58 N.Y.S. 460 | N.Y. App. Div. | 1899
The controversy between the parties to this action furnishes quite a narrow issue, and one not difficult of statement, however troublesome it may be of determination The plaintiff executed to the defendant as trustee two mortgages, one in April, 1886, and the other in October, 1892. The purpose of the mortgages was to secure the payment of certain registered bonds issued by the plaintiff, the first issue being of $15,000, and the second, $20,000. By the terms of the bonds, interest and principal were payable at the
The claim of the plaintiff is that the defendant, so far as this account is concerned, was its fiscal agent, and that the deposit of the moneys with it for the payment of the interest constituted it a mere depository for that purpose, and that it had the 2’ight, at any time before actual disbursement of the moneys, to withdraw the same. On the part of the defendant, it is claimed that the annual remittance of this money to it ci’eated irrevocable trusts iú the same for the benefit of the coupon holders; and that, as the coupons had not yet been presented for the. whole sum, it was required to hold the same to meet such demand. In support of this contention, the j defendant, while not claiming that it was created a trustee for this J pm'pose by virtue of the mortgages, asserts that it became a trustee by virtue of the remittance of the money to it for the particular
We conclude, therefore, that no trust was created; that no liability was incurred by the defendant to any of the bondholders,, and that it is protected in following the directions of its principal. It was, therefore, bound to pay over to the plaintiff, upon demand, the unexpended portion of the deposit.
This leads us to the conclusion that the judgment should be affirmed.-
All concurred.
Judgment affirmed, with costs.