NY Not-for-Profit Corporation Law
Article 1, Definitions, Applications
SHORT TITLE; DEFINITIONS; APPLICATION;
CERTIFICATES; MISCELLANEOUS
Section
101. Short title.
102. Definitions.
103. Application.
104. Certificates; requirements, signing, filing,
effectiveness.
104-A. Fees.
105. Certificates; corrections.
106. Certificates as evidence.
107. Corporate seal as evidence.
108. When notice or lapse of time unnecessary; notices
dispensed with when delivery is prohibited.
109. Reservation of power.
110. Effect of invalidity of part of chapter; severability.
111. References.
112. Actions or special proceedings by attorney-general.
113. Certificate of type of not-for-profit corporation.
114. Visitation of supreme court.
115. Power to solicit contributions for charitable purposes.
S 101. Short title.
This chapter shall be known as the "Not-for-Profit Corporation Law"
and may be cited as "N-PCL".
S 102. Definitions.
(a) As used in this chapter, unless the context otherwise requires,
the term:
(1) "Bonds" includes secured and unsecured bonds, debentures, and
notes.
(2) "By-laws" means the code or codes of rules adopted for the
regulation or management of the affairs of the corporation irrespective
of the name or names by which such rules are designated.
(3) "Certificate of incorporation" includes (A) the original
certificate of incorporation or any other instrument filed or issued
under any statute to form a domestic or foreign corporation, as amended,
supplemented or restated by certificates of amendment, merger or
consolidation or other certificates or instruments filed or issued under
any statute; or (B) a special act or charter creating a domestic or
foreign corporation, as amended, supplemented or restated.
(4) "Conducting of activities" of a corporation means the operations
for the conduct of which such corporation is formed and may constitute
"doing of business" or "transaction of business" as those terms are used
in the statutes of this state.
(5) "Corporation" or "domestic corporation" means a corporation (1)
formed under this chapter, or existing on its effective date and
theretofore formed under any other general statute or by any special act
of this state, exclusively for a purpose or purposes, not for pecuniary
profit or financial gain, for which a corporation may be formed under
this chapter, and (2) no part of the assets, income or profit of which
is distributable to, or enures to the benefit of, its members, directors
or officers except to the extent permitted under this statute.
(6) "Director" means any member of the governing board of a
corporation, whether designated as director, trustee, manager, governor,
or by any other title. The term "board" means "board of directors".
(7) "Foreign corporation" means a corporation formed under laws other
than the statutes of this state, which, if formed under the statutes of
this state, would be within the term "corporation or domestic
corporation" as herein defined. "Authorized", when used with respect to
a foreign corporation, means having authority under Article 13 (Foreign
Corporations) to conduct activities of the corporation in this state.
(7-a) "Infant" or "minor" means any person who has not attained the
age of eighteen years.
(8) "Insolvent" means being unable to pay debts as they become due in
the usual course of the debtor`s business.
(9) "Member" means one having membership rights in a corporation in
accordance with the provisions of its certificate of incorporation or
by-laws.
(10) "Not-for-profit corporation" means a corporation as defined in
subparagraph (5).
(11) "Office of a corporation" means the office the location of which
is stated in the certificate of incorporation of a domestic corporation,
or in the application for authority of a foreign corporation or an
amendment thereof. Such office need not be a place where activities are
conducted by such corporation.
(12) "Process" means judicial process and all orders, demands,
notices or other papers required or permitted by law to be personally
served on a domestic or foreign corporation, for the purpose of
acquiring jurisdiction of such corporation in any action or proceeding,
civil or criminal, whether judicial, administrative, arbitrative or
otherwise, in this state or in the federal courts sitting in or for this
state.
(13) "Endowment fund" means an institutional fund, or any part
thereof, not wholly expendable by the corporation on a current basis
under the specific terms of all applicable gift instruments.
(14) "Gift instrument" means a will, deed, grant, conveyance,
agreement, memorandum, court order, writing or other governing document
(including the terms of any institutional solicitations from which an
institutional fund resulted) under which property is transferred to or
acquired by a corporation as an institutional fund.
