Court Opinion

ID: 5191835
Source: CourtListenerOpinion
Date Created: 2022-01-06 15:37:21.237607+00
Date Added: 2024-06-11T08:23:47.131335
License: Public Domain

Goodrich, P. J.
(dissenting):
I dissent. The note was payable on demand and return of securities. I think demand and tender must take place before action.
There was no such demand or tender of securities before action, and it was not sufficient compliance with the terms of the note to tender the bonds at the trial.
.When the tender was made at the trial, the bonds, with the consent of the pledgee, and by his affirmative action, had merged in the judgment of foreclosure. The bonds were then valueless except for their right to participate in the benefit of the sale under the decree.
By the terms of the agreement of the bondholders, the pledgee, at any time before judgment had been entered, could have withdrawn the bonds burdened only with a proportionate share of the expenses of the foreclosure action, but when they had merged in the judgment this power ended.
The pledgee dealt with the bonds to a greater extent than simply taking proceedings for their collection.
Under the bondholders’ agreement the committee of the bond*86holders therein named was authorized to pay for the mortgaged premises on the foreclosure sale with the bonds deposited with the committee. This exceeds tiré powers of a pledgee and goes beyond simple proceedings for collection. As the bonds merged in the judgment, and as the pledgee had consented to and authorized a" material change in the character and condition of the securities, his action, in my opinion, constituted a conversion of the bonds.
Judgment affirmed, with costs.