Legislation

Search OpenLegislation Statutes
This entry was published on 2015-10-02
The selection dates indicate all change milestones for the entire volume, not just the location being viewed. Specifying a milestone date will retrieve the most recent version of the location before that date.
SECTION 112
Actions or special proceedings by attorney-general
Not-for-Profit Corporation (NPC) CHAPTER 35, ARTICLE 1
§ 112. Actions or special proceedings by attorney-general.

(a) The attorney-general may maintain an action or special proceeding:

(1) To annul the corporate existence or dissolve a corporation that
has acted beyond its capacity or power or to restrain it from carrying
on unauthorized activities;

(2) To annul the corporate existence or dissolve any corporation that
has not been duly formed;

(3) To restrain any person or persons from acting as a domestic or
foreign corporation within this state without being duly incorporated or
from exercising in this state any corporate rights, privileges or
franchises not granted to them by the law of the state;

(4) To procure a judgment removing a director of a corporation for
cause under section 706 (Removal of directors);

(5) To dissolve a corporation under article 11 (Judicial dissolution);

(6) To restrain a foreign corporation or to annul its authority to
carry on activities in this state under section 1303 (Violations).

(7) To enforce any right given under this chapter to members, a
director or an officer of a charitable corporation. The attorney-general
shall have the same status as such members, director or officer.

(8) To compel the directors and officers, or any of them, of a
charitable corporation which has been dissolved under section 1011
(Dissolution for failure to file certificate of type of Not-for-Profit
Corporation Law under section 113) to account for the assets of the
dissolved corporation.

(9) Upon application, ex parte, for an order to the supreme court at a
special term held within the judicial district where the office of the
corporation is located, and if the court so orders, to enforce any right
given under this chapter to members, a director or an officer of a
non-charitable corporation. For such purpose, the attorney-general shall
have the same status as such members, director or officer.

(10) To enjoin, void or rescind any related party transaction, seek
damages and other appropriate remedies, in law or equity, in addition to
any actions pursuant to section 715 (Related party transactions) of this
chapter.

(b) In an action or special proceeding brought by the attorney-general
under any of the provisions of this chapter:

(1) If an action, it is triable by jury as a matter of right.

(2) The court may confer immunity in accordance with the provisions of
section six hundred nineteen-c of the code of criminal procedure.

(3) A temporary restraining order to restrain the commission or
continuance of the unlawful acts which form the basis of the action or
special proceeding may be granted upon proof, by affidavit, that the
defendant or defendants have committed or are about to commit such acts.
Application for such restraining order may be made ex parte or upon such
notice as the court may direct.

(4) If the action or special proceeding is against a foreign
corporation, the attorney-general may apply to the court at any stage
thereof for the appointment of a temporary receiver of the assets in
this state of such foreign corporation, whenever it has assets or
property of any kind whatsoever, tangible or intangible, within this
state.

(5) When final judgment in such action or special proceeding is
rendered against the defendant or defendants, the court may direct the
costs to be collected by execution against any or all of the defendants
or by order of attachment or other process against the person of any
director or officer of a corporate defendant.

(6) In connection with any such proposed action or special proceeding,
the attorney-general may take proof and issue subpoenas in accordance
with the civil practice law and rules.

(c) In any such action or special proceeding against a foreign
corporation which has not designated the secretary of state as its agent
for service of process under section 304 (Statutory designation of
secretary of state as agent for service of process), any of the
following acts in this state by such foreign corporation shall
constitute the appointment by it of the secretary of state as its agent
upon whom process against such foreign corporation may be served.

(1) As used in this paragraph the term "resident" shall include
individuals, domestic corporations of any kind and foreign corporations
of any kind authorized to do business or carry on activities in the
state.

(2) Any act done, or representation made as part of a course of the
solicitation of orders, or the issuance, or the delivery of contracts
for, or the sale of, property, or the performance of services to
residents which involves or promotes a plan or scheme to defraud
residents in violation of the laws or the public policy of the state.

(3) Any act done as part of a course of conduct of business or
activities in the solicitation of orders from residents for property,
goods or services, to be delivered or rendered within this state to, or
on their behalf, where the orders or contracts are executed by such
residents within this state and where such orders or contracts are
accompanied or followed by an earnest money deposit or other down
payment or any installment payment thereon or any other form of payment,
which payment is either delivered in or transmitted from the state.

(4) Any act done as part of the conduct of a course of business or
activities with residents which defrauds such residents or otherwise
involves or promotes an attempt by such foreign corporation to
circumvent the laws of this state.

(d) Paragraphs (b), (c), (d) and (e) of section 307 (Service of
process of unauthorized foreign corporation) shall apply to process
served under paragraph (c).