(15) "Governing board" means the body responsible for the management
of a corporation or of an institutional fund.
(16) "Historic dollar value" means the aggregate fair value in
dollars of (i) an endowment fund at the time it became an endowment
fund, (ii) each subsequent donation to the fund at the time it is made,
and (iii) each accumulation made pursuant to a direction in the
applicable gift instrument at the time the accumulation is added to the
fund. The determination of historic dollar value made in good faith by
the corporation is conclusive.
(17) "Institutional fund" means a fund for the exclusive use, benefit
or purposes of a corporation, held either by the corporation itself or
on behalf of the corporation by a person or entity whose sole authority
with respect to the fund has been delegated by the corporation pursuant
to section 514 (Delegation of investment management), but does not
include (i) a fund held for a corporation by a trustee that is not a
not-for-profit corporation (other than a trustee whose sole authority
with respect to the fund has been delegated by the corporation pursuant
to section 514), or (ii) a fund in which a beneficiary that is not a
not-for-profit corporation has an interest (other than possible rights
that could arise upon violation or failure of the purposes of the fund).
(18) "Authorized person" means a person, whether or not a member,
officer, or director, who is authorized to act on behalf of a
corporation or foreign corporation.
S 103. Application.
(a) Except as otherwise provided in this section, this chapter
applies to every domestic corporation as herein defined, and to every
foreign corporation as herein defined which is authorized to conduct or
which conducts any activities in this state. This chapter also applies
to any other domestic corporation or foreign corporation of any type or
kind to the extent, if any, provided under this chapter or any law
governing such corporation and, if no such provision for application is
made, to the extent, if any, that the membership corporations law
applied to such corporation as of the effective date of this chapter. A
corporation formed by a special act of this state which has as its
principal purpose an education purpose and which is a member of the
university of the state of New York, is an "education corporation" under
section two hundred sixteen-a of the education law.
To the extent that the membership corporations law or the general
corporation law applied to it as of the effective date of this chapter,
the corresponding provisions of this chapter apply to a corporation
heretofore formed by or pursuant to a special act of this state other
than a religious corporation or an "education corporation" under clause
(b) of subdivision one of section two hundred sixteen-a of the education
law, if (1) its principal purpose is a religious, charitable or
education purpose, and (2) it is operated, supervised or controlled by
or in connection with a religious organization. Any such corporation
may elect hereunder at any time after the effective date of this chapter
to file a certificate of type under section one hundred thirteen
(Certificate of type of not-for-profit corporation). Upon the filing of
such certificate by the department of state, this chapter shall apply in
all respects to such corporation.
This chapter also applies to any other corporation of any type or
kind, formed not for profit under any other chapter of the laws of this
state except a chapter of the consolidated laws, to the extent that
provisions of this chapter do not conflict with the provisions of such
unconsolidated law. If an applicable provision of such unconsolidated
law relates to a matter embraced in this chapter but is not in conflict
therewith, both provisions shall apply. Any corporation to which this
chapter is made applicable by this paragraph shall be treated as a
"corporation" or "domestic corporation" as such terms are used in this
chapter, except that the purposes of any such corporation formed or
formable under such unconsolidated law shall not thereby be extended.
For the purpose of this paragraph, the effective date of this chapter as
to corporations to which this chapter is made applicable by this
paragraph shall be September one, nineteen hundred seventy-three.
(b) The general corporation law does not apply to a corporation of
any type or kind to which this chapter applies. A reference in any
statute of this state which makes a provision of the general corporation
law applicable to a corporation of any type or kind to which this
chapter is applicable or a reference in any statute of this state, other
than the membership corporations law, which makes a provision of the
membership corporations law applicable to a corporation of any type or
kind shall be deemed and construed to refer to and make applicable the
corresponding provision, if any, of this chapter.
