Philip Dohn and Others, Respondents, v. Buffalo Amusement Company and Others, Defendants; Edmund L. Magner, as Receiver of the Buffalo Amusement Company, Appellant

Philip Dohn and Others, Respondents, v. Buffalo Amusement Company and Others, Defendants. Edmund L. Magner, as Receiver of the Buffalo Amusement Company, Appellant. Injunction order in proceedings for the dissolution of a corporation — an order modifying it can only be made oh notice to the Attorney-General. Where an order, made in a proceeding for the dissolution of a corporation, enjoins-all persons from bringing any action against said corporation and from taking any further proceedings in any such action theretofore commenced, an order modifying the restraining clause of such order by allowing the moving parties to prosecute to judgment a pending action against the corporation and others, made without notice to the Attorney-General, as required by section 8 of chapter 378 of the Laws of 1883, is void. The fact that the order modifying the restraining clause is entitled in the action brought by the moving parties, and not in the proceeding for the dissolution of the corporation, is immaterial. Appeal by Edmund L. Maguer, as receiver of the defendant, the Buffalo Amusement Company, from an order of the Supreme Court, made at the Erie Special Term and entered in the office of the clerk of the county of Erie on the 3d day of September, 1901, modifying an order theretofore granted in a proceeding for the dissolution of the Buffalo Amusement Company, a domestic corporation. The order appointing the temporary receiver in the dissolution proceedings and requiring the parties interested to show cause before a referee why the corporation should not be dissolved, enjoined all persons “ from bringing any action against said corporation * * * and from taking any further proceedings whatsoever in any such action heretofore commenced.” At the time of the granting of the order, an action was pending, commenced by the plaintiffs to recover upon a claim of $1,300' held by them against the corporation and the other defendants. The order appealed from modified the restraining part of the order in the dissolution proceedings by permitting the plaintiffs to prosecute their claim to judgment against the corporation. Lyndon L. Wood, for the appellant. Niles C. Bartholomew and A. Bartholomew, for the respondents. [MAJORITY — Spring, J. :] Spring, J. : The foundation of the present proceeding was an order to show cause providing for service of a copy of the order and papers upon which it was granted upon the receiver and attorney for the corporation. There was no direction to serve upon the Attorney-General, and the recitals in the final order do not show any appearance on behalf of that officer. The omission to serve the motion papers and the proposed order upon the Attorney-General is a fatal defect. Section 8, chapter 378, Laws of 1883, in prescribing the service of papers upon the Attorney-General in proceedings of this kind, declares that “ any order or judgment granted in any action or proceeding aforesaid, without such service of such papers upon the attorney-general, shall be void.” Full effect has been given to this section by the courts. (People v. Seneca Lake Grape & Wine Co., 52 Hun, 174-180; Gillig v. Treadwell Co., 151 N. Y. 552.; Langdon v. New York Book Co., 39 N. Y. St. Eepr. 167.) The statute, is a wholesome one designed to insure the conservation and distribution of the assets of the defunct corporation among its creditors, and it must be stringently enforced. It would seem to be entirely proper to permit the plaintiffs to establish their claim against the corporation, as it is not included, among the admitted liabilities; but any change in the order to dissolve the corporation, although apparently immaterial, must be upon notice to the Attorney-General. ' An invasion of this requirement once permitted by the courts might be used as a precedent for extending the application until the efficiency of the provision is destroyed. The counsel for the respondent seeks to escape the force of this section of the statute on the ground that the order to show cause and also the order of modification were entitled in the action, and not in the proceeding for the dissolution of the corporation. The order modified was the one in the latter proceeding. If the position of the counsel is tenable there is no difficulty in evading the effect of the statute, and by collusion with the receiver dissipating.the property. The fact that the order Was in the action may be another reason for its reversal, rather than for upholding it. The order appealed from should be reversed and the preliminary order to show cause dismissed, but inasmuch as the question of the failure to serve the order to show cause and"''.moving papers upon the Attorney-General was not raised at Special. .Term, so far as the record before us shows, the reversal should be.Vwithout costs of this appeal. . . All concurred. Order appealed from reversed and preliminary order to show cause dismissed, without costs of this appeal to either party.