152 N.Y. 121 | NY | 1897
The liability imposed upon stockholders in a manufacturing corporation, organized under chapter 40 of *123
the Laws of 1848, by section 10 of the act and the amendments thereto, for the debts of the company, is controlled by section 24. By that section it is made a condition precedent to the maintenance of an action to enforce the liability of a stockholder created by section 10, that a suit for the recovery of the debt should have first been brought against the company and "an execution against the company shall have been returned unsatisfied in whole or in part." (Handy v. Draper,
There are several cases in this court in which the question of dispensation with the condition in the 24th section of the statute of 1848, that judgment and execution shall first go against the corporation, has been considered. It was held inHardman v. Sage (
In the case now before us, the plaintiff, a creditor of the corporation, entitled to the remedy against stockholders, given by the act of 1848, brings his action against the stockholders without having first procured judgment and issued execution against the corporation. He sets forth in his complaint that an action has been commenced by a stockholder against the company "for an order appointing a receiver" of its property and assets, and for other relief; that a receiver had been appointed who had taken possession of the corporate property; that in the action an order of the court had been issued restraining creditors of the corporation from commencing or prosecuting any action against the corporation. The complaint also avers facts tending to show the insolvency of the corporation, and that the judgment debts to be paid out of the assets will leave nothing for other creditors. The complaint expressly avers that no final judgment or decree has been rendered, or any decree dissolving the corporation. The facts above stated are alleged as an excuse for not first proceeding to judgment and execution against the corporation. The nature of the suit brought against the corporation is not set forth, except in the vaguest *127 terms, and if it may be inferred that the action was brought for a dissolution of the corporation, it does not appear by what right the stockholder can maintain an action for that purpose. It may be conceded that the plaintiff in the present action could not sue the corporation to recover judgment on his debt so long as the restraining order was in force. But no effort, so far as appears, has been made by him to secure a modification of the order, so as to permit him to bring such an action. The order was preliminary and precautionary, subject at any time to the power of the court to modify it and relieve the plaintiff from its prohibition, and it can scarcely be doubted that on the plaintiff's application such a modification would have been made. If such an application had been refused, a different question would have been presented. It is not like the case of Hunting v. Blun, where the injunction was made perpetual by the final judgment in the action. It was not a vain thing as respects the stockholders sued, that the plaintiff should establish as against the corporation by judgment its liability, although its assets were in the hands of a receiver. If in such an action the plaintiff failed to establish his claim and judgment should go against him, it would end any claim against the stockholders.
We are of opinion that the excuse alleged by the plaintiff is insufficient, it not appearing that he made any effort to procure a modification of the restraining order. It is but a reasonable requirement, in view of the statute, that the creditor should take all reasonable measures to remove an obstacle interposed against his proceeding in the first instance against the corporation. The decisions thus far have dispensed with the condition precedent (1) where the corporation has been dissolved by judicial decree; (2) where by final judgment in an action for sequestration a perpetual injunction has been issued restraining suits by creditors, and (3) where, by statute, such suits are prohibited. In these cases there intervenes an impossibility within the meaning of the law, which excuses the performance of the condition precedent. We think the courts should not extend the exception *128 beyond its present limits, unless, in possibly a new case, clearly within the principle of the decisions already made.
These views lead to an affirmance of the judgment below.
All concur, except HAIGHT, J., not sitting, and VANN, J., not voting.
Judgment affirmed.