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0-12/27

AND

COURT OF APPEALS

OF THE

STATE OF NEW YORK.

By R. M. STOVER,

REPORTER.

VOLUME LX.

ALBANY:

WILLIAM GOULD & SON,

LAW BOOKSELLERS AND PUBLISHERS.

1881.

31

Entered according to act of Congress, in the year eighteen hundred and eighty-one,

BY WILLIAM GOULD & SON,

in the office of the Librarian of Congress, at Washington.

Rec. May
May 28, 1881

THE ARGUS COMPANY,

PRINTERS AND STEREOTYPERS,

ALBANY, N. Y.

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PRACTICE REPORTS.

SUPREME COURT.

THE PEOPLE OF THE STATE OF NEW YORK agt. WILLIAM FONTAINE BRUFF, THE BROOKLYN ELEVATED RAILWAY COMPANY and others.

Action against directors, &c., of a corporation for misconduct - By whom action to be brought-When attorney-general must bring action — Power of the court to appoint a receiver — Practice — Code of Civil Procedure, sections 1781, 1782, 1808, 1810.

*

The attorney-general, in behalf of the people of the state, may maintain an action "against one or more trustees, directors, managers or other officers of a corporation to procure a judgment * * compelling the defendants to account for their official conduct in the management and disposition of the funds and property committed to their charge," and "compelling them to pay the corporation which they represent, or its creditors, any money, and the value of any property which they have acquired to themselves, or transferred to others, or lost or wasted, by a violation of their duties," and "suspending a defendant from exercising his office when it appears that he has abused his trust" (Code of Civil Procedure, sections 1781, 1782).

By section 1808 of the Code of Civil Procedure the attorney-general "must bring an action" for the purposes just enumerated, "if, in his opinion, the public interests require that an action should be brought;" and by section 1810, in an action brought for the objects specified, by the attorney-general, the court has power to appoint a receiver of the property of the corporation.

When the president of a railroad company makes a contract with himself for the construction of a railway; when he obtains all the securities, stock and bonds under the pretense of paying the nominal contractor; when as chief engineer he makes to himself as contractor certificates of work done, and then as president pays himself many hundred thousand dollars in advance of what the nominal contractor was entitled to receive under the contract for construction, ample cause is shown for the appointment of a receiver, and the command of the statute to the attorney-general that he "must bring an action," becomes imperative.

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