Bell Pub. Co. v. Garrett Engineering Co.

• Decision Date: 17 March 1943
• Docket Number: No. 1911-7935.,1911-7935.
• Citation: 170 S.W.2d 197
• Parties: BELL PUB. CO. et al. v. GARRETT ENGINEERING CO.
• Court: Texas Supreme Court

170 S.W.2d 197

BELL PUB. CO. et al. v. GARRETT ENGINEERING CO.

No. 1911-7935.

Commission of Appeals of Texas, Section B.

March 17, 1943.

Rehearing Denied April 21, 1943.

COPYRIGHT MATERIAL OMITTED

Error to Court of Civil Appeals of First Supreme Judicial District.

Action by the Garrett Engineering Company against the Bell Publishing Company and another for libel. To review a judgment of the Court of Civil Appeals, 154 S.W.2d 885, reversing and remanding a judgment for plaintiff, both plaintiff and defendant bring error.

Judgment of Court of Civil Appeals affirmed.

W. O. Cox and Will Brown, both of Temple, for Dr. Gober.

Joe Everton, Walker Saulsbury, and Byron Skelton, all of Temple, and Blalock, Blalock, Lohman & Blalock, and Clarence Lohman, all of Houston, for Garrett Pub. Co.

Sam D. Snodgrass, of Temple, and Howard, Reinhard & Schwing, of Houston, for defendant.

TAYLOR, Commissioner.

This is a libel suit. Plaintiff, Garrett Engineering Company, is a corporation. Defendants are Dr. O. F. Gober of Temple who wrote and signed the article containing the alleged libel, and Bell Publishing Company, publisher of the Temple Daily Telegram, in which the article appeared.

The suit was filed in Harris County where plaintiff's main office is located. Defendants filed pleas of privilege to be sued in Bell County where Dr. Gober resides and where the publisher had its domicile. They were overruled and the trial court's action was upheld by the Galveston Court of Civil Appeals. 146 S.W.2d 301. Upon trial on the merits with the aid of a jury plaintiff recovered judgment against both defendants for $15,000. The Court of Civil Appeals by unanimous decision reversed and remanded the case on its holding with respect to a procedural matter relating to the charge. 154 S.W.2d 885. Justice Graves dissented upon motion for rehearing, being of opinion upon further consideration that the trial court's judgment should be affirmed. 154 S.W.2d 887. Both plaintiff below and defendants below respectively filed applications for writ of error and both were granted.

