Wilmersdoerffer v. Lake Mahopac Improvement Co.

It is provided by our statute that whenever any incorporated company shall have remained insolvent for one whole year, or for one year shall have neglected or refused to pay and discharge its notes or other evidences of debt, or for one year shall have suspended the ordinary and lawful business of such corporation, it shall be deemed to have surrendered the rights, privileges and franchises granted by any act of incorporation, or acquired under the laws of this State, and shall be adjudged to be dissolved. (2 E S., 463, § 38.) This statute goes further than the common law has gone before it, and-makes certain circumstances, heretofore having no such effect, equivalent to a surrender. An action therefore instituted under this provision is not presented for the surrender of the franchise of the corporation, but to have its dissolution judicially declared. The existence of the circumstances enumerated in the statute are the death of the corporate body, and the object of the action is to have such death judicially declared and recorded. The complaint in this action contains all the allegations necessary to bring the Lake Mahopac Improvement Company within the condemnation of the statute, and is sufficient, so far as it lies in statement of matter and circumstance, but the demurrer raises the question of the capacity of a stockholder to maintain the action. Previous to the year 1870 the courts of this State had been divided on this question, and there is no necessity now of *389harmonizing the conflicting decisions and dicta on the question, because, in that year, the Legislature of our State passed a law to regulate proceedings against corporations by injunction and otherwise, in which it is provided, among other things, that all actions and proceedings against a corporation when the relief sought or which can be granted therein, shall be the dissolution of such corporation, or the removal or suspension of any officer or director thereof, shall be brought by the attorney general in the name of the People of the State. (Laws of 1870, chap. 151, § 2.)

"Whatever doubt existed before this statute, is now removed, and such an action, as the present, must be brought by the attorney general in pursuance of its provision, and cannot be instituted or maintained by a stockholder.

The judgment must be reversed, with costs.

Judgment reversed, and new trial granted, costs to abide event.