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Current Developments in the Commercial Divisions of the
New York State Courts by Schlam Stone & Dolan LLP
Posted: January 2, 2020

Corporate Officer May be Held Liable for Corporation’s Tort in Which the Officer Participated

On December 20, 2019, the Fourth Department issued a decision in Canandaigua Natl. Bank & Trust Co. v. Acquest S. Park, LLC, 2019 NY Slip Op. 09130, holding that a corporate officer may be held liable for a corporation’s tort in which the officer participated, explaining:

The sole contention raised by Huntress in support of his motion with respect to the first cross claim was that he could not be personally liable inasmuch as he was acting as an agent of a disclosed principal. We conclude that Huntress failed to establish his entitlement to judgment as a matter of law with respect to that cross claim and, as a result, the burden never shifted to Kingsbury to raise a triable issue of fact.

It is well established that a corporate officer may be held personally liable for a tort of the corporation if he or she committed or participated in its commission, whether or not his or her acts are also by or for the corporation. A cause of action under RPAPL 853 sounds in tort. Here, Huntress failed to establish that he did not participate in the eviction of Kingsbury, and he therefore failed to establish as a matter of law that he cannot be held personally liable if the eviction violated RPAPL 853.

(Internal quotations and citations omitted).

The rule explained in this decision means that a corporate officer cannot escape liability for a tort the officer committed by claiming that it was done for the benefit of the corporation, not the officer individually. Contact Schlam Stone & Dolan partner John Lundin at jlundin@schlamstone.com if you or a client have questions regarding a corporate officer’s liability for actions taken on behalf of the corporation.

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