
    John E. Hagmayer, Suing on his own Behalf and on Behalf of All Other Creditors of Harlem River Bank of the City of New York, Plaintiff, v. John C. Alten and Others, Respondents. John Linck, James Gamble and Joseph M. Richards, Appellants.
    
      Bepresentative action by a creditor of a bank to enforce the statutory liability of the stockholders — right of other creditors to be made parties thereto—what is not loches.
    In view of the recent decision of the Court of Appeals, that creditors of an insolvent bank, not parties to an action brought by a creditor of the bank on behalf of himself and of all other creditors, to enforce the liability of the stockholders under section 52 of the Banking Law (Laws of 1892, chap. 689), have no rights in the action until made parties thereto, and that the plaintiff may, at any time, discontinue it without regard to the interests of such creditors, the Appellate Division considered that the motion of such creditors to be made parties plaintiff in the representative action should be granted where the applicants acted with diligence as soon as the decision of the Court of Appeals was rendered, although the motion was made more than three years after the commencement of the action, and after it was at issue as to all the answering defendants, although not noticed for trial.
    Appeal by John Linck and others from an order of the Supreme Court, made at the Rew York Special Term and entered. in the office of the clerk of the county of Rew York on the 8th day of March, 1899, denying their motion to be made parties plaintiff in the above-entitled action.
    The action was begun Rovember 7, 1895, and the notice of motion upon which the order appealed from was made was dated January 29, 1899.
    
      George M. Mackellar, for the appellants.
    
      Jacob Fromme, Jeroloman & Arrowsmith, Forbes & Haviland, Albert Ritchie, Deyo, Duer & Bauerdorf, Tracy, Boardman & Platt, Sigmund Feuchtwanger, James Kearney, Ralph H. Raphael and George F. Langbein, for the respondents.
   Van Brunt, P. J.:

This action was brought by John E. Hagmayer, a creditor of the Harlem River Bank, in his own behalf and in behalf of all other creditors of the bank, against the stockholders of the bank to enforce the liability of the stockholders under section 52 of the Banking Law (Laws of 1892, chap. 689), the ground of the action being that the bank had become insolvent and that its assets were and are insufficient to pay its debts. The complaint has been amended several times owing to the necessity of bringing in the personal representatives of deceased defendants. The action is at issue as to all of the defendants who have appeared and served answers, but has not been noticed for trial or put upon the calendar. A motion was made by the appellants for an order making them parties plaintiff in the action with the plaintiffs. The appellant Linck was a member of the firm of Linck & Doenick, who were depositors in the bank at the time of its failure. Doenick had assigned to Linck his interest in the claim of his firm against the bank. The other appellants are assignees of depositors’ claims. The motion of the appellants was denied, and from the order denying the motion this appeal has been taken.

Had not the decision in the case of Hirshfeld v. Fitzgerald (157 N. Y. 166) been made by the Court of Appeals we should have said that the motion in question was properly denied, and that, having so long delayed their application to be brought in, the appellants should now be compelled to await the interlocutory judgment in this action and then come in and prove their claims. But this decision has changed very materially what we believed to be the rights of the parties in behalf of whom actions of this nature are brought, and it would appear that they have no rights whatever until they have been made parties to the action, and that an action like the one at bar can be discontinued by the plaintiff at any time and without having any regard to the interests of the parties on whose behalf the action is apparently brought. We think that prior to this decision the appellants had a right to rely upon the decision which had been made by this court, that in this form of action the plaintiff did not represent himself only, but also those upon whose behalf he had confessedly brought the action.

It was also apparently the law that the other creditors could not each bring an independent action (Pfohl v. Simpson, 74 N. Y. 137), but that the rights of all must be determined in the one action brought. This view of the law, however, was also pronounced incorrect in the case of Hirshfeld v. Fitzgerald (supra), where it was held that any creditor might sue notwithstanding the pendency of an action brought on his behalf, and it is claimed that the appellants should be remitted to their independent action.

In view of the apparent difference of decision upon this question by the court of last resort we do not think that the appellants should be compelled to run the hazard of being finally prevented from proceeding in their independent action, if brought, by the application •of the rule laid down in Pfohl v. Simpson (supra).

As to the objection that certain of the defendants are in default ••and, therefore, no greater judgment can be taken against them than that demanded in the original complaint, it may be observed that no greater judgment is taken against them. The action, in any event, results in an interlocutory judgment which will be the same whether •one creditor suing in behalf of all others is the plaintiff or other •creditors are parties plaintiff. All can come in and prove their •claims under the interlocutory judgment.

The objection of the Statute of Limitations is just as available as it would have been had the parties come in under the interlocutory judgment. Each creditor has the right to protect himself from a •discontinuance of the action by being made a party, and while he must make his' application in due season he should not be deprived ■of this right unless in justice will result. We can see no reason why .an assignee of a claim has not the same rights as his assignor, and whether he became assignee before or after the commencement of this action, as even if his assignor had been a party, the assignee can be substituted. The appellants acted with diligence as soon as the law was laid down allowing the discontinuance of this class of actions at the will of the nominal plaintiff.

The order appealed from should be reversed and motion granted, with ten dollars costs of appeal to appellant.

Barrett, Ruhsey and Patterrson, JJ., concurred.

Order reversed and motion granted, with ten dollars costs of appeal to appellant.  