SER Van Nguyen v. Berger
Annotate this Case
September 1996 Term
_____________
No. 23614
_____________
STATE OF WEST VIRGINIA EX REL.
TRUONG VAN NGUYEN,
Petitioner
v.
HONORABLE IRENE C. BERGER, JUDGE OF THE CIRCUIT
COURT OF KANAWHA COUNTY, AND WILLIAM C. FORBES,
PROSECUTING ATTORNEY FOR KANAWHA COUNTY,
Respondents
________________________________________________________________
WRIT OF PROHIBITION
WRIT DENIED
________________________________________________________________
Submitted: October 1, 1996
Filed: December 16, 1996
Richard L. Gottlieb, Esq. Alvin E. Gurganus, II, Esq.
Lewis, Friedberg, Glasser, Casey & Rollins Shott, Gurganus & Williamson
Charleston, West Virginia Bluefield, West Virginia
Attorneys for the Petitioner Attorneys for the Petitioner
Susan B. Tucker, Esq.
Assistant Prosecuting Attorney
Charleston, West Virginia
Attorney for Respondents
JUDGE RECHT, sitting by temporary assignment, delivered the Opinion of the Court.
JUSTICE CLECKLEY dissents without reserving the right to file a dissenting opinion.
IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA
September 1996 Term
_____________
No. 23655
_____________
STATE OF WEST VIRGINIA,
Appellant
v.
STEVE A. RIFE,
Appellee
__________________________________________________________________
Appeal from the Circuit Court of Kanawha County
Honorable Paul Zakaib, Jr., Judge
Felony Indictment No. 96-F-85
REVERSED AND REMANDED
__________________________________________________________________
Submitted: October 1, 1996
Filed: December 16, 1996
Richard L. Gottlieb, Esq.
Lewis, Friedberg, Glasser, Casey & Rollins
Charleston, West Virginia
Attorneys for the Appellee
Susan B. Tucker, Esq.
Assistant Prosecuting Attorney
Charleston, West Virginia
Attorney for the Appellant
JUDGE RECHT, sitting by temporary assignment, delivered the Opinion of the Court.
JUSTICE CLECKLEY dissents without reserving the right to file a dissenting opinion.
SYLLABUS BY THE COURT
1. Corporate officers can be criminally responsible, along with the
corporation, for the failure to pay workers' compensation premiums and to file workers'
compensation reports within the meaning of W. Va. Code 23-1-16(a) (1995).
2. "Officers, agents, and directors of a corporation may be criminally liable
if they cause the corporation to violate the criminal law while conducting corporate
business." Syllabus Point 5, State v. Childers, 187 W. Va 54, 415 S.E.2d 460 (1992).
3. "The common law, if not repugnant of the Constitution of this State,
continues as the law of this State unless it is altered or changed by the Legislature. Article
VIII, Section 21 of the Constitution of West Virginia; Chapter 2, Article 1, Section 1, of the
Code of West Virginia." Syllabus Point 3, Seagraves v. Legg, 147 W. Va. 331, 127 S.E.2d 605 (1962).
4. "'The common law is not to be construed as altered or changed by
statute, unless legislative intent to do so be plainly manifested.' Shifflette v. Lilly, 130 W.
Va. 297, 43 S.E.2d 289 [1947]." Syllabus Point 4, Seagraves v. Legg, 147 W. Va. 331, 127 S.E.2d 605 (1962).
Recht, Judge:See footnote 1
We are presented here with two cases consolidated for purposes of appeal,
each requiring us to consider whether a corporate officer is criminally responsible, along
with the corporation, for the failure to pay workers' compensation premiums and to file
workers' compensation reports within the meaning of W. Va. Code 23-1-16(a) (1995). The
defendant Truong Van Nguyen petitions this Court for a writ of prohibition to prevent the
Circuit Court of Kanawha County, Judge Irene Berger, from enforcing an order refusing to
grant the defendant's motion to dismiss an indictment for multiple violations of W. Va. Code
23-1-16 (1995). Conversely, the State appeals the granting of a motion to dismiss the
indictment against defendant Steve A. Rife for multiple violations of W. Va. Code 23-1-16
(1995) by the Circuit Court of Kanawha County, Judge Paul Zakaib, Jr.
