Case ID: abb-pr_18/html/0438-01.html
Source: Caselaw Access Project
Author: {"author": "By the Court.—Clerke, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

PEOPLE a. THE NEW YORK COMMON PLEAS.
    
      Supreme Court, First District;
    
    
      General Term, Feb., 1865.
    Jurisdiction.—Powers oe Supreme Court.—Court of Common Pleas.
    The Supreme Court has power to issue a writ of prohibition to prevent an inferior court only from exceeding its jurisdiction. It cannot restrain the court in the exercise of its lawful jurisdiction.
    The Court of Common Pleas has as ample jurisdiction of ordinary equity proceedings as the Supreme Court, though the visitatorial powers over corporations belong exclusively to the Supreme Court.
    An action to set aside an assignment made by the directors of a company as fraudulent as against stockholders, is an ordinary equity proceeding within the jurisdiction of the Court of Common Pleas.
    During the pendency of the action of Smith against The New York Consolidated Stage Company, a motion was .made in the Supreme Court, as stated in our report of that case, Ante, 423, on behalf of The New York Consolidated Stage Company for a writ of prohibition restraining the Court of Common Pleas from proceeding with the action, Such a writ was issued but was subsequently quashed at special term.
    From the order quashing the writ the company appealed.
    
      Wm. F. Allen and C. A. Rapallo, for the appellants.
    
      A. R. Lawrence, Jr., and H. W. Robinson, for the respondents.
    I. The writ of prohibition ought to have set out facts sufficient to show on its face that in no possible contingency could the Court of Common Pleas have jurisdiction of any subject-matter involving the question of the validity of the assignment to Augustus Schell, or the appointment of a receiver of all the property and effects of The New York Consolidated Stage Company. This process being considered as the declaration, the relator can only succeed upon the strength of his own allegations demonstrating the error and entire want of jurisdiction. The People a. Ransom, 2 Coms., 490; Com. Dig., Tit. Prohibition, (D.)
    1. The writ can only issue where it is made to appear that the inferior court has assumed to act upon a matter or upon the right of a party which it could not determine, or against which it could not proceed.
    2. Por aught that appears in the writ, the suit of Smith and Kerr was an ordinary equitable action to establish fraud or breach of trust, and a right to all the assets of the New York Consolidated Stage Company, and to follow them into the possession of Augustus Schell as a mere voluntary or unauthorized assignee, or it may have been an action brought by a director or creditor under the provision of 2 Rev. Stat., 462, § 33, subd. 7, and § 35, in which case, the appointment of a receiver pendente lite would be a necessary and proper measure for the preservation of the property. Such a suit is not a creature of this statute, but is a re-enactment of an acknowledged principle of equity. (Revisers’ Notes, 3 Rev. Stat., 2 ed., 755; Abbott a. American Hard Rubber Co., 33 Barb., 578; and also see, The People a. Sturtevant, 5 Seld., 263; Dodge a. Woolsey, 18 How. Pr., 331.)
    3. The Court of Common Pleas' of the city and county of New York has complete jurisdiction of any action, legal or equitable, against The New York Consolidated Stage Company, that corporation being established by law within the city of New York (Laws of 1854, ch. 142), and having its place of business in that city. (Code, § 33, subd. 3.)
    4. An action on behalf of a stockholder, director, or creditor to set aside an assignment made by a corporation or its directors in violation of their rights, does not invoke any visitorial power over a corporation enumerated in 2 Rev. Stat., 462, § 33, nor any but the ordinary powers of a court of equity, to prevent or redress a fraud or injury to the rights of parties. (Revised Notes, 3 Rev. Stat., 2 ed., 755.)
    
