of the association, and are sold in the ordinary course of business without knowledge by or notice to the purchasers of any particular use to which the money is to be applied, the bondholders are entitled to priority, in the distribution of the proceeds of the sale of the property of the company, over mechanics' liens filed for work begun after the mortgage was recorded; and all of the bonds are entitled to such priority although some of them were sold after the improvements, for which the liens were filed, were begun.</p>