Wamsley v. H. L. Horton Co.

17 Misc. 327, 39 N.Y.S. 963

• Court: New York Supreme Court
• Decided: June 15, 1896
• Status: Published

Opinion

Pryor, J.

Pending an action in this court against the H. L. Horton Company (Limited), ah English corporation, the company was dissolved; whereupon motion is made to continue the action against three certain individuals, “ as trustees of the defendant for its creditors and stockholders.” Were the company merely in process of liquidation, Societe, etc., v. Milliken, 135 U. S. 304, 309, is authority for the proposition that, nevertheless) the action might be prosecuted to judgment against the corporation. But the tmcontradicted fact is that the company no longer exists as a legal entity, and the necessary consequence is the abatement of the suit against it. McCulloch v. Norwood, 58 N. Y. 562; National Bank v. Colby, 21 Wall. 609, 615; Taylor on Corp. 435. May the action be revived and continued against the directors of the company? ■ •

• Undoubtedly, since the assets of a defunct corporation are subject to a trust or lien in favor of creditors and stockholders, such assets, in the-.hands of these directors, would be accessible in an appropriate action against them. Tinkham v. Borst, 31 Barb. 407; Field on Corp., §§ 491, 92; Mumma v. Potomac Co., 8 Pet. 281; Hastings v. Drew, 50 Blow. Pr. 254. That, however, is not the relief contemplated by the motion, but its avowed and only object' is to continue against the directors' an action commenced against the corporation.

Whether the action against the corporation may, on its- dissolution, be continued against the directors, being a matter of procedure, is to be determined by the law of the forum. Sturges v. Vanderbilt, 73 N. Y. 384, 389. Where, then, is the statute of New York which authorizes an order to continue this action against • the directors of the extinct corporation? Not section .756 of the Code, for here the liability has not devolved upon -the directors. ' Nor yet section 4 of chapter 295, Laws of 1832, for it is repealed and no longer in force. Grafton v. Union Ferry Co., 13 N. Y. Supp. 878, 879. Indeed, the only statutory provision which plaintiff adduces in' support of the motion is section 30 of the General ' Corporation Law. But that enactment is of no avail to him, because, first, it is plainly applicable only to domestic corporations (Vanderpoel v. Gorman, 140 N. Y. 563); or else, secondly, because pursuant to the laws of England a liquidator hás been appointed for winding up the affairs of the company' and distributing its property. Marstaller v. Mills, 143 N. Y. 398, 401. The plaintiff must apply for redress to the courts of the country of which the corporation is the creature. Redmond v. Enfield Man. Co., 13 Abb. (N. S.) 332, 334.

Motion denied, with costs. i,' ^