Case Name: Sydney H. Palmer, Temporary Receiver of J. S. Neuberger & Company, a Corporation, Appellant, v. Charles E. Ring and Others, Respondents
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1906-06-08
Citations: 113 A.D. 643
Docket Number: 
Parties: Sydney H. Palmer, Temporary Receiver of J. S. Neuberger & Company, a Corporation, Appellant, v. Charles E. Ring and Others, Respondents.
Judges: 
Reporter: Appellate Division Reports
Volume: 113
Pages: 643–644

Head Matter:
Sydney H. Palmer, Temporary Receiver of J. S. Neuberger & Company, a Corporation, Appellant, v. Charles E. Ring and Others, Respondents.
Second Department,
June 8, 1906.
Conversion—sale — corporate property transferred by personal bill of sale made by principal stockholder—vendee must show transfer by corporation or. his possession is tortious.
The title to corporate property is in the corporate entity and not in its stockholders, and a personal bill of sale of such property made by the president of the corporation does not transfer title, although such president owns substantially all of the stock. '
Hence, in an action for conversion brought by the receiver of such corporation to recover the value of corporate property conveyed only by the personal bill of sale of its president, it is error to dismiss the complaint, and the defendant is put to proof to- show some transfer from the corporation itself.
Appeal by the plaintiff, Sydney H. Palmer, temporary receiver of J. S. Neuberger & Company, a corporation, from a judgment of the Supreme .Court in favor of the defendants, entered in the office of the clerk of the county of Kings on the. 4tli day of October, 1905, upon the dismissal of- the complaint by direction of the court after a trial at the Kings County Trial Term.
Adam K. Stricker [Frederick S. Lyke and William J. Foster with him on the brief], for the appellant.
William S. Haskell, for the respondents.

Opinion:
Miller, J.:
The plaintiff appeals from a judgment dismissing his complaint entered on a nonsuit. The action is for conversion, and the evidence tends to establish that the defendant Ring loaned to the corporation, .of which the plaintiff is receiver, and to its president, one Schwickart, certain moneys, a portion of which appears to have been used by said Schwickart personally, and the remainder for the benefit" of the corporation. ' It is conceded that the property in question was the property of said corporation, and that it is now in the possession of the defendants. There is evidence that said .Schwickart, personally,, executed' a bill of sale of . sáid property to the defendant Bing,..and delivered possession thereof under said bill of salé, biit there is no evidence of any transfer, by the "corporation owning the property. It also appears" that said Schwickart owned nearly all of the stock of said corporation, and the parties appear to have dealt upon the supposition that he was in- fact the corporation. The learned trial court .granted the motion f.or a nonsuit upon the .theory that, the' possession of the defendants was not shown to have been tortious, evidently overlooking the allegation in the complaint,'! admitted.by the answer, that the plaintiff had made a demand upon the defendants for .the prdperty. It is well settled that the -title to corporate property is in the corporate entity and not in its stockholders (Saranac & L. P. R. R. Co. v. Arnold, 167 N. Y. 368 ; Buffalo Loan, Trust & S. D. Co. v. Medina Gas Co., 162 id. 67), and as the transfer made by Schwickart did not purport to bd a corporate act, it was manifestly insufficient to transfer the corporate property, although he may have owned substantially all of the stock. - It is not entirely clear from this record what the actual dealings between the- parties were, or whether the defendants claim under some transfer from the corporation itself, as they were not putito their proof, but so far- as the record/ discloses anything, it simply discloses a transfer made by Schwickart,' individually, as stated sujjra., Upon this proof the defendants never obtained title to the property, and their possession, after a' refusal to surrender it to the receiver of the corporation, became tortious, whatever its character may have been theretofore. . •
It is clear, therefore, that a case was made- putting the defendants to their proof, and the judgment entered On the nonsuit must, therefore, be reversed and á new trial granted,'costs to abide the event. • . -
Hirschberg, P. J., Woodward and Rich, JJ., concurred.
Judgment reversed and new'trial granted, costs-to abide the event.