In re the Society for the Prevention of Cruelty to Animals of Upstate

New York Supreme Court

In re the Society for the Prevention of Cruelty to Animals of Upstate

2 Misc. 3d 644, 773 N.Y.S.2d 789, 2003 N.Y. Misc. LEXIS 1612

CourtNew York Supreme Court

DecidedNovember 24, 2003

StatusPublished

Cited by1 cases

This text of 2 Misc. 3d 644 (In re the Society for the Prevention of Cruelty to Animals of Upstate) 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.

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In re the Society for the Prevention of Cruelty to Animals of Upstate, 2 Misc. 3d 644, 773 N.Y.S.2d 789, 2003 N.Y. Misc. LEXIS 1612 (N.Y. Super. Ct. 2003).

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Opinion

OPINION OF THE COURT

Thomas D. Nolan, Jr., J.

The petition of the Society for the Prevention of Cruelty to Animals of Upstate, New York, Inc. for court approval, pursuant to Not-For-Profit Corporation Law § 510 (a) (3), for the sale of [645]*645certain real property for a price not less than $650,000 is denied, without costs and without prejudice.

Petitioner owns 3.54 acres of real property on Queensbury Avenue in the Town of Kingsbury, Washington County, on which a 15,000-square-foot commercial building is located and at which petitioner operates an animal shelter. On July 28, 2003, petitioner’s board of directors adopted a resolution authorizing that the property be sold, at auction, by a designated auctioneer, for a price not less than $650,000. By order to show cause and verified petition, petitioner seeks court approval of the sale plan. The Attorney General of the State of New York opposes the petition principally on the ground that there is nothing for the court to approve unless and until a valid, binding agreement for sale has been obtained. Petitioner counters that neither section 510 nor section 511 of the Not-For-Profit Corporation Law expressly requires that a binding contract be in existence before court approval of a contemplated sale is secured.

The primary purpose for requiring that not-for-profit corporations secure court approval before assets are sold is to insure that the consideration to be received and the terms of the sale are fair and reasonable. (N-PCL 511 [a] [6].) Crucial to the making of such determination is the requirement that “the consideration to be received” be disclosed to the court. (N-PCL 511 [a] [5].) The petition now sub judice does not and cannot make such a disclosure because a definite purchase offer has not been made and there, of course, is no identified price which a purchaser has agreed to pay. The court cannot ascertain whether the $650,000 minimum price set by the board constitutes fair and reasonable consideration. The court cannot and should not approve a sale which at this time is nothing but a “hoped for” sale. This result comports with the historical reluctance of courts to render “advisory opinions.” Once a firm contract for sale is secured, be it from an auction or other traditional sales method, petitioner may reapply to the court for approval.

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OPINION OF THE COURT

Thomas D. Nolan, Jr., J.

The petition of the Society for the Prevention of Cruelty to Animals of Upstate, New York, Inc. for court approval, pursuant to Not-For-Profit Corporation Law § 510 (a) (3), for the sale of [645]*645certain real property for a price not less than $650,000 is denied, without costs and without prejudice.

Petitioner owns 3.54 acres of real property on Queensbury Avenue in the Town of Kingsbury, Washington County, on which a 15,000-square-foot commercial building is located and at which petitioner operates an animal shelter. On July 28, 2003, petitioner’s board of directors adopted a resolution authorizing that the property be sold, at auction, by a designated auctioneer, for a price not less than $650,000. By order to show cause and verified petition, petitioner seeks court approval of the sale plan. The Attorney General of the State of New York opposes the petition principally on the ground that there is nothing for the court to approve unless and until a valid, binding agreement for sale has been obtained. Petitioner counters that neither section 510 nor section 511 of the Not-For-Profit Corporation Law expressly requires that a binding contract be in existence before court approval of a contemplated sale is secured.

The primary purpose for requiring that not-for-profit corporations secure court approval before assets are sold is to insure that the consideration to be received and the terms of the sale are fair and reasonable. (N-PCL 511 [a] [6].) Crucial to the making of such determination is the requirement that “the consideration to be received” be disclosed to the court. (N-PCL 511 [a] [5].) The petition now sub judice does not and cannot make such a disclosure because a definite purchase offer has not been made and there, of course, is no identified price which a purchaser has agreed to pay. The court cannot ascertain whether the $650,000 minimum price set by the board constitutes fair and reasonable consideration. The court cannot and should not approve a sale which at this time is nothing but a “hoped for” sale. This result comports with the historical reluctance of courts to render “advisory opinions.” Once a firm contract for sale is secured, be it from an auction or other traditional sales method, petitioner may reapply to the court for approval.

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Bluebook (online)

2 Misc. 3d 644, 773 N.Y.S.2d 789, 2003 N.Y. Misc. LEXIS 1612, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-the-society-for-the-prevention-of-cruelty-to-animals-of-upstate-nysupct-2003.

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