Court Opinion

ID: 5346890
Source: CourtListenerOpinion
Date Created: 2022-01-08 06:22:11.3746+00
Date Added: 2024-06-11T08:29:39.897725
License: Public Domain

In an action brought by plaintiffs, as receivers of an insolvent foreign corporation, to recover moneys alleged to have been improperly paid by the directors to an attorney, order denying plaintiffs’ motion to strike out the separate defenses contained in the answers of the defendants modified so as to grant plaintiffs’ motion as to the fifth, sixth and seventh defenses contained in said answers and to deny their motion as to the remaining defenses. As so modified the order is affirmed, with ten dollars costs and disbursements to the appellants. The third defense may be sufficient in law if it appears that the so-called acquiescence and ratification was made by all the stockholders. (Goldberg y. Berry, 231 App. Div. 165.) The fifth defense is insufficient in law because the laws of Delaware, authorizing the directors to employ attorneys and counsel, could not be a justification of such an employment in fraud of the rights of the corporation. The sixth and seventh defenses are also insufficient in law because the courts of this State have jurisdiction to appoint a receiver of an insolvent foreign corporation in order to preserve its assets in this State and distribute them among its creditors, and may also authorize the receiver to maintain actions for that purpose. Plaintiffs were appointed receivers of the corporation by our Supreme Court, and the judgment authorized them to maintain such action. (Horton v. McNally Co., 155 App. Div. 322.) Lazansky, P. J., Young, Hagarty, Davis and Johnston, JJ., concur.