DAWSON v. WITHYCOMBE

No. 1 CA-CV 06-0043.

163 P.3d 1034 (2007)

John DAWSON, an individual, Plaintiff/Appellee/Cross-Appellant, v. F. Keith WITHYCOMBE and Patricia Withycombe, husband and wife; and Roderick Turner and Terry C. Turner, husband and wife, Defendants/Appellants/Cross-Appellees.

Court of Appeals of Arizona, Division 1, Department C.

July 24, 2007.


Attorney(s) appearing for the Case

Kutak Rock, LLP By E. Scott Dosek, Todd B. Tuggle, Alvin A. Velazquez, Scottsdale, Attorneys for F. Keith Withycombe and Patricia Withycombe.

Shughart Thomson & Kilroy P.C. By Rudolph J. Gerber, Phoenix, Attorneys for Roderick Turner and Terry Turner.

Gallagher & Kennedy, P.A. By Mark C. Dangerfield, Kevin O'Malley, Mark A. Fuller, Phoenix, Attorneys for John Dawson.


OPINION

KESSLER, Judge.

¶ 1 This appeal requires us to clarify when corporate directors may be personally liable to corporate creditors and potential creditors for misrepresentations made by other corporate officers and for constructive fraud. We must also address the scope of the duty of directors to corporate creditors when the corporation enters a zone of insolvency, as well as issues of personal liability for negligent supervision of corporate employees...

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