Flagg Court Realty Co. v. Flagg Court Owners Corp.

230 A.D.2d 740, 646 N.Y.S.2d 298, 1996 N.Y. App. Div. LEXIS 8253

• Court: Appellate Division of the Supreme Court of the State of New York
• Decided: August 5, 1996
• Status: Published

Opinion

—In a proceeding pursuant to Business Corporation Law § 619, inter alia, to confirm an election of the Board of Directors of Flagg Court Owners Corporation held on May 15, 1995, the petitioners appeal from an order of the Supreme Court, Kings County (Held, J.), dated June 22, 1995, which denied their motion to confirm the election.

Ordered that the order is affirmed, with costs.

The petitioners, Flagg Court Realty Co. and Lee Wallach, who sponsored the conversion of one of the respondents, Flagg Court Owners Corporation, into a cooperative corporation (hereinafter the corporation), instituted this proceeding, inter alia, to confirm an election of the Board of Directors of the corporation held on May 15, 1995. The petitioners moved to confirm the election by order to show cause dated June 9, 1995. The Supreme Court granted a stay prohibiting a new election, which was subsequently vacated on the return date of the order to show cause. In lifting the stay, the Supreme Court permitted the respondents to proceed with the June 13, 1995, meeting at which a new election was held. By order dated June 22, 1995, the Supreme Court denied the petitioners’ motion to confirm the May 15, 1995, election.

The May 15, 1995, election was conducted in violation of the offering plan and by-laws, inasmuch as the sponsor used its votes to elect all seven board members after having nominated three sponsor-related members. Accordingly, the Supreme Court was correct in refusing to confirm the election.

Rosenblatt, J. P., Ritter, Copertino and Joy, JJ., concur.