Smith v. New York Consolidated Stage Co.
New York Court of Common Pleas
A majority of the directors of the New York Consolidated Stage Company, at a special meeting on the 4th day of November, 1864, passed a resolution assigning all the property and effects of the company to one Augustus Schell, and on the same day a deed was'executed in pursuance of the resolution, assigning all their property to the said Schell, in trust to sell and pay creditors pro rata, and the residue, if any, to the company.
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A majority of the directors of the New York Consolidated Stage Company, at a special meeting on the 4th day of November, 1864, passed a resolution assigning all the property and effects of the company to one Augustus Schell, and on the same day a deed was'executed in pursuance of the resolution, assigning all their property to the said Schell, in trust to sell and pay creditors pro rata, and the residue, if any, to the company. Hugh Smith and John Kerr,, two large stockholders in the company, brought an action against the company, Augustus Schell and the eight directors who had taken part in…
1Opinion of the CourtCardozo, J.
This case is directly within the authority, and must follow the disposition of Abbot a. The American Hard Rubber Co. (33 Barb., 578).
If the company be regarded as solvent, the case is extremely plain.
The directors were chosen-to manage the business of the corporation, not to destroy it. And yet, without the concurrence of the stockholders, they do an act which substantially terminates, for all practical purpose, at all events, the existence of the company.
All its property is transferred to an assignee, and the company is left without any thing but a name. The act in the language of Judge…
2Cases cited13 opinions
- Robinson v. SmithNew York Court of Chancery · 1831
- Abbot v. American Hard Rubber Co.New York Supreme Court · 1861
- Sullivan v. Judah & WeedNew York Court of Chancery · 1834
- Marten v. Van Schaick & BloodgoodNew York Court of Chancery · 1834
- Lansing v. EastonNew York Court of Chancery · 1839
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3Cited by4 opinions
- People v. . BallardNew York Court of Appeals · 1892
- Maloney v. KingMontana Supreme Court · 1904
- Sheldon Hat Blocking Co. v. Eickmeyer Hat Blocking Co.New York Supreme Court · 1878
- Wilcox v. PrattNew York Supreme Court · 1889