Spencer v. Clark — 15 N.Y. St. Rep. 949

Majority

p. 949

Richard H. Spencer, etc , App’lt, v. Benjamin G. Clark et al., Resp’ts.

(Supreme Court, General Term, First Department,

Filed May 18, 1888.)

Headnote

Equity suit—When bill defective.

A bill in an equity suit to have certain bonds of a corporation and the mortgage to secure the same, cancelled, is fatally defective in not offering to restore to the holders of the bonds what the corporation had received therefrom.

Appeal from a judgment sustaining a demurrer to the complaint.

Charles EC. Crosby, for app’lt; Edward D, Bettens, for resp’ts.

—The plaintiff in this action is a stockholder of a corporation and seeks to enforce a right of that corporation to have certain bonds of the corporation and mortgage given to secure the same cancelled. The corporation has received a large amount of money from the holders of said bonds upon the sale thereof.

It is a familiar rule of equity that he who seeks equity must do equity, and as it would be the greatest inequity to allow the corporation to repudiate its bonds without restoring that which it had received therefor, the plaintiff should have offered in his bill to restore to the holders of these bonds that which the corporation had received therefor.

This, however, he has not done, and for this reason his bill is fatally defective.

The judgment appealed from should be affirmed with costs, with leave to plaintiff to amend upon payment of costs of appeal and demurrer.