Opinion
8078 Index 17384/07 300513/10 83796/10
01-10-2019
In re Hugh W. CAMPBELL, etc., Petitioner–Appellant, v. MCCALL'S BRONXWOOD FUNERAL HOME, INC., Respondent–Respondent. Hugh W. Campbell, etc., Plaintiff–Appellant, v. Jeffrey D. Buss, Esq., et al., Defendants–Respondents. [And a Third–Party Action]
Wilson Jacobson P.C., Eastchester (Leroy Wilson, Jr. of counsel), for appellant. Spolzino, Smith, Buss & Jacobs LLP, Yonkers (Charles S. Welcome of counsel), for respondents.
Wilson Jacobson P.C., Eastchester (Leroy Wilson, Jr. of counsel), for appellant.
Spolzino, Smith, Buss & Jacobs LLP, Yonkers (Charles S. Welcome of counsel), for respondents.
Acosta, P.J., Renwick, Manzanet–Daniels, Webber, Kahn, JJ.
In determining whether involuntary dissolution under section 1104–a of the Business Corporation Law is warranted, the Court must consider (1) whether liquidation "is the only feasible means whereby [a] petitioner may reasonably expect to obtain a fair return on [her] investment; and (2) [w]hether liquidation ... is reasonably necessary for the protection of the rights and interests, of any substantial number of shareholders or of the petitioners" ( Business Corporation Law § 1104–a[b] ; see also Matter of Kemp & Beatley [Gardstein] , 64 N.Y.2d 63, 484 N.Y.S.2d 799, 473 N.E.2d 1173 [1984] ). A court has discretion to deny a petition for dissolution upon a showing of shareholder oppression, provided the respondent shows that an "adequate, alternative remedy" exists, such as a buy-out under the shareholders' agreement that would provide a fair return on the corporate investment (see Kemp & Beatley , 64 N.Y.2d at 74, 484 N.Y.S.2d 799, 473 N.E.2d 1173 ; Matter of Harris [Daniels Agency] , 118 A.D.2d 646, 500 N.Y.S.2d 5 [2d Dept. 1986] ).
Because the Funeral Home and defendant Alston failed to substantiate that their buy-out offer under the 1998 corporate shareholders' agreement would provide decedent's Estate with a fair return on the decedent's investment, and the Estate has presented substantial evidence that the buy-out offer was grossly inadequate, we remand for an evidentiary hearing on the value of the Estate's interest in the Funeral Home (see Matter of Fancy Windows & Doors Mfg. Corp. [Fei Wu] , 244 A.D.2d 484, 484, 664 N.Y.S.2d 113 [2d Dept. 1997] ; Matter of Wiedy's Furniture Clearance Ctr. Co. , 108 A.D.2d 81, 85, 487 N.Y.S.2d 901 [3d Dept. 1985] ).
We have considered the Estate's remaining arguments and find them unavailing.