Case Name: Borough Bank of Brooklyn, Respondent, v. Henry F. Thompson, Appellant
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1916-05-05
Citations: 172 A.D. 527
Docket Number: 
Parties: Borough Bank of Brooklyn, Respondent, v. Henry F. Thompson, Appellant.
Judges: 
Reporter: Appellate Division Reports
Volume: 172
Pages: 527–529

Head Matter:
Borough Bank of Brooklyn, Respondent, v. Henry F. Thompson, Appellant.
Second Department,
May 5, 1916.
Banks—power of State Superintendent to make contract to purchase real estate — Banking Law, section 19, as amended, construed — suit for specific performance in name of bank—pleading — failure to allege authorization by court.
Under the authority of section 19 of the Banking Law, as amended by Laws of 1910, chapter 453, the State Superintendent of Banks on taking possession of such institution may, when authorized to do so by the Supreme Court, make a contract in the name of the bank to purchase real estate, and may maintain a suit for specific performance.
But where the complaint in such suit merely alleges that the contract of purchase “ was duly approved by a justice of the Supreme Court,” it fails to set forth the requirements of the statute essential to the validity of the contract, for there is a distinction between a court of record and a judge of such court.
Appeal by the defendant, Henry F. Thompson, from an order of the Supreme Court, made at the Kings County Special Term and entered in the office of the clerk of the county of Kings on the 21st day of January, 1916, denying his motion for judgment on the pleadings, consisting of a complaint, amended answer and reply.
James W. Hyde, for the appellant.
Wilbert Ward, for the respondent.

Opinion:
Carr, J.:
The defendant appeals from an order that denied his motion for judgment on the pleadings. The action was brought to compel specific performance of a contract to purchase real property owned by the Borough Bank at the time it was taken over by the Superintendent of Banks. The contract is annexed to the complaint. It was made on or about February 10, 1913, in the name of the plaintiff by the Superintendent of Banks, and it expressly provides that it is made " subject to the approval of the Supreme Court, Kings county, and shall not be binding upon the Borough Bank of Brooklyn or the Superintendent of Banks in charge of the Borough Bank of Brooklyn, until so approved by the Supreme Court, Kings County," and that in case " the court should refuse to approve this contract of sale, that the said contract shall be null and void."
The plaintiff, through the Superintendent of Banks, rests its claim of authority to make this contract through said Superintendent upon section 19 of the Banking Law (Consol. Laws, chap. 2 [Laws of 1909, chap. 10], as amd. by Laws of 1910, chap. 462). That section provides, in part, that the Superintendent of Banks " may, in the name of the delinquent corporation or individual banker, execute, acknowledge and deliver any and all deeds, assignments, releases and other instruments necessary and proper to effectuate any sale of real or personal property authorized by the court." Earlier in section 19, as aforesaid, there is a general provision that " The Superintendent shall collect all debts due and claims belonging to it [the delinquent bank], and upon the order of the Supreme Court may sell or compound all bad or doubtful debts, and on like order may sell all the real and personal property of such corporation or individual banker on such terms as the court shall direct." The section provides further: " For the purpose of executing and performing any of the powers and duties hereby conferred upon him, the Superintendent may, in the name of the delinquent corporation or individual banker, prosecute and defend any and all suits and other legal proceedings." We think it is clear that under the provisions of section 19 as aforesaid, the Superintendent had power to enter into the contract in question, if ordered or approved by the Supreme Court, and to bring this action in the name of the Borough Bank to enforce the contract. The complaint, however, does not plead any order by the Supreme Court approving the contract in question. The only allegation in the complaint on this point is as follows: " The said agreement in writing was duly approved by a justice of the Supreme Court, Kings county, and defendant was notified of said fact." Not only does section 19 of the Banking Law require an order of the Supreme Court authorizing the making of such a contract, but the instrument sought to be enforced likewise provides for such an order. It would seem that the making of such an order by the Supreme Court was an essential condition for the validity of the contract. If so, then the complaint did not plead sufficiently the essential condition, for, as said by Vann, J., in People ex rel. Eckerson v. Trustees (151 N. Y. 75, 84): "The distinction between a court of record and a judge of a court of record is too well recognized in the law to require discussion."
The order should be reversed, with ten dollars costs and disbursements, and the motion granted, with ten dollars costs, with leave to the plaintiff to serve an amended complaint within twenty days on payment of the costs and disbursements, as aforesaid.
Jenks, P. J., Thomas, Mills and Rich, JJ., concurred.
Order reversed, with ten dollars costs and disbursements, and motion granted, with ten dollars costs, with leave to plaintiff to serve an amended complaint within twenty days on payment of the costs and disbursements as aforesaid.