State v. Rollfink

469 N.W.2d 398, 162 Wis. 2d 121, 22 Envtl. L. Rep. (Envtl. Law Inst.) 20203, 33 ERC (BNA) 1507, 1991 Wisc. LEXIS 309
CourtWisconsin Supreme Court
DecidedMay 23, 1991
Docket89-1908
StatusPublished
Cited by14 cases

This text of 469 N.W.2d 398 (State v. Rollfink) is published on Counsel Stack Legal Research, covering Wisconsin Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State v. Rollfink, 469 N.W.2d 398, 162 Wis. 2d 121, 22 Envtl. L. Rep. (Envtl. Law Inst.) 20203, 33 ERC (BNA) 1507, 1991 Wisc. LEXIS 309 (Wis. 1991).

Opinion

LOUIS J. CECI, J.

This case is before the court on certification from the court of appeals, pursuant to sec. (Rule) 809.61, Stats. The certified question is whether a corporate officer has sufficient ownership and control of the corporation, although not directly involved in any wrongdoing, to be held personally liable for violations of Wisconsin's solid and hazardous waste laws by the corporation. We hold that a corporate officer is personally liable for violations of Wisconsin's solid and hazardous waste laws committed by the corporation if the officer is responsible for the overall operation of the corporation's facility which violated the law.

The State of Wisconsin (the state) commenced this action against Herman Rollfink (the defendant) and W.O.W. Distributing Co., Inc. (W.O.W.), 1 seeking, inter alia, forfeitures from the defendant for violating secs. 144.44(4)(a) and 144.63, Stats. 2 The state alleged that the defendant violated secs. 144.44(4)(a) and 144.63, *126 respectively, by operating a facility that generated hazardous waste 3 without a license and by operating a facility which did not identify, handle, and dispose of its hazardous waste in the manner required by sec. 144.63.

The defendant appeals from a judgment of the circuit court for Washington county, Richard T. Becker, Circuit Judge. The circuit court granted summary judgment in favor of the state on the issue of the defendant's *127 liability and, after an adversarial hearing on the issue of forfeitures, imposed forfeitures, penalties, and court costs against the defendant in the amount of $9,946.00. In granting summary judgment on the issue of the defendant's liability, the court ruled that the defendant could be held personally liable for violations of secs. 144.44(4) (a) and 144.63, Stats., committed by Pro Specialties, Inc. (PSI), a corporation in which he owned a majority of the stock and served as president, chief executive officer, and chairman of the board. The circuit court reasoned that the defendant's ultimate control of PSI's facility 4 which violated secs. 144.44(4) (a) and 144.63 made him an "operator" 5 of a hazardous waste facility, and operators of hazardous waste facilities are *128 personally liable for violations of ch. 144, Stats. 6

One issue is presented by this appeal: 7 whether the defendant was an operator of a hazardous waste facility within the meaning of former Wis. Admin. Code sec. NR 181.04(70). We hold that the defendant was an operator within the meaning of sec. NR 181.04(70) because the undisputed evidence in the record shows that he was "responsible for the overall operation" 8 of a hazardous waste facility. Accordingly, we affirm the judgment of the circuit court.

The material facts relevant to this appeal are not in dispute. On June 10, 1987, the state commenced this action against the defendant and W.O.W., seeking, among other things, forfeitures for violations of secs. 144.44(4) (a) and 144.63, Stats. On April 11, 1988, the defendant brought a motion for summary judgment against the state, arguing that he could not be held liable for PSI's violations of secs. 144.44(4)(a) and 144.63 because a corporate officer cannot be held liable for the illegal acts of a corporation unless the corporate officer personally participated in the illegal activity, and the state does not contend that he personally participated in the acts that violated secs. 144.44(4)(a) and 144.63.

*129 In support of his motion, the defendant relied in part upon his own affidavit in which he averred that he did not exercise or assume responsibility for the day-today operations of PSI's facility and that he did not authorize, permit, supervise, or participate in the disposal of materials in violation of secs. 144.44(4) (a) and 144.63. The defendant also averred that he delegated responsibility for ensuring compliance with hazardous waste laws to his subordinates.

On June 3, 1988, the state filed a motion for summary judgment against the defendant, arguing that the defendant was an operator of a hazardous waste facility because he was responsible for the overall operation of PSI's facility which produced and disposed of hazardous waste. In support of its motion, the state relied in part on affidavits and deposition testimony of former PSI employees and documents concerning PSI's operations and personnel matters.

Hem Vakharia, who served as PSI's Vice President of Research and Development and whose duties included updating PSI's data on hazardous waste, stated in an affidavit that the defendant had general knowledge of the entire operation of PSI's plant and had the power to direct and control all employees. Mr. Vakharia further averred that the defendant would inquire at least weekly, if not daily, of the staff in the shipping and production departments and that the defendant controlled all financial aspects of PSI. For example, Mr. Vakharia averred that the defendant handled all incoming checks and deposits and controlled all expenditures of money, such as making the decision to purchase new machinery or raw chemical supplies. Mr. Vakharia also averred that he was hired by the defendant and that the defendant fired him after he repeatedly informed the defendant and other PSI employees and stockholders that PSI's facility *130 did not have the capability to legally dispose of its hazardous waste.

The state also relied in part upon the deposition testimony of Janice Finke, who was hired by the defendant to perform administrative functions for PSI, such as processing incoming orders and accounts receivable, keeping sales records, and handling phone contact with sales representatives and customers. Mrs. Finke testified that no financial decision concerning PSI was made without input from the defendant and that the defendant was part of every hiring decision. Mrs. Finke further testified that all checks to pay creditors or payroll were either signed by the defendant or approved by the defendant. Mrs. Finke also testified that the defendant was in charge of such matters as obtaining advertising to sell shares in PSI, paying insurance premiums for the employee benefit plans, and directing an attempt to obtain Small Business Administration funding. Mrs. Finke's deposition also contains the following exchange:

Q: And Mr. Rollfink [the defendant] was the person, while you were there [at PSI] at least, that controlled the operations of the company?
A: He was the principal owner.

The state contended that the above-quoted exchange, along with Mrs. Finke's other testimony, established that the defendant was responsible for the overall operation of PSI's facility.

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469 N.W.2d 398, 162 Wis. 2d 121, 22 Envtl. L. Rep. (Envtl. Law Inst.) 20203, 33 ERC (BNA) 1507, 1991 Wisc. LEXIS 309, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-v-rollfink-wis-1991.