153 A.D. 594 | N.Y. App. Div. | 1912
This proceeding was begun by the presentation to the Supreme Court of a petition of all the directors of the Seneca Oil Company, a domestic stock corporation, for a voluntary dissolution of the corporation pursuant to the provisions of section 170 of the General Corporation Law (Consol. Laws, chap. 23; Laws of 1909, chap. 28). On the presentation of the petition to the Special Term an order was made appointing a referee and requiring all persons interested in the corporation to show cause before him at a place and time therein fixed why the corporation should not be dissolved. The petition, in addition to the statements required by section 174 of the law (as amd. by Laws of 1909, chap. 240) to be embodied therein, contained an allegation in substance that a controversy had ■ arisen among the stockholders concerning the distribution of the assets of the corporation, certain stockholders claiming the right to a preference on such distribution. The order by which the referee was appointed recites the fact of such controversy, and directs the referee to “hear the allegations and proofs of the parties and particularly as to the conflicting claims of the stockholders as set forth in said petition and determine the facts, and that said referee make his report in writing and file the same with all convenient speed,” etc. It is this part of that order to which objection is made by appellants as unauthorized. The referee found that certain .stockholders are entitled to a preference in the distribution of the assets of the corporation. This finding, confirmed, as modified by the court at Special Term by its final order in said proceedings, and the distribution of the funds directed in accordance with that determination, are urged by appellant as the principal reasons why the final order was erroneous.
Assuming that appellants are in a position to urge their
The court, having the power to determine by its final order in this proceeding how and to whom the assets of the corporation should be distributed, the next inquiry is, was the determination it made correct ? , Here it is important in the first place to note that appellants’ counsel concedes that in addition to the common stock there was an issue and sale of preferred
It is claimed that appellant Mitchell, who is now the owner by assignment of the common stock originally issued to Wilbur, is not bound by the agreement made by Wilbur as to the pre ■ f erred stock as Wilbur would have been if he still held this stock. Wilbur was a party to the agreement providing for the issue of preferred stock. Mitchell, to whom the stock was assigned, took it burdened with any equities in relation to the stock which existed as to it in the hands of his assignor. (Kent v. Quicksilver Mining Co., 78 N. Y. 159, 188.)
It is also urged that the Bushnell common stock, which appears to have been purchased by the treasurer of the company for the company and then transferred to such holders of preferred stock as had no common stock, was improperly issued
On the other hand it is not shown that it was issued without consideration. Until tha't fact is made to appear it must be presumed that it was regularly issued and for value. (Kent v. Quicksilver Mining Co., supra, 183.)
The objection now made to the allowance of the claim of Hamilton for the sum of $250, money loaned by him to the corporation May 20, 1905, together with interest thereon to the date of the report,- upon the ground that this claim was barred by the Statute of Limitations, seems to be without merit.
Of the many exceptions to the admission of evidence reference is especially made to one as presenting error, requiring a reversal of the order. The original agreement under which the common stock was issued provided that it should be issued to the parties to the agreement in certain agreed proportions according to their several interests in certain Indiana oil leases, which were to be tranferred by these parties to the company and they were to receive this common stock in payment therefor. The face value of stock so issued was $100,000. This was all the common stock ever issued, and practically all the corporation received for the stock were these leases. A witness was asked what these leases cost these promoters. This was objected to,, overruled and exception taken. The answer was $1,100. In the first place, even if this evidence was incompetent or immaterial, I do not think its reception would be error so prejudicial as to require a reversal of the order for that reason alone. I do think, however, it was entirely competent. Every purchaser of a share of preferred stock paid $80 fór a $100 share. The recipients of the common stock turned in. these oil leases and received common stock in return at the rate of about $1 per $100 share. The sale of the preferred stock was the only method, except by borrowing it,
The orders, so far as appealed from, should be affirmed, with costs.
All concurred.
Orders, so far as appealed from, affirmed, with costs.