Court Opinion

ID: 5242651
Source: CourtListenerOpinion
Date Created: 2022-01-06 17:30:05.306154+00
Date Added: 2024-06-11T08:27:49.361514
License: Public Domain

McLaughlin, J. (dissenting):
. I am unable to concur in the opinion of Mr. Justice Laughlin. It appears from the complaint that the bank went into voluntary liquidation on the 16th day of June, 1911, and is now and was at the time of the commencement of this action in process of liquidation. It does not appear just when the action was commenced, but both at Special Term and on the argument of this appeal counsel for both parties assumed that the action was commenced after the appointment of the committee, and I think that fact is also to be fairly inferred from the allegations of the complaint, which was not verified until nearly one year after the appointment of such committee. Once the stockholders had voted to go into voluntary liquidation, no further business could be done. After that there was no authority on the part of the officers or directors of the bank to transact any business in its name, except that which is implied from the obligation to liquidate its affairs, unless authority were expressly conferred by the stockholders. (Richmond v. Irons, 121 U. S. 27.) No such authority was here given; on the contrary, thé same was withheld by the passage of a resolution by the stockholders appointing a committee of seven “to liquidate the affairs, of the bank.” Thereafter it was the duty of this committee to marshal the assets and discharge the obligations of the bank and to divide among the stockholders anything remaining according to their respective holdings. The corporation, of course, as such, was not dissolved, nor were the directors thereby removed or their terms of office terminated, but they were deprived of all power in so *264far as the liquidation was concerned by the appointment of the committee. Its duty was, and it had the sole power, in my opinion, to do and perform every act necessary to the liquidation, which included, as indicated, the marshaling of assets and their proper distribution. In the discharge of that duty the directors had nothing to say. Their consent was not necessary to the commencement of an action, nor had they any voice whatever in its prosecution. If it be true, as contended in the prevailing opinion, “that the liquidating committee could maintain an action here only by the approval or acquiescence of the board of directors ” then the passage of the resolution directing the committee to liquidate the affairs was an idle ceremony. The passage of the resolution indicated that the stockholders desired to take from the directors the power to liquidate and to give such power solely to the committee. What possible object could there be in appointing a committee to liquidate the affairs of the bank if it could not liquidate without asking the directors’ consent % The power to liquidate necessarily includes the right to bring actions in the name of the bank to recover upon claims similar to the one here alleged to exist. The committee, therefore, could have brought this action, but before the plaintiff could do so, he had to first request that such action be brought by the committee, or show why a request would have been ineffectual. The complaint here does not allege that such request was made by the committee, nor are any facts set forth showing any excuse therefor. For that reason I think it fails to state a cause of action.
I think the order appealed from should be reversed and the demurrers overruled.
Order affirmed, with ten dollars costs and disbursements.