(a) Any pledge made by the bank to secure its obligations with respect to bonds or other financial assistance is valid and binding from the time the pledge is made. The revenue, money, or property pledged and received by the bank is immediately subject to the lien of the pledge without any physical delivery or further act. The lien of any pledge is valid and binding as against all parties having claims of any kind in tort, contract, or otherwise against the bank, irrespective of whether the parties have notice of the pledge.
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Terms Used In Alabama Code 23-7-21

  • Contract: A legal written agreement that becomes binding when signed.
  • Lien: A claim against real or personal property in satisfaction of a debt.
  • property: includes both real and personal property. See Alabama Code 1-1-1
  • Tort: A civil wrong or breach of a duty to another person, as outlined by law. A very common tort is negligent operation of a motor vehicle that results in property damage and personal injury in an automobile accident.
  • Uniform Commercial Code: A set of statutes enacted by the various states to provide consistency among the states' commercial laws. It includes negotiable instruments, sales, stock transfers, trust and warehouse receipts, and bills of lading. Source: OCC
(b) No recording or filing of the resolution authorizing the issuance of bonds or other financial assistance, the trust indenture or other financing agreement securing the bonds or other financial assistance, or any other instrument including filings under the Uniform Commercial Code is necessary to create or perfect any pledge or security interest granted by the bank to secure any bonds or other financial assistance.
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