Court Opinion

ID: 9560665
Source: CourtListenerOpinion
Date Created: 2023-08-21 17:53:28.958383+00
Date Added: 2024-06-11T09:13:05.348381
License: Public Domain

PETERSON, C. J.,
concurring.
It stretches comprehension to believe that any corporation would authorize an employee to ingest chocolate mescaline to “give [the employee] enough energy to * * * work on *445preparing a bid for the remodeling project.” 305 Or at 441 (1988). But corporations, though incorporeal, are created by and operated by human beings, humans often do strange, incomprehensible deeds, and therefore corporations can, as well. I concur with the majority without reservation, but write separately to state why I concur.
ORS 60.301 states that “[a]ll corporate powers shall be exercised by or under the authority of, and the business and the affairs of the corporation managed under the direction of, the board of directors * * *.” In every corporation, there must be a real person or persons (at some level of management) that act as the mind exercising the discretion of the corporation.
Viewing the pleadings, affidavits and exhibits in the light most favorable to the plaintiff, this is a case in which a real person was the sole promoter of the corporation, the president of the corporation, the sole person acting in a management capacity in terms of preparing and placing bids for construction jobs and deploying the necessary employees to carry out the work and the person that committed the tortious act. It is undisputed that Barmon’s knowledge was the corporation’s knowledge. We do not have before us the traditional respondeat superior situation in which the questions are (1) whether a tortious act by a subordinate employee was within the time and space limits authorized by the corporation’s policymaking or management employees, (2) whether the subordinate employee was motivated, at least in part, by a purpose to serve the employer, and (3) whether the act of the subordinate was of a kind which the employer’s policymaking or management employees hired the subordinate employee to perform.
In Johnson v. Alabama Fuel and Iron Co., 166 Ala 534, 52 So 312 (1910), the general manager of a coal mine (operated by the defendant corporation) “arrested plaintiffs intestate,” who was living in a tent near the mine, and later shot him to death. The plaintiff sought to hold the corporation liable for the acts of its general manager. The court held that the corporation was not liable, stating:
“We find in these facts no warrant for the inference that the murder of plaintiffs intestate was accomplished by [the general manager] while in the execution of his agency. Nor is the controlling principle, or its application to the facts, affected *446by the consideration that Adams was a vice principal for the defendant corporation, if it be a fact that he was a vice principal. Corporations may, and often do, create vice principals, who in their general management of the corporate business so partake of the corporate entity that their acts have the same effect upon corporate responsibility as if done or expressly authorized by the governing board or stockholders, and so corporations may become responsible in cases for the indictable crimes of their agents. But this does not impair the doctrine that the corporation is bound only when its vice principal acts, however improperly, negligently, or maliciously, in the execution of corporate functions. When he steps wholly aside from his authority, and does an act to gratify personal malignity, or to accomplish some other purpose personal to himself and having no relation to the business of the corporation, as, for aught appearing to the contrary, was the case here, the corporate master is no longer responsible.”
Id. at 536-37, 52 So at 313, quoted with approval in 10 Fletcher Cyc Corp 325-26, § 4877 (Perm ed 1986).
In Fields v. Lancaster Cotton Mills, 77 SC 546, 58 SE 608 (1907), a corporation was held liable when the superintendent of a cotton mill directed and participated in the assault of one who sought to lure cotton mill employees to other jobs. The court held that Lancaster Cotton Mills was liable for the acts of the superintendent because he was entrusted with the control of its policies and the methods to be employed to prevent interference with its employees:
“The superintendent of a cotton mill is usually the representative of the mill with respect to the hiring and management of its operatives, and other features of its mechanical operations. The evidence on the part of the defendant shows the superintendent, in this instance, was intrusted with the control of its policy and the methods to be employed to prevent interference with the operatives. The Lancaster Cotton Mill cannot, therefore, escape the liability to third persons for any actions taken by him with respect to the matters it had placed under his control. It makes no difference that the action was unlawful and that it would not have been sanctioned by the corporation itself.”
Id. at 549, 58 SE at 609.
Although the foregoing cases are not sole-shareholder cases, they state the premise that the corporation is liable for *447the acts of one entrusted with the control of the company policy if the act was in the execution of a corporate function. Conversely, the corporation is not liable if the employee’s act is unrelated to any corporate purpose. Newer cases reflect the concept that by giving one powers of management, the corporation “must be held to have invested him with authority to make decisions for it, when necessary, in connection with the performance of those duties. When made, the [employee’s] judgment becomes the judgment of the defendant.” Panjwani v. Star Service & Petroleum Company, 395 SW2d 129, 132 (Mo 1965) (quoting Bova v. St. Louis Public Service Co., 316 SW2d 140, 144 (Mo App 1958) (holding corporation vicariously liable for assault on customer by assistant manager “as customer was engaged in trying to settle a controversy concerning a portion of defendant’s business”).
Cornell v. Albuquerque Chemical Co., Inc., 92 NM 121, 584 P2d 168 (NM Ct App 1978), is to that effect. In that case the vice president of the defendant corporation ran the corporation along with family members who were corporate officers. The vice president, along with another corporate employee, wrongfully repossessed a chemical sprayer and resold it. The court stated that the vice president’s acts “were the acts of the corporation” in light of evidence that the vice president
“bought and sold used equipment, managed the employees, hired and fired them, signed the checks * * * and [performed all] of the duties necessary to running the business. He was in charge of the day-to-day functions of the business. * * * It was a family corporation with [the vice president] as the one man who ‘wielded the executive power of the corporation.’ He was authorized to commit these acts.”
Id. at 126, 584 P2d at 173.
Barmon is in a like position here. Summary judgment in favor of the corporate employer was therefore improper. At some future time we may have to determine whether vicarious corporate liability may result when a corporate manager without authority to make policy but with authority to exercise supervision with respect to the manner in which the duties of other corporate employees are carried out or fulfilled authorizes a subordinate employee to take a drug to “better” perform work for the employer. This is not that case. Here the person *448charged with making company policy committed the act that is claimed to be tortious. I therefore concur.
Lent, J., joins in this concurring opinion.