Court Opinion

ID: 6120538
Source: CourtListenerOpinion
Date Created: 2022-02-04 18:42:35.227944+00
Date Added: 2024-06-11T08:23:10.886075
License: Public Domain

Learned, P. J.
The object of this action is to obtain the advice of the court. The plaintiffs do not allege that they have been injured, nor do they ask for redress. They wish to be informed whether a contract which they made was illegal; a matter about which neither they, nor the other party to the contract are alleged to be in doubt.
Executors and trustees are allowed to come into court for the construction of instruments and directions as to their duties. In a like manner, those standing as eestuis que trust, have had the same privilege. The general ground on which such actions are permitted, is, that the trustees or executors have, under some instrument, future duties to perform, about which they are in doubt; that there are conflicting claims as to what these duties are; that the duties are imposed on them by the words of some other person ; that in their trust capacity, they are entitled to protection in equity. Ho such circumstances exist in this case. Under this instrument, there is no doubt or misunderstanding as to the plaintiffs’ duties. They are simply to receive a sum of money monthly. There are no conflicting claims as to their duties under this instrument. Hone but the stockholders claim the money which they receive. The language of the instrument is their own, and their duties are not imposed lwsome other person. And the plaintiffs do not act in a trust c *715city, 'entitling them to the protection of equity. The corporation plaintiff is a person. It has its duties undoubtedly, like other persons, but the affairs which it manages are its own.
The case is simply this: Two persons have made a contract of lease, one to the other. A third person has alleged that the lease is illegal. And the lessors ask the court to say whether it is or not. The lessors do not allege its illegality, or ask to have it set aside. On the contrary the lessors aver that they are content. And the lessees are content. There is no controversy for the court to settle. Courts do not sit to lay down principles of law, but to decide controversies. And here is none. And it is not best that courts should lay down principles, except as the result of actual controversy. To take the present case, for illustration. The question we are asked to pass upon, is, whether such a lease is beyond the powers of a corporation: ultra vires. Now, both the' plaintiffs and the defendants apparently think that it is not; for they acted on that view; and even now they seem to desire a decision in the negative. There is no probability, therefore, that the arguments for the affirmative will be presented with that force which they would have in a real controversy. In fact, it looks much as if this suit were brought only to obtain a quasi decision, which might serve as a precedent in the action brought by the people, in which it is distinctly alleged that this lease was ultra vires, and worked a forfeiture of the charter.
Furthermore, it may be that, while such a contract is ultra vires, and while the State may thereupon allege a forfeiture, yet the contracting party shall not be allowed to set up the invalidity of his own act. Or again, if the contract were beyond the power of the directors, yet, possibly, the approval of the stockholders might be sufficient to affirm it. Or, once more, it might possibly be affirmed by some of the stockholders, while others might disavow it. We do not pass on these points. We suggest them to show the impropriety of our deciding a question presented in this manner. So long as the State does not enforce a forfeiture, why should the plaintiffs raise any question as to the legality of the contract? They made it, and, until somebody objects, they would best observe it. When the State shall attempt by action to enforce such forfeiture, it will be time enough to decide in that action whether *716the charter has been forfeited by reason of this lease. When a stockholder shall complain that the directors transgressed their powers in making this lease, it will be time enough to inquire whether he has not ratified their act.
And again: Whenever executors or -trustees, or the cestuis que trust, come into court for the construction of an instrument, they bring in as parties all who are affected by the conflicting construction. Now, in the present instance, if there be any one who claims that the lease is void, as ultra vires, it is the people; yet they cannot be heard in this action.
The plaintiffs have carefully omitted in their complaint any allegation that the lease is illegal, or that they desire to have it set aside. They only allege that, if it is illegal, they desire to be relieved therefrom.
It may be said that the plaintiffs, as a railroad corporation, have certain public duties, and therefore ought to be instructed as to the legality of their acts. It is enough to say, that if, before entering into this contract, they had brought an action similar to the present, stating their intention to enter into such a lease, and-the threat of the attorney-general that the lease would be ultra vires, and their desire that the court should adjudge whether or not such a lease would be valid, no one would have thought that such an action could be sustained. Now they have acted; if legally, it is all right; if illegally, they must, like other persons, take the consequences. Thus far the consequences have contented the plaintiffs and the defendants.
We may see that the view above taken of the nature of this action is correct, if we consider what judgment could be granted on default. (Code, § 275, sub. 1.) The plaintiffs could not have a judgment that the contract was.illegal, but only an adjudication whether or not it was illegal; and as none of the parties to the action aver its illegality, the court would be deciding a matter not disputed. It is possible that the plaintiffs are unwilling to aver that the lease was ult/ra vi/t'es, lest such an averment should be used to their prejudice in the suit of the people. But, however that may be, such unwillingness shows the absence of all controversy between the parties to this action. They seem to be in complete harmony, which the court ought not to disturb.
*717This action, then, cannot be maintained. There is nothing before us which calls on us to decide whether or not this contract was ultra vires. It is therefore unnecessary to decide the question of jurisdiction. In the general view taken by the Special Term of this matter we concur. In a proper action, brought by the plaintiffs to recover possession of property within this State, to which the non-resident defendants or the foreign corporation claimed some title or interest, we do not understand that the Special Term held that no jurisdiction could be obtained ; jurisdiction that is sufficient to enable the court to adjudge possession of the property. In accurate language, there is probably no action now (except in admiralty) which can be called an action im. rem. But some times the subject of the action is real or personal property in this State. Then the court can obtain a quasi jurisdiction of non-residents and of foreign corporations. (Code, § 135, sub. 4.)
The judgment and order appealed from should be affirmed.
Present — Learned, P. J., and Boardman, J.
Judgment affirmed, with costs.