Summary
In Matter of Northern Dispensary, 26 Misc. Rep. 147, cited for the petitioner, the matter reviewed was the main election, not a substitution of trustees.
Summary of this case from Matter of Ringler Co.Opinion
January, 1899.
Nelson Smith, for motion.
C. Fine, opposed.
At a meeting of the subscribers of the Northern Dispensary of the City of New York, held on January 13, 1899, a board of fifty trustees was elected for the ensuing year. One of the fifty was Dr. Samuel Hall. The petitioner herein, who is a subscriber of said dispensary, makes this motion to have annulled the election of said Dr. Hall, as such trustee, for the reason that he is not an actual resident of the city of New York. The act of the legislature incorporating said dispensary provides, in section 4, as follows, viz.: "There shall be forever hereafter not less than twenty-five nor more than fifty trustees (exclusive of the president and vice-presidents) of said corporation; and the said trustees shall be contributors to the said dispensary, actually resident in the city of New York." Section 7 of said act provides thus: "In case any of the said persons elected to be trustees of said corporation, or who shall thereafter be elected thereto, shall die, or remove from the city of New York, before the time of their appointed service shall expire, or shall refuse or neglect to act in and execute the said office, then, and in every such case, the remaining trustees of said corporation shall, within thirty days thereafter, by ballot elect another or others of the members of said corporation, instead of him, or them, so dying or removing, refusing or neglecting to act; and such person or persons as shall have the greatest number of votes at every such election shall hold their said office from the time of such election," et cetera. The petitioner presents affidavits tending to show that Dr. Samuel Hall is not an actual resident of the city of New York, and was not at the time of his election, but is a resident of the town of Rye, in the county of Westchester. There is no denial on the part of Dr. Hall to this allegation, which must be assumed to be true. It, therefore, appears to be an established fact in the case that Dr. Hall is not eligible for the office of trustee in said dispensary. The question here presented is as to the propriety of the petitioner's proceedings. The attorney for Dr. Hall claims that the attorney-general should have intervened, under section 1948 of the Code. This section provides that the attorney-general may maintain an action against a person who usurps, intrudes into, or unlawfully holds or exercises, within this state, an office in a domestic corporation. Section 1811 of the Code provides that a trustee of a corporation shall not be removed from office by a court or judge otherwise than by a final judgment of a competent court, in an action brought by the attorney-general, as prescribed in section 1781 of the Code. This last section provides for an action by the attorney-general to remove a trustee, who has abused his trust, or been guilty of misconduct. No abuse of trust or misconduct is alleged against Dr. Hall, and this motion does not ask for the removal of a trustee, but for the annulment of his election, for the reason that at the time of such election and ever since, said Dr. Hall was and is ineligible, under the provisions of the act of incorporation. It is true that it is not disputed that the election was properly held and conducted, and that it is good as to all of the other forty-nine trustees, elected on the same ticket with Dr. Hall; and the attorney for Dr. Hall claims that practically the motion is one for the removal of one of the trustees elected on that ticket, on the ground of his ineligibility. Section 1781 of the Code does not provide for such an action by the attorney-general, even taking it to be as claimed by the attorney for Dr. Hall. That section refers to abuse of trust and misconduct, not to ineligibility on the part of the trustee. There does not appear to be any reason for holding that because the forty-nine eligible trustees were elected on the same ticket with the one ineligible trustee, that an annulment of the election of the latter requires also the annulment of the election of the former. Chapter 563 of the Laws of 1890, section 15, provides that "The supreme court shall, upon the application of any person or corporation aggrieved by, or complaining of any election of any corporation, or any proceeding, act or matter touching the same, upon notice thereof to the adverse party, or to those to be affected thereby, forthwith and in a summary way hear the affidavits, proofs and allegations of the parties, or otherwise inquire into the matters or causes of complaint, and establish the election or order a new election or make such order and give such relief as right and justice may require, and may in its discretion order issues to be made up in such a manner and form as it may direct, to try the respective rights of the parties touching the matters complained of." Whether this motion has been instituted through spite and personal rancor, as claimed by the attorney for Dr. Hall, or not, has no bearing upon the question involved. If the doctor is not eligible, under the provisions of the act creating the corporation, and a member of the corporation objects to such irregularity, Dr. Hall should not be allowed to continue as such trustee. The practice of the petitioner seems to be correct, and as he has established the ineligibility of Dr. Hall, he is entitled to a decision annulling the election of said Dr. Hall. Section 7 of the act of incorporation, above quoted, provides that in the case of a trustee's becoming ineligible, by reason of his removal from this city, the remaining trustees of the corporation shall elect another to take his place. I am of the opinion that the motion should be granted, without costs.
Motion granted, without costs.