Case Name: City Investing Company, Plaintiff, v. John Gerken et al., Defendants
Court: New York Supreme Court
Jurisdiction: New York
Decision Date: 1924-01
Citations: 122 Misc. 871
Docket Number: 
Parties: City Investing Company, Plaintiff, v. John Gerken et al., Defendants.
Judges: 
Reporter: New York Miscellaneous Reports
Volume: 122
Pages: 871–871

Head Matter:
City Investing Company, Plaintiff, v. John Gerken et al., Defendants.
Supreme Court, New York Special Term,
January, 1924.
Corporations — director liable for declaration of improper dividend though it was not formally ratified at meeting at which he was present.
Reopening of City Investing Co. v. Gerken, 121 Misc. Rep. 763.
Edward F. Clark (Leonard J. Reynolds, of counsel), for plaintiff.
Herbert H. Gibbs, for defendants Gerken, O’Donnell and Harris.

Opinion:
Proskauer, J.
Upon the reopening of this case it appears that the declaration of the improper dividend was not formally ratified at a meeting at which the defendant Gerken was present. Nevertheless, in view of his preponderant stock interest, the receipt by him as a stockholder of a substantial portion of the improper dividend, the fact that it was paid out by him and other acts of control, he must be held liable under the principle of Godley v. Crandall & Godley Co., 212 N. Y. 121, 138.
Judgment accordingly.