Opinion
April 23, 1957
Gifford, Woody, Carter Hays for petitioner.
James H. Halpin and Joseph M. O'Loughlin for respondents.
This is a proceeding under article 78 of the Civil Practice Act to direct respondents to turn over the books, records and other property of the petitioner to the officers elected at a meeting held on March 12, 1957. The respondents claim to be officers of the corporate petitioner and that, as such officers, the property is lawfully in their custody. Petitioner contends that the respondents were removed as officers at a meeting of the stockholders. The petition alleges that notices signed by two of three directors were duly mailed on March 6, 1957, calling for a meeting of all the stockholders for March 12, 1957, and also for a directors' meeting for the same day, but at a later time. These notices do not comply with sections 45 and 55 of the Stock Corporation Law, nor with the by-laws of the corporation, and such defect is apparent on the face of the petition. While the respondents are not entitled to custody and control of books, records and other property as individuals, yet as officers such custody may be retained in the absence of a showing of any other representatives or officers of the corporation being entitled to their custody. It is the duty of the officers of a corporation to protect and preserve the books and records of the corporation. Since the meeting of March 12, 1957, at which it is alleged the respondents were removed as officers, must be deemed a nullity for failure to comply with the statute, the respondents are officers charged with the duty of caring for the corporate records and at the same time are duty-bound not to hinder the corporation in any manner which would interfere with its business. The petition is dismissed.