Edwin S. Gibson v. Charles H. Adams

Edwin S. Gibson (Gibson) formed Madison Metal Services, Inc. (Madison) with Charles H. Adams (Adams) and James V. Murphy (Murphy) in 1981. All three were shareholders of the company. After discharging Gibson in 1991, Adams and Murphy failed to hold shareholders' or directors' meetings and raided Madison's assets without obtaining shareholder or board approval, all to Gibson's detriment. The trial court found Adams and Murphy had breached their fiduciary duty owed to Gibson. Because substantial evidence exists to support the trial court's decision, we affirm it's finding of breach of fiduciary duty. In 1988 Gibson, Adams and Murphy signed an agreement which provided if one of them was fired Madison would purchase his shares of stock for a specified price. After Gibson was fired, Adams and Murphy prevented Madison from buying Gibson's shares. Substantial evidence supports the trial court's finding of tortious interference with contract.