Have you ever considered whether you could be held personally liable for signing company documents? Maybe you should, especially if you know the documents are false.
A recent case out of Ohio, Decker v. Wesex, is considering whether the CFO of a construction company can be held personally liable for falsifying affidavits that stated that the construction company was paying its subcontractors. In this case, Wesex was hired to build an office building. Throughout the course of construction, the property owner demanded that Wesex submit payment affidavits, stating that it had paid subcontractors, before the owner would issue payment to Wesex. While Wesex did submit the requested affidavits, the affidavits were falsified in that Wesex had not paid its subcontractors.
Not surprisingly, subcontractors started complaining about not getting paid and ultimately sued both Wesex and the property owner. In response to the lawsuit brought by the subcontractor, the property owner alleged that Wesex’s CFO had fraudulently misrepresented that Wesex had paid its subcontractors and that the CFO should be personally liable for the damage caused to the owner.
The CFO tried to dismiss the property owner’s claims, on a number of grounds, none of which were successful. And, while the case is far from over, the CFO will have to participate in the lawsuit and could be found personally liable for submitting false affidavits to the owner.
It’s never a good idea to submit inaccurate documents on a construction project. Aside from making the company look bad, you could also be personally liable for any damage caused by the falsified documents.
If you are running into problems on a construction project, we recommend that you consult with an experienced construction attorney to understand your risks and potential claims.