Court Opinion

ID: 3496898
Source: CourtListenerOpinion
Date Created: 2016-07-05 22:04:33.952105+00
Date Added: 2024-06-11T14:15:33.215495
License: Public Domain

I am not in accord with the opinion of Mr. Justice POTTER.
The issues are ruled by Union Guardian Trust Co. v. BuildingSecurities Corp., on rehearing, 280 Mich. 717.
In point of law the purchase at the foreclosure sale was by the trustee and inured to the benefit of the mortgage bondholders. The corporation being the trustee could not purchase in any other capacity. At the sale, without possession of the mortgage bonds, the trustee was exercising power expressly delegated by the trust indenture and the power, so employed, carried with its exercise continuance of the trust and the trustee thereafter held the title for and in behalf of the bondholders without power of control, management or incumbrance contrary to their rights therein.
The rights of plaintiff, holder of first mortgage bonds, are superior to rights of bondholders under the second mortgage and defendant must pay the plaintiff its proportionate share of the value of the security pledged by the first mortgage.
The decree should so provide, with costs to plaintiff.
BUTZEL, C.J., did not sit. *Page 267