Perez v. One Clark Street Housing Corp.
| Decision Date | 19 February 1985 |
| Citation | 485 N.Y.S.2d 346,108 A.D.2d 844 |
| Parties | Rafael PEREZ, Jr., etc., et al., Appellants, v. ONE CLARK STREET HOUSING CORPORATION, et al., Respondents. |
| Court | New York Supreme Court — Appellate Division |
William F. O'Connor, New York City, for appellants.
Russo, Silverman & Vitaliano, New York City (Fisher & Fisher, Brooklyn corporate structure a sham. The co-operative corporation laws of New York are structured so that shareholders may personally benefit from their membership in the co-operative (see Cooperative Corporations Law, § 3, subds. ).
We find that the complaint falls short of adequately stating a cause of action against the shareholders (see Cusumano v. Iota Indus., 100 A.D.2d 892, 893, 474 N.Y.S.2d 579). There are no allegations that these shareholders ignored, circumvented or perverted the corporate form nor are there allegations of fraud or misrepresentation. In fact, what the complaint does describe are features of a valid housing co-operative. The benefits which flow to these shareholders, including the limitations on their personal liability, in no way impair the independent existence of the corporation (see We're Assoc. Co. v. Cohen, Stracher & Bloom, 103 A.D.2d 130, 478 N.Y.S.2d 670). The complaint is totally devoid of solid, nonconclusory allegations (see Walkovszky v. Carlton, 18 N.Y.2d 414, 421, n. 3, 276 N.Y.S.2d 585, 223 N.E.2d 6).
Moreover, we find that Special Term was correct in its view that "all practical purposes, there is only one action here and plaintiffs amended the complaint twice without first obtaining leave of the court". Therefore, plaintiffs' cross motion was properly denied as unnecessary (see Catanese v. Lipschitz, 44 A.D.2d 579, 580, 353 N.Y.S.2d 250).
Lastly we note that respondents are not entitled to recover attorney's fees in this action and on this appeal from the plaintiffs since such fees are merely an incident of litigation (see City of Buffalo v. Clement Co., 28 N.Y.2d 241, 262, 321 N.Y.S.2d 345, 269 N.E.2d 895; Klein v. Sharp, 41 A.D.2d 926, 343 N.Y.S.2d 1014).
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