44 Barb. 625 | N.Y. Sup. Ct. | 1865
The plaintiffs rely upon three grounds to maintain the judgment of ouster and dissolution granted in this action. 1. That, the privileges and
1. The defendant claims title to the privileges arid franchises which it has exercised, under the provisions of the act entitled “An act to authorize the formation of corporations for the erection of buildings,” passed April 5, 1853. In section 2 of the articles of association it is declared that “The object for which this company is formed is the purchasing, holding, leasing and conveying of real and personal estate and the erection and management of buildings for the purposes of a hotel, and for stores and shops, in the city of Troy.” It is found by the court below that the' defendant has never engaged in the erection of buildings, otherwise than as stated in the findings of the court, and which consist substantially in this: a former voluntary association had been engaged in improving and adding to a building already erected, used for a hotel and stores, and erecting a new one story building for a bar and reading room connected with such hotel. The defendant, which succeeded to the ownership of the property formerly held by such voluntary association, continued and completed several of the improvements previously commenced, and made other extensive repairs, alterations and improvements upon the property formerly held by the voluntary associates, and also after their organization purchased, held managed and leased the property in question for the purposes of a hotel and stores, in the city of Troy. The question is Whether under these circumstances this was a company formed for the erection of buildings, within the meaning of the statute before quoted. I am inclined to think it was riot, for the following among other reasons: (1.) The company authorized by' the act of 1853
It is true the 2d section of the act in question declares that “they shall by their corporate name be capable in law of purchasing, holding, leasing and conveying any real and personal estate whatever which may be necessary to enable the said company to carry on their operations named in such certificatebut this is incidental to the main purpose of their organization, and comes under the head not of leading and primary objects .of the incorporation but of means necessary or proper to carry into effect powers specifically granted.
(2.) The company in question, -as I understand the pleadings of the court, has never erected any buildings, but at
2. The complaint not only alleges that the privileges and franchises exercised by the defendant were never conferred upon it by law, but that it has never exercised the privileges or franchises actually conferred, to wit, those of erecting buildings. If the conclusion already intimated be correct, to wit, that the franchises exercised by the defendant were not such as were contemplated by the act incorporating companies of this description, then, inasmuch as the court below found that it exercised no other than those stated in its findings, it would seem to follow that there has been no user of the powers conferred. Perhaps this would bring the case within § 7, of the title of the revised statutes concerning the general powers, privileges and liabilities of corporations, (1 N. Y. Statutes at Large, 557,) which provides that “if any corporation hereafter created by the legislature shall not organize and. commence the transaction of its business within one year from the • date of its incorporation, its corporate jjowers shall cease.” Perhaps the true construction of this sectioii would refer the business here spoken of to such as it might laiufully do under the act of incorporation; and if so, then, as it has never done any business of that description, the section would apply, and the decision of the court below would be sustainable on that ground. This point, however, is -of minor consequence, as it is entirely dependent upon the conclusion arrived at under the first point. If that is not tenable, then this also falls to the ground.
There is another section, (1 N. Y. Stat. at Large, 560,) which provides that a corporation shall be deemed to have
3. The remaining question arises under sections 10 and 14 of the act of 1853. Section 10 provides that “the capital stock so fixed and limited (by the articles of association) shall all be paid in, at least one half thereof within one year, and the remainder thereof within two years, from the incorporation of said company, or such corporation shall be dissolved.” Section 14 provides that “nothing but money shall be considered as payment of any part of the capital stock.”
These are very plain provisions, and admit, it seems to me, of but one construction. The capital stock must be paid in within two y.ears; and it must be paid in money. These provisions have not been complied with, and the statute with equal plainness declares the consequence; the corporation shall be dissolved.
I see no satisfactory answer which can be given to these provisions. We have heretofore held under the law of limited partnership which requires that the capital contributed by the special partner shall be paid in cash, that the statute was imperative, and must be strictly obeyed. (Haviland v. Chace, 39 Barb. 283. Also MSS. opinion in same case.) The principle of that case applies to this. The language is not ambiguous, and the clear mandate of the legislature must be followed. It is not enough to say that something equivalent to this has been done—that property of equal value with the prescribed amount of money has been contributed. This always raises the question whether the proposed substi
On this ground, if on no other, the decision of the court below can safely stand, and therefore, as it seems to me, its judgment should be affirmed with costs.
The case also comes here on appeal from the order allowing this fiction to stand in its present form, and refusing to confine its operation and effect to the question whether the privileges and franchises exercised were within the grant of power contained in the charter, or rather refusing to exclude from the issue the ground of forfeiture or dissolution arising out of the non-payment of the capital in cash. And it is further suggested that, independent of the appeal, this court may rightfully control, and should do so in this case, the proceedings so far as to restrict the grounds of forfeiture as above mentioned. I do not think this court should interfere on any of these grounds. It is doubtful whether the appeal comes within any of the recognized cases for such relief prescribed by law; and whether it is hot a case of discretion resting in the judge who granted the order, in a matter of
The order appealed from must he affirmed, and the motion for further relief denied, with $10 costs.
Bogeboom, Peokhcm and Ingalls, Justices.]