However, those individuals who find themselves wielding executive power in a corporation should be mindful that they may be held personally liable if they commit a tort or fraud while acting on behalf of the corporation. The plaintiff sued the president individually under the “participation theory.” The Superior Court determined that the only tortious conduct was the improper installation of a part. Although the President’s day-to-day duties generally included supervising mechanics, there was no evidence that he was actively involved in the particular maintenance work at issue. The general power to supervise or prevent the improper installation, without knowledge that it had occurred, was insufficient participation.
If you are a corporate officer and would like to discuss your potential personal liability in a particular matter or if you would like to institute a lawsuit against a corporation and its individual officers and/or directors, please contact us.