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A CORPORATE OFFICER OR SHAREHOLDER CANNOT BE PERSONALLY LIABLE FOR NONFEASANCE (DOING NOTHING), AS OPPOSED MISFEASANCE (FIRST DEPT).

The First Department, reversing (modifying) Supreme Court, determined the complaint against the individual defendant, John Milevoi, an officer or shareholder of the  property management company, defendant M&L Milevoi Management, must be dismissed. Plaintiff alleged a leak in the ceiling of her apartment caused her slip and fall:

The complaint should be dismissed against the individual defendant John Milevoi, because there is no allegation that his liability stems from an act of misfeasance or malfeasance, as opposed to nonfeasance. A corporate officer or shareholder may not be held personally liable for a failure to act … . Defendant owner and defendant management company, on the other hand, have not established their entitlement to judgment as a matter of law. De Barcacel v 1015 Concourse Owners Corp., 2022 NY Slip Op 02869, First Dept 4-28-22

Practice Point: A corporate officer or shareholder cannot be personally liable for nonfeasance (doing nothing), as opposed to misfeasance. The complaint against the corporate officer or shareholder here was dismissed. But the complaint against the corporation was not. The corporation is a property management company and plaintiff’s slip and fall complaint alleged there was a water leak in her apartment.

 

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