87 N.J. Eq. 486 | New York Court of Chancery | 1917
The receiver of the New Jersey Steel Company filed his bill against the former directors of the company, eleven in number, setting up that during their administration they authorized and approved payments of dividends to the holders of the preferred stock of the defunct company,- aggregating $75,250, at times when there was no surplus or net profit arising from the conduct of the business of the company, in willful and negligent violation of the provisions of section 30 of “An act concerning corporations (Revision of 1896),” Comp. Stat. p. 1592, 'as amended by chapter 143 of the laws of 1904. P. L. 1904 p. 275. The prayer is that the directors “be decreed jointly and sevérally to pay the full amount of the said dividends.” The section of the act referred to prohibits directors of a corporation from paying dividends except from the surplus or from the net profits arising from the business of the corporation, and imposes a joint and several liability upon them for any willful or negligent violation, which in case of insolvency is enforceable by the receiver to the full amount of any loss sustained, by the corporation by reason of such division. Two of the director-defendants are residents of this state; the others reside elsewhere, one of whom is George D. Boughton, who has filed his petition, together with the usual bond, setting up the diverse citizenship of the complainant and nine of the defendants; that he is a citizen of -the State of Pennsylvania; and that the suit presents a separable controversy as to him. The petition prays for an order removing the cause into the federal court for this district, pursuant to section 1010 of the revised statutes of the Hnited States, as amended January 20th, 1914. 1 U. S. Comp. Stat. 1916 p. 841. The complainant disputes the separability of the action. The question here presented was disposed of adversely to the contention of the applicant, by this court, hi the case of National Docks Co. v. Pennsylvania Railroad
.• The statute imposes a joint, liability upon all of the directors and, according^, the bill'charges them jointly as tort-feasors. As the relief to which the complainant is entitled is a money decree against all of the directors, which relief obviously, could not;be afforded in a prosecution against the applicant alone, it is-manifest that the controversy is not separable. The motion to remove is denied, with costs.