I.
FACTS
The defendants in this case were indicted in separate proceedings in the
January 1996 term by the Grand Jury for the Circuit Court of Kanawha County. The grand
jury returned multiple count indictments against Van Nguyen, in his capacity as president
of McDowell Energy, Inc., and Rife, in his capacity as president of Black Rock Mining, Inc., both for failing to pay premiums into the Workers' Compensation Fund as well as failing to
file quarterly reports with the Workers' Compensation Commissioner.
The defendants filed motions to dismiss their indictments on the ground that
corporate officers cannot be held criminally liable under W. Va. Code 23-1-16 (1995).
The defendants' motions were considered by different circuit judges, one of
whom agreed with the defendant Rife and dismissed his indictment, with prejudice; the other
of whom denied Mr. Nguyen's motion.
As a result of the circuit court rulings on the defendants' respective motions,
Mr. Nguyen petitions this Court for a writ of prohibition to prevent the circuit court from
enforcing its order, and the State appeals the dismissal of the indictment against Mr. Rife.
Because both cases turn on the same legal issue, we granted both petitions and consolidated
them for purposes of appeal.
II.
DISCUSSION
The sole issue raised in both appeals is whether, under the specific provisions
of W. Va. Code 23-1-16(a) (1995), a corporate officer can be held criminally responsible for
the failure of the corporation to pay workers' compensation premiums as well as the failure
to file quarterly reports.
W. Va. Code 23-1-16 (1995) provides, in relevant part:
(a) Any person, firm, partnership, company, corporation or
association who, as an employer, is required by the provisions
of this chapter to subscribe to the workers' compensation fund, and who knowingly and willfully fails . . . to make any payment
or file a report as required by the provisions of this chapter
within the time periods specified by law, is guilty of a felony,
and, upon conviction thereof, shall be fined not less than one
thousand dollars and not more than ten thousand dollars. . . .
Provided, That in the case of a person other than a natural
person, the amount of the fine shall be not less than ten
thousand dollars nor more than twenty-five thousand dollars.
W. Va. Code 23-1-16 (1995).
The defendants contend that because W. Va. Code 23-1-16(a) (1995) does not
specify corporate officers among those who may be responsible for the non-performance of
the mandatory requirement of paying workers' compensation premiums and submitting
workers' compensation forms, then the statute was not intended to apply to corporate
officers. The argument continues that the statute was designed only to apply to sole
proprietorships and other enumerated business organizations in their capacity as employers,
and not corporate officers, as they are not employers as contemplated within W. Va. Code
23-2-1.See footnote 2
W. Va. Code 23-1-16(a) does impose responsibility upon a corporation and
does not specifically mention officers of the corporation, however, the common law rule is
entrenched in West Virginia to the extent that "[o]fficers, agents, and directors of a
corporation may be criminally liable if they cause the corporation to violate the criminal law
while conducting corporate business." Syllabus Point 5, State v. Childers, 187 W. Va 54,
415 S.E.2d 460 (1992). See also Syllabus Point 3, Bowling v. Ansted Chrysler-Plymouth-
Dodge, Inc., 188 W. Va. 468, 425 S.E.2d 144 (1992) ("An officer of a corporation . . . may
be personally liable for the tortious acts of the corporation, including fraud, if the officer
participated in, approved of, sanctioned, or ratified such acts.")
The rationale behind imputing criminal liability to corporate officers, in
addition to imposing liability upon the corporation, is that "[t]he existence of a corporate
entity does not shield from prosecution corporate agents who knowingly and intentionally
cause the corporation to commit crimes, in that a corporation obviously acts, and can act,
only by and through its member agents and it is their conduct which criminal law must deter and those agents who in facts are culpable."See footnote 3 Childers, 187 W. Va. at 59, 415 S.E.2d at 465
(quoting Miller v. State, 732 P.2d 1054, 1059 (Wyo.1987)). See Syllabus Point 3, Mullins
v. Venable, 171 W. Va. 92, 96, 297 S.E.2d 866, 871 (1982) ("Corporate officers have a duty
to see that their corporation obeys the law.").
