Rose v. Chadwick

This action was brought by a creditor of the Chadwick Leather Company, a business corporation organized, under the laws of this state, against the directors thereof, to recover his debt of them, on the ground that they had failed to file annual reports in January, 1894, and in January, 1895, as required by the thirtieth section of the stock corporation law. Two of the defendants answered, and admitted that the reports had not been filed, and alleged that the claim of the plaintiff had been fully paid. When the case was for trial, the complaint was dismissed, on the-ground that it was not alleged therein that the plaintiff had recovered a judgment for the debt against the corporation, and an execution thereon had been returned unsatisfied. This was error. The recovery of a judgment and the return of an execution are-not conditions precedent to the right of a creditor to recover from the directors of the corporation for failing to file reports. Miller v. White, 50 N. Y. 137-141; Rorke v. Thomas, 56 id. 559-565; Green v. Easton, 74 Hun, 329, 55 S. R. 859; Bank v. Andrews, 2 Misc. Rep. 394, 51 S. R. 123; Strauss v. Trotter, 6 Misc. Rep. 77, 55 S. R. 489.

Bank v. Dillingham, 147 N. Y. 603, 42 N. E. 338, arose under tlie twenty-fourth section of the stock corporation law, imposing a liability upon directors for creating an indebtedness not secured by mortgage in excess of the amount of its paid-up capital stock, and is not in point.

The judgment should be reversed, and a new trial ordered, with costs to abide the event.

All concur.