
    In the Matter of the Lawyers Title and Guaranty Company.
    Supreme Court, New York County,
    October 17, 1935.
    
      Benjamin J. Rabin [Charles M. Joseph of counsel], for Mortgage Commission of the State of New York.
    
      Harry Rodwin [James F. Murphy, Jr., of counsel], for the Superintendent of Insurance of the State of New York.
    
      
      O’Malley & Wilson [Richard F. Wilson of counsel], for promulgating certificate holders.
    
      James B. Alley, General Counsel Reconstruction Finance Corporation, and Frederick P. Smith of counsel, New York Loan Agency Reconstruction Finance Corporation.
   Frankenthaler, J.

As part of the collateral for a loan made to the title company by the Reconstruction Finance Corporation, the former issued to the latter a participation certificate in the mortgage which secures this issue. That certificate was registered in the name of the Reconstruction Finance Corporation and was delivered several months before the making of the order of rehabilitation. It is still held by the pledgee as part of the collateral for the unpaid balance of its loan. Although the title company has an equity of redemption in the certificate, it is not the present holder thereof. The certificate does not, therefore, represent a part of the mortgage investments held by the guaranty corporation which sold or guaranteed it, and must be counted in determining what is the principal amount upon the basis of which the necessary two-thirds must be computed. (Schackno Act [Laws of 1933, chap. 745], § 6, subd. 2.) Accordingly, as the necessary two-thirds- is lacking in this case, I am constrained to refuse to sign the final order presented.  