The common law rule of imputing criminal liability upon corporate officers
who are responsible for the criminal violations of the corporation continues as part of the law
of this State until and unless the Legislature says otherwise. We have said that "[t]he
common law, if not repugnant of the Constitution of this State, continues as the law of this
State unless it is altered or changed by the Legislature. Article VIII, Section 21 of the Constitution of West Virginia; Chapter 2, Article 1, Section 1, of the Code of West
Virginia." Syllabus Point 3, Seagraves v. Legg, 147 W. Va. 331, 127 S.E.2d 605 (1962).
If the Legislature intends to alter or supersede the common law, it must do so
clearly and without equivocation. Our "common law is not to be construed as altered or
changed by statute, unless legislative intent to do so be plainly manifested." Syllabus Point
4, Seagraves, 147 W. Va. 331, 127 S.E.2d 605 (quoting Shifflette v. Lilly, 130 W. Va. 297,
43 S.E.2d 289 (1947)). See also United States v. Wise, 370 U.S. 405, 409 (1962) ("No intent
to exculpate a corporate officer who violates the law is to be imputed to Congress without
clear compulsion; else the fines established . . . to deter crime become mere license fees for
illegitimate corporate business operations."). Therefore, if the Legislature intends to change
the common law rule so as to exempt corporate officers from criminal liability for criminal
offenses committed by the corporation, it must draft the legislation with language that
explicitly expresses that intent.See footnote 4
Because the common law in this State is clear that a corporate officer can be
held criminally liable for criminal violations of the corporation, does W. Va. Code 23-1-
16(a) (1995) contain express language which plainly and without equivocation exempts
corporate officers from criminal sanctions when the corporations that they control fail to pay
workers' compensation premiums or file timely appropriate reports? The answer is no.
We are assisted in framing this answer by our decision in Mullins v. Venable,
171 W. Va. 92, 297 S.E.2d 866 (1982). In Mullins, we held that civil liability may be
imposed upon corporate officers, under the Wage Payment and Collection Act, to the
employees of the corporation. We noted, in support of our holding, that the Wage Payment
and Collection Act, W. Va. Code 21-5-15 (1981), imposed criminal penalties, including
imprisonment, for willful violations of the bonding provisions in the Act.See footnote 5 Mullins, 171
W. Va. at 95, 297 S.E.2d at 870. We construed W. Va. Code 21-5-15 (1981), which is
similar in language to W. Va. Code 23-1-16 (1995), to impose criminal liability upon
corporate officers from the language "[a]ny person, firm or corporation," despite the absence
of corporate officers being specifically mentioned within this provision of the Wage Payment
Act. Mullins, 171 W. Va. at 95, 297 S.E.2d at 870 (stating that the statute clearly
contemplated that "corporate officers may not hide behind the corporate skirt to escape
liability for their unlawful mischief"). We reasoned that W. Va. Code 21-5-15 (1981) clearly envisioned "personal liability on the part of corporate officers since imprisonment of the
corporation, it having no body, is impossible."See footnote 6 Id.
We find that Mullins v. Venable, while it addresses a different statute within
a different act of the West Virginia Code, is still very persuasive, as the language regarding
who is liable under W. Va. Code 21-5-15 (1981) is substantively similar to that of W. Va.
Code 23-1-16 (1995).
The defendants also contend in support of their position that the legislative rule
regarding the enforcement of reporting and payment requirements under the Workers' Compensation Act provides that corporate officers were not intended by the Legislature to
be liable for the corporation's failure to pay premiums or file quarterly reports.See footnote 7
The term "employer" has the meaning ascribed to that term by
W. Va. Code § 23-2-1, which includes, but is not limited to, any
individual, firm, partnership, limited partnership, copartnership,
joint venture, association, corporation, organization, receiver,
estate, trust, guardian, executor, administrator, or any other
entity regularly employing another person or persons for the
purpose of carrying on any form of industry, service or business
in this state.
85 C.S.R. 11 § 2.8 (1993).
The defendants argue that this regulation, which removed the term "officer"
from its definition when it amended the previous version, clearly indicates the government's
intent not to hold corporate officers responsible for the failure of the corporation to make
payments or file reports under W. Va. Code 23-1-16(a) (1995). We disagree.
