Opinion ID: 294007
Heading Depth: 1
Heading Rank: 3

Heading: Personal and Corporate Responsibility of Licensee

Text: 21 While the Electrical Board does not draw a clear distinction between the responsibility of Belsinger based on his personal knowledge and activity, and the responsibility of appellant based on his position as president of Belsinger Maintenance Corporation, we point out for the guidance of the Board in future cases that there is a distinction. Furthermore, this distinction determines the type of remedy the Board properly could seek, and against whom. 22 If it were found by the Board to be a fact that the appellant held himself out as having the required qualifications, and personally directed or authorized anyone — whether employee of Belsinger Maintenance Corporation or Belsinger Signs, Inc. — to make electrical connections at the Sunoco service stations, it could plausibly be argued that the appellant himself was really acting in excess of his limited master electrician specialist license. With proof of appellant's personal direction or authorization, the illicit electrical connections would be related to appellant's limited electrical license, and suspension thereof would be a proper remedy. 23 But here the record, contrary to the apparent conclusion of the District Judge, does not support such a finding. The appellant himself vigorously denies any such representation, direction, or even knowledge. His action in making the agreement with Kolb Electric intrinsically contradicts any intent on Belsinger's part to utilize his own limited master electrician license. The only evidence tending to impute knowledge to the appellant of the progress of the Sunoco pump installation contract is the testimony of the Secretary of Kolb Electric that he called Belsinger. However, the same witness testified that he was sometimes referred to Dirzuweit, the vice-president and general manager of the Maintenance Corporation, and he made the detailed arrangements with Dirzuweit. Moreover, there is no claim that in any of these conversations appellant was informed that Maintenance Corporation employees were making the electrical connections. 4 In fact, if he had received any such intimation from Kolb Electric, since he himself had made the agreement with Kolb for the performance of this work, Belsinger would probably have acted to force Kolb Electric to carry out its contract. Of any such action by appellant Belsinger the record is silent. 24 On an alternative theory, if the Board is seeking to penalize appellant Belsinger based on his position as president of the Maintenance Corporation, it must prove that he either knew or should have known of the forbidden and dangerous work being done by employees of the Maintenance Corporation, and took no action to stop it. 5 We find that the Board has not sustained this burden. 25 In Am-Chi Restaurant, Inc. v. Simonson 6 the forbidden offensive actions (soliciting for prostitution) grew out of the business (sale of liquor) which the licensee was licensed to conduct and occurred on his premises. Hence the licensee was held to be properly chargeable with responsibility, even though he testified he had no personal notice, and the suspension of his license was upheld by this court. Here the forbidden offensive actions (making electrical connections at gasoline pumps) did not grow out of the business (electrical signs and lighting) which the licensee Belsinger was licensed to conduct. Those actions grew out of the business of the Maintenance Corporation, which has no electrical license. 26 And while it is arguable that because of the two small corporations sharing offices, appellant Belsinger by osmosis ought to have been aware of what the Maintenance Corporation employees were doing out on the job, there is no proper finding to this effect, nor does the record support such a conclusion. The Maintenance Corporation has a vice-president and general manager, Dirzuweit, who made the original contract with Sunoco and whose duties were to conduct the day to day operations of the Maintenance Corporation. It is not enough to simply label appellant as the president of the Maintenance Corporation, without either showing personal knowledge or an obligation arising from his normal official duties to have known of the specific actions complained of. This contract was for no more than twenty-five hundred dollars ($2,500.00), the electrical connections were a small part of it, and there is no reason to infer from the description of appellant's principal duties with the Sign Company and his positions with the other related corporations, that in the exercise of his normal responsibilities as president of the Maintenance Corporation, he would necessarily have become aware of any of the facts made the basis of his license revocation. 7 27 If the basis for the Board's action against appellant rests on his failure properly to discharge his responsibilities as president of the Maintenance Corporation, then the penalty of revocation of a personal electrical license unrelated to the business of the Maintenance Corporation is unjustified and cannot stand. The Board could have sought injunctive action, or perhaps even criminal penalties if authorized, against the Maintenance Corporation and its employees actively participating in the violations, including appellant Belsinger himself if the facts established his responsibility as president of the Maintenance Corporation. 28 On oral argument the Electrical Board sought to attach personal responsibility to appellant Belsinger by theorizing that its action was piercing the corporate veil. But a moment's reflection shows that if, indeed, this was the basis for the Board's action, the wrong corporate veil was pierced. Hamlet illustrates the danger of piercing curtains. At least Shakespeare's character had the right curtain, although he stabbed the wrong man; here the Electrical Board, while sure in its own mind of its mark, pierced the wrong veil and invoked the wrong remedy against the wrong victim. 29 The record makes it clear that the Maintenance Corporation performs strictly mechanical functions in its normal operations, and is not dependent upon a license from the Electrical Board for its continued existence. At the hearing, the Board sought to exercise its power to suspend and revoke licenses. Accordingly, the only corporate veil which could have been pierced was that of Belsinger Signs, Inc., the operations of which are directly dependent upon the continued existence of Belsinger's electrician specialist permit. 30 Judging from the record in this case, this is merely illustrative of the confusion from the beginning as to what the Board was doing, why, where, and to whom. If the Electrical Board's order of suspension stands, the citizens of the District of Columbia will be deprived of the services and the competition offered by Belsinger Signs, Inc. for one year, while Belsinger Maintenance Corporation is left unrestricted to carry on installing gasoline pumps and electrical connections too, in whatever manner it has done in the past.