Court Opinion

ID: 5181135
Source: CourtListenerOpinion
Date Created: 2022-01-06 04:42:19.788943+00
Date Added: 2024-06-11T08:26:34.535788
License: Public Domain

Follett, J.:
This action was brought by a creditor of the Chadwick Leather Company, a business corporation organized under the laws of this *312State, against the directors thereof to recover his debt of them on the ground that they had failed to file annual reports in January, 1894, and in January, 1895, as required by the. 30th section of" the Stock Corporation Law (Laws of 1892, chap. 688).
Two of the defendants answered and admitted that the reports had not been filed, and alleged that the claim of the plaintiff had been fully paid.
When the case was moved for trial the complaint was dismissed on the ground that it was not alleged therein that the plaintiff liad recovered a judgment for the debt against the corporation and that. an execution thereon had been returned "unsatisfied. This was error. The recovery of a judgment and the return of an execution are not conditions precedent to the right of a creditor to recover from the directors of the corporation for failing to file reports. (Miller v. White, 50 N. Y. 137-141; Rorke v. Thomas, 56 id. 559-565 ; Green v. Easton, 74 Hun, 329 ; State Bank of Rock Valley v. Andrews, 2 Misc. Rep. 394 ; Strauss v. Trotter, 6 id. 77.)
The case of The National Bank of Auburn v. Dillingham (147 N. Y. 603) arose under the 24th section of the Stock Corporation Law imposing a liability upon directors for creating an indebtedness not secured by mortgage in excess of the amount of its paid-up capital stock, and is not in point.
• The judgment should be reversed and a- new trial ordered, with costs to abide the event.
All concurred.
Judgment and order reversed and a new trial ordered, with costs to abide the event.