As we discussed above, if the Legislature desires to alter or supplant the
common law, its intent must be plainly and clearly manifested. Syllabus Point 4, Seagraves
v. Legg, 147 W. Va. 331, 127 S.E.2d 605 (1962). While the removal of the term "officer"
from legislative rule 85 C.S.R. 11 § 2.8 (1993), would, in isolation, lend support to the
defendants' argument, we are obliged to observe the other alterations made to the section. Significantly, we note that although the definition of "employer" no longer explicitly
includes in its list the term "officer," the Legislature, in amending 85 C.S.R. 11 § 2.8 in
1993, made it clear that the list of persons and entities defined as "employer" was not
intended to be an exhaustive list, as evidenced by the addition of the qualifier "but is not
limited to" in the definition of "employer." Read in its entirety, then, we cannot say that the
Legislature unequivocally expressed an intent to remove officers from the regulation defining
"employer."See footnote 8
Finally, the defendants argue that the use of the language "the officer of any
corporation" in subsection (b) of W. Va. Code 23-1-16 (1995),See footnote 9 is noticeably absent from
the text of subsection (a), and requires us to apply the maxim of statutory construction
known as expressio unius est exclusio alterius, which means the expression of one implies the exclusion of another. Syllabus Point 3, Manchin v. Dunfee, 174 W. Va. 532, 327 S.E.2d 710 (1984). We do not believe that subsections (a) and (b) of W. Va. Code 23-1-16 (1995)
require us to apply the maxim of expressio unius est exclusio alterius. Although these two
subsections are contained within the same section of the West Virginia Workers'
Compensation Act, they create separate and distinct offenses, which was made clearer by the
Legislature's amendment of the section in 1995, whereby the two offenses were removed
from a unified text and placed into separate subsections. The two subsections address
mutually exclusive offenses, and each subsection can be read without doing offense to the
other. Furthermore, W. Va. Code 23-1-16(a) (1995) is clear and unambiguous in that it does
not express an intent to create an exception to our rule under the common law that corporate
officers may be liable for the criminal violations of the corporation. Therefore, because W.
Va. Code 23-1-16(a) (1995) is not vague or ambiguous, there is no need to construe the
statute, and we need not turn to the rules of statutory construction, including the maxim of
expressio unius est exclusio alterius.
III.
CONCLUSION
For the foregoing reasons, we find that the Legislature has not expressed a
clear intent to exempt corporate officers from criminal liability under W. Va. Code 23-1-16
(1995). We therefore conclude that circuit court's order denying Mr. Nguyen's motion to
quash the indictment was proper, and that the circuit court's order granting Mr. Rife's motion
to quash the indictment improperly interpreted the statute and misapplied the law.
Writ denied.
Reversed and remanded.
Footnote: 1
The Honorable Arthur M. Recht resigned as Justice of the West Virginia Supreme
Court of Appeals effective October 15, 1996. The Honorable Gaston Caperton, Governor
of the State of West Virginia, appointed him Judge of the First Judicial Circuit on that same
date. Pursuant to an administrative order entered by this Court on October 15, 1996, Judge
Recht was assigned to sit as a member of the West Virginia Supreme Court of Appeals
commencing October 15, 1996 and continuing until further order of this Court.Footnote: 2
W. Va. Code 23-2-1 provides, in relevant part:
The state of West Virginia and all governmental agencies or
departments created by it, including county boards of education,
political subdivisions of the state, any volunteer fire department
or company and other emergency service organizations as
defined by article five [§ 15-5-1 et seq.], chapter fifteen of this
code, and all persons, firms, associations and corporations
regularly employing another person or persons for the purpose
of carrying on any form of industry, service or business in this
state, are employers within the meaning of this chapter and are
hereby required to subscribe to and pay premium taxes into the
workers' compensation fund for the protection of their
employees and shall be subject to all requirements of this
chapter and all rules and regulations prescribed by the workers'
compensation division with reference to rate, classification and
premium payment: Provided, That such rates will be adjusted
by the division to reflect the demand on the compensation fund
by the covered employer.
