Flanagan v. Flanagan

273 A.D. 918, 77 N.Y.S.2d 682

• Court: Appellate Division of the Supreme Court of the State of New York
• Decided: March 30, 1948
• Status: Published

Opinions

Memorandum by the Court. Action for specific performance of a contract. The contract, made by two brothers, one of whom is deceased and the other a defendant, each the owner of twenty-nine shares of the sixty shares of outstanding corporate stock of Flankane Realty Corporation, the second defendant, in providing that certain designated property owned by that corporation should be, upon the occurrence of certain contingencies, distributed to one or the other of them, or their estates, in accordance with a certain allocation of each parcel, constituted an arrangement to deal with the property as if it were owned by them individually, or as partners or joint venturers. Such a contract is contrary to public policy and is unenforciblc. (Epstein v. Leibner, 258 App. , affd. 284 N. Y. 717; Boag v. Thompson, 208 App. Div. 132) and the court, of its own motion, may refuse to grant relief under an unenforcible contract. (Attridge v. Pembroke, 235 App. Div. 101.) In any event, neither the corporation nor the holders of the other two shares of stock (the wife of each brother), both of whom are now deceased, were parties to the contract.

Judgment dismissing the complaint and directing plaintiffs to account, modified on the law by striking out the second decretal paragraph thereof and by substituting in lieu thereof the following: “ Ordered, Adjudged and Decreed that the purported agreement dated July 15, 1937, made between Joseph A. Flanagan, now deceased, and defendant John J. Flanagan, constituted an arrangement to deal with property belonging to a corporation, defendant Flankane Realty Corporation, as if it were owned by the said Joseph A. Flanagan and John J. Flanagan individually, or as partners, or as joint venturers, and, therefore, was contrary to public policy and is unenforcible.” As so modified, the judgment is affirmed, with costs to respondents. Findings of fact and conclusions of law contained in the written decision, which is in the form of an opinion, inconsistent with the foregoing are reversed.