Vancouver Trust & Savings Bank v. Union Woolen Mills

Citations

• 85 Wash. 114
• 147 P. 643
• 1915 Wash. LEXIS 825

Syllabus

<p>Corporations — Deed oe Trust — Foreclosure. Where a corporation in embarrassed circumstances, but still a going concern, issued negotiable bonds for the purpose of selling the same to pay indebtedness and obtain money to continue operations, and to secure same executed a deed of trust of the corporate properties to a trustee for the bondholders, and such trustee, to enable the corporation to meet current necessities pending the sale of the bonds, advanced money to the corporation as a loan on the pledge of the bonds, such trustee as pledgee of the bonds had priority over the general creditors and was entitled to foreclose its pledge.</p> <p>Corporations — Deed oe Trust — Bond Issue — Assignment eor Benefit of Creditors. The execution of a deed of trust by a corporation to secure its bonds, issued with a view to their sale for the purpose of changing due obligations into time obligations and of raising funds for current expenses, and the assignment of the bonds to the trustee bank, which made advances thereon to meet temporary necessities of the corporation pending the sale of the bonds, the trust deed reciting that the trustee should have no responsibility for the delivery of any of the bonds, and that it assumed no responsibility other than to hold the deed as trustee for the purchasers of the bonds, did not constitute an assignment for the benefit of creditors nor impose on the trustee the duty of selling the bonds.</p>