Court Opinion

ID: 5351896
Source: CourtListenerOpinion
Date Created: 2022-01-08 06:43:41.825558+00
Date Added: 2024-06-11T08:29:44.510793
License: Public Domain

The decision of this court handed down on October 22, 1937 [ante, p. 785], is hereby amended to read as follows: On appeal by plaintiffs from an order denying their motion for an examination of the defendants before trial, for the production of books and papers thereat pursuant to section 296 of the Civil Practice Act, and for a stay until said examination is completed, in a derivative action brought in the right of the corporate defendant society by the plaintiffs, members thereof, order reversed on the law and the facts, with ten dollars costs and disbursements, and motion granted, with ten dollars costs. The examination is granted as to all the items contained in the affidavit of plaintiff Tricarico, printed at pages 13 to 35 of the record. For the purpose of refreshing the memory of witnesses and for the other purposes specified in section 296 of the Civil Practice Act, defendants are directed to produce, on the examination, all books, records and papers relating to the controversy and referred to in such affidavit. The examination will proceed at Special Term, Part 2, Kings county, on five days’ notice. In view of the allegations in the complaint and in the moving affidavits which are not substantially controverted by those defendants charged with wrongdoing, the plaintiffs-appellants, under our now liberalized practice, are clearly entitled to the examination be ore trial of all the defendants, with the aid of the books, records and papers of the membership corporation defendant (Civ. Prac. Act, §§ 288, 289, 296). The action was properly brought by the plaintiffs as members of that corporation without regard to any statute. (Isaac v. Marcus, 258 N. Y. 257, 263, 264; Loewenstein v. Diamond Soda Water M. Co., 94 App. Div. 383.) This action is for much more than an accounting, and the fact that plaintiffs demand, along with relief in other forms, that the defendants account to the membership corporation or funds belonging to it, alleged to have been misappropriated or wasted by them, does not defeat plaintiff’s right to the examination sought. (Muller v. Ackerman, 246 App. Div. 849.) It is true that the proposed subjects of inquiry are stated at considerable length. That circumstance is the result of the multiplicity of the charges of wrongdoing against certain individual defendants. Hagarty, Carswell, Davis, Adel and Taylor, JJ., concur.