Hunt v. Hunt

• Decision Date: 07 December 1995
• Docket Number: No. 1,No. 2,1,2
• Citation: 634 N.Y.S.2d 804,222 A.D.2d 759
• Parties: Donald R. HUNT, Appellant, v. Edward G. HUNT et al., Respondents. (Action) Edward G. HUNT, Respondent, v. Donald R. HUNT, Appellant. (Action)
• Court: New York Supreme Court — Appellate Division

Page 804

634 N.Y.S.2d 804

222 A.D.2d 759

Donald R. HUNT, Appellant, v. Edward G. HUNT et al., Respondents. (Action No. 1.)

Edward G. HUNT, Respondent, v. Donald R. HUNT, Appellant. (Action No. 2.)

Supreme Court, Appellate Division,

Third Department.

Dec. 7, 1995.

Caputo, Aulisi and Skoda (Richard T. Aulisi, of counsel), Gloversville, for appellant.

Friedman, Hirschen, Miller, Coughlin & Campito P.C. (Lynn M. Blake, of counsel), Schenectady, for respondent.

Before MIKOLL, J.P., and CREW, CASEY, YESAWICH and SPAIN, JJ.

SPAIN, Justice.

Appeal from a judgment of the Supreme Court (White, J.), entered September 1, 1994 in Fulton County, upon a decision of the court in favor of Edward G. Hunt.

In the early 1950s Edward G. Hunt began working at his father's gasoline service station at the age of 16 years; within a short period of time his father, George Hunt, placed him in charge of the business. In 1953 Edward, with approximately $7,000 he had received from the settlement of a personal injury negligence action, purchased a dump truck and track loader and started a contracting business. In or about 1958 Edward's younger brother, Donald, began working at the service station. In 1965, the year their father died, Edward filed, in his name only and as successor in interest to his father, a certificate of doing business as "Hunt's Garage". In 1969 Hunt Brothers Contractors Inc. (hereinafter the corporation) was formed and included the garage and the contracting business; no stock certificates were ever issued and the certificate of incorporation does not reflect the identity of the shareholders. Edward was the president of the corporation and Donald the vice-president. During the ensuing years the corporation expanded to include four components, to wit: the garage, the construction business, Hamilton Oil Company and Hamilton Ready Mix. The oil company was purchased by Edward in 1977 from Stuart Oil Service with promissory notes signed by him and moneys he received from the sale of his residence after his divorce. In 1978 Edward used approximately $8,000 from a workers' compensation award to purchase equipment for the corporation. In December 1990, after a dispute with Edward, Donald left the business.

Donald commenced action No. 1 alleging, inter alia, that he was an owner of 50% of the shares of the corporation and seeking an accounting. Edward answered, denying that Donald was an owner of the corporation, and commenced action No. 2 for money damages, alleging, inter alia, that Donald improperly withdrew money from certain joint bank accounts. In April 1992 the two actions were joined for trial; after a nonjury trial Supreme Court dismissed action No. 1 and determined, in action No. 2, that Edward was entitled to $6,857.83 in damages since Donald withdrew more than his half of a joint bank account set up by Edward. Donald appeals.

We affirm. Donald's assertion that he was a 50% shareholder in the corporation was not established by a preponderance of the evidence. Since no certificates of stock were issued by the corporation, Supreme Court properly examined other evidence to determine the validity of Donald's claim (see, Rocha Toussier y Asociados, S.C. v. Rivero, 184 A.D.2d 397, 398, 585 N.Y.S.2d 384; Matter of Benincasa v. Garrubbo, 141 A.D.2d 636, 639, 529 N.Y.S.2d 797). Donald's argument that Supreme Court should have given more attention to the documentary evidence is without merit. A number of documents before the court, including invoices, letters and financing documents, referred to both Edward and Donald as being principals of the business. However, Supreme Court understandably afforded little weight, if any, to this evidence. Donald was both an employee and vice-president of the corporation; therefore, it does not seem unreasonable that third parties dealing with the business might be confused about the true legal relationship between the parties. As to the corporate tax returns, which for seven years reported that Edward and Donald were each 50% shareholders of the corporation, the corporate accountant who prepared those returns testified at the trial that he believed the stock ownership as listed on those returns was in error. Moreover, other corporate tax returns report that Edward is 100% owner of...