Alpert v. 28 Williams Street Corp.
| Decision Date | 14 December 1982 |
| Parties | Jack L. ALPERT, et al., Plaintiffs-Respondents-Appellants, v. 28 WILLIAMS ST. CORP., et al., Defendants-Appellants-Respondents. |
| Court | New York Supreme Court — Appellate Division |
M. Hirshowitz, for plaintiffs-respondents-appellants.
E. Brodsky, New York City, for defendants-appellants-respondents.
Before MURPHY, P.J., and KUPFERMAN, SULLIVAN, ASCH and ALEXANDER, JJ.
Judgment of the Supreme Court, New York County entered on July 7, 1982, which held defendants liable as directors and majority shareholders with respect to a merger agreement which they approved and executed, and set the matter down for a hearing to assess remedies and damages, unanimously reversed, on the law and the facts, and the matter remanded for a new trial, with costs to abide the event, in which the court should make findings of fact as to whether the merger transaction was tainted with fraud, conflict of interest or self-dealing.
Plaintiffs, until execution of the merger here complained of, for many years owned a 26% minority interest in 79 Realty Corp., the principal asset of which was a seventeen story office building located at 79 Madison Avenue.
In September, 1980, defendants purchased a greater than two-thirds controlling interest in 79 Realty Corp. through a nominee corporation, defendant 28 William St. Corp. To accomplish the takeover of 79 Realty Corp., the principal actors behind the acquisition had formed a limited partnership, defendant Madison 28 Associates.
After the closing, the board of directors of 79 Realty Corp. resigned and was replaced by the four general partners of Madison 28 Associates. New officers were appointed from among the general and limited partners of Madison 28 Associates.
The new board then approved a merger plan whereby 28 William St. Corp. would merge into 79 Realty Corp., which would then be dissolved, the minority shares cancelled, with title to the building ultimately to vest in Madison 28 Associates. The minority shareholders were to be paid at the same rate per share as the defendants had paid for the majority shares.
The minutes of the board of directors meeting at which the merger was approved state that the purposes of the merger were to obtain greater capital contribution for needed renovation, and to realize tax savings through ownership in the partnership rather than corporate form. Defendants consummated the merger after posting a bond to vacate a temporary restraining order plaintiffs had obtained against the holding of a special shareholders meeting to approve the merger.
Plaintiffs contest the stated purposes of the merger on the grounds that, at the time of the merger, capitalization was adequate to finance the required renovation, and that the...
To continue reading
Request your trial
-
Alpert v. 28 Williams Street Corp.
...meeting was not lawfully conducted, or whether the entire transaction involved fraud, conflict of interest, or self-dealing" (91 A.D.2d 530, 531, 457 N.Y.S.2d 4). It rejected the legal standard applied by Supreme Court, holding that the proper standard was that the "will not interfere with ......
-
Crabapple Corp. v. Elberg, 4025N. 650492/15.
...when it granted the motion to remove Elberg as co-manager without holding an evidentiary hearing (see Alpert v. 28 Williams St. Corp., 91 A.D.2d 530, 457 N.Y.S.2d 4 [1st Dept.1982] ; see also Lehey v. Goldburt, 90 A.D.3d 410, 933 N.Y.S.2d 281 [1st Dept.2011] ). Questions of fact exist as to......