    
      5. The jurisdiction conferred on “ the chancellor” is now vested in .the Court of Common Pleas as well as in the Supreme and Superior Court whenever an action “ by bill” might be brought, and the corporation is such a one as is designated in subdivision 3, of section 33 of the Code. (Bowen a. Irish Presbyterian Church, 6 Bosw., 265, and cases cited ; N. Y. Harlem R. R. Co. a. The Mayor, &c, 1 Hilt., 563; Forrest a. Forrest, 6 Duer, 114; S. C., 25 N. Y., 507.)
    6. Even if the object of the suit, or the purpose of the Common Pleas was to appoint a receiver of all the property of the corporation, the Court of Common Pleas had complete equitable jurisdiction over it, and such an action would not have worked a dissolution, nor necessarily interfere with its franchises. (Mann a. Pentz, 3 Comst., 415, 419.)
    H. The writ was improvidently granted’m parte.
    
    I. The facts as disclosed by the affidavits of Mr. Lawrence, and the complaint of Smith and Kerr showed the subject-matter complained of was within the jurisdiction of the Common Pleas. (People a. Seward, 7 Wend., 578 ; State a. Judge, 14 Louisiana, An., 504; 4 Com. Dig., Tit. Prohibition, 491; Washburn a. Phillips, 2 Metc., 296 ; Arnold a. Shields, 5 Dana, 18.)
    2. The party aggrieved had a perfect remedy by appeal for any erroneous decision of the judge, and the issuing of the writ of prohibition in such a case could not but operate as a great public inconvenience.
   By the Court.—Clerke, J.

The weight of authority is certainly in favor of the proposition, that a refusal to grant a writ of prohibition is not appealable.' It seems to. have been held by the greater number of judges in England that the awarding of a prohibition is discretionary; that is, in the language of Matthew Bacon : “from the circumstances of the case the Superior Courts are at liberty to exercise a legal discretion, but not an arbitrary one, in refusing prohibitions, where in such like cases they have been granted, or where by the laws and statutes of the realm, they might to be granted.” (Bacon’s Abridgment, Tit. Prohibition B.; see, also, ex parte Braudlacht, 2 Hill, 367.) The determination of this question is, however, not necessary in the present case, for the justice, from whose order this appeal is taken, was abundantly justified in refusing to grant a writ of prohibition, or, which is the same thing, in revoking a writ which he had inadvertently issued.

The writ is granted by the Superior Courts of Westminster, and in this State by the Supreme Court alone, to prevent inferior courts from exceeding their jurisdiction. It appears to me very plain that the Court of Common Pleas, in entertaining jurisdiction of the action entitled Hugh Smith and John Kerr a. The New York Consolidated Stage Company and others, did not exceed its jurisdiction. In doing so, that court does not necessarily exercise the visitatorial power intrusted alone to the Supreme Court. ■

The máin object of the action was to have ah alleged fraudulent assignment executed by a majority of the directors declared null and void, and to enjoin the assignee from holding possession of, or interfering with the property and effects of the company. This is the exercise of the ordinary equity powers, with which the Court of Common Pleas is as amply intrusted as the Supreme Court.

To grant a writ of prohibition, therefore, in that action, would be an attempt to deprive the Common Pleas of a jurisdiction which the law, in its wisdom, has thought proper to give it; whereas, this court is only allowed to issue the writ to prevent the usurpation of a jurisdiction. If, in the exercise of its lawful authority, or if, having taken rightful cognizance of an action, the Common Pleas should not only declare the assignment null and void, and enjoin the assignee from taking possession of the property of the company, but it should go further and assume additional powers which it does not possess, or commit any other error, the remedy is not for the injured parties to apply to this court for a writ of prohibition, but to have recourse to the appropriate appellate jurisdiction for a correction of such errors.

In short, although this court, in the exercise of its supreme superintending power over all other courts of original jurisdiction in the State, will, unhesitatingly, issue a writ of prohibition, where visitatorial or any other aúthority is usurped, it will refuse the writ when the general scope or purpose of the action is within the jurisdiction of the inferior court—an overstepping of its authority in a portion of its judgment, or any other error in its proceedings, being a ground of appeal or review, but not of prohibition. (See Grant a. Gould, 2 H. Black., 100, for various reasons a most interesting case.) ■

The order should be affirmed, with $10 costs.

Sutherland, J., concurred.