Ascher Corp. v. Horvath

• Decision Date: 26 April 1962
• Citation: 231 N.Y.S.2d 676,35 Misc.2d 375
• Parties: The ASCHER CORP., Plaintiff, v. George HORVATH, Defendant.
• Court: New York Supreme Court

Page 676

231 N.Y.S.2d 676

35 Misc.2d 375

The ASCHER CORP., Plaintiff, v. George HORVATH, Defendant.

Supreme Court, Special Term, New York County, Part I.

April 26, 1962.

Maurice Iserman, New York City (Avrom S. Waxman, New York City, of counsel), for plaintiff.

Frederick E. M. Ballon, New York City (Ernest Swiedler, Brooklyn, of counsel), for defendant.

MATTHEW M. LEVY, Justice.

The defendant moves, pursuant to Rules of Civil Practice No. 107(2), for an order dismissing the complaint upon the ground that the plaintiff does not have capacity to sue, in that it is a foreign corporation not qualified to do business in this State, is doing business in this State, and brings the action on a promissory note executed and delivered in this State.

The point has not been raised, and I shall not pass upon the question whether Rule 107(2) is or is not available for the assertion of alleged incapacity under sections 210 and 218 of the General Corporation Law or whether the issue must be raised on the basis of insufficiency of the complaint as pleaded, or lack of merit in the cause of action as proved. Suffice it for present purposes to note the pertinent language of the applicable statute and that of three opinions of the Court of Appeals.

Section 218 of the General Corporation Law, in its relevant portions, provides that: 'A foreign corporation, other than a moneyed corporation, doing business in this state shall not maintain any action in this state upon any contract made by it in this state, unless before the making of such contract it shall have obtained a certificate of authority' in conformity with Section 210. (emphasis supplied) In Wood & Selick v. Ball, 190 N.Y. 217, 225, 83 N.E. 21, 23, the court said: 'We think that compliance with section 15 [now section 210] of the General Corporation Law should be alleged and proved by a foreign corporation such as the plaintiff, in order to establish a cause of action in the courts of this state'. (emphasis supplied) In Mahar v. Harrington Park Villa Sites, 204 N.Y. 231, 234, 97 N.E. 587, 588, 38 L.R.A.,N.S., 210, the court said: 'The only penalty which the General Corporation Law itself prescribes for a disregard of the provisions of this section is a disability to sue upon such a contract in the courts of New York'. (emphasis) supplied) And, in Ward v. Petrie, 157 N.Y. 301, 311-312, 51 N.E. 1002, 1005, the court said: 'There is a difference between capacity to sue, which is the right to come into court, and a cause of action, which is the right to relief in court. Incapacity to sue exists when there is some legal disability, such as infancy, or lunacy, or a want of title in the plaintiff to the character is which he sues. The plaintiff was duly appointed receiver, and has a legal capacity to sue as such, and hence could bring the defendants into court by the service of a summons upon them, even if he had no cause of action against them. On the other hand, an infant has no capacity to sue, and hence could not lawfully cause the defendants to be brought into court, even if he had a good cause of action against them. ^* Incapacity to sue is not the same as insufficiency of facts to sue upon. * * * We think that the plaintiff had capacity to sue, but that his complaint stated no cause of action of which the county court had jurisdiction.' (Cf. Hebrew Home for Orphans and Aged of Hudson County, New Jersey v. Freund, 208 Misc. 658, 660-661, 144 N.Y.S.2d 608, 609-610; Ohlstein v. Hillcrest Paper Co. Inc., 24 Misc.2d 212, 214-215, 195 N.Y.S.2d 920, 922, 923; Harris v. Averick, 24 Misc.2d 1039, 1041, 204 N.Y.S.2d 372, 374; Sorin...