Case ID: misc_45/html/0130-01.html
Source: Caselaw Access Project
Author: {"author": "\n      Gildersleeve, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

W. J. Morgan & Co., Plaintiff, v. The Quo Vadis Amusement Co., Defendant.
    (Supreme Court, New York Special Term,
    October, 1904.)
    Action for the sequestration of corporate property—A denial of any information and belief as to the entry of judgment and the return of an execution — The pendency of proceedings for the dissolution of the corporation.
    Where, in an action for the sequestration of the property of the defendant corporation and the appointment of a receiver, the defendant interposes an answer alleging that it has no knowledge or information sufficient to form a belief concerning the allegation of the complaint respecting the entry of a judgment in favor of the plaintiff against the defendant and the return, wholly unsatisfied, of an execution issued thereon, and also alleging, that proceedings for the dissolution of the corporation had been begun, but had not as yet been prosecuted to judgment, such answer is frivolous," first, because the entry of the judgment and the return of the execution being a matter of public record, the defendant’s denial of any information or belief respecting those matters will not be permitted, and second, because the proceedings for dissolution, not having yet eventuated in a judgment and the appointment of a receiver, were not effective to preserve the property, the dissipation of which the sequestration suit sought to prevent.
    Motion for judgment on the answer as frivolous.
    Franklin Bien, for motion.
    Alfred Pagelow, opposed.
   Gildersleeve, J.

The action is for sequestration of defendant corporation's property and the appointment of a receiver. The complaint, among other things, alleges the entry of judgment in favor of plaintiff against defendant corporation, the issuing of execution thereon and the return of the same wholly unsatisfied. The answer alleges that defendant corporation has no knowledge or information sufficient to form a belief as to the entry of the judgment and the issuing and return of the execution unsatisfied. The answer, as a separate defense, further alleges the commencement of dissolution proceedings, which have not yet been prosecuted to judgment. The- plaintiff moves for judgment on the answer as frivolous. It has frequently been held that an allegation of no knowledge or information sufficient to form a belief as to the allegations of the complaint raises an issue (see Batterman v. Journal Co., 28 Misc. Rep. 375; Grocers' Bank v. O’Rorke, 6 Hun, 18), and such a defense cannot usually be regarded as frivolous. In the case at bar, however, the defendant alleges ignorance as to a judgment and execution against itself, which should be peculiarly within the knowledge of its officers. Moreover, the judgment and execution are matters of public record open to public inspection, and such" want of knowledge and information arises from unwillingness to learn the facts. McLean v. Julien Electric Co., 19 N. Y. Supp. 906, McAdam, J. ; 1 E. D. Smith, 554. It seems to me that a defendant should not be permitted to use this form of denial, if the necessary information is close at hand and easily procurable, as in the case at bar. The separate defense that dissolution proceedings have been begun, but not yet prosecuted to judgment, is not effective, because this fact would not prevent injury to plaintiff that might be irreparable. Before the judgment is entered in the dissolution proceedings, and the receiver therein appointed, the property of the defendant corporation may be entirely dissipated, unless the receiver in this sequestration suit is appointed. I think the motion for judgment on the answer should be granted, with ten dollars costs.

Motion granted, with ten dollars costs.