Brady v. Meenan

204 A.D. 390, 198 N.Y.S. 177, 1923 N.Y. App. Div. LEXIS 9475

• Court: Appellate Division of the Supreme Court of the State of New York
• Decided: February 9, 1923
• Status: Published

Opinion

Page, J.:

This is a derivative action, brought by a stockholder of a corporation on behalf of himself and other stockholders, to compel an officer and director to account for funds belonging to the corporation, collected and retained by said officer. In such an action the corporation is a necessary party, and should have been brought in when the attention of the court was called to this defect of parties at the trial. The complaint should have alleged a demand upon the corporation to bring the action or an excuse for not doing so. The complaint was amended by order of the court upon the trial to allege such a demand, but no proof thereof was offered. The evidence satisfied the justice that the defendant was accountable to the corporation in the sum of $6,214.23, but there was no decision containing findings of fact and conclusions of law signed by the justice; the judgment merely adjudges the defendant indebted to the corporation, and there is no direction to whom he should pay the money. We are of opinion that the defects in this case are beyond the limits of the liberality of section 105 of the Civil Practice Act, and that, in justice to all the parties, the complaint should be dismissed, to the end that the action may be commenced against the proper parties and on a sufficient complaint.

The judgment should be reversed, with costs to the appellant, and the complaint dismissed, without costs to either party as against the other.

Claeke, P. J., Dowling, Smith and McAvoy, JJ., concur.

Judgment reversed, with costs to appellant, and complaint dismissed, without costs to either party as against the other.