In re Ades

New York Supreme Court

In re Ades

12 Misc. 2d 915, 177 N.Y.S.2d 574, 1958 N.Y. Misc. LEXIS 3361

DecidedMay 12, 1958

StatusPublished

This text of 12 Misc. 2d 915 (In re Ades) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

In re Ades, 12 Misc. 2d 915, 177 N.Y.S.2d 574, 1958 N.Y. Misc. LEXIS 3361 (N.Y. Super. Ct. 1958).

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Opinion

William C. Hecht, J.

This is a proceeding for dissolution, pursuant to article 9 of the General Corporation Law, and for incidental relief. The application is made by one of the three directors of the corporation. It, therefore, fails to comply with section 101 of the General Corporation Law, which requires the petition to be made by a majority of directors. Section 102 of the General Corporation Law, is of no avail to petitioner, for it applies only where the majority of the stockholders have requested the petitioning director to apply for dissolution. Section 103 of the General Corporation Law, is likewise of no help to petitioner. In the event of a deadlock among the directors, it authorizes the holders of one half of the stock to present a petition for dissolution. The petition equally fails to allege facts which would bring this case within the language of the latest amendment to section 103 (supra). Neither the charter nor the by-laws are annexed, nor are their provisions referred to. The stockholders ’ agreement, which is annexed to and made [916]*916part of the petition, does not require unanimity for action by the board of directors or the stockholders.

What petitioner apparently means by his allegation, in paragraph 13 of the petition, that ‘6 under the terms of the agreement of April 4, 1955, unanimity of all the directors is required ’ ’ is that because one of the three directors is in the military service, the concurring votes of the remaining two are necessary to authorize any corporate action. The deadlock among the directors which is alleged to result is not sufficient, under section 103 (sufra) to empower one of the directors to petition for dissolution. In such a situation, the petition, according to that section, must be presented by the holders of a majority of the stock.

Since the petition fails to comply with any of the sections of the General Corporation Law which authorize a dissolution proceeding by directors or stockholders, it is unnecessary to determine whether the absence of a director in military service creates an even number of directors within the meaning of said statute.

The application is denied and the petition is dismissed.

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William C. Hecht, J.

This is a proceeding for dissolution, pursuant to article 9 of the General Corporation Law, and for incidental relief. The application is made by one of the three directors of the corporation. It, therefore, fails to comply with section 101 of the General Corporation Law, which requires the petition to be made by a majority of directors. Section 102 of the General Corporation Law, is of no avail to petitioner, for it applies only where the majority of the stockholders have requested the petitioning director to apply for dissolution. Section 103 of the General Corporation Law, is likewise of no help to petitioner. In the event of a deadlock among the directors, it authorizes the holders of one half of the stock to present a petition for dissolution. The petition equally fails to allege facts which would bring this case within the language of the latest amendment to section 103 (supra). Neither the charter nor the by-laws are annexed, nor are their provisions referred to. The stockholders ’ agreement, which is annexed to and made [916]*916part of the petition, does not require unanimity for action by the board of directors or the stockholders.

What petitioner apparently means by his allegation, in paragraph 13 of the petition, that ‘6 under the terms of the agreement of April 4, 1955, unanimity of all the directors is required ’ ’ is that because one of the three directors is in the military service, the concurring votes of the remaining two are necessary to authorize any corporate action. The deadlock among the directors which is alleged to result is not sufficient, under section 103 (sufra) to empower one of the directors to petition for dissolution. In such a situation, the petition, according to that section, must be presented by the holders of a majority of the stock.

Since the petition fails to comply with any of the sections of the General Corporation Law which authorize a dissolution proceeding by directors or stockholders, it is unnecessary to determine whether the absence of a director in military service creates an even number of directors within the meaning of said statute.

The application is denied and the petition is dismissed.

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Bluebook (online)

12 Misc. 2d 915, 177 N.Y.S.2d 574, 1958 N.Y. Misc. LEXIS 3361, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-ades-nysupct-1958.