Case Name: CONNECTICUT BANK a. SMITH
Court: New York Supreme Court
Jurisdiction: New York
Decision Date: 1859-06
Citations: 9 Abb. Pr. 168
Docket Number: 
Parties: CONNECTICUT BANK a. SMITH.
Judges: 
Reporter: Abbott's Practice Reports
Volume: 9
Pages: 168–175

Head Matter:
CONNECTICUT BANK a. SMITH.
Supreme Court, First District;
Special Term, June, 1859.
Pleading.—Complaint.—Averment of Plaintiff’s Incobporation .—Demurbeb.
The complaint of a foreign corporation must plead the fact of its incorporation, except in the case where the defendants are estopped from denying the incorporation; as, by having contracted with the corporation by their corporate name.
The plaintiffs sued as the President, Directors, and Company of the Connecticut Bank, claiming to recover as indorsees of notes made by the plaintiffs, but did not aver that they were a corporation.
Held, on demurrer, that the complaint was insufficient.*
The demurrer specified as the ground of demurrer, that the complaint did not state facts sufficient to constitute a cause of action; among other things, in that it did not show the plaintiffs’ capacity to sue.
Held, that although the latter objection was not properly a specification of a particular, falling under the general objection that the complaint did not state facts sufficient, but should have been assigned as a distinct ground of demurrer, the error should be disregarded.
A complaint on a promissory note in an action by indorsees against maker, which sets forth the indorsement by which the plaintiffs became holders of the note, need not also allege that they are holders and owners of it.
A complaint in such case which sufficiently alleges the making of the note, delivery, indorsement, and non-payment, need not also allege that the defendants are indebted on it to the plaintiff.
Demurrer to complaint.
This was an action against the defendants as makers of certain promissory notes of which the plaintiffs were indorsees.
The title of the complaint, and its statement of the first cause of action were as follows :
Supreme Court, City and County of New York.
The plaintiffs, by Miller, Peet & Nichols, their attorneys, make this complaint, and charge that the defendants, on or about the 16th day of September, 1858, made their joint and several promissory notes, dated the day and year aforesaid, whereby they promised to pay to the order of J. G-. Beckwith, six months after date, one thousand dollars, with interest after three months, at the Bank of Horth America, New York city; that said J. G-. Beckwith duly indorsed the same to these plaintiffs.
That the defendants have not paid the same, or any part thereof, although when the same became due, it was duly presented for payment at said Bank of Horth America, and payment demanded and refused, and the same was protested for non-payment.
The other causes of action were stated in a similar manner. There was no other averment respecting the plaintiffs, and no-description of them, except that contained in the title of the cause.
The defendants demurred. The demurrer was as follows :
Supreme Court, City and County of New York.
A. Freeman Smith, Isaac Yan Cleef, and Skidmore Pettit, the defendants in the above-entitled action demur to the complaint herein, on the ground appearing on the face thereof, that it does not present facts sufficient to constitute a cause of action, in that,
1. It does not state that the said Connecticut Bank is a corporate or legally constituted body, and legally entitled to bring an action, either in the name of its president, directors, and company, or in any other manner.
2. It does not state that the plaintiffs are the lawful and bona fide owners and holders of the said notes, or either of them, or that they ever paid value for the same.
3. It does not allege any indebtedness from defendants to the plaintiffs on account of said notes, or any or either of them,
James R. Jessup, in support of the demurrer.
