153 N.Y.S. 866 | N.Y. App. Div. | 1915
Action to recover damages for the alleged illegal declaration of dividends of a New Jersey corporation contrary to sections 28 and 70 of the New York Stock Corporation Law (Consol. Laws, chap. 59; Laws of 1909, chap. 61), and section 30 of the New Jersey General Corporation Law (Laws of 1896, chap. 185, as amd. by Laws of 1904, chap. 143; 2 Comp. Stat. N. J. 1617, § 30).
The defendant, a resident of the State of Iowa, was personally served with a copy of the summons in this State and appeared in the action. He interposed a demurrer to 'the complaint, but died before the issue raised thereby was decided. After his death the plaintiff moved, by an order to show cause, which was personally served upon Johnston’s administrators without the State, that the action be continued against them and that a supplemental summons be served upon them by publication or personally without the State. Upon the return of the order the administrators appeared specially for the purpose of objecting to the jurisdiction of the court. The motion was granted and they appeal.
I am of the opinion that the cause of action survives. Section 120 of the Decedent Estate Law (Consol. Laws, chap. 13 [Laws of 1909, chap. 18], added by Laws of 1909, chap. 240) provides that “ For wrongs done to the property, rights, or interests of another, for which an action might be maintained against the wrong-doer, such action may be brought by the person injured, or after his death, by his executors or administrators, against such wrong-doer, and after his death against his executors or administrators, in the same manner and with the like effect in all respects, as actions founded upon contracts.”
I have been unable to find any authority in this State which definitely settles whether an action of this character is, in its nature, contractual or in tort. But it is unnecessary to determine that question, because in either case the cause of action survives. That a cause of action for the breach of a contract, whether express or implied, survives the death of the defendant, is so thoroughly settled that the citation of authorities is unnecessary. (But see Holsman v. St. John, 90 N. Y. 461.)
If the illegal declaration of a dividend be considered in the nature of a tort, then the liability comes within the clear meaning of the section of the Decedent Estate Law above quoted, and the action survives. This must follow, because the illegal declaration of a dividend is a wrong “ done to the property, rights or interests of another ” within the meaning of the statute. This is recognized by the fact that both the New York and New Jersey statutes permit a recovery for the amount of the loss sustained. (New York Stock Corp. Law, §§ 28, 70; New Jersey Gen. Corp. Law, § 30.)
In Mayer v. Ertheiler (144 App. Div. 158) this court held that a cause of action for fraud and deceit survived. Justice Miller, who delivered the opinion, referring to the section of
The cause of action having survived the death of the defendant, the plaintiff had a clear legal right to have the action continued against his administrators. (Code Civ. Proc. §§ J5J, 1836a.) The former section provides that in case of the death of a sole plaintiff or a sole defendant, if the cause of action survives or continues, the court must, upon motion, allow or compel the action to he continued by or against his representatives or successors in interest. The latter section provides that an executor or administrator duly appointed in any other State may sue or be sued in any court in this State in his capacity of executor or administrator in like manner and under like restrictions as a non-resident may sue or he sued. (See Provost v. International Giant Safety Coaster Co., 152 App. Div. 83; affd. on opinion of App. Div., 208 N. Y. 635.)
If the foregoing views be correct, then it follows that so much of the order as continued the action against defendant’s administrators is right and should be affirmed.
But I am of the opinion that the order, in so far as it directs the service of a supplemental summons by publication, or at the option of the plaintiff personally without the State, is erroneous. I have been unable to find any authority which permits service to be thus made, or which would authorize the court, in case of the non-appearance in the action of the administrators, to enter a personal judgment against them. The defendant, at the time of his death, had no property in the State of New York. His administrators have no property in such State and the court would not be authorized to render a personal judgment against them. The rule is well settled that to entitle a plaintiff to an order directing the service of a summons by publication, where a money judgment is demanded, there must he property within the State and unless there is the court does not obtain jurisdiction to render
The order appealed from, therefore, should be modified by striking therefrom the provision permitting the service of the supplemental summons by publication, or at the option of the plaintiff, personally without the State, and as thus modified affirmed, with ten dollars costs and disbursements to the appellant.
Ingraham, P. J., Laughlin, Clarke and Scott, JJ., concurred.
Order modified as directed in opinion, and as modified affirmed, with ten dollars costs and disbursements to appellant. Order to be settled on notice.