A Wisconsin Supreme Court decision issued July 19, 2011 has significant implications regarding liability of corporate officers for negligence.

Business Law Wausau: Commentary

In order to protect one’s personal assets against liability claims, corporate officers may want to consider obtaining Directors and Officers Insurance.

Casper v. American International South Ins. Co, 2011 WI 81 involved a motor vehicle accident.  Mark Wearing, a co-employee of Bestway Systems, Inc. (“Bestway”) and Transport Leasing/Contract Inc. (“TLC”), struck the Caspers’ minivan from behind, seriously injuring all five people in the Casper family’s vehicle.  Wearing was found to be abusing three prescription drugs at the time of the accident.

Bestway’s CEO, Jeffrey Wenham, was named as a defendant in the ensuing lawsuit.  He was not involved in the hiring or supervision of Wearing and, in fact, had never even met him.  Wenham had, however, approved the trucking route used by Wearing a year and a half earlier.  The route required Wearing to drive 536 miles through several states overnight, which purportedly violated federal trucking laws. The argument was made he could not be held personally liable for negligence committed with the scope of his employment.

The unanimous court refused to accept this argument, in effect acknowledging that there could be circumstances when a corporate officer can be held personally liable for such negligence. The court noted that the even the business judgment rule, which provides protection for corporate officers acting in the course of their duties, protects officers and directors only for negligent acts harming shareholders, not third parties.

The majority decided that the negligence in this particular case was too remote from the injuries to impose personal liability against Wenham.  However, this case stands for the proposition that corporate officers may be personally liable in certain circumstances, thus increasing the possibility corporate officers and directors will be named as individual defendants and subject to liability in tort actions.

Business Law Wausau WI: Attorney Contact Info

Get more information about business law Wausau WI. Learn more about the divorce process, property division and family law in Wausau WI from a business law attorney.  If you have questions about corporate officer liability or other matters related to your business, call an attorney specializing in business law Wausau WI for a free telephone consultation. Call 715.843.6700 to speak with a lawyer practicing business law Wausau WI.  Business attorney wausau serving clients throughout north central Wisconsin.

Attorneys specializing in business law Wausau WI: Eaton Law, LLP