In re Hammerman

72 A.D.2d 677, 421 N.Y.S.2d 210, 1979 N.Y. App. Div. LEXIS 13856

• Court: Appellate Division of the Supreme Court of the State of New York
• Decided: November 1, 1979
• Status: Published

Opinions

Order, Supreme Court, New York County, entered February 23, 1979, granting the stockholder’s application to examine corporate books and records, reversed, on the law and the facts and in the exercise of discretion, and the matter remanded for a hearing to determine the good faith of the petitioner and, if an inspection is warranted, the scope of inspection to be permitted, with costs and disbursements. Petitioner Ham-merman and his two brothers are minority shareholders in the Bueche-Girod Corp., a manufacturer and dealer in watches and jewelry. The corporation purchased large quantities of diamonds from petitioner’s brothers. After a disputed transaction among the parties, Bueche-Girod Corp. stopped doing business with petitioner’s brothers and in fact elected to go into the diamond business itself. Hammerman brought this petition seeking to inspect the corporate books and records, beginning with 1969 to date. It is the claim of the corporation that the present petition was brought by Hammerman, in effect, on behalf of his brothers’ business interests, and is not being brought in good faith (see Business Corporation Law, § 624, subd [c]). It is further claimed that the plethora of documents sought to be inspected, which cover a period of 10 years of doing business, is overly broad and burdensome. The record before us leaves us in doubt as to the good faith of the petitioner, and furthermore we perceive no basis for the broad inspection sought. We have remanded this matter for a hearing on both the issue of petitioner’s good faith as well as the scope of inspection to be allowed. Concur—Lane, Lupiano and Lynch, JJ.