I. It does not appear from the complaint who the plaintiffs are, or that they have any legal existence. 1. The existence of a natural person who appears as plaintiff may be assumed; but when the plaintiff is an artificial person, or a creature of the law, there is no assumption of any legal existence beyond the express averments in the pleadings. (Johnson a. Kemp, 11 How. Pr. R., 187, approved by the general term in Broome county; Bank of Havana a. Wickham, 7 Abbotts’ Pr. R., 134; S. C., 16 How. Pr. R., 97.) 2. In the present case, all that can be inferred is that the plaintiff is an artificial person, created by some foreign law, and located somewhere out of this State; but whether a corporation, a joint stock company, a mercantile association, or a copartnership, or precisely where located, does not appear. 3. They do not sue as individuals, but confessedly as a corporation not created by the laws of this State, and they must therefore prove who and what they are. (Waterville Manufacturing Company a. Bryan, 14 Barb., 184.) 4. The plaintiffs can have no standing in court until they show that they have a legal existence. 5. It must be inferred from their style that they are a foreign corporation. 6. A domestic corporation might plead their existence by referring to the title and date of the action. (3 liev. Stats., 5th ed., 755.) 7. A different rule exists as to the necessity of proving at the trial the existence of a domestic or foreign corporation. The rule of the Revised Statutes that, unless the defendant pleads nul tiel corporation, no proof of incorporation is necessary, does not apply to the case of foreign corporations. They must prove their incorporation under the general issue. (Waterville Manufacturing Company a. Bryan, supra.) 8. The defendant, therefore, before he answers, has a right not only to know that the plaintiffs claim to be a corporation duly created, but whether they claim to be a foreign or domestic corporation, inasmuch as in the one case to put in issue the existence of the plaintiffs, he must answer nul tiel corporation, in the other he may simply deny the allegations in the complaint. 9. In the present case, there being no averment in the complaint, that plaintiffs are a corporation, either domestic or foreign, defendants cannot either plead nul tiel corporation, neither can they save the point by a general denial, as there is nothing to deny. Defendants should not be allowed to be placed in such a predicament by plaintiffs, as the result might be, if defendants did not answer right, to let in a stranger to sue, without showing who he might be. Plaintiff should be obliged to show who and what he is before defendants are put to the expense of answering.' Mo one should be allowed to come in the court, as plaintiffs, with a mask on; under the old system, defendants would have been obliged to have put in a plea of abatement, and now if defendants set up that plaintiffs have no right to sue, &c., it would amount to a plea in abatement, which, perhaps, cannot be set up with other matter, at any rate the Code has provided that defendants shall in such case demur. All the cases seem to assume that, although it may not be necessary for a corporation plaintiff to refer in the complaint to the title of the act and the date of its passage; yet there must be some averment that they are a corporation duly created and existing, either under a domestic or a foreign law, and this under the general principle in pleading, that every issuable fact, necessary for a plaintiff to prove on the trial to sustain his action, should be averred in the complaint, otherwise no issue could be properly made, on a fact material to the action. If the existence of the plaintiffs as a creature of the law (or otherwise), created by a domestic or foreign law, is an issuable or traversable fact, it must be stated in the complaint. (See opinion of Judge Duer in Mann a. Morewood, 5 Sandf, 564, 565.)
II. There is no allegation in complaint that plaintiffs have a right to receive negotiable paper and to sue thereon. The rights which the plaintiffs may have, are distinct from their mere existence or creation, and although if the complaint had stated that plaintiffs were a corporation duly created by a foreign or domestic law, the court might infer that plaintiffs had the right to sue, or some powers, yet in this case there being no such averment, the court cannot infer any thing as to the powers of plaintiff (see Camden and Amboy Railroad Company a. Remer, 4 Barb., 127), where, in the language of the marginal note, it was “ held on demurrer to a bill filed by a corporation as the assignep of a demand for the purpose of enforcing the same, that it was sufficient for the complainants to allege generally in their bill that they were duly incorporated, and had power to purchase and hold the demand.” 2. The rights of the plaintiff to hold the demand and sue, are issuable facts.
III. The complaint does not set forth in any way that the plaintiffs are the bona fide owners, or even holders of the notes, or that they paid any value for them, nor that the defendants are indebted to them thereon. (Parker a. Totten, 10 How. Pr. R., 234, 236.)
IV. These questions are raised by the demurrer. (See Archb. Pl., ed. 1824, 345; Bank of Lowville a. Edwards, 11 How. Pr. R., 216; White a. Brown, 14 Ib., 282.)
Miller, Peet, and Nichols, in support of the complaint.
I. The objection that the complaint does not show that the defendants are incorporated cannot be raised under this demurrer, which is put on the ground that there is no cause of action shown. The capacity of the plaintiffs to sue does not go to the cause of action, but is a separate ground of demurrer. It must be specially assigned to raise the objection. (See Bank of Low ville a. Edwards, 11 How. Pr. R., 216; Johnson a. Kemp, 11 Ib., 186; Bank of Havana a. Wickham, 7 Abbotts’ Pr. R., 134; S. C., 16 How. Pr. R., 97; Viburt a. Frost, 3 Abbotts' Pr. R., 119; Nellis a. De Forest, 16 Barb., 65.)
