Case Name: Solomon R. Jacobs and Arthur Jacobs, Appellants, v. Mexican Sugar Refining Company, Limited, and Mexican Sugar Company, Respondents
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1906-04-20
Citations: 112 A.D. 655
Docket Number: No. 1
Parties: Solomon R. Jacobs and Arthur Jacobs, Appellants, v. Mexican Sugar Refining Company, Limited, and Mexican Sugar Company, Respondents.
Judges: 
Reporter: Appellate Division Reports
Volume: 112
Pages: 655–656

Head Matter:
Solomon R. Jacobs and Arthur Jacobs, Appellants, v. Mexican Sugar Refining Company, Limited, and Mexican Sugar Company, Respondents.
(No. 1.)
First Department,
April 20, 1906.
Discovery —examination of corporation before trial granted.— request for copy of records not prerequisite.'
In an action by a stockholder to have an agreement by a corporation canceling a ' lease declared to be void, an examination of the corporation before trial should be granted when to maintain the action it will be necessary to prove certain correspondence, agreements, etc., made by the corporation,-which documents might be removed from the State.
The plaintiff is not required as a condition precedent to such examination to request the corporation to furnish a copy of such records.
_ Appeal by the plaintiffs, Solomon R. Jacobs and another, from that portion' of an order of the Supreme Court, made at the Hew York Special Term and entered in the office of the clerk of the county of Hew York on the 28th day of February, 1906, which vacates so mucli of a previous order as requires the Mexican Sugar Refining Company, Limited, and Henry J. Braker, its president, to submit to an examination before trial. •
G. H. Engelhard, for the appellants.
William P. S. Melvin, for the respondents.

Opinion:
Laughlin, J.:
The plaintiffs bring the action as stockholders of the Mexican Sugar Company, a Hew Jersey corporation, and demand judgment that an agreement by which a lease made by the Mexican Sugar Refining Company, a Louisiana corporation, to the Mexican Sugar Company has been canceled, be declared null and void-. The order for the examination of the corporation appears to have been vacated upon the theory that the plaintiffs should have applied to thfe company for the information before applying to the court for the examination. It appears that the plaintiffs are quite familiar with the facts, but in the main the material facts could not be proved by their .testimony. It is essential to the plaintiffs' cause of action to prove certain correspondence, negotiations, agreements and proceedings of the corporation of which they are stockholders by, with or concerning the other corporation defendant. It is manifest that the only competent evidence of such matters are the records, correspondence and contracts. There is no rule by which, as a condition precedent to 'the right to such examination, the .plaintiffs are, required to request the corporation for a copy of the records and, papers desired; nor would the plaintiffs be bound by such copies. They are entitled to the original evidence, and' this appears to. be a proper case for an examination before trial. The records are now in this State, and they might not be at the time of the trial. Moreover, an examination in advance of the trial will quite likely shorten the trial, and the court should not be delayed by an investigation through records upon a trial where the investigation may be had in advance ¿nd the material evidence selected for presentation upon the trial., . « *
The order for the examination, however, is too broad. It authorizes ah examination into the operation of the plantation by. the Mexican Sugar Refining Company after the cancellation of the lease under which it is claimed that the Mexican Sugar Company should have operated the plantation. The suit is in equity, and the issue to be tried preliminarily is as to whether the lease was lawfully canceled. If not, then there may be an interlocutory judgment requiring the Mexican Sugar Refining Company to account; and on that accounting its.operation of the plantation may be investigated. But that is not essential in -the -first instance.
It follows, therefore, that the order appealed from should be reversed, with ten dollars costs and disbursements,,ánd the motion denied, without costs, except that the original order for the examination should be modified by eliminating the subdivision thereof numbered 27, which relates to the operation of the plantation by the Mexican Sugar Refining Company after the cancellation of the lease.
O'Brien, P. J., Patterson, Ingraham and Clarke, JJ., concurred.
Order reversed, with ten dollars costs and disbursements, and motion denied, without'costs, with -the modification stated in the opinion. Settle order on notice. .