90 N.Y.S. 749 | N.Y. App. Div. | 1904
Upon his own affidavit Sands obtained an ex pa/rte order for the examination of these companies through their president and a director, and the companies were directed to produce before the referee certain books of the corporation for examination thereof by said Francis P. B. Sands, concerning the matters stated ” in his affidavit. It is conceded that the application was made pursuant to the provisions of sections 870, 872 and 873 of the Code of Civil Procedure, and not pursuant to the provisions of sections 803-809 of said Code, which authorize the inspection and taking a copy of books and papers in certain cases upon the petition of a party. It is well settled that there is a clear distinction between- the authority granted by and the practice under these respective sections. (Boeck v. Smith, 85 App. Div. 575; Mauthey v. Wyoming Co. Co-op. Ins. Co., 76 id. 579.)
In the case of an examination ordered under sections 870-873 of a party not a corporation, there is no authority for an inspection or for requiring the production of books or papers, even for use upon the examination of the party, except by subpoena duces teemn • but in the case of a corporation the court is now authorized by subdivision 7 of section 872, without the formality of subpoena duces tecum, to order the production of books and papers, not for an inspection by the adverse party,.but for the use of the witness upon the examination. (Horst v. Yuengling Brewing Co., 1 App. Div. 629; Press Publishing Co. v. Star Co., 33 id. 242; Duffy v. Consolidated Gas Co., 59 id. 580.) Even in the case of a corporation, if an inspection is desired in the technical sense, it must be obtained as provided in sections 803-809. It is manifest, therefore, that this order, in so far as it directed the production of the books and papers for the examination thereof by Sands, was unauthorized and was properly vacated.
The respondent contends that th'e affidavit of Sands was insufficient to show that he had a cause of action against the corporations or that the examination is necessary for the purpose of enabling him to frame a complaint. He shows the formal requirements (See Gen. Rules Pr. rules 14, 15) and that in May, 1896, he was employed by the John P. Holland Torpedo Boat Company under a written contract as its agent to secure an order from the Rus
There are many general charges of fraud and conspiracy in the affidavit of Sands, and he states at one place that he contemplates bringing the action “ to recover from the defendant damages for fraud and for failure to keep and perform a contract in writing made and entered into between one of the defendant corporations
The facts stated by Sands in his affidavit fail to show that he has a cause of action against the Electric Boat Company. He never had a contract with that company. He asserts that the Holland Company was merged in, absorbed or purchased by it, but he does not allege that the Electric Company assumed the obligations of the Holland Company or its obligation to him under this contract.
The order vacating the order for the examination should, therefore, be reversed, with'ten dollars costs and disbursements, and the order for the examination modified by confining the examination to the Holland Torpedo Boat Company through its president and director named, and by confining the direction for the production of the books and papers to the direction for their production for use by the witnesses upon such examination.
O’Brien and Hatch, JJ., concurred; Vah Brunt, P. J., and Patterson, J., dissented.
Order vacating order for examination reversed, with ten dollars costs and disbursements, and order for examination modified as directed in opinion.