The petitioner, George B. Inman, claims to be a stockholder of the New York and Mount Vernon Water Company, and as such has applied for, and been refused, the right to intervene in the foreclosure suit under the judgment in which the property of the corporation has been sold. The application is made in the foreclosure action. The mortgage foreclosed was executed by the New York City Suburban Water Company, a corporation into which the New York and Mount Vernon Water Company was afterwards merged by consolidation, and the effect and validity of the proceedings and the nature and extent of the lien, if any, of such mortgage upon the property so after acquired by the consolidated company, were considered by this court in the cases of Drake v. New York Suburban Water Co. (26 App. Div. 499) and Drake v. New York Suburban Water Co. (36 id. 275). The facts are fully set forth in the report of those appeals and need not be repeated here. Drake’s action was in substance to have an adjudication that the mortgage was not a lien upon the property in question, that the judgment of foreclosure and sale and the consolidation proceedings be vacated and set aside as null and void, and that the defendant the New York Suburban Water Company be required to hold the property in trust for the discharge of valid liens of the New York and Mount Vernon Water Company to be ascertained. A judgment in the plaintiff’s favor was reversed on each appeal, but without determining the question whether either the provision in the mortgage in terms subjecting any after-acquired property of the corporation to the lien of such mortgage or a similar provision in the consolidation agreement was sufficient to accomplish the purpose. In each opinion delivered, however, a strong intimation was given by the respective writers that the lien did exist, although after the argument of the second appeal there was still some difference of opinion among the. members of the court.
The petitioner claims to be the holder and owner of 100 shares of the stock of the Mount Vernon Company, represented by two certificates of equal amount, which were undoubtedly issued to him originally or to the firm of which he was a member, and which stand upon the books of the company as originally issued. But it is admitted by the petitioner that more than fifteen years ago he transferred both certificates to another person, although such transfers, however absolute upon the face, were, he states, only intended as collateral security to promissory notes made by him at the time and representing money then borrowed by him. He has never redeemed the certificates, never paid the debts, judgment has been recovered against him upon one of the notes in an action in which he interposed the fact of such collateral security by way of answer, one.-of the certificates was sold and delivered in 1899 through a broker to the New York In ter urban Water Company for value, which company now claims to be the lawful owner and holder, and the whereabouts of the other certificate is undisclosed. The petitioner asserts that the certificates have been unlawfully-diverted by the assignee, but it would be improper to try and determine the title to the shares upon affidavits in the absence of parties who may be adverse claimants, and no authority is cited to show that one situated as he is should be granted relief so disastrous to others as that which he seeks in aid of a possible restoration of title dependent upon a remote and apparently unlikely contingency.
Certainly the cases cited in his behalf have no application. Burr v. Wilcox (22 N. Y. 551) merely holds that one to whom
But aside from the status of the petitioner as a stockholder, he has not satisfactorily explained his delay in making the application. The petition is chiefly based upon the allegation that in the foreclosure suit the officers of the defendant in violation of their duty “illegally, falsely in bad faith and in collusion with the plaintiff, admitted all the allegations of the complaint herein and confessed judgment whereby and hot otherwise the judgment of foreclosure herein was obtained.” This allegation is predicated upon others to the effect that the mortgage foreclosed was not a lien upon the property of the New York and Mount Vernon Water Company ; that no property of the corporation executing the mortgage ever came into the possession, ownership and control of the defendant; that no property affected by the foreclosure judgment ever was the property of the mortgagor, and that “ when this action was commenced it became and was the duty of the officers of the defendant to deny the allegations that the defendant executed said mortgage, that its property was in any wise bound thereby, and that it
The petitioner had abundant means of knowledge of the material facts for many years, and if he had no actual knowledge it is difficult to account for it upon any other theory than personal indifference. The agreement for consolidation was ratified at a stockholders’ meeting in June, 1891, of which meeting he, as a stockholder of record, must have received the notice required by law. On behalf of certain non-assenting stockholders a preliminary injunction was at once obtained restraining the contemplated action, and for nearly a year the question was in litigation until its validity was finally established in the Court of Appeals in May, 1892, by the decision in Cameron v. N. Y. & M. V. W. Co. (133 N. Y. 336). The consolidation was consummated in the following month. The judgment of foreclosure and sale was entered nearly seven years before the presentation of the present petition, and has been a matter of record accessible to the petitioner and his attorneys during that entire period. Tile Drake litigation followed and lasted several years, was based upon the allegations now presented, and twice terminated at the Circuit in an adjudication favoring the petitioner’s contention. More than three years have expired since the second decision in that case in this court holding that the foreclosure judgment-was subject to such an application by non-assenting stockholders as the petitioner has now made. And the petitioner does not allege that he had no knowledge of the fact or of the terms of the consolidation, of the
The order should be affirmed. .
All concurred.
Order affirmed, with ten dollars costs and disbursements.