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Dornan v. Humphrey

Appellate Division of the Supreme Court of New York, Fourth Department
Jul 11, 1951
278 App. Div. 1010 (N.Y. App. Div. 1951)

Summary

In Dornan, it was held that the defendant was successful in defending the stockholder's suit when the amended bill of complaint was dismissed because of the Statute of Limitations.

Summary of this case from Keyworth v. Industrial Sales

Opinion

July 11, 1951.

Present — Taylor, P.J., Vaughan, Kimball, Piper and Wheeler, JJ.


Order insofar as appealed from reversed on the law and matter remitted to the Official Referee to determine the reasonable expenses including attorneys' fees of the defendants-appellants, without costs of this appeal to any party. Memorandum: In this application for assessment of expenses, including attorneys' fees, pursuant to article 6-A of the General Corporation Law, the defendant directors were successful in their motion to dismiss the final amended complaint on the ground that the Statute of Limitations was a bar to the causes of action therein alleged. As there was no trial of the issues on the merits, the Official Referee has found that they are not entitled to reimbursement under the statute. There having been no trial, there was no adjudication that they were negligent or guilty of misconduct and consequently this application does not come within the exception contained in section 64. We think the word "successful" as used in section 67 was not intended to include only those cases in which defendant directors have been exonerated of claims of negligence and misconduct. The word has been defined as follows: "Gaining or having gained success; having the desired effect; resulting or terminating in success; the obtaining or terminating in the accomplishment of what is desired, intended, or aimed at." (60 C.J., p. 983.) Under this definition, as well as the common usage of the word, it appears that the defendants are, under the statute, entitled to have their "reasonable expenses" assessed against the corporation and that the court erred in refusing to fix the amounts. The Official Referee has not passed upon the question of whether or not the expenses applied for by the defendants are "reasonable". While we have the record before us we think it should be sent back to the Official Referee to determine what amount should be allowed to the defendants, and, if he deems the record is insufficient, to take further proof on that subject. All concur. (Appeal from part of an order dismissing the application of individual defendants for an assessment of expenses incurred in the defense of a stockholder's action.)


Summaries of

Dornan v. Humphrey

Appellate Division of the Supreme Court of New York, Fourth Department
Jul 11, 1951
278 App. Div. 1010 (N.Y. App. Div. 1951)

In Dornan, it was held that the defendant was successful in defending the stockholder's suit when the amended bill of complaint was dismissed because of the Statute of Limitations.

Summary of this case from Keyworth v. Industrial Sales
Case details for

Dornan v. Humphrey

Case Details

Full title:CLIFFORD DORNAN, Suing for Himself and for All Others Similarly Situated…

Court:Appellate Division of the Supreme Court of New York, Fourth Department

Date published: Jul 11, 1951

Citations

278 App. Div. 1010 (N.Y. App. Div. 1951)

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The disposition of this prosecution in the Federal court clearly falls within the latter description. The…

Keyworth v. Industrial Sales

Nor do we regard the decisions cited by Keyworth as contrary to the conclusion we have reached. Dornan v.…