Pledger v. Burnup & Sims, Inc.

• Decision Date: 20 April 1983
• Docket Number: No. 81-1555,81-1555
• Citation: 432 So.2d 1323
• Court: Florida District Court of Appeals
• Parties: Thomas R. PLEDGER, Appellant, v. BURNUP & SIMS, INC., a Delaware corporation, and Nick A. Carporella, Appellees.

Page 1323

432 So.2d 1323

Thomas R. PLEDGER, Appellant, v. BURNUP & SIMS, INC., a Delaware corporation, and Nick A Carporella, Appellees.

No. 81-1555.

District Court of Appeal of Florida Fourth District.

April 20, 1983.

Rehearing Denied July 8, 1983.

Wm. Snow Frates of Frates Jacobs Farrar Novey & Blanton, Miami, and James B. Tilghman, Jr., and Robert Galt, III, of Floyd, Pearson, Stewart Richman, Greer & Weil, P.A., Miami, for appellant.

Malcolm H. Fromberg of Fromberg, Fromberg & Roth, P.A., Miami, and Joel D. Eaton and Joel S. Perwin of Podhurst, Orseck, Parks, Josefsberg, Eaton, Meadow & Olin, P.A., Miami, for appellees.

DELL, Judge.

Thomas R. Pledger, formerly President and Chairman of the Board of Burnup & Sims, Inc., filed a six count complaint in libel and slander against Burnup & Sims and Nick A. Caporella, its current president. Pledger appeals from summary judgment entered in favor of appellees on Counts I, II, IV, V and VI of his complaint.

This case arose out of a corporate take-over attempt. Burnup & Sims had filed suit in New York against one Victor Posner, alleging, inter alia, that Posner attempted to take over Burnup & Sims by inducing "plaintiff's [i.e., Burnup & Sims'] executive officer" to violate his fiduciary duty to the corporation. This complaint (New York complaint) specifically alleges that "plaintiff's executive officer" was so induced. Although not mentioned by name in the New York complaint, it clearly appears during the times alleged that Pledger served as the chief executive officer of Burnup & Sims.

Count I of the defamation complaint alleges that appellees prepared a writing labelled "complaint" (Draft I), which charges appellant with specific egregious conduct and with conspiracy to effect the Posner takeover. Appellees published Draft I by giving it to Posner's Florida attorney. Draft I, which appellees call a preliminary draft of the New York complaint, has never been filed in any court.

Count II charges appellees with defamations contained in a second draft complaint (Draft II), which appellees published by reading Draft II over the telephone to the presidents of fourteen subsidiary corporations.

The defamation alleged in Count IV rests on the inducement language contained in the New York complaint and published to Posner's New York attorneys before appellees filed the New York complaint.

Count V charges appellee Caporella, individually, with wrongfully inducing Burnup & Sims to include the defamatory matter about appellant in the New York complaint.

Count VI alleged a second publication of the New York complaint. Appellant asserts that the actual filing thereof in the Supreme Court of the State of New York constituted publication, which has since become actionable because that court dismissed the New York complaint.

None of these writings names appellant as a party defendant.

The trial court found all of the above statements absolutely privileged as publications preliminary to a proposed judicial proceeding and pertinent thereto, citing Ange v. State, 98 Fla. 538, 123 So. 916 (1929) and Restatement (Second) of Torts § 587 (1977). Additionally, the trial court found that the holding of Kent v. Connecticut Bank and Trust Co., 386 So.2d 902 (Fla. 2d DCA 1980), did not operate to nullify the defense of absolute judicial privilege with respect to Count VI, and that the one-year New York Statute of Limitations, CPLR Section 215, and Section 95.10, Florida Statutes (1981) barred Counts IV and VI.

Counts I, II and IV allege publications which occurred before a judicial proceeding, rather than in the course of a judicial proceeding. This appeal presents the question of whether a privilege attaches to publications made prior to litigation. In Ange v. State, 123 So. at 917, our Supreme Court held:

The doctrine is well settled that defamatory words when used by parties, counsel, or witnesses in the due course of judicial procedure, and when relevant to the matter in hand, and pertinent to the subject of inquiry, are privileged and cannot be made the basis of a proceeding for libel or defamation, no matter how false or malicious such statements may in fact be. Myers v. Hodges, 53 Fla. 197, 44 So. 357. This rule of privilege as applied to statements made in the course of judicial proceedings is not restricted to trials of actions, but includes proceedings before a competent court or magistrate in the due course of law or administration of justice which is to result in any determination or action by such court or officer. This privilege extends to the protection of the judge, parties, counsel, and witnesses, and arises immediately upon the doing of any act required or permitted by law in the due course of the judicial proceeding or as necessarily preliminary thereto. [Emphasis added.]

There are many examples of publications which are necessarily preliminary to a judicial proceeding which include, but are not limited to, actions brought under the Florida Tort Claims Act, ¹ landlord-tenant actions, ² certain agricultural claims, ³ various actions brought under the Uniform Commercial Code, ⁴ insurance claims and other contract actions where the parties have agreed to a notice requirement as a condition precedent to suit. The absolute privilege afforded to necessarily preliminary publications is not without limitation, as the court in Myers v. Hodges so carefully pointed out:

In coming to this conclusion, we are not unmindful of the weighty reasons advanced in favor of the English doctrine of absolute privilege for defamatory words published in the course of judicial proceedings; that it is to the interest of the public that great freedom should be allowed in complaints and allegations with a view to have them inquired into; and that parties and counsel should be indulged with great latitude in the freedom of speech in the conduct of their causes and courts and in asserting their rights, because in this way the purposes of justice will be subserved, and the court can and will protect the party aggrieved by expunging irrelevant, defamatory matter from the pleadings, and by punishing for contempt of court the guilty party. We think the ends of justice will be effectively accomplished by not extending the privilege so far as to make it an absolute exemption from liability for defamatory words wholly and entirely outside of, and having no connection with, the matter of inquiry. For why should a person be absolutely privileged to defame another in the course of a judicial proceeding by making slanderous statements wholly outside of the inquiry before the court? We think it is unnecessary to carry the doctrine so far.

53 Fla. 197, 44 So. 357, 361 (1907).

The Supreme Court held statements made to the insurance commissioner to be absolutely privileged in Robertson v. Industrial Insurance Company, 75 So.2d 198 (Fla.1954), because the statements were necessary to institute license revocation proceedings. However, our sister court, in Ridge v. Rademacher, 402 So.2d 1312 (Fla. 3d DCA 1981), