HYATT v. ROACH

HYATT v. ROACH. N. Y. Supreme Court; Special Term, November, 1876. Reference. Compulsory reference cannot be ordered of an action to charge a trustee of a manufacturing corporation with a debt of the corporation, by reason of omission to file annual report, although the only issue is as to the indebtedness of the corporation on a long account. Thaddeus Hyatt, and others, sued John Roach on his liability as trustee of a corporation, under the “Manufacturing Companies’ Act,” Laws of 1848, c. 40, § 12. The answer admitted that defendant was such trustee, and the omission to file report, but denied the alleged facts constituting the indebtedness. Ambrose Monell, for plaintiff, moved for a compulsory reference, on the pleadings, and on an affidavit that the debt incurred by the corporation was for labor and materials ; and that the proof would involve a long account, of more than thirty items. Geo. W. Van Siclen, opposed. See also the last case, Kingsley v. City of Brooklyn. In the case of the Meriden Tool Co. v. Morgan (N. Y. Supreme Court, First Department, Circuit, June, 1875), it was held that the omission to file in the secretary of state’s office, a duplicate of the certificate of organization, does not avail a trustee as a defense, where there is proof of user. The statute provides that the persons desiring to form a manufacturing, &c., corporation, may make “ and file in the office of the clerk of the county in which the business of the company shall be carried on, and a duplicate thereof in the office of the secretary of state, a certificate, &c. . . . When the certificate shall have been filed as aforesaid, the persons who shall have signed, &c., shall be a body politic and corporate, &c.” (L. 1848, c. 40, §§ 1, 2). The Meriden Tool Company sued defendant as administrator, to charge him with a debt of the Robbins Burglar Alarm Company, a corporation of which the intestate was a director. Barrett, J.—By the filing of the certificate in the county clerk’s office, immediately followed try user, the Robbins Burglar Alarm Company became a corporation de facto, and the duty to make and publish a report attached (19 N. Y. 119; 17 Id. 458). Any other construction would enable trustees to evade all responsibility by simply omitting to file a duplicate certificate. The trustees are estopped under such circumstances from denying the existence of the corporation (22 How. Pr. 35). This rule is especially just in the case of the defendant’s testator, from the fact that the proof of user is under his own hand, in the shape of the contract under which the plaintiffs delivered their goods; which contract was executed within the very twenty days during which it was his duty to make and publish the report in question. Judgment for the plaintiff, with costs. [MAJORITY — Lawrence, J.] Lawrence, J. The action is brought to recover a penalty for neglect to file the annual report under section 12 of chapter 40, Laws of 1848. It is not upon contract (Merchants’ Bank v. Bliss, 35 N. Y. 412). The penalty imposed by that section is, that upon failure to file such report, the trustees of the company shall jointly and severally be liable for all the debts of the company then existing, &c. The character of the action is determined by the complaint (Welsh v. Darragh, 52 N. Y. 590). An inspection of the complaint shows that it is not upon contract, but is brought to enforce a penal obligation of the defendant, under the statute, in his capacity as trastee. Motion for reference denied, with costs.