Evening bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1895-1912, 1902-04-20

Nut DllNt 10 Nht llbll'NN AlldN NOuih pN
obtained. The policy OF equity Is to
remove every possible temptation
from the trustee"
DEEDS OF TRUST.
Upon the deeds Of trust securing the
bJads the Court says:
The provisions of the indenture Of
trust executed Ey the McBryde Sugar
Co., and the Waialua Agricultural Co.,
are. except with reference to the prop.
crty conveyed. identically alike. Both
deeds contain this provision. to wiz:
In case of default in payment Of in.
tciest or any of the bonds hereby Sc.
cured, the coupons therefor having
been presented and payment demand.
cd should such default in payment
continue for the period of three
months after such demand. then and
thereupon the principal OF all of said
bonds outstanding and unpaid shall at
the option OF the holders OF a majority
ct said bonds, signifed in writing, be.
cCm me Immediately due and payable,
provided that non.action of any of
said bond holders IN case of any de.
fault shalt not extend and shall not eff
feet any subsequent default OF any
rights arising therefroln.'
There is no other provision in
, either Of said deeds of trusts under
which bond holder may have the
right to declare the principal Of his
bond due upon non.payment Of the in
torest: he may be forced. II he is So
III fortunate as to be a minority bond
holder, and unable to secure the CO.
operation of the majority bondholders,
to bring successive actions for the col,
lection of his interest, resulting not
only in delay in the realization of in.
come. but in the expense which is at.
!tCrdant upon all litigation, thereby re.
ducing the net income 10 a sum great.
ly less than that anticipated by and
T!edged upon the face OF the bonds. II
the majority bondholders are the own
Crs of the plantation, or II the plan
tation, or others having an interest in
Il entirely separate and distinct from
and greater than their interest as
bcndholders. should acquire the ma
jority of the bonds, they would, If VIC
can take into account the motives
which usually influence men in mat
tCrs where dollars are at stake, hardly
sac rifCe their interests for the bene'
Ill of the minority. In other words
they would not nor could they in rea
son be expected TO consent to fore
closure for non-payment OF the inter
at II 1t were clearly contrary to their
protection as stockholders, or as inter
ested parties otherwise TO do so.
THE situation is plainly one in
which the big dog II he may not eat
the little dog can etfectually hold the
sm aller one at bay while he compla
Gently ticks his chops over the bone.
couNNiNGLING OF INTERESTS.
Judge Humphreys says: THE guar
dian by investing in securities under
these deeds of trust has relieved him
self from the letters imposed upon hi!
own custody and management of the
, fund by sharing that management
with others and giving those others al
much authority over II as himself. HC
has no power to foreclose II the per
sons interested with the veto refus,
to permit him to do so. On this plei
be continues:
AS often as the question has been
before the courts II has been declared
emphasized and enforced that a trus
tee shall not mingle the trust funds IL
mis- possession with his private funds
The same objection applies as forcl
bl! to the mingling by the trustee o
trust funds with the funds OF a thir,
party. ! take II that in any case II
4 which the question might be raised
would not be disputed that a trustee
would be prohibited from contributing
certain amount of flduciary fund
where n similar amount had been cor
tributed by stranger, both amount
being secured by one mortgage take
j. the name of common trustee
h Such a contributory mortgage tam
A the trust deeds in this case are moth
ms more or less) as an investment 70
trust funds, are reprobated by all q
q the text writer's and in every cas-
n which | have been able to find. Tn
J proposition is treated by Mr., Levin a
d one too plain for extended discussion
4 He says: OF course trustees shout
I Of join with others in a mortgage S
I az to mix up the trust funds with tn
II PiUhto nf Of ra n paro. and still los