II. But if the demurrer is held sufficient to present the objection stated in subdivision 2 of section 144 of the Code, yet it is not a cause of demurrer that the complaint fails to show legal capacity to sue, but that affirmatively it shows a want of it, (Union Mutual Insurance Company a. Osgood, 1 Duer, 707.)
III. It is not necessary to allege that the Connecticut Bank is a corporation, or legally constituted or entitled to sue in name of its president, &e. 1. The law will not presume, as against the pleader, that the bank is a corporation, or that it is the plaintiff, when the action is in the name of the president. 2. If a corporation, they need not aver it at common law. (2 Ld. Raym., 1535; 5 Wend., 478; 1 Johns. C., 132; 2 Cow., 770; 4 Sandf., 675; nor under the Code, Union Mutual Insurance Company a. Osgood, 1 Duer, 707; 13 How. Pr. R., 270.)
IV. It is unnecessary, after alleging the contract and its breach, to go on and allege that the defendants are indebted, (Bank of Waterville a. Beltzer, 13 How. Pr. R., 270; Union Mutual Insurance Company a. Osgood, supra; Holyoke Bank a. Haskins, 4 Sandf., 675.)

Opinion:
Clerke, J.
Undoubtedly, the demurrer in this action should have been taken under the second and not under the sixth subdivision of section 144 of the Code. The want of an allegation showing the capacity of the plaintiffs to sue is not the omission of a constituent fact, essential to the transaction upon which a cause of action is founded. It only affects the character of a party to the alleged transaction. But, although the objection is apparently taken under the sixth subdivision, the objection itself is set forth in express words, " that the complaint does not state that the plaintiffs are a corporation." I consider, therefore, that the manner of stating the objection is a mere inadvertence, at most, a clerical error which could not possibly lead the plaintiffs astray. Disregarding, then, the manner of the objection, is it in itself tenable % It is ad mitted that the plaintiffs are a foreign corporation. There is no such corporation, we know, authorized by the laws of this State.
The law only recognizes individuals in their natural capacity, with distinctive Christian names and surnames, and artificial bodies, constituted by the competent authority, allowed to sue and to be sued, bearing some distinctive appellation. Confusion and uncertainty would be the inevitable result, if any number of persons, real or fictitious, were permitted to maintain claims in a court of justice. It would appear, therefore, as a necessary corollary to this, that persons coming into a court of justice to establish or defend claims, or to seek redress, should come in their real individual names, or, if endowed with a corporate capacity, that they should expressly allege it.
But, where the incorporation is created by a general law of the State or country in which the action is commenced, it is then plainly unnecessary, because such incorporation is a portion of the public law, of which the court will take judicial cognizance, and in this State, even a particular law constituting a corporate body, printed in an authorized volume of the statutes, would now make it the subject of judicial cognizance. Mor is it necessary to allege' the incorporation, where the defendants have entered into a contract with the plaintiffs in their corporate name, because they thereby admit them to be duly constituted as a body corporate, under such name. This was really the question in Henriques a. The Dutch West India Company. (2 Let. Raym., 1535.) The plaintiffs in error were estopped, by the recognizance, which they had entered into with the defendants in error, from insisting that there was no such company. But, where no such admission has been ever made—where the contract, upon which the action is founded, has not been made with the plaintiffs in their corporate capacity, and by their corporate name—I think there is no sufficient consent of authority, allowing the maintenance of an action by a foreign corporation, without alleging the incorporation. This is the true and reasonable deduction, which has been lost sight of in some recent special term decisions. By referring to the case of The Dutchess County Manufacturing Company a. Davis (14 Johns., 239), it will be observed that this distinction is recognized by the court in banc, in the opinion of Chief-justice Thompson.
I do not say that it is necessary to state the act of incorporation at large, or even to refer to it—this must be done if controverted at the trial; but enough must be alleged, in actions instituted by foreign corporations, to show, at least, that it is a corporation, and to indicate the State or country to which it belongs. Nothing of the kind appears in this complaint. A certain number of words are put together, which are manifestly neither Christian names nor surnames of individuals, and without a single word indicating a corporate existence. This ground of demurrer is, in my opinion, sufficient.
The other specifications, which are properly included under the sixth subdivision of section 144, are not tenable.
Judgment for the defendants on the demurrer, unless the plaintiffs within twenty days amend their complaint, costs of demurrer to defendant to abide event.*