Case Name: Susan Schmidt, Appellant, v. A. M. Schwartz Building & Construction Co., Inc., and Others, Defendants; Frank McCabe and Another, Respondents
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1931-06-12
Citations: 232 A.D. 549
Docket Number: 
Parties: Susan Schmidt, Appellant, v. A. M. Schwartz Building & Construction Co., Inc., and Others, Defendants. Frank McCabe and Another, Respondents.
Judges: 
Reporter: Appellate Division Reports
Volume: 232
Pages: 549–552

Head Matter:
Susan Schmidt, Appellant, v. A. M. Schwartz Building & Construction Co., Inc., and Others, Defendants. Frank McCabe and Another, Respondents.
First Department,
June 12, 1931.
Benjamin D. Jackman of counsel [Herman Lubetkin, attorney], for the appellant.
John L. O’Connell of counsel [Wormser & Kemp, attorneys], for the respondents.

Opinion:
McAvoy, J.
We think that these defendants, respondents, may not be made parties to defend the foreclosure action, and that their answer should be struck out. If the defendant corporation is permitting a judgment to be taken without cause, the stockholders may, by such equitable or statutory remedy as may be granted, restrain the prosecution of the cause on a showing of conspiracy to defraud them on the part of plaintiff and the corporate defendant.
The order granting motion of respondents to be made parties defendant and to interpose a defense should be reversed, with ten dollars costs and disbursements to the appellant, and the motion denied. The order striking out the answer of the defendant corporation, so far as appealed from, should be reversed.
Merrell and Sherman, JJ., concur; Finch, P. J., and Martin, J., dissent.