(c) If any provision in articles one to thirteen inclusive of this
chapter conflicts with a provision of any subsequent articles or of any
special act under which a corporation to which this chapter applies is
formed, the provision in such subsequent article or special act
prevails. A provision of any such subsequent article or special act
relating to a matter referred to in articles one to thirteen inclusive
and not in conflict therewith is supplemental and both shall apply.
Whenever the board of a Type B corporation, formed under a special act,
reasonably makes an interpretation as to whether a provision of the
special act or this chapter prevails, or both apply, such interpretation
shall govern unless and until a court determines otherwise, if such
board has acted in good faith for a purpose which it reasonably believes
to be in the best interests of the corporation, provided however, that
such interpretation shall not bind any governmental body or officer.
(d) This chapter applies to commerce with foreign nations and among
the several states, and to corporations formed by or under any act of
congress, only to the extent permitted under the constitution and laws
of the United States.
(e) The enactment of this chapter shall not affect the duration of a
corporation which is existing on the effective date of this chapter.
Any such existing corporation, its members, directors and officers shall
have the same rights and be subject to the same limitations,
restrictions, liabilities and penalties as a corporation formed under
this chapter, its members, directors and officers.
(f) This chapter shall not affect any cause of action, liability,
penalty or action or special proceeding, which on the effective date of
this chapter, is accrued, existing, incurred or pending but the same may
be asserted, enforced, prosecuted or defended as if this chapter had not
been enacted.
S 104. Certificates; requirements, signing, filing, effectiveness.
(a) Every certificate or other instrument relating to a domestic or
foreign corporation which is delivered to the department of state for
filing under this chapter, other than a certificate of existence under
section 1304 (Application for authority; contents), shall be in the
English language, except that the corporate name may be in another
language if written in English letters or characters.
(c) Whenever such instrument is required to set forth the date of
incorporation or the date when a certificate of incorporation was filed,
the original certificate of incorporation is meant. This requirement
shall be satisfied, in the case of a corporation created by special act,
by setting forth the chapter number and year of passage of such act.
(d) Every such certificate required under this chapter to be signed
and delivered to the department of state shall, except as otherwise
specified in the section providing for such certificate, be signed
either by an officer, director, attorney-in-fact or duly authorized
person and include the name and the capacity in which such person signs
such certificate.
(e) If an instrument which is delivered to the department of state
for filing complies as to form with the requirements of law and there
has been attached to it the consent or approval of the supreme court
justice, governmental body or officer, or, other person or body, if any,
whose consent to or approval of such instrument or the filing thereof is
required by any statute of this state and the filing fee and tax, if
any, required by any statute of this state in connection therewith have
been paid, the instrument shall be filed and indexed by the department
of state. No certificate of authentication or conformity or other proof
shall be required with respect to any verification, oath or
acknowledgment of any instrument delivered to the department of state
under this chapter, if such verification, oath or acknowledgment
purports to have been made before a notary public, or person performing
the equivalent function, of one of the states, or any subdivision
thereof, of the United States or the District of Columbia. Without
limiting the effect of section four hundred three of this chapter,
filing and indexing by the department of state shall not be deemed a
finding that a certificate conforms to law, nor shall it be deemed to
constitute an approval by the department of state of the name of the
corporation or the contents of the certificate, nor shall it be deemed
to prevent any person with appropriate standing from contesting the
legality thereof in an appropriate forum.
(f) Except as otherwise provided in this chapter, such instrument
shall become effective upon the filing thereof by the department of
state.
(g) The department shall make, certify and transmit a copy of each
such instrument to the clerk of the county in which the office of the
domestic or foreign corporation is or is to be located. The county
clerk shall file and index such copy.
S 104-A. Fees.
Except as otherwise provided, the department of state shall collect
the following fees pursuant to this chapter:
(a) For filing a certificate of type of not-for-profit corporation
pursuant to section one hundred thirteen of this chapter, thirty
dollars.
(b) For the reservation of a corporate name pursuant to section three
hundred three of this chapter, ten dollars.
(c) For the resignation of a registered agent for service of process
pursuant to section three hundred five of this chapter, thirty dollars.
