Ayer v. Seymour

5 N.Y.S. 650, 15 Daly 249, 1889 N.Y. Misc. LEXIS 2563
CourtNew York Court of Common Pleas
DecidedMay 27, 1889
StatusPublished

This text of 5 N.Y.S. 650 (Ayer v. Seymour) is published on Counsel Stack Legal Research, covering New York Court of Common Pleas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ayer v. Seymour, 5 N.Y.S. 650, 15 Daly 249, 1889 N.Y. Misc. LEXIS 2563 (N.Y. Super. Ct. 1889).

Opinion

Daly, J.

The plaintiff seeks to enjoin the defendants from selling or transferring and from voting upon certain of the shares of stock of the Recamier Manufacturing Company, and asks that a receiver be appointed to take and hold such shares during the pendency of this action. The grounds of her application are that those shares belong to her, and were pledged with the defendant James M. Seymour as security for a loan of $50,000 made by him to her;, that Seymour, who was a stock-broker, was engaged in certain transactions for her benefit in the purchase and sale of stocks, which transactions, as he reported from time to time to her, resulted in profits which he applied in reduction of said loan until it was almost or wholly repaid in or about the month of August, 1888; that in November, 1888, Seymour, who was the assistant treasurer of the company, and his son, the defendant A. Lewis Seymour, who was the treasurer, without her knowledge and consent, and in pursuance of a conspiracy to deprive her of such shares, and to exclude her from the management of the company, she being the president, canceled the certificate of said shares, and issued a new certificate to the defendant Harriet T. Seymour, who is the wile of A. Lewis Seymour, and the daughter of the plaintiff, and who paid no consideration for such stock, and took it with full knowledge of plaintiff’s title thereto.

In support of her claim the plaintiff sets forth that prior to April, 1887, she was engaged in the manufacture of certain, proprietary articles known as the “Recamier Toilet Preparations,” in accordance with certain recipes and formulas which were her sole property; that at said date the Recamier Manufacturing Company was incorporated at the suggestion of defendant James M. Seymour, with a capital stock of 1,000 shares at $50 each, all of which were issued to the plaintiff for the purchase of her said recipes, trade-marks, and business. She advanced $7,000 to the company as-working capital, and also put into its treasury the $50,000 borrowed as aforesaid from James M. Seymour. She gave to him a certificate for 498 shares as collateral security for said loan, and indorsed the certificate in blank. She transferred 1 share to A. Lewis Seymour, his son, and 1 share to Albert Watson, and 30 shares to one Mrs. Mason. The balance, 470 shares, has always remained her property. She was elected president of the company, and A. Lewis Seymour treasurer, and they, with Watson, were elected trustees for the first year. In May, 1888, she was taken ill at her residence, No. 120 West Thirteenth [652]*652street, in this city, where she lived with her daughter Harriet, who was then and was for nearly two years engaged to be married to defendant A. Lewis Seymour. In June, 1888, the plaintiff was removed to her summer residence at Montclair, H. J., where she remained ill until October, 1888, when she returned to this city. During the said months, May and June, the defendant Seymour and his son, as she complains, began their conspiracy to obtain control of the company, and to exclude her from the exercise of her functions as president, and to obtain possession of her stock. In the said month of June a meeting of the trustees of the said company was held, without notice to her, and they elected James M. Seymour as assistant treasurer of the company. On Hovember 12,1888, her daughter was married to A. Lewis Seymour. On Hovember 22d the transfer of the 498 shares held by James M. Seymour as security was made to Harriet by her father-in-law and her husband, without plaintiff’s knowledge' and in fraud of her rights. In December, 1888, the plaintiff sailed for Europe to visit her younger daughter, a child of 12 years, who was residing in Stuttgart, in charge of a Miss Howard. Before and after her departure for Europe, and while she was ill, she charges that the Seymours, father and son, caused to be administered to her dangerous drugs for the purpose of destroying her health and incapacitating her from managing her affairs, and that they reported that she was insane. While she was in Europe, with the design of preventing her return to America, they sent false telegrams to her, falsely informing her that her daughter Harriet was about to join her there, and also fabricated and sent to her a telegram purporting to come from an old friend, one Grubb, and also suppressed a telegram from one Henry T. Thomas, which he intrusted to A. Lewis Seymour to send her; also that during her absence, and in December, 1888, James M. Seymour obtained access to her residence in Hew York by fraud, and abstracted therefrom certain papers of hers, among them being his own letters' and writings, which she possessed as evidence of the payment of the said loan of $50,000, and a certain cipher paper containing the secret of her manufactures; also that James M. Seymour fraudulently signed the name of the plaintiff to an order on one Dr. Pinkham, of Montclair, by which he obtained and examined certain of her letters; and also, in February, 1889, he, or his son, A. Lewis Seymour, wrongfully obtained from the post-office and kept two letters posted to the plaintiff, and addressed to her at the Clarendon Hotel, H. Y.

The plaintiff charges that Albert Watson, the aforesaid trustee of the company, is and has been for years a clerk of the defendant James M. Seymour, and is wholly under his control; and that between May and October, 1888, over $20,000 was drawn-from the treasury of the company by A. Lewis Seymour, and debited to the account of the plaintiff, of which some part was applied to her use, but no account thereof was ever rendered to her; and that no meeting of the board of trustees of the company has been held since April, 1887, except the alleged meeting of June, 1888; and that no meeting of the stockholders has ever been held, notwithstanding the by-laws provided for a meeting on May lst-of each year. It is also alleged as ground for the equitable interference of the court that the stock of the company is of great value, but that no share has ever been sold in the market, and that it has no market price; also that the transfer of the 498 shares to the defendant Harriet will enable defendants to destroy plaintiff’s title to her stock, and render ineffectual any judgment she may recover, and exclude her from her rightful share in the control and management of the company, and thus injure its business and credit, and impair the value of the stock.

The proof with respect to these charges must now be examined, and, first, as to the plaintiff’s claim that the 498 shares were delivered to the defendant James M. Seymour as collateral security, and not otherwise. The plaintiff swears to it positively. The defendant James M. Seymour denies it. He [653]*653swears that she offered and agreed to give him one-half of the capital stock of the company in consideration of his services in organizing the company, and as manager and director of its affairs, and of his procuring sufficient money to run the business; that this was before its incorporation; that he had previously lent her large sums of money for use in the manufacturing business, which had before that date, as he says, been conducted at a loss; and that she consulted him in regard to carrying it on, and he proposed the formation of the corporation in order to extend the business, and proposed to advance the requisite capital, as she had not sufficient money; that after the company was organized she transferred to him one-half of the capital stock in accordance with her agreement, and the said stock was held by him as his own property, in consideration of his said services and of such loans of money as he might be required to make; that he thereafter procured a loan of $50,-000 from “one O. S.

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Bluebook (online)
5 N.Y.S. 650, 15 Daly 249, 1889 N.Y. Misc. LEXIS 2563, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ayer-v-seymour-nyctcompl-1889.