Majority
Headnote
Corporations—Reorganization—Stockholders—Former adjudication. Under an agreement for reorganization of a corporation by the foreclosure of the mortgage on its property and purchase of the property by a-committee, the shares of stock and certain moneys were deposited with the committee, which failed to secure a foreclosure, but secured the creation of another corporation, to which they conveyed the property. Plaintiff, and those he represents, dissented from this change of procedure and brought this action to recover the shares and money. An interlocutory judgment was recovered by default for the return of the shares and so much of the money as had not been expended in the plan agreed upon. A motion to relieve defendant from default was denied and the order affirmed on the ground that plaintiff had recovered no more than he was entitled to. On appeal from final judgment, Held, that the interlocutory judgment was final as to the rights of the parties, and that as the referee adhered to its directions the final judgment should be affirmed.The action was brought by the plaintiff in his own behalf and as assignee of other owners of shares of stock in the-Spring Valley Hydraulic Gold Company, for the return of shares deposited by them with the Knickerbocker Trust Company, and also for the recovery of the moneys deposited with the company at the time of the delivery of the shares of stock to it. These shares were delivered, and the money was deposited, under an agreement for the re-organization of the company by means of another corporation to be created under the ’aws of the state of California, and providing for the foreclosure of a mortgage upon the property of the Spring Valley Hydraulic Gold Company, and its purchase by a committee appointed for that purpose, and its subsequent transfer to the company to be created under the laws-of the state of California. After this plan was adopted and agreed upon, the persons having its execution committed to them, failed to have the mortgage foreclosed, as that had been agreed upon and provided for, but secured the creation of another corporation in the state of California, and then conveyed the property of the Spring Valley Hydraulic Gold Company to that corporation The plaintiff and the stockholders who assigned their shares-to him, and those who have made themselves parties to the action, dissented from this change in the mode of proceeding provided for and adopted, and alleged this departure or change to be entirely unauthorized. And this action was brought for the recovery of the shares deposited under the agreement, and of so much, of the money also deposited with the shares as had not been expended under the terms of and pursuant to the agreement
The action was brought to trial at the special term and an interlocutory judgment recovered by the plaintiff for the return of these shares, and of so much of the deposit in money as had not been expended in and about the promotion of the plan provided for by the agreement. The defendants faffed to appear at the-
This affirmance proceeded in part upon the fact that' the plaintiff and the other persons identified with him had recovered no more by the interlocutory judgment than the relief, they were entitled to secure under the agreement made and the other facts appearing upon the trial. And so far as this judgment proceeded, it became conclusive as to the rights of the parties and the disposition which should be made of the action.
This interlocutory judgment directed a reference to take and state the account of the defendants relating to the moneys deposited by the stockholders with the trust company. And when the report should be confirmed, it directed final judgment to be entered in favor of tire plaintiff and the other persons who became parties to the action. Under the authority of this direc■tion a referee was appointed before whom the accounting has taken place. And he reported the amount payable to the plaintiff, and also to others who had come in and made themselves parties to the action, on account of the deposit of the moneys with the trust company. Exceptions were filed to the referee’s report, which have been overruled, and final judgment entered pursuant to the authority of the interlocutory judgment. It has not been contended that the referee, in the taking of the accounts and ascertaining the amounts of money to be paid over, departed in any essential respect from the authority conferred and the directions contained in the interlocutory judgment. By his report and the evidence given upon the hearing before him, it appears that he has substantially conformed to the directions and determination of the case, as they were given and adjudged in that judgment. If that judgment was right, as it must be assumed to be for the disposition of the present appeal, then no further relief has been secured in the final judgment than that which the proofs before the referee and his report indicated to "be proper, and was fully sustained. The interlocutory judgment is not before this court in any form for its re-examination, and is consequently to be held final as to the rights and obligations .adjudged and declared through its provisions. And as the referee in the hearing before him, and the decision which he has made, has adhered to the directions given for his government by •the interlocutory judgment, no ground is presented upon which the final judgment from which the appeal has been taken can be in any manner impeached or disturbed. The plaintiff, on the contrary, appears to be entitled to the affirmance of that judgment, .•and such a disposition should be made of this appeal, with costs.
Yan Brunt, P. J., and Brady, J., concur.