(d) For service of process on the secretary of state pursuant to
section three hundred six or three hundred seven of this chapter, forty
dollars. If the service is in an action brought solely to recover a sum
of money not in excess of two hundred dollars and the process is so
endorsed, or the process is served on behalf of a county, city, town or
village or other subdivision of the state, ten dollars.
(e) For filing a certificate of incorporation pursuant to section four
hundred two of this chapter, seventy-five dollars.
(f) For filing a certificate of amendment pursuant to section eight
hundred three of this chapter, thirty dollars.
(g) For filing a certificate of change pursuant to section eight
hundred three-A of this chapter, twenty dollars.
(h) For filing a restated certificate of incorporation pursuant to
section eight hundred five of this chapter, thirty dollars.
(i) For filing a certificate of merger or consolidation pursuant to
section nine hundred four of this chapter, thirty dollars.
(j) For filing a certificate of merger or consolidation of domestic
and foreign corporations pursuant to section nine hundred six of this
chapter, thirty dollars.
(k) For filing a certified copy of an order of approval of the
supreme court pursuant to section nine hundred seven of this chapter,
thirty dollars.
(l) For filing a certificate of dissolution pursuant to section one
thousand three of this chapter, thirty dollars.
(m) For filing a certificate of annulment of dissolution pursuant to
section one thousand twelve of this chapter, thirty dollars.
(n) For filing an application by a foreign corporation for authority
to do business in New York state pursuant to section thirteen hundred
four of this chapter, one hundred thirty-five dollars.
(o) For filing a certificate of amendment of an application for
authority by a foreign corporation pursuant to section thirteen hundred
nine of this chapter, thirty dollars.
(p) For filing a certificate of change of application for authority by
a foreign corporation pursuant to section thirteen hundred ten of this
chapter, twenty dollars.
(q) For filing a certificate of surrender of authority pursuant to
section thirteen hundred eleven of this chapter, thirty dollars.
(r) For filing a statement of the termination of existence of a
foreign corporation pursuant to section thirteen hundred twelve of this
chapter, thirty dollars. There shall be no fee for the filing by an
authorized officer of the jurisdiction of incorporation of a foreign
corporation of a certificate that the foreign corporation has been
dissolved or its authority or existence has been otherwise terminated or
cancelled in the jurisdiction of its incorporation.
(s) For filing any other certificate or instrument, thirty dollars.
S 105. Certificates; corrections.
Any certificate or other instrument relating to a domestic or foreign
corporation filed by the department of state under this chapter may be
corrected with respect to any informality or error apparent on the face
or defect in the execution thereof including the deletion of any matter
not permitted to be stated therein. A certificate, entitled "Certificate
of correction of.......... (correct title of certificate and name of
corporation)" shall be signed and delivered to the department of state.
It shall set forth the name of the corporation, the date the certificate
to be corrected was filed by the department of state, the provision in
the certificate as corrected or eliminated and if the execution was
defective, the proper execution. The filing of the certificate by the
department of state shall not alter the effective time of the instrument
being corrected, which shall remain as its original effective time, and
shall not affect any right or liability accrued or incurred before such
filing. A corporate name may not be changed or corrected under this
section.
S 106. Certificates as evidence.
(a) Any certificate or other instrument filed by the department of
state relating to a domestic or foreign corporation and containing
statements of fact required or permitted by law to be contained therein,
shall be received in all courts, public offices and official bodies as
prima facie evidence of such facts and of the execution of such
instrument.
(b) Whenever by the laws of any jurisdiction other than this state,
any certificate by any officer in such jurisdiction or a copy of any
instrument certified or exemplified by any such officer may be received
as prima facie evidence of the incorporation, existence or capacity of
any foreign corporation incorporated in such jurisdiction, or claiming
so to be, such certificate when exemplified, or such copy of such
instrument when exemplified shall be received in all courts, public
offices and official bodies of this state, as prima facie evidence with
the same force as in such jurisdiction. Such certificate or certified
copy of such instrument shall be so received, without being exemplified,
if it is certified by the secretary of state, or official performing the
equivalent function as to corporate records, of such jurisdiction.
