Court Opinion

ID: 5190448
Source: CourtListenerOpinion
Date Created: 2022-01-06 15:35:10.504588+00
Date Added: 2024-06-11T08:26:53.882908
License: Public Domain

Spring, J. :
The foundation of the present proceeding was an order to show cause providing for service of a copy of the order and papers upon which it was granted upon the receiver and attorney for the corporation. There was no direction to serve upon the Attorney-General, and the recitals in the final order do not show any appearance on behalf of that officer. The omission to serve the motion papers and the proposed order upon the Attorney-General is a fatal defect.
Section 8, chapter 378, Laws of 1883, in prescribing the service of papers upon the Attorney-General in proceedings of this kind, declares that “ any order or judgment granted in any action or proceeding aforesaid, without such service of such papers upon the attorney-general, shall be void.”
Full effect has been given to this section by the courts. (People v. Seneca Lake Grape & Wine Co., 52 Hun, 174-180; Gillig v. Treadwell Co., 151 N. Y. 552.; Langdon v. New York Book Co., 39 N. Y. St. Eepr. 167.)
The statute, is a wholesome one designed to insure the conservation and distribution of the assets of the defunct corporation among its creditors, and it must be stringently enforced. It would seem to be entirely proper to permit the plaintiffs to establish their claim against the corporation, as it is not included, among the admitted liabilities; but any change in the order to dissolve the corporation, although apparently immaterial, must be upon notice to the Attorney-General. ' An invasion of this requirement once permitted by the courts might be used as a precedent for extending the application until the efficiency of the provision is destroyed.
The counsel for the respondent seeks to escape the force of this section of the statute on the ground that the order to show cause and also the order of modification were entitled in the action, and not in the proceeding for the dissolution of the corporation. The order modified was the one in the latter proceeding. If the position of the counsel is tenable there is no difficulty in evading the effect of the statute, and by collusion with the receiver dissipating.the property. The fact that the order Was in the action may be another reason for its reversal, rather than for upholding it.
The order appealed from should be reversed and the preliminary order to show cause dismissed, but inasmuch as the question of the *448failure to serve the order to show cause and"''.moving papers upon the Attorney-General was not raised at Special. .Term, so far as the record before us shows, the reversal should be.Vwithout costs of this appeal. . .
All concurred.
Order appealed from reversed and preliminary order to show cause dismissed, without costs of this appeal to either party.