81 N.Y.S. 129 | N.Y. App. Div. | 1903
The plaintiffs allege that during all of the times hereinafter mentioned the plaintiff James V. Lawrence was, and now is, the sole surviving partner of the firm of Lawrence Brothers, and that the plaintiff Lawrence Brothers, Incorporated, is a domestic corporation located at and having its principal place of business in the city of Yonkers; that prior to the 29th day of July, 1901, the plaintiff James V. Lawrence was and for many years past has been engaged in business individually and as sole surviving partner of the firm of Lawrence Brothers at Yonkers, N. Y., as a wholesale and retail dealer in lumber, etc., and as such had created and built up and was the owner of a business and property of the value of a large sum of money, and largely in excess of all his just debts and liabilities, and as the owner and proprietor of said business was well and favorably known to the community and trade throughout the United States, and enjoyed and possessed a high business rating and exceptional credit for integrity and financial responsibility; that on the date above men
The defendants appear separately and demur to the complaint,
Section 446 of the Code of Civil Procedure provides: “All persons having an interest in the subject of the action, and in obtaining the judgment demanded, may be joined as plaintiffs, except as otherwise expressly prescribed in this act.” The question here presented is whether the plaintiffs in this action have such an interest in the subject of this action, and in obtaining the judgment, as is contemplated by the Code provision cited. The bankruptcy proceeding was directed against the plaintiff James Y. Lawrence, on the ground that he had committed an act of insolvency in disposing of all his property with the intent to hinder, delay and defraud his creditors, and while the pleadings are somewhat involved, it is difficult to understand how the plaintiff Lawrence Brothers, Incorporated, could have been involved in the bankruptcy proceedings, except incidentally. But it is conceded that the plaintiff James Y. Lawrence had disposed of all of his property to the plaintiff Lawrence Brothers, Incorporated, taking the stock of the latter, and its promise to pay his debts, in consideration of the transfer, so that he had no property except such as was represented by the stock of Lawrence Brothers, Incorporated. He could not, therefore, have been injured in his property, except as that was involved in the corporation, and he cannot recover damages apart from those which are suffered by the corporation as a whole in a personal action against these defendants. If the plaintiff James Y. Lawrence suffered any injuries at the hands of these defendants, they were such as resulted to his feelings and his business reputation, while the damages of the plaintiff Lawrence Brothers, Incorporated, must have been those of a business character, relating to the property which had been transferred by James Y. Lawrence. In other words, while the cause of action in both cases arose out of the alleged malicious prosecution of bankruptcy proceedings against James Y. Lawrence, there are necessarily two separate and distinct causes of action, assuming that the Lawrence Brothers, Incorporated,
In the case of Loomis v. Brown (16 Barb. 325), relied upon by the appellants, the defendants had executed an undertaking, running to the plaintiffs Loomis, Kirby and Gunn, to the effect that the plaintiffs in an action for an injunction would pay the said Loomis, Kirby and Gunn “such damages not exceeding $2,500 as they might sustain by reason of the injunction, if the court should finally decide that the plaintiffs were not entitled thereto,” and the court very properly held that as the covenant was joint the covenantees might sue jointly. There was some discussion and some general language which would seem to support the contention of the appellants, but we are unable to agree with the appellants that the language there used is controlling in the present case. It was true that all of the plaintiffs in that action were not damaged alike, but they were all interested in the joint covenant to indemnify them against loss by reason of the injunction, and it was proper that they should dispose of the matter in one action. But here the plaintiffs, as we have seen, are not jointly interested; their interests are separate and distinct, and neither party can have any legal interest in the judgment which may be recovered by the other, and this is the test of whether the plaintiffs are properly joined; they must have an interest in the subject of the action and in obtaining the judgment demanded, and the mere fact that an individual is the principal stockholder in a corporation does not operate to give the cor
The interlocutory judgment appealed from should be affirmed, with costs.
Goodrich, P. J., Hirschberg and Hooker, JJ., concurred.
Interlocutory judgment affirmed, with costs.