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People ex rel. Lehman v. Consolidated Fire Alarm Co.

142 A.D. 753 Court First Department, Decision date 1911-02-03 English

Delivered by Miller, J.:

Contents

Majority

p. 753
The People of the State of New York ex rel. Abraham Lehman, Respondent, v. Consolidated Fire Alarm Company, Appellant.
First Department,
February 3, 1911.

Headnote

Corporation — inspection of books by stockholder — ulterior motive — mandamus —* demurrer.
While a stockholder has a right, for a proper purpose and at a proper time and place, to inspect tile books of his corporation, which right may be enforced by mandamus, an inspection will not be granted .where it appears that he desires the inspection in order to furnish information to a competing company. Where a relator, instead of asking for an alternative writ of mandamus, stands upon the. moving papers and opposing affidavits, he is in the position of a demurrant.
Appeal by the defendant, the Consolidated Fire Alarm Com* pany, from an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the 28th day of November, 1910, directing the issuance of a peremptory writ of mandamus commanding the defendant, its officers, agents and representatives to permit the relator to examine and inspect its' books, papers, documents and records and to take extracts therefrom.
p. 754
Peter B. Olney of counsel, for the appellant.
Jay C. Guggenheimer of counsel, for the respondent.

It is settled in this State that a stockholder has the right for a proper purpose and at a proper time and place to inspect the books of his corporation, and that, if that right is denied him by the officers of the corporation, the Supreme Court may in its sound discretion issue a writ of mandamus to compel an inspection. (Matter of Steinway, 159 N. Y. 250 .)

Instead of asking for an alternative writ, the relator stood upon the moving papers and the opposing affidavits, and he is, therefore, in the position of a demurrant. (Matter of Steinway, supra, and cases cited at p. 254 of the opinion.) It is charged in the opposing affidavits that the motive of the relator was to obtain information to furnish to the president of a competing company, who. had at .various times attempted to get information as to the appellant’s contracts, prices and methods of doing business; and in support of that charge affidavits were presented of two persons who had made affidavits for the relator, to the effect that they were procured to make such affidavits by the president of said competing company. An examination will not be allowed for an ulterior purpose or to embarrass the corporation. (Matter of Pierson, 44 App. Div. 215 ; Matter of Kennedy, 75 id. 188 ; Matter of Taylor, 117 id. 348 .)

The order should be reversed, with ten dollars costs and disbursements, and the petition denied, with costs.

Ingraham, P. J., McLaughlin, Clarke and Dowling, JJ., concurred.

■Order reversed, with ten dollars costs and disbursements, and motion denied, with fifty dollars costs.

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