"Certificate of Beneficial Interest." Example: The Temple Iron Co. is controlled by certain railroad companies, and operated in their mutual interests. The latter, not wishing to use their funds for investment in the Temple Iron Co., but, at the same time, wishing to retain its voting control, sell certificates of " beneficial interest," equal in their total amount to the capital stock of the Temple Iron Co. Such " beneficial interest " conveys to the investor the right only to receive dividends, and right to the equity in the property in case of financial disaster to it. These certificates were issued by the Guaranty Trust Co. of New York, certifying that the actual stock of the Temple Iron Co. was deposited with it, and that the voting power of such stock rested with the company. To a certain extent the railroads " ate their cake and had it too; " that is, they obtained money from investors at the latter's own risk, for the benefit of the railroad companies, without the necessity for investment upon their part, enabling them to so control the output of the Temple Iron Co. that the railroads in interest should get the benefit of its freight.
One meaning of "beneficial" in a general sense is that of a dependent or secondary possession, from which must arise its use as above outlined.