Jenkins v. Auburn City Railway Co.

50 N.Y.S. 852

• Court: Appellate Division of the Supreme Court of the State of New York
• Decided: March 26, 1898
• Status: Published

Opinions

FOLLETT, J.

September 22, 1897, the plaintiff took an assignment of two shares of stock, of the par value of $25 each, in the Auburn City Railway Company. Two days afterwards he verified the complaint in this action, and on the same day (September 24, 1897) the injunction herein was granted. October 11; 1897, the defendants’ answer was verified, denying all the equities in the complaint, except it is admitted that the "railroad commissioners have not granted the Auburn City Railway Company permission to construct its proposed line, as required by section 59 of the railroad law. It is alleged in the complaint that this certificate was refused June 6, 1897. It is alleged in the answer that the New York Central & Hudson River Railroad Company opposed the granting of the certificate, by the attorneys for the plaintiff in this action; and it is further alleged in the answer that the plaintiff “is not now, and never has been, a stockholder in the Auburn City Railway Company,” and “that said plaintiff procured said certificate in bad faith, and for no other purpose but to commence this action, and annoy and harass the stockholders of the Auburn City Railway Company,” etc. In an affidavit, verified October 11, 1897, by the president of the Auburn City Railway Company, it is averred:

“That the plaintiff’s attorneys in this action are attorneys for the New York Central & Hudson River Railroad Company, and that the plaintiff, if he obtained the obsolete stock certificate above mentioned at all, obtained the same, at the instance of said attorneys of the said New York Central & Hudson River Railroad Company, for the purpose, solely, of preventing any proceedings that the Auburn City Railway Company and the Geneva, etc.,- Traction Company might take for their own advantage and benefit; and this injunction was not procured to protect any legal right, but purely and solely for purposes of annoyance.”

This affidavit was used on the order to show cause (granted October 12, 1897) why the injunction granted September 24, 1897, should not be vacated. In opposition to this motion, and in answer to the allegations in the answer, and to the averments in the affidavit of October 11, 1897, the plaintiff verified an affidavit October 22, 1897, in which he avers that:

“Said stock was sold and transferred to me on or before September 22, 1897) by J. H. Vail, of Philadelphia, Pennsylvania, in consideration of fifty dollars actually paid to him therefor. * * * The action brought by me has not been brought for the purpose of annoying the defendants, but for the purpose of preventing an illegal and unauthorized action on their part.”

The plaintiff nowhere denies that he purchased the certificate, at the instance of the attorneys of the New York Central & Hudson River Railroad Company, for the purpose, solely, of preventing any proceedings that the Auburn City Railway Company and the Geneva, etc., Traction Company might take for their own advantage and benefit. Under this state of the proof, it is evident that this action was not brought in good faith by the plaintiff for the protection of his own rights, but was brought by him at the instance of the New York Central & Hudson River Railroad Company, the line of which is parallel with the proposed line of the Auburn City Railway Company. Under such a state of facts the plaintiff is not entitled to an injunction pendente lite. The rule is well settled that an injunction will not be granted or sustained against a private corporation in a suit brought by an individual in the interest of a rival private corporation. Waterbury v. Express Co., 50 Barb. 157 (a motion for a receiver); Belmont v. Railway Co., 52 Barb. 637 (a motion to open an order appointing a receiver); Kingman v. Railroad Co., 30 Hun, 73 (a motion for an injunction); Pfooks v. Railway Co., 1 Smale & G. 142; Forrest v. Railway Co., 4 De Gex, F. & J. 126; Filder v. Railway Co., 1 Hem. & M. 489; Robson v. Dodds, L. R. 8 Eq. 301; 2 Cook, Stock, Stockh. & Corp. Law (3d Ed.) § 736, and cases cited; 1 Spell. Extr. Relief, § 747, and cases cited; 4 Thomp. Corp. § 4567 et seq., and cases cited; 1 Mor. Priv. Corp. (2d Ed.) § 260 ; 2 Lindl. Partn. (3 Eng. Ed.) 967. Ramsey v. Gould, 57 Barb. 398, Id., 39 How. Prac. 62, Id., 8 Abb. Prac. (N. S.) 174, was a peculiar case, arising out of the Erie and Susquehanna railroad war. It was brought to remove some of the directors of the Erie Railway Company, for the recovery of damages against them, and for the appointment of a receiver of the Erie Railway Company. An injunction pendente lite was granted, restraining the directors, which was vacated; and, as one of the reasons for vacating it, it was suggested that the plaintiff was a mere volunteer. Ramsey v. Railway Co., 7 Abb. Prac. (N. S.) 156; Id., 38 How. Prac. 193. After this, and before answering, the extraordinary motion was made, on affidavits, perpetually to stay the prosecution of the action, or to dismiss it, which was denied. The correctness of the decision was never questioned. That case will be best understood by reading the report in 7 Abb. Prac. (N. S.) 156, and 8 Abb. (N. S.) 174. It was a decision made at special term,, and the rule declared, that the court will not stay perpetually the prosecution of an action,, or dismiss it, on the ground that it is vicious or malicious, unless it plainly appears that the plaintiff has no meritorious cause of action, or is estopped from bringing it, is not germane to the question whether an injunction should be granted or sustained in an action brought by an individual for the benefit of a private corporation against a rival private corporation. This case does not support the plaintiff’s right to an injunction in the case at bar. In many cases an injunction pendente lite will not be granted or sustained, though a motion to dismiss the action on affidavits would not be entertained.

I think the order denying the motion to vacate the injunction should be reversed, with $10 costs and printing disbursements, and the motion to vacate the injunction should be granted, with $10 costs.

HARDIN, P. J., and GREEN, J., concur.