Case Name: The Socorro Mountain Mining Co., Plaintiff, v. George B. Preston et al., Defendants
Court: New York Supreme Court
Jurisdiction: New York
Decision Date: 1896-05
Citations: 17 Misc. 220
Docket Number: 
Parties: The Socorro Mountain Mining Co., Plaintiff, v. George B. Preston et al., Defendants.
Judges: 
Reporter: New York Miscellaneous Reports
Volume: 17
Pages: 220–221

Head Matter:
The Socorro Mountain Mining Co., Plaintiff, v. George B. Preston et al., Defendants.
(Supreme Court, Albany Special Term,
May, 1896.)
1. Corporations — Discontinuance of action brought by. ' ;
Stockholders of a corporation may vote upon a resolution to discontinue an action brought in the name of the corporation, although they aré interested in the result. .' ■.
3. Same — Election — Tfansfer-book.
Where the stock-book and. seal are withheld or concealed in order . to prevent a. transfer of stock in time to permit-the new stock to be voted on at the annual meeting, it is lawful for- the directors to adopt a new seal and stockibook to accomplish .that purpose.
Motion to discontinue action.
John H. Peck and E. Countryman, for motion. .
Lansing & Holmes, opposed. . .

Opinion:
Crester, J.
I think there is a failure to show by competent evidence in the moving papers that this action was not properly -commenced in the name-of the company by Mr. Darling, the. former president. •
I think, also, that while the directors might not properly vote to discontinue the action when they were personally interested as defendants, yet that á majority of the stockholders could do so. - The latter are "not disqualified to voté on á quéstion before the shareholders' meeting because of an interest in the. result. They . have a right tb represent their individual interest, and they are in no sense trustees or.- representatives of others. Gamble v. Queens County Water Co., 123 N. Y. 91; Bjorngaard v. Goodhue Co. Bank, 52 N. W. Repr. 48; Northwestern Transportation Co. v. Beatty, L. R., 12 App. Cas. 589.
It is claimed that much of the stock which was voted upon by the stockholders at' the last annual meeting had not been properly transferred upon the books of the company, which were in the hands of the prior president, Mr. Darling; but, upon his withholding the seal and the stock-book so as to prevent the transfer of the stock thereon, .and the issue of new stock in time to permit it to be voted upon at the annual meeting, it was lawful for the directors to adopt and procure a new seal and a new stock-book to accomplish that purpose. In re Argus Co., 138 N. Y. 557, 576.
It appears that this course was pursued, and that a majority of the stockholders, at the annual meeting, voted to discontinue this action, and, pursuant to- this direction, the present president and secretary of the company-have made a consent to discontinue, upon which this motion is based.
I think that effect must be given to this consent. The action hating been properly begun, however, and the plaintiff being insolvent, it should not be discontinued against the consent, of plaintiff's attorneys, without securing them for them lawful charges for their services and costs herein.
The motion to discontinue is granted, without costs, upon condition that the plaintiff's attorneys be first settled with and paid for their services and costs herein, and if-there is a failure to agree upon the amount thereof a reference will be directed to determine the-amount.
Motion granted, without costs.