Case ID: ad_139/html/0566-01.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

Andrew W. Kaulbach and Others, Respondents, v. Knickerbocker Trust Company, Appellant.
    (Appeal No. 2.)
    First Department,
    July 7, 1910.
    Pleading— action by corporation — allegation as to. corporate capacity-r- ■ when causes should be separately stated and numbered.
    . The complaint of a corporation should allege that ,it is a corporation and state whether it be domestic.or foreign, and if. the latter,, the law under which it is incorporated, as required by section 1775 of the Code of Civil Procedure.
    Where the complaint of several plaintiffs shows that the damages sustained by some are separate and distinct from the damages sustained by the others, and there is no allegation that by assignment, agreement or otherwise all parties . ' are mutually interested in the total damage, the plaintiffs will .he required to separately state and number the causes of action.
    Appeal by the defendant, the Knickerbocker Trust Company, from an order of the Supreme Court, made at the New York Spécial Term and entered. in the office of the clerk of the county of New York ón the 26th day of May, 1910, as resettled by-an order entered on the 27th day of May, 1910, denying the defendant’s motion to require plaintiffs to separately state and number the causes of action attempted to be set forth in the complaint, to strike out certain allegations of the complaint as irrelevant and to require that certain other allegations be made more definite and certain.
    
      Herbert Barry [Julien T. Davies with, him on the brief], for the appellant.
    
      H. Melville Walker, for the respondents.
   Laughlin, J.:

It is fairly to be inferred that the ;plaintiff, the Toledo, Michigan and Lake Huron Railroad is a corporation, but the complaint fails to allege wliat it is. If it be a corporation section 1775 of the Code of Civil Procedure requires that that fact be alleged in the complaint,; and that it be stated whether it is a. domestic or a foreign corporation,. and if the latter, the State, country or government by or under whose laws it was created. The importance of requiring a compliance with these statutory provisions is shown by section 1776 of the Code of Civil Procedure, under which the plaintiff need not prove the incorporation unless it be affirmatively alleged in a ■ verified answer that it is not a corporation. Neither this nor the other matters of which the defendant complains can be explained on the theory of inadvertence on the part of the pleader, for a like motion was made with respect to the original complaint and thereafter the complaint was amended merely by changing the allegation that the defendant was incorporated under the laws of New Jersey into the allegation that it is a domestic corporation, without taking any notice of. the objections raised to the complaint by the motion, which'necessarily fell with the amendment.

The learned justice who presided at Special Term, deeming the decision on the former motion stare decisis, entered an order pro forma denying the motion. It is exceedingly doubtful. whether the facts pleaded are sufficient to show a cause of action in favor of any plaintiff, and it is quite clear that they fail .to show that the plaintiffs are all interested in the same cause of action or in the damages sought to be -recovered. It is alleged that the defendant refused and .neglected to cancel bonds of the Toledo, Marshall and Northern Railroad, a Michigan corporation', of - the par value of $1,500,000, which had been delivered to it as trustee for certification and issuance, and the mortgage to it to secure the same, on. notice from and direction of the obligor and mortgagor and a syndicate composed of one of the individual plaintiffs and three others» which was organized to finance and construct the railroad, and, in disregard of such notice and direction, certified and issued the bonds which, therefore, became a lien on the rights óf way then and now owned by the syndicate and the Toledo, Michigan & Lake Huron Railroad.” It is then charged that the plaintiff, the Toledo, Michigan and Lake Huron Railroad has succeeded to the ownership and rights, of the mortgagor railroad, and has been unable, in consequence of the certification and issuance of said bonds, to finance and construct the railroad to its damage in thé sum of $4,000,000, and that the other plaintiffs “ havó been put to gréat expense and loss to their damage of $1,000,000, making a total loss and damage of Five million dollars.”

The complaint contains no. statement of the facts showing how or in .what manner the individual plaintiffs have been damaged, but whatever the facts may be which gave rise to these damages, it is, as has been seen, specifically stated that they are separate and distinct from the damages sustained by the other plaintiff, and there is no allegation that by. assignment, agreement or otherwise the parties plaintiff haVe become mutually interested in the total damages sought to be recovered. • '

Although no cause of action may be-sufficiently pleaded, it is manifest that there has been- an. attempt to plead two separate causes of action, one in behalf of the individual plaintiffs, and the other in behalf of the other plaintiff. ■

The allegations of the complaint are not sufficiently definite with respect to the causes of action, attempted to be. pleaded to enable the court to determine whether any of them should be stricken out, but they should be made more definite. ' The fapts with respect to the syndicate agreement arid the rights and interests of. the parties thereunder and the notices alleged to have' been given "to defendant particularly Connecting defendant with knowledge of the interest of the plaintiffs and showing a duty on the part, of tíre defendant to the members of the syndicate agreement, are- not. pleaded. In this respect the complaint should be made more definite. Only one member of the syndicate agreement is a. party to the action. ' It. appears that the other individual plaintiff' has succeeded to the interests of one of the others of the four members of the syndicate agreement, but it does not appear- what the interest ■of -the individual plaintiffs are, and there.is nó allegation as to what the interests of the two members of the-syndicate agreement who are not parties and.who are.not shown to have assigned interests, if any, are.' The 3d paragraph of the complaint should be made more definite with respect to the terms of the trust under' which it is claimed the-defendant became trustee for.the purpose of certifying -and issuing' tlie bonds of the Toledo, Marshall and Northern Railroad. .The 6th paragraph -of the complaint should be made more definite by setting forth the facts with respect to the right, title aiid interest of -the members Of the syndicate agreement in the right of' way of the Toledo, Michigan and Lake Huron Railroad. The 7th paragraph' of the complaint should be made, more ■ definite by showing how and in what manner the Toledo, Michigan and Lake Huron ¡Railroad became the successor to the Cold water, Marshall and Mackinaw Railroad, and to the franchises, rights of way and property of said railroad and of tlie Toledo, Marshall and Northern Railroad, and how and in what manner the Toledo, Michigan and Lake Huron Railroad has ratified and confirmed the notice alleged to have been given by the Toledo, Marshall and Northern Railroad to the defendant to cancel said bonds, and how and in what manner said Toledo, Michigan and Lake Huron Railroad has succeeded to said syndicate agreement.

It follows, therefore, that the order should be reversed, with ten dollars costs and disbursements, and motion granted to the extent of requiring the plaintiffs to separately state and number the- causes of action and to make the complaint more definite and certain in the' particulars specified in this opinion,

Ingraham, P. J., Clarke, Scott and Miller, JJ., concurred.

Order reversed, with ten dollars costs and disbursements, and motion granted to extent stated in opinion. Settle order on notice.