For several years prior to May 21, 1939, when the alleged libel was published, the question whether the city of Temple needed a municipally owned electric light and power system had been widely discussed by the citizens, who took an active interest on both sides. The city commission had made several preliminary surveys and had carried on negotiations with various persons and concerns, including plaintiff, relating to such a project. On December 6, 1938, the city commissioners, on behalf of the city, entered into a contract with plaintiff company whereby, in consideration of a stipulated fee, it agreed to render to the city its services as consulting and supervising engineer in the event the city should either construct a municipal power plant, or purchase the existing privately owned system. Plaintiff obligated itself to prepare detailed preliminary plans and specifications together with large scale and full size drawings of buildings and equipment, furnish preliminary estimates of the cost, hold the necessary conferences with the city commission, supervise the work and employ and keep on the work from beginning to completion a resident electrical engineer who should remain thereon throughout the entire period of construction. Plaintiff then prepared and submitted to the city plans and estimates of cost of a complete light and power system, and on May 15, 1939, the city commission ordered an election to be held June 2nd, at which the qualified voters of the city would decide whether to authorize the issuance of revenue bonds (not payable by taxation) in an amount not exceeding $850,000 to finance the proposed project. In the campaign which followed M. T. Garrett, plaintiff's president, consulted and advised with the proponents of the bond issue, furnished campaign literature and contributed financial aid on the side of the proponents. It was during this campaign that Dr. Gober (who with others opposed a municipally owned plant) wrote and had published in the Temple Daily Telegram an article containing three statements which were complained of by plaintiff as hereinafter stated. The article is lengthy and is set out in full in the opinion of the Court of Civil Appeals on defendant's pleas of privilege, cited above, which see. It is addressed to the home owners and voters of Temple and is signed by Dr. Gober. Under his signature is a parenthetical statement that the article is an advertisement written and paid for personally by him. It contains a call for a public mass meeting "for the purpose of threshing * * * out and definitely determining whether or not Temple really needs this proposed utility." In the preface the article states that the tax payers of the city have theretofore been very liberal in voting bond issues to provide various public improvements, naming the improvements and the amounts expended therefor, and inquires when "this expenditure of public funds is going to stop." The preface closes with the statement that "it is about time the tax payers went on a sit-down strike." The body of the article sets forth nine reasons (numbered seriatim in nine paragraphs) why the writer is opposed to the proposed municipally owned plant, and concludes with the call for the mass meeting. The following statement summarizes the reasons except those stated in the seventh paragraph. This paragraph will be set out in full, since it contains the three statements complained of by plaintiff. The reasons set forth in the other paragraphs are as follows: (1) Puts too much government in business; (2) no real saving to users of electric energy; (3) constant change in city's governing body prevents operation according to fixed policies essential to successful operation; (4) would mean dismantling of existing plant and large loss to "many widows, orphans and other innocent people (who) have made investments" (5) no one of the three commissioners voting for the project was experienced in constructing or operating a public utility; (6) because the contract of the city "with Garrett Engineering Company, of Houston," provided for payment to the company of the supervising fee ($39,525) "whether it supervises the construction of the plant" or whether the city purchases the existing plant; (8) charges the city commission with making a mistake in employing a non-resident firm of lawyers to handle the legal work in view of the fact that the city had a competent city attorney who was paid for that purpose; and (9) opposition to giving the "Board of Commissioners, or any other board," power to expend the large amount involved. The seventh paragraph in full is as follows: "The members constituting the board of commissioners of Temple are my warm personal friends, but I think they have made a most serious error in employing an engineering company to make the survey for, lay out, design and construct the distributing plant, when there is no person connected with the company who is a practical engineer, or who holds a degree of engineering. I am reliably informed that this company has never done any similar work, and by that I mean that it has never constructed such plant for any other city." (All italics in this opinion ours.)

The emphasized statements are the only statements of the article alleged by plaintiff to be libelous. It alleged that the statements were false, maliciously made, and damaging to the company's reputation, and that they injured it financially in that they led people to believe it did not possess the skill and technical knowledge and ability to properly perform its contract with the city, or to carry on its business of consulting and supervising engineer. It alleged also that the Temple Daily Telegram which published and widely circulated the article was a newspaper of general circulation in the state, having a large circulation in Bell, Williamson, Lampasas, Mills, Coryell, McLennan, Falls, Milam, Burleson, Travis and Harris counties.

Dr. Gober and the publishing company pleaded in support of their alleged defense of non-liability that the statements complained of were substantially true; and alternatively, in support of their claim of mitigation of damages that, if not true, they were made and published in an honest belief of their truthfulness. They pleaded also that the statements were privileged as fair comment on a matter of public interest. Both defendants denied that any part of the article alleged to be libelous contained a fact statement and, in the alternative, that should it be held that any statement of fact was made, it was substantially true, and made without malice; that the article was absolutely privileged to the Bell Publishing Company, and if not, was conditionally privileged as to both defendants. Dr. Gober, in addition to adopting the allegations of the publishing company, alleged that before writing the article he carefully investigated its subject matter, and formed a bona fide opinion that the statements and contents of the article were true; and the publisher pleaded in this connection that Dr. Gober presented for publication the article "fully prepared and signed by him"; that the editor (Mr. Walter Humphrey) to whom the article was presented inquired of Dr. Gober (an outstanding physician of unquestioned integrity and veracity) "whether its contents were true in every particular", and was assured by Dr. Gober that he "had checked and investigated the matters contained in the article" and that they were true.

By supplemental petition plaintiff, in addition to a general denial, alleged in reply specially defendants' recklessness and lack of good faith for the following reasons: "That said defendant failed to ascertain as could have reasonably and inescapably been done from the State Board of Registration for Professional Engineers, or any other authentic source, that it was in fact a matter of public record that plaintiff had done...