In a July 11 decision, the North Dakota Supreme Court clarified how far personal liability can reach when corporate officers fail to pay workers’ compensation premiums.
In the case State of North Dakota by and through Workforce Safety and Insurance v. Boechler, PC and Jeanette Boechler, the state’s Workforce Safety and Insurance agency (WSI) appealed a lower court’s decision that limited Jeanette Boechler’s liability for unpaid premiums owed by her law firm.
WSI had pursued Boechler, both in her corporate and personal capacity, for more than $17,000 in unpaid workers’ compensation premiums, penalties, and interest dating back to 2020. While the district court agreed that the corporation owed the full amount, it found that Boechler, as president of the firm, was only personally liable for $5,802. The court ruled that she was not responsible for penalties tied to the failure to file payroll reports and that her liability extended only to amounts due as of WSI’s 2021 decision.
WSI took the matter to the state’s highest court. The justices agreed in part – holding that Boechler was not liable for penalties related solely to failing to file payroll reports. Those types of penalties, they concluded, fall outside the scope of personal liability defined under North Dakota Century Code § 65-04-26.1, which covers premiums, interest, and related costs – but only when they are directly connected to unpaid premiums.
However, the Supreme Court reversed the lower court’s ruling that Boechler’s liability ended with the 2021 determination. Instead, the court said her liability continued beyond that date, so long as she remained affiliated with the firm and unpaid amounts continued to accrue. The court also held that the $11,661.99 already awarded against the firm in a previous judgment could not be deducted from Boechler’s personal liability, since she was dismissed from that earlier action without prejudice.
The case has now been sent back to the district court to update the judgment in line with the high court’s decision.
For insurance professionals, especially those working in compliance or collections within state-mandated systems, the ruling draws clear lines. It reaffirms that personal liability can extend to unpaid employer obligations tied directly to premiums. At the same time, it limits liability for reporting violations – distinguishing between payment failures and administrative noncompliance.
The ruling does not interpret private insurance policies but could have broader implications for how insurers and regulators pursue corporate officers for ongoing unpaid obligations. It also highlights the importance of timely administrative determinations and clear communication around what liabilities may continue to accrue.
The decision stands as a precedent for how state agencies and insurers can manage delinquent accounts while balancing statutory limits on personal liability.
