In re Finando

In In re Finando, 226 A.D.2d 634, 641 N.Y.S.2d 384 (2d Dep't 1996), the petitioner alleged that he was the owner of more than 20% of the outstanding shares of a corporation and commenced a proceeding to dissolve the corporation pursuant to Business Corporation Law 1104-a. In his original petition, the petitioner averred that he and Robert Sohn, who is the president of the corporation were the corporation's sole shareholders. However, Sohn maintained that his wife Tina Sohn was actually the true owner of the shares claimed by the petitioner. After receiving notice of the proceeding in accordance with Business Corporation Law 1106, Tina Sohn moved to dismiss the proceeding, contending that she was a necessary party to the court's resolution of the threshold issue of whether the petitioner actually owns at least 20% of the corporation's shares and is thus entitled to seek dissolution of the corporation. The Court held that, petitioner was able to proceed with his application for dissolution despite the fact that the court lacked personal jurisdiction over an individual who claimed to be a shareholder of the corporation. The court had acquired jurisdiction over the corporation and "all persons interested in the corporation" upon compliance with the statutory notice provisions set forth in Business Corporation Law 1106. The Court stated that, "there is no authority for the appellants' assertion that the court must have personal jurisdiction over all putative stockholders in order to conduct such a hearing." Id.