W. Va. Code 23-2-1(a) (1995).Footnote: 3
Our jurisprudence relating to an officer's criminal liability is neither unique nor on
the cutting edge of new age legal theories. The highest court in New York in 1912 offered
possibly the best analysis as to the persona of a corporation:
A corporation [ ] is a mere conception of the legislative mind.
It exists only on paper through the command of the Legislature
that its mental conception shall be clothed with power. All its
power resides in the directors. Inanimate and incapable of
thought, action, or neglect, it cannot hear or obey the voice of
the Legislature except through its directors. It can neither act
nor omit to act except through them. Hence a command
addressed to a corporation would be idle and vain unless the
Legislature in directing the corporate body, acting wholly by its
directors, to do a thing required or not to do a thing prohibited,
meant that the directors should not make or cause the
corporation to do what was forbidden, or omit to do what was
directed. We think . . . that when the corporation itself is
forbidden to do an act, the prohibition extends to the board of
directors and to each director, separately and individually.
People v. Knapp, 99 N.E. 841, 844 (N.Y. 1912).Footnote: 4
We believe that this holding is consistent with the following principle:
A statute should be so read and applied as to make it accord
with the spirit, purposes and objects of the general system of
law of which it is intended to form a part; it being presumed that
the legislators who drafted and passed it were familiar with all
existing law, applicable to the subject matter, whether
constitutional, statutory or common, and intended the statute to
harmonize completely with the same and aid in the effectuation
of the general purpose and design thereof, if its terms are
consistent therewith.
Syllabus Point 5, State v. Snyder, 64 W. Va. 659, 63 S.E. 385 (1908).Footnote: 5
Mullins v. Venable directly involved civil as opposed to criminal responsibility.
However, we discussed the range of criminal sanctions that could be imposed upon a
corporate officer under the Wage Payment Act.Footnote: 6
If we were to adopt the defendants' contention that corporate officers were not
intended to be included within the scope of W. Va. Code 23-1-16(a) (1995), because they
are not "employers," we would effectively be interpreting the statute so that the only
individuals who would be criminally responsible would be sole proprietors and not the
constituents of any of the business organizations, including corporations, expressly
mentioned in the statute. "It is the duty of a court to construe a statute according to its true
intent, and give to it such construction as will uphold the law and further justice. It is as well
the duty of a court to disregard a construction, though apparently warranted by the literal
sense of the words in a statute, when such construction would lead to injustice and
absurdity." Syllabus Point 2, Click v. Click, 98 W. Va. 419, 127 S.E. 194 (1925); accord
Syllabus Point 2, Pristavec v. Westfield Ins. Co., 184 W. Va. 331, 400 S.E.2d 575 (1990).
We believe that insulating those who control the business organization from criminal liability
would create the absurd result of only subjecting sole proprietors to the imprisonment portion
of the penalty. The purpose behind incorporating is to limit the civil and personal liability
of the agents, officers, directors, and shareholders in the event that the corporation's
performance in the market results in financial losses. The purpose behind incorporating is
not to create a shield in which to protect those who control the corporation from answering
for its actions that may be criminal in nature.Footnote: 7
85 C.S.R. 11 § 1.1 (1995) provides:
Scope. -- This legislative rule provides for the determination of
delinquency and default on the part of employers regarding
reporting and payment requirements, for the enforcement of
collection of payments from those requirements, and for
enforcement of other required payments.Footnote: 8
We do not mean to be so presumptuous as to suggest to the Legislature the model of
any statute that might exempt corporate officers and directors from being criminally
responsible for criminal offenses of the corporation so as to change the common law. An
example, though, might be as follows: "Providing that, liability for violations under this
section shall not be imposed upon the officers and directors of the corporation."Footnote: 9
W. Va. Code 23-1-16(b) (1995) provides:
Any person or firm, or the officer of any corporation, who knowingly and willfully makes a false report or statement under oath, affidavit or certification respecting any information required to be provided under this chapter, shall be guilty of a felony, and, upon conviction thereof, shall be fined not less than one thousand dollars nor more than ten thousand dollars or confined in the penitentiary for a definite term of imprisonment which is not less than one year nor more than three years, or both.
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.