Case ID: nys_153/html/0342-01.html
Source: Caselaw Access Project
Author: {"author": "LAUGHLIN, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

BROCK v. POOR et al.
    (No. 6958.)
    (Supreme Court, Appellate Division, First Department.
    May 7, 1915.)
    Corporations <@=>210—Suit by Stockholder—Accounting—Parties.
    In a suit in equity brought by a stockholder on behalf of himself and all other stockholders who became parties or successors of parties to a written agreement between stockholders and two of the defendants, as trustees of property of the corporation, to compel an accounting by the trustees as to acts in connection with the agreement and alleged to have been in excess of their authority and in violation of their duty, the corporation was a proper, if not a necessary, party; either it or the stockholders in its right being interested in the consideration received by the defendant trustees, for which they were accountable.
    [Fd. Note.—For other cases, see Corporations, Cent. Dig. §§ 808-813; Dec. Dig. <S=>210.]
    <£^>For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes
    Appeal from Special Term, New York County.
    Action by Charles Brock against Ruel W. Poor and another, individually and as trustees under an agreement dated November 29, 1904, and others. Demurrers by defendant Anthony Sz: Scovill Company sustained, and plaintiff appeals.
    Reversed.
    Argued before INGRAHAM, P. J., and McLAUGHLIN, LAUGHLIN, CLARKE, and SCOTT, JJ.
    Burt D. Whedon, of New York City, for appellant.
    Thomas D. Adams, of New York City (Charles A. Brodek and Edgar J. Nathan, both of New York City, on the brief), for respondents.
   LAUGHLIN, J.

The material facts aré set forth in the opinion on the appeals from the orders sustaining the demurrers of the defendants Poor and Bennett, which is to be handed down herewith.

The respondent company demurred on the ground that the plaintiff has not legal capacity to sue, and that the amended complaint fails to state facts sufficient to constitute a cause of action. The first ground of the demurrer is sufficiently considered in the opinion in the other case. The company was a proper, if not a necessary, party, and that is sufficient to warrant its being joined as a party defendant in a suit in equity, notwithstanding the fact that no relief is demanded against it. Mawhinney v. Bliss, 124 App. Div. 612, 109 N. Y. Supp. 332. If the stockholders are not entitled to a distribution of the fund and property of the Anthony Company, for which the individual defendants are accountable, then the Anthony Company is entitled thereto, and, in either event, it is a proper, if not a necessary, party, for either, it is, or its stockholders in its right are, interested in the consideration received by the individual defendants, for which they are accountable. Mawhinney v. Bliss, supra.

It follows that the order should be reversed, with $10 costs and disbursements, and plaintiff’s motion for an order overruling the demurrer granted, with $10 costs, but with leave to respondent to withdraw the demurrer and interpose an answer on payment of the costs of the appeal and of the motion. All concur.