Court Opinion

ID: 5183500
Source: CourtListenerOpinion
Date Created: 2022-01-06 04:45:19.081452+00
Date Added: 2024-06-11T08:26:39.428348
License: Public Domain

Ingraham, J.:
The appeal from this order has been argued by counsel as though it, in effect, continued the action against the receiver of the defendant corporation which has been dissolved by a judicial decree, and
*224the appellant appointed receiver; and in disposing of the appeal we will assume, as the parties have assumed, that such is the effect of the order appealed from. The question presented, therefore, is whether the cause of action survives the dissolution of the corporation so as to justify an order continuing it as against the receiver. It is not disputed but that at common law, upon the dissolution of a corporation, as upon the death of an individual, all actions against it abate. (National Bank v. Colby, 21 Wall. 614; Greeley v. Smith, 3 Story, 658.) It is also conceded that in an action for personal injuries as against an individual upon the death of a party, the cause of action does not survive, and the action cannot be continued by or as against the personal representatives of the deceased party. (Wade v. Kalbfleisch, 58 N. Y. 286.) “Where an injury is done to the person of the plaintiff, the pecuniary damage sustained thereby cannot be so separated as to constitute an independent cause of action, for the cause of action is single, and consists of the injury to the person; the damages are the consequence merely of that injury and where by the terms of the statute such a cause of action abates, the character of the damages cannot save it.” (Cregin v. Brooklyn Crosstown Railroad Company, 75 N. Y. 192.) As this rule applies as well to a corporation as to an individual, it would necessarily follow that, unless there is some provision of the statute applying to corporations that changed the rule so as to continue a cause of action for personal injuries against a corporation, after the death of the corporation, the cause of action dies with the corporation, and the action against the corporation to enforce such a cause of action cannot be continued against the receiver
The only provision of the statute to which our attention has been called, or of which we have any knowledge, is that contained in section 38 of chapter 611 of the Laws of 1875, which is continued, with a slight modification, in section 5 of chapter 691 of the Laws of 1892, known as the Business Corporation Law. The act of 1875 is an act for the incorporation of business corporations, and the provisions of the section before referred to apply only to corporations organized under that act. The section 5 of the Business Corporation Law expressly limits it to corporations organized under that act, or corporations which had theretofore been organized, and which may incorporate themselves under the provisions of section 4 of that act. *225It did not appear before the court below, nor does it appear in the record before us, that this defendant corporation was organized under the provisions of the act of 1875, or has come under the provisions of the Business Corporation Law, so that the provisions of that act apply to it. It does not appear, therefore, that this provision of the statute applies to this defendant corporation. We cannot assume that it does; and in determining this question the general rule nmst apply as to all corporations except those within the provisions of the statute above cited. This rule is' expressly recognized by the Court of Appeals in the case of Marstaller v. Mills (143 N. Y. 400) where Judge Gray, in delivering the opinion of the court, says, in speaking of an action for personal injuries against a corporation : “ If provision has not been made in the statute law of this state whereby such a cause of action is preserved from abatement, the common-law rule would undoubtedly be in force and the plaintiff’s remedy would be gone.” In that case the court discussed the effect of section 5 of the Business Corporation Law and section 38 of chapter 611 of the Laws of 1875, and held that, as to corporations organized under that act, or which were continued under the Business Corporation Law-, the cause of action for personal injuries survived and could be continued as against the directors or managers of the affairs of a corporation which had been dissolved, where no receiver had been appointed under the provisions of section 30 of the General Corporation Law, being chapter 687 of the Laws of 1892. It appears in this case that the defendant corporation has been dissolved and a receiver appointed to wind up the affairs of the corporation ; and as it does not appear that this corporation was organized under the act of 1875, or is subject to the provisions of section 5 of the Business Corporation Law, the provisions of these acts do not apply. The case of Hepworth v. Union Ferry Co. (62 Hun, 257) is also relied upon by the respondent. The corporation defendant in that case appears to have been organized under a special charter, and stress appears to have been laid upon the provisions of such charter. The corporation had expired by the limitation of its charter, and its property was in the hands of its directors. It was held in that case, by the General Term of the Supreme Court in the second department, *226that the tort there sued stood upon the same basis as a contract, as “ the charter pledges the property of the corporation to pay all damages for misfeasance of the company’s employees. The law makes the directors trustees to settle the affairs of the corporation and to pay all debts against the corporation. The court has the power to continue the action which was pending at the dissolution of the corporation of necessity.” An appeal from this order appears to have been dismissed. (See 131 N. Y. 645.) I do not think that this case can be said to be an authority as applied generally to corporations organized under general law, and in which there was no provision of the charter like the one relied on. This is especially so in view of the statement made by the court in Marstaller v. Mills (supra), that unless the provisions were made in the statute law of the State whereby such a cause of action was preserved from abatement, the common-law rule would undoubtedly be enforced and the plaintiff’s remedy would be gone.
I think, therefore, that upon this record there is nothing to show that a cause of action against this defendant corporation survives, and that the order appealed from should be reversed, with ten dollars costs and disbursements, and the motion denied, with ten dollars costs.
Van Brunt, P. J., Patterson and O’Brien, JJ., concurred; Williams, J., dissented.