DEBENTURE

Definition of DEBENTURE in Black's Law Dictionary 4th Edition – Legal dictionary – Glossary of legal terms.

Definition of DEBENTURE

A certificate given by the collector of a port, under the United States customs laws, to the effect that an importer of merchandise therein named is entitled to a drawback, (q. v.,) specifying the amount and time when payable. See Act Cong. March 2, 1799, § 80, 1 St. at Large 687.

An instrument in use in some government departments, particularly in England, by which the government is charged to pay to a creditor or his assigns the sum found due on auditing his accounts. Brande; Blount.

A security for a loan of money issued .by a public company, usually creating a charge on the whole or a part of the company's stock and property, though not necessarily in the form of a mortgage. They are subject to certain regulations as to the mode of transfer, and ordinarily have coupons attached to facilitate the payment of interest. They are generally issued in a series, with provision that they shall rank part passe in proportion to their amounts. See Bank v. Atkins, 72 Vt. 33, 47 A. 176; Cavanagh, Mon. Sec. 267; 56 L.J.R.Ch.D. 815; Brice, Ultra Vires (2d Ed.) 279.

A charge in writing on certain property, with the repayment at a time fixed, of money lent by a person therein named at a given interest.

Any instrument (other than a covering or trust deed) which either creates or agrees to create a debt in favor of one person or corporation, or several persons or corporations, or acknowledges such debt. Simonson, Debentures, 5.

A debenture is distinguished (1) from a mortgage which is an actual transfer of property, (2) from a bond which does not directly affect property, and (3) from a mere charge on property which is individualized and does not form part of a series of similar charges; Cay.Mon.Sec. 267, citing L.R. 10 Ch.D. 530, 681; 15 Ch.D. 465; 21 Ch. D. 762; L.R. 7 App.Cas. 673; Jones, Corp. B. & M. 1 32; 10 H.L.C. 191; L.R. 2 Ch.D. 337.

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