S 107. Corporate seal as evidence.
The presence of the corporate seal on a written instrument purporting
to be executed by authority of a domestic or foreign corporation shall
be prima facie evidence that the instrument was so executed.
S 108. When notice or lapse of time unnecessary; notices dispensed with
when delivery is prohibited.
(a) Whenever, under this chapter or the certificate of incorporation
or by-laws of any corporation or by the terms of any agreement or
instrument, a corporation or the board or any committee thereof is
authorized to take any action after notice to any person or persons or
after the lapse of a prescribed period of time, such action may be taken
without notice and without the lapse of such period of time, if at any
time before or after such action is completed the person or persons
entitled to such notice or entitled to participate in the action to be
taken or, in the case of a member, by his attorney-in-fact, submit a
signed waiver of notice of such requirements.
(b) Whenever any notice or communication is required to be given to
any person by this chapter, the certificate of incorporation or by-laws,
or by the terms of any agreement or instrument, or as a condition
precedent to taking any corporate action and communication with such
person is then unlawful under any statute of this state or of the United
States or any regulation, proclamation or order issued under said
statutes, then the giving of such notice or communication to such person
shall not be required and there shall be no duty to apply for license or
other permission to do so. Any affidavit, certificate or other
instrument which is required to be made or filed as proof of the giving
of any notice or communication required under this chapter shall, if
such notice or communication to any person is dispensed with under this
paragraph, include a statement that such notice or communication was not
given to any person with whom communication is unlawful. Such
affidavit, certificate or other instrument shall be as effective for all
purposes as though such notice or communication had been personally
given to such person.
(c) Whenever any notice or communication is required or permitted by
this chapter to be given by mail, it shall, except as otherwise
expressly provided in this chapter, be mailed to the person to whom it
is directed at the address designated by him for that purpose or, if
none is designated, at his last known address. Such notice or
communication is given when deposited, with postage thereon prepaid, in
a post office or official depository under the exclusive care and
custody of the United States post office department. Such mailing shall
be by first class mail except where otherwise required by this chapter.
S 109. Reservation of power.
The legislature reserves the right, at pleasure, to alter, amend,
suspend or repeal in whole or in part this chapter, or any certificate
of incorporation or any authority to do business in this state, of any
domestic or foreign corporation, whether or not existing or authorized
on the effective date of this chapter.
S 110. Effect of invalidity of part of chapter; severability.
If any provision of this chapter or application thereof to any person
or circumstances is held invalid, such invalidity shall not affect other
provisions or applications of this chapter which can be given effect
without the invalid provision or application, and to this end the
provisions of this chapter are declared severable.
S 111. References.
Unless otherwise stated, all references in this chapter to articles or
sections refer to the articles or sections of this chapter, and all
references in any section of this chapter to a lettered or numbered
paragraph or subparagraph refer to the paragraph or subparagraph so
lettered or numbered in such section.
S 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 Type B or Type C 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 Type B
or Type C 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 Type
A corporation. For such purpose, the attorney-general shall have the
same status as such members, director or officer.
(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 type or kind and foreign
corporations of any type or 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).
S 113. Certificate of type of not-for-profit corporation.
(a) Every corporation to which this chapter applies and which is in
existence on September 1, 1970, except those described in paragraph (b)
of this section, shall in all respects be considered a type B
corporation unless it shall deliver to the department of state a signed
certificate, entitled "Certificate of type of not-for-profit corporation
of ............(name of corporation) under section 113 of the
Not-for-Profit Corporation Law", or unless its certificate of
incorporation has been amended to state its type under section 201
(Purposes). A certificate of type shall set forth:
(1) The name of the corporation and, if its name has been changed,
the name under which it was formed.
(2) The date its certificate of incorporation was filed by the
department of state and the law under which it was formed.
