Case Name: ANDERSON v. SPEERS
Court: New York Supreme Court Special Term
Jurisdiction: New York
Decision Date: 1879-10
Citations: 8 Abb. N. Cas. 382
Docket Number: 
Parties: ANDERSON v. SPEERS.
Judges: 
Reporter: Abbott's New Cases
Volume: 8
Pages: 382–385

Head Matter:
ANDERSON v. SPEERS.
N. Y. Supreme Court; Special Term,
October, 1879.
Complaint against Trustee of Manufacturing Corporation.
A complaint to charge a trustee of a manufacturing corporation, organized under the Act of 1848, with a debt of the corporation, under section 15, because of filing a false report, must allege that the debt was contracted while the defendant was such trustee.
Each cause of action must contain a complete statement thereof in itself; and authority is against supplementing one cause of action, by statements made in another and separate cause, unless it be distinctly connected therewith by appropriate words.
The liabilities imposed by statute upon trustees, for malting false reports, and allowing the indebtedness of the corporation to exceed its capital stock, are in their nature penal, and each act of this character enters into and becomes a separate cause of action.
Trial by the special term of the supreme court in the first judicial district, of an issue of law arising on demurrer.
Robert J. Anderson sued Henry J. Speers, to enforce liabilities alleged to have been incurred as a trustee of a manufacturing corporation.
Michael H. Cardozo, for defendant.
W. W. Niles, for plaintiff.

Opinion:
Van Vorst, J.
This action is brought against the defendant, as a trustee of a manufacturing corporation organized under the Act of 1848, to enforce liabilities incurred under sections 15 and 23 of that act. Three separate causes of action are relied upon.
The first arises under section 15, and is for an alleged filing of a false report on December 13, 1877. But this cause of action is defective in not stating that the debt, for which the defendant is sought to be made liable, was contracted while he was a trustee. It is stated in the complaint, in this connection, that the defendant was, on January 13, 1877, and "before that date" and subsequent thereto, one of the trustees of the corporation. But that is not a statement that the defendant was a trustee in the year 1876, when the debt is alleged to have been contracted. If the defendant was a trustee a day previous to January 13, 1877, that would satisfy the statement that he was a trustee before that day.
The second cause of action grows out of the filing of a false report on January 13, 1878. The complaint terms this breach of the statute, as it undoubtedly is, "a further and other cause of action."
Each act of the character of the one of which com plaint is made, affords the creditor a right of action against the trustee in fault.
The creditor, on the trial, may fail as to the act complained of as being committed in January, 1877, and may succeed as to the one alleged to have been done in January, 1878.
But the second cause of action is defective for the reasons above stated with respect to the first cause ; and, further, in that it omits to set up a debt against the corporation in favor of the plaintiff.
In the first cause of action an indebtedness, in favor of the plaintiff against the corporation, is fully set up ; but the second cause of action cannot be supported by the allegations in the first, as it contains no statements drawing to itself the statements of the first upon this subject (Moaks Van Santvoord's Pleadings, 3 ed. 149).
The third cause of action arises under section 23, and from the fact, as is alleged, that the indebtedness of the company exceeded the amount of its capital stock.
In disclosing his last cause of action, the pleader states that the defendant, during all the time between January 15, 1876, and January 18, 1878, was one of the trustees of the company. Had such statement been made in the first cause of action it would have been complete. But such allegation made with respect to the last cause of action, cannot be used to uphold the first, in the absence of language connecting the same therewith.
Authority is clearly against supplementing the allegations of one cause of action by statements made in another, not distinctly connected therewith by appropriate words. Justice La wrence had this subject lately before him in the Victory Webb, &c. Manufacturing Co. v. Beecher (55 How. Pr. 193), and in a carefully considered opinion, which I approve, he so held. See also Simmons v. Fairchild (42 Barb. 404). The learned counsel for the plaintiff, on the' argument of the demurrer, contended that there was, in fact, but one cause of action set up in the complaint, and that what are claimed by the defendant's counsel to be several causes of action, are in reality several liabilities for the same cause.
. I cannot accept this conclusion. The liabilities imposed by the statute upon the trustees for the making of false reports, and allowing the indebtedness to exceed the capital stock are in their nature penal (Jones v. Barlow, 6 J. & S. 142; Niles v. Suydam, 64 N. Y. 173). Each act enters into and becomes a separate cause or ground of action.
It is true that there could be but one recovery for the debt existing in the plaintiff's favor against the corporation, but such recovery would be justified by proof of either of the acts done or suffered by the trustees—that is, for filing a false report in 1877 or 1878, or suffering an increase of the indebtedness above the capital stock of the corporation. There should be judgment for the defendant on the demurrer, with liberty to the plaintiff to amend on payment.
See note on p. 455.