Court Opinion

ID: 5228461
Source: CourtListenerOpinion
Date Created: 2022-01-06 16:50:32.136163+00
Date Added: 2024-06-11T08:27:37.785034
License: Public Domain

Laughlin, J.:
The facts and points presented by this appeal are the same as those presented on the other appeal in this case, in- which the defendant Runyon is the respondent (156 App. Div. 724), with the exception of those relating to this respondent’s connection with the company, and his participation in the conveyance and assignment of. its property, and, therefore, the opinion on that appeal disposes of them in favor of the appellants. He was not a director, but was the treasurer of the company at the time a mortgage, alleged to have been given in violation of the statute, was executed. As a stockholder,- he signed a consent to its execution, and it is alleged that he advised, ratified,' approved and assented to the execution of the mortgage, and that through its execution he received payment of a note of the corporation which he .held for $2,500.- It is quite plain, I think, that, although he did not in his official capacity represent the corporation in the execution and delivery of the mortgage, and, therefore, did not as an officer of the corporation violate the statute, yet he was concerned in the disposition of the corporate property made thereby, for the words “be concerned in violating,” as used in section 66 of the. Stock Corporation Law (Consol. Laws, chap. 59; Laws of' 1909, chap. 61), are equivalent to “participate” or “take part” in violating. (See United States v. Scott, 74 Fed. Rep. 213.) I am of opinion that an officer may, without acting officially, violate the statute by inducing other officers to transfer assets of the corporation in violation of law to himself or to another, at least, when, as here alleged, he is to and did derive a benefit' therefrom.
The determination of the Appellate Term and order of the Special Term of the City Court should, therefore, be reversed, with costs, and motion denied, with costs.
McLaughlin and Hotchkiss, JJ., concurred; Ingraham, P. J., and Dowling, J., dissented.
Determination and order reversed, with costs, and motion denied, with .costs.