279 A.D. 719 | N.Y. App. Div. | 1951
(dissenting). The first and second causes of action ought to be dismissed against the corporate defendant Motty Eitingon, Inc. It is neces
The correct manner in which to resolve this controversy seems to me to be to dismiss the complaint against Motty Eitingon, Inc., upon its motion, but to allow the action to proceed to trial against the individual Eitingon defendants. Such an outcome is indicated by the circumstance that the indorsement by Motty Eitingon, Inc., of the negotiable paper in suit to plaintiff’s assignors,
The individual Eitingon defendants are in a different category. They are charged with having been joint tort-feasors with Motty Eitingon, Inc., in the negotiation of these instruments to plaintiff’s assignors and, if the allegations of the complaint be true, they therefore became liable jointly and severally with Motty Eitingon, Inc., for damages arising from the fraud. Unlike said corporation, however, they have not received debentures or any other form of payment as an expression or in satisfaction of their liability. The difference between their position and that of Motty- Eitingon, Inc., is substantial. Even if, as plaintiff alleges, the debentures and preferred stock which it holds of Motty Eitingon, Inc., be worth but 7% of the otherwise unpaid balance of plaintiff’s claim, the object of the readjustment in the bankruptcy proceedings was to give to all of the creditors, including plaintiff, in equitable proportion, as much as the bankrupt corporation was in position to provide by devoting all of its assets to that purpose. The object of the approved plan was to postpone the bankrupt’s obligations to plaintiff and to its other creditors in order to enable it, if
In order -to avoid that consequence, it is not necessary to hold that the distribution to creditors under the bankruptcy arrangement constituted full payment to plaintiff of its loss. If the debentures and preferred stock received by plaintiff be actually worth but 7% of the unpaid balance upon these notes, there is no reason on account of which the individual Eitingon defendants should be exonerated from making good the difference, if - they participated in the alleged fraud. That is quite a different proposition from determining that the intention of the arrangement approved by the bankruptcy court was that plaintiff should accept securities of the bankrupt in satisfaction of all liability of the bankrupt by reason of the discount of the notes by plaintiff’s assignors, or by way of postponement of the enforcement of such liability against it.
The order appealed from by defendant Motty Eitingon, Inc., as resettled on May 8, 1951, denying the motion of said defendant to dismiss the complaint against it should be reversed, with $20 costs and disbursements to appellant, and said motion granted, with costs.
On first appeal: Peck, P. J., Glennon and Shientag, JJ., concur in decision; Yan Yoorhis, J., dissents in opinion in which Callahan, J., concurs.
On second appeal: Peek, P. J., Glennon, Callahan, Yan Yoorhis and Shientag, JJ., concur in decision.
On third appeal: Peek, P. J., Glennon, Callahan and Yan Yoorhis, JJ., concur in decision; Shientag, J., dissents in part and votes to affirm the denial of the motion to dismiss the complaint made upon the ground that the claim sued on had been released in the following memorandum: If there is any ambiguity in the release drafted by the appellants, such ambiguity should be resolved against them. The scope of the special release should be left for the trial and should not be determined summarily on a motion to dismiss (Whittemore v. Judd Linseed & Sperm Oil Co., 124 N. Y. 565, 574).
On first appeal: Order affirmed, with $10 costs and disbursements to respondent, payable by defendant-appellant Motty Eitingon, Inc. It may be, under the circumstances and conditions, that plaintiff’s assignors accepted securities in the bankruptcy reorganization, that the contemplation was or effect should be that drawn by the dissenting opinion. We think, however, that such determination may not be made as a matter of law on the face of the complaint. Settle order on notice. On second appeal: Order entered in the Supreme Court, New York County, on May 8, 1951, resettling an order entered in said court on March 30, 1951, denying the motion of defendants Motty Eitingon, Solomon Eitingon, Leon Eitingon, Naum Eitingon and Arthur Kramer to dismiss the complaint, unanimously affirmed, with $10 costs and disbursements to respondent. Settle order on notice. On third appeal: Order entered in the Supreme