Danny Hill, the general manager of Southeastern Floor Covering Co., Inc.

(SE), had full authority to run the business. His responsibilities included preparing and submitting bid proposals to general contractors for floor coverings and ceilings on construction projects. Hill prepared and submitted a Chapter 48 Management of Corporations 1157 bid for a job for Chata Construction Co. for asbestos encapsulation, ceramic tile, ceilings, carpets, and vinyl tile flooring. However, because SE was not licensed by the EPA, the asbestos work was withdrawn. In the past, SE had used Larry Barnes’s company, which was EPA licensed, to do asbestos work under a subcontract agreement. Hill did not pursue a subcontract with Barnes for the Chata job. Rather, Hill and Barnes worked up a bid together and submitted it to Chata for the asbestos work. The bid was accepted, and Hill made $90,000 from the Chata job. Two years later, SE found out about Hill’s role in the asbestos work done for Chata, and the corporation sued him for the lost profits.

Hill argued that SE was not licensed by the EPA to do asbestos work and thus could not claim a lost corporate opportunity when it was not qualified to do the work. Decide. Are any ethical principles applicable to this case? [Hill v Southeastern Floor Covering Co., 596 So2d 874 (Miss)]

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