Designer Surfaces, Inc., fabricated and installed countertops. Designer’s corporate officers were Howard Berger and John McCarthy. The company bought materials from Arizona Tile, LLC, on an open account. When Designer became insolvent, it could not pay Arizona Tile the balance due, including amounts for materials for which Designer had already received payment. Arizona Tile filed a suit in an Arizona state court against Berger and McCarthy for diverting corporate funds. Arizona Tile argued that the use of the funds for purposes other than to pay for the materials was a breach of fiduciary duty. Berger and McCarthy argued that corporate law did not impose on corporate officers a fiduciary duty or personal liability for breach of such a duty to suppliers of materials. Which argument is more credible and why? [Arizona Tile, LLC v. Berger, 223 Ariz. 491, 224 P.3d 988 (Ariz.App. 2010)] (See Duties of Directors and Officers.)

Answer rating: 100% (QA)

1 Arizona Tile LLC sold materials on an open record to Designer Surfaces Inc an Arizona partnership Fashioner Surfaces top managerial staff consisted of just two people Howard Berger and John McCarthy ... View the full answer