Case ID: ny-st-rep_3/html/0564-01.html
Source: Caselaw Access Project
Author: {"author": "Daly, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

John M. C. Rodney, Resp’t, v. The Southern Railroad Association, App’lt.
    
      (New York Common Pleas,
    
    
      Filed December 6, 1886.)
    
    Corporation—Officer of—Action by, for salary.
    The plaintiff was treasurer of the defendant corporation, which during his term of office was consolidated with another, thereby reducing plaintiff’s duties as an officer in the former so that they were merely nominal. Held, that the salary allowed to an officer of a corporation is presumed to be for services performed by him as such; and that where, with the consent and co-operation of such officer, all the property, business and franchise of the corporation are sold, so that he has no further duty to perform, the contract as to salary will be deemed to be cancelled, although the corporation itself is not dissolved. This rule, however, is inapplicable where there are duties performed for the company by the officer in virtue of his office, no matter how few and slight those duties may be.
    Appeal from judgment in favor of plaintiff for $8,956.75 against defendant for salary as treasurer of defendant from July 1, 1874, to January 26, 1877, at the rate of $2,900 per annum.
    
      Brisbon, Peet & Opdyke, for resp’ts; Bangs & Stetson, for app’lts. ,
   Daly, J.

The defendant, the Southern Railroad Association, was chartered by the state of Tennessee, in apparently that it might take leases of the Mississippi Central Railroad and connecting railroads, and exercise their franchises. It proceeded to do so until about July 1, 1874, when by its act and consent the Mississippi Central Railroad was consolidated with the New Orleans, Jackson and Great Northern Railroad Company, whereby a new corpo ■ ration was formed under the name of the New Orleans, St. Louis and Chicago Railroad Company, and thereafter the defendant ceased to transact any ousiness as lessee of the Mississippi Central Railroad Company.

The plaintiff, who was treasurer of the defendant at the time of the consolidation, at a salary of $2,000, was immediately made assistant treasurer of the new company at a salary of $2,500. He and the other officers of the defendant remained such officers until January, 1877, although there were only such duties to perform with that company as the safe keeping of its securities (which were, however, deposited in the safe of the new corporation), the closing up of the business of defendant, receiving and transferring collections, etc., and effecting loans amounting to $218,000. As to this latter, it might have taken him an hour, or two or three .days, and with the exception of this, the services were mainly slight, and some merely formal, for the business of the defendant, as far as the plaintiff had any charge of it, practically ceased when the consolidation took place.

I think it is urged by appellant that the case falls within the rule laid down in Long Island Ferry Co. v. Terbell (48 27. Y., 427), “That the salary allowed to an officer of a corporation is presumed to be for services to be performed by him as such. Where, therefore, with the assent and cooperation of such officer, all the property, business and franchises of the corporation are sold, so that he has no further duty to perform, there is no basis in law or equity for a claim upon his part that the salary continues, and the contract as to salary will be deemed to be cancelled, although the corporation itself is not dissolved.” It will be seen that the case before the court was an extreme one, in which the officer had no duties whatever to perform; and the rule _ established is in effect, “no duties, no pay.” But this is inapplicable where there are duties performed for the company by the officer in virtue of his office, no matter how few or slight those duties may be, providing they are substantial and not merely nominal or trifling. In considering the question whether salary runs with the office, and that question depends upon whether any duties are imposed upon and performed by the officer, we cannot distinguish between degrees of service or amount of work. The test is, whether anything is left for the officer to do; if there be, then we must hold that the presumption is that his salary continues. There is a basis, both in law and equity for a claim, and it cannot be deemed that the contract as to salary is cancelled.

The judgment should be affirmed, with costs.

Larhemore, Oh. J., and Van Hoesen, J., concur.