SUPREME COURT OF NEW YORK, APPELLATE DIVISION, FIRST DEPARTMENT
December 3, 1968
HERLINDA GANEM DE ISSA ET AL., PLAINTIFFS, AND GANEM & CIA ET AL., INTERVENING PLAINTIFFS-RESPONDENTS,
ELIAS GANEM, DEFENDANT, AND ROYAL BANK OF CANADA, APPELLANT
Concur -- Stevens, J. P., Eager, Steuer, Tilzer and McGivern, JJ.
While the law of New York governs matters of procedure, the law of the country where an entity is created governs the issue of authority to act on its behalf. Where a challenge is made as to the authority to act for foreign entities on their application to intervene in a pending action in this jurisdiction, the interests of the litigants as well as proper utilization of judicial time and effort require that the question of participation be disposed of at the threshold. It was an improvident exercise of discretion for Special Term to have granted intervention without a preliminary determination of movants' authority. Accordingly, the disposition of the motion to intervene should be withheld pending a hearing before a Special Referee to hear and report on the issue of movants' authority. The motion shall be referred to the same Special Referee who now has under consideration another question of jurisdiction in this action. The motion to intervene is therefore remanded to Special Term for disposition upon the coming in of the Special Referee's report. Settle order on notice.
Order entered July 15, 1968, unanimously reversed on the law and the facts, with costs and disbursements to abide the event, and the motion to intervene is granted to the extent hereinafter indicated.
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