Covering Deed

A trust deed executed by a trading company to secure an issue of debentures. Such deed usually contains a conveyance to the trustees of the holders of debentures or debenture stock with provisions authorizing the company to retain possession and carry on the business until forfeiture. Simonson, Debentures, 38. It corresponds to the general corporation mortgage to secure an issue of bonds, as used in this country. They did not formerly include a charge on personal chattels because of decisions that trust deeds containing charges on personalty must be framed and registered under the Bills of Sales acts; 34 Ch. Div. 43; but it having been held that a covering deed is not subject to the registration provisions; (1S91) 1 Ch. (C. A.) 627; (1896) 2 Ch. 212; they now usually contain such a charge; Simonson, Debentures, 39. See Debentube.