60 N.Y.S. 923 | N.Y. App. Div. | 1899
This action was brought to recover from a director of a corporation a debt of the corporation on the failure of the proper officers to file annual reports as required by section 30 of chapter 688 of the Laws of 1892. (Chap. 36, General Laws.) Plaintiffs produced evidence in support of the various facts necessary to constitute a cause of action, and the jury found in their favor. From a judgment entered upon the verdict of the jury, and from the order denying a motion for a new trial, appeal comes to this court, the appellant urging that he was not a director of the corporation under the law, and that the trial court erred in the rejection and' reception of evidence. The most important point to be considered is whether the appellant was, in law, a director of the corporation at the time of the default in filing the report required by the statute, it being conceded that the corporation owed the debt, and that the plaintiffs had exhausted their remedy against the corporation. The contention of the appellant is that, as the corporation of which he became a director and treasurer in 1892, was organized under chapter 40 of the Laws of 1848, there is no presumption that he continued a director up to and including the month of January, 1897, at which time the default is alleged, and this proposition receives some support in the case of Bank of the Metropolis v. Faber (38 App. Div. 159) where the court held that a corporation organized prior to 1892, under the Manufacturing Act of 1848, is not governed by the rule found in
In Bank of the Metropolis v. Faber (supra) the defendant,, against' whom it was sought to enforce the indebtedness of theKaldenburg Company, of which he was one of the original directors, by reason of a default in filing the annual report, the corporation was organized under the Manufacturing Act of 1848 in 1887.. The court held that, conceding .the election of the defendant m. April, 1887, he held office for one year, and that there was no presumption, under the provisions of the Manufacturing Act, that the-defendant held over; that the presumption was that he went out of his office at the end of his term. It is to be observed, however,, that the defendant in that case was elected as a director in 1887,. before the enactment of chapter 563 of the Laws of 1890, and ,at that time there is no doubt that'the presumption of law was as stated.
We are also satisfied that, the plaintiff sustained the burden of proof in establishing the default; the certificate of the Secretary of State in 1898 that he has made a diligent search, and has failed to find any annual report of the corporation specified, is certainly broad 1 ■enough to cover the period of January, 1897.
The attention of this court is called to an alleged error in the admission of the evidence of one Hamlin, who appears to have had ■charge of the business of the California Vintage Company. The -question was asked “ What, if anything, did Mr. Fritz (the defendant) say regarding fixing the books so as to show-that he was n.ot a director ? ” “ A. I suppose I will have to answer that question.” “ Q. I don’t see any way for you to escape it, if there was '.anything said. A. Mr. Lawrence stated that there was only one' way out'of it that he saw-—one or two ways out of this thing that he saw, and that was either to destroy the minute book oi’ remove that page from the book which contained his election as an officer of the company.” The question was objected to as incorcn petent, immaterial and irrelevant; objection overruled and the witness answered as above stated. The question as asked was not open to any of the objections staffed ; it was proper for the witness to testify to any remarks of the defendant made in his presence bearing upon the question of his liability. The answer was not, however, responsive to the question. It did not undertake to give the language of Mr. Fritz, but of a Mr. Lawrence. The defendant did not ask to have the answer stricken out; he relied, if at all, upon his objections to the materiality, competency or relevancy of the qufes
We have considered the exceptions to the charge of the trial judge, as well as those to the admission or exclusion of evidence, and we are unable to discover - reversible error in the case. If we are right in concluding that the act of 1848 was amended by the act of 1890, so that the directors were obliged to hold over until the election of their successors, and upon this point we have no doubt, then the charge of the trial court was as favorable to the defendant as could be expected, or as he had any right to-expect, and it is the duty of this court to affirm the judgment and order appealed from.
The judgment and order appealed from should be affirmed, with costs.
All concurred.
Judgment and order affirmed, with costs.