Conant v. National Ice Co. — 40 N.Y. Super. Ct. 83

Majority

p. 83

JAMES H. CONANT, Plaintiff, v. THE NATIONAL ICE COMPANY OF NEW YORK, Defendant.

Headnote

L CORPORATIONS—CONTRACTS BETWEEN.

1. Assumption by one cobpobation (a.) op all the debts, liabilities, AND OBLIGATIONS OP (B.) ANOTHEB.

1. Non-liaMlity of the assuming corporation,.

1. A. is not bound to perform a contract made by B. to trans fer shares of its (B.’s) stock try transferring an equal number , of shares of its (A.’s) stock; nor is A. in any event liable as and for damages for the breach of such contract made by B., or otherwise, in the value of an equal number of shares of its (A’s.) stock.

a. This, although the consideration for such assumption was the transfer by B. to A. of all the property, rights, and privileges of B.

b. And although the stock of the old company was to

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be delivered in payment for services rendered in procuring some of the property so transferred.

c. And although the individuals who organized the new company were the same who organized the old one, the offices of the one the same as those of the other, and filled by the same persons; the seal of the one the same as the seal of the other, and the two corporations in all other respects alike, and all the property of the old company was transferred to the new one.

Before Curtis and Sedgwick, JJ,

Decided August 3, 1875.

Motion by defendant for a new trial under § 268 of the Code.

The action was tried at special term. The judge found as part of the facts that a corporation called The National Ice Company, in consideration of services performed by the plaintiff for it, in obtaining leases and ice privileges, and in consideration of the plaintiff surrendering to it fifteen hundred shares of its stock, held by him, agreed on January 8, 1867, to deliver to the plaintiff four hundred shares of the stock of that company; that on February 2, 1867, the persons interested in said corporation formed the corporation, which is the defendant; that the defendant assumed all the liabilities, debts, and obligations of the said National Ice Company, and took possession of all the property, rights, and privileges of such corporation „ including all the leases and ice privileges procured for it by the plaintiff, and assumed the liability of the National Ice Company to deliver to the plaintiff four hundred shares of its stock. From these and other facts found by the learned judge, he found, as the law of the case, that the plaintiff was entitled to the delivery of four hundred shares of the stock of the defend

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ant-, if delivery could be made by defendant; that if such delivery could not be made, the plaintiff was entitled to recover the value of the stock; that the plaintiff was entitled, to recover all dividends declared and paid on said stock since February 7, 1867, and interest thereon ; and that the plaintiff was entitled to an accounting to ascertain the amount of the dividend.

Sewell & Pierce, attorneys; and Robert Sewell, of counsel for the defendant.

Daniel B. Childs, attorney; and Joseph H. Choate, of counsel for the plaintiff.

If we look to the findings of fact made by the learned judge, or to the testimony in the case, we see that the defendant made no contract of its own with the plaintiff to deliver stock to him. At best for plaintiff, the defendant assumed the liability of another corporation upon a contract made by the other corporation with the plaintiff, to deliver its stock to him. Manifestly the plaintiff’s rights relate only to that stock. The name of the other company was the National Ice Company. But the plaintiff here.obtained a judgment which is based upon his having a right to the stock of the present defendant. As there was no evidence of any contract, in relation to the defendant’s stock, I think there should be a new trial.

If the individuals who organized the defendant were the same who organized the National Ice Company ; if that company transferred all its property to the defendant, and the defendant had no other property ; if the offices were the same, and filled by the same persons ; if the seal of one was used by the other as its seal; if in all other respects the two companies were alike, the National Ice Company would maintain

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its existence, and its capital stock could not be the capital stock of the defendant.

If the first company has performed and delivered its stock to the plaintiff, I think there would be no claim, that he, because of his having the stock, would be entitled to the same number of shares in the defendant’s stock. But now he is not entitled to more than the legal rights that arise to him from an executory contract to deliver that stock.

This result makes it unnecessary to examine whether the present action is one in equity or at law, and in what way the parties’ rights are affected by its being the one or the other. In the new trial granted, the parties can take positions so definite, that there will be no doubt on this point. If we are correct in the result, the other exceptions taken in the case present questions of law that on this appeal have no practical importance, and we do not examine, or decide, them.

There should be a new trial, with costs to defendant to abide the event of the action.

Curtis, J., concurred.