N.Y. Banking Law § 9-a: Defense of ultra vires

§ 9-a. Defense of ultra vires.

No act of a corporation formed under this chapter, or of a corporation

formed under any other statute or special act having as its purpose or

among its purposes a purpose for which a corporation may be formed under

this chapter, and no transfer of real or personal property to or by such

a corporation, otherwise lawful, shall be invalid by reason of the fact

that the corporation was without capacity or power to do such act or to

make or receive such transfer, but such lack of capacity or power may be

asserted:

1. In an action by a stockholder or member against the corporation to

enjoin the doing of any act or the transfer of real or personal property

by or to the corporation. If the unauthorized act or transfer sought to

be enjoined is being, or is to be, performed or made under any contract

to which the corporation is a party, the court may, if all of the

parties to the contract are parties to the action and if it deems the

same to be equitable, set aside and enjoin the performance of such

contract, and in so doing may allow to the corporation or to the other

parties to the contract, as the case may be, such compensation as may be

equitable for the loss or damage sustained by any of them from the

action of the court in setting aside and enjoining the performance of

such contract; provided that anticipated profits to be derived from the

performance of the contract shall not be awarded by the court as a loss

or damage sustained.

2. In an action by or in the right of the corporation to procure a

judgment in its favor against an incumbent or former officer or director

of the corporation for loss or damage due to his unauthorized act.

3. In an action or special proceeding by the superintendent or the

attorney-general to annul or dissolve the corporation or to enjoin it

from the doing of unauthorized business.