Read the Full Case Text: http://caselaw.findlaw.com/mt-supreme-court/1018118.html
Diamond Cattle Company sold land, Kimble Properties sold equipment
Lloyd Kimble is president of both Companys
Plaintiffs argue that all the defendants are jointly and severally liable for the misrepresentation and breach of duty due to the fact that the irrigation equipment sold by Kimble Prop and Lloyd Kimble did not work.
The lower court found all three defendants liable.
Is the Agent and Principle liable for the wrong act of the agent?
Agent: A principle is liable for wrongs committed by an agent while the agent acts within the scope of his employment.
Individual: a director or officer is individually liable for his false representation. Personal liability attaches regardless of whether liability also attaches to the corporation. This happens when a director or an officer fradulently acts or makes false representations.
Lloyd Kimble made false representations regarding the irrigation equipment. He was working as an agent of Kimble properties at the time the false representations were made. He was not acting as an agent of Diamond Cattle at the time, which was a seperate transaction.
Lloyd and Kimble Properties were held jointly and severally liable for Llyod's constructive fraud (false representations), but Diamond Cattle was not liable.The court relies on a formalistic approach here instead of a equitable approach.
The companies in this case were separate and there is no theory of enterprise liability here.