(3) A designation of the secretary of state as agent of the
corporation upon whom process against it may be served and post office
address within or without this state to which the secretary of state
shall mail a copy of any process against it served upon him.
(4) That under section 201 (Purposes) it is a Type ..... (insert A,
B, C or D) not-for-profit corporation as defined in this chapter.
(b) The following corporations are exempt from the provisions of
paragraph (a).
(1) A corporation to which is applicable, and whose type is determined
by, the education law, the religious corporations law and the private
housing finance law.
(2) A corporation formed under an article of the membership
corporations law or any predecessor general law or special act, which if
formed currently would be formable under, and its type determined by, a
section of article fourteen hereof.
(3) A corporation otherwise within the provisions of paragraph (a),
which has as its principal purpose a religious, educational or
charitable purpose, and is operated, supervised or controlled by or in
connection with a religious corporation.
(4) A corporation having a right under paragraph (a) of section 103
(Application) to elect to file a certificate of type under this section.
(5) Anything to the contrary herein notwithstanding any corporation
exempt hereunder may deliver a certificate of type described in
paragraph (a) to the department of state.
(d) A corporation formed by or pursuant to a special act which elects
to file a certificate of type, as authorized under paragraph (a) of
section 103 (Application), shall file at any time after the effective
date of this chapter a certificate of type setting forth, in addition to
the items in subparagraphs (1) through (4) of paragraph (a), a statement
that it elects to have this chapter apply in all respects to it.
S 114. Visitation of supreme court.
Type B and Type C corporations, whether formed under general or
special laws, with their books and vouchers, shall be subject to the
visitation and inspection of a justice of the supreme court, or of any
person appointed by the court for that purpose. If it appears by the
verified petition of a member or creditor of any such corporation, that
it, or its directors, officers or agents, have misappropriated any of
the funds or property of the corporation, or diverted them from the
purpose of its incorporation, or that the corporation has acquired
property in excess of the amount which it is authorized by law to hold,
or has engaged in any business other than that stated in its certificate
of incorporation, the court may order that notice of at least eight
days, with a copy of the petition, be served on the corporation and the
persons charged with misconduct, requiring them to show cause at a time
and place specified, why they should not be required to make and file an
inventory and account of the property, effects and liabilities of such
corporation with a detailed statement of its transactions during the
twelve months next preceding the granting of such order. On the hearing
of such application, the court may make an order requiring such
inventory, account and statement to be filed, and proceed to take and
state an account of the property and liabilities of the corporation, or
may appoint a referee for that purpose. When such account is taken and
stated, after hearing all the parties to the application, the court may
enter a final order determining the amount of property so held by the
corporation, its annual income, whether any of the property or funds of
the corporation have been misappropriated or diverted to any other
purpose than that for which such corporation was incorporated, and
whether such corporation has been engaged in any activity not covered by
its certificate of incorporation. An appeal may be taken from the order
by any party aggrieved to the appellate division of the supreme court,
and to the court of appeals, as in a civil action. No corporation shall
be required to make and file more than one inventory and account in any
one year, nor to make a second account and inventory, while proceedings
are pending for the statement of an account under this section.
S 115. Power to solicit contributions for charitable purposes.
No corporation having the power to solicit contributions for
charitable purposes may solicit contributions for any purpose for which
approval of such solicitation is required under the provisions of
section four hundred four of this chapter unless the certificate
specifically makes provision for such solicitation and the required
written approval is endorsed on or annexed to such certificate or unless
the corporation is among those referred to in section one hundred
seventy-two-a of the executive law. If such approval is not obtained
and the corporation continues to solicit or to receive contributions for
such purpose or advertises that it has obtained such approval, the
attorney general, at the request of the officer or body authorized to
grant such approval, shall maintain an action or proceeding pursuant to
the provisions of subparagraph one of paragraph (a) of section one
hundred twelve of this chapter. Such an action may also be maintained
in relation to a corporation hereinafter incorporated if the name,
purposes, objects or the activities of such corporation may, in any
manner, lead to the belief that the corporation possesses or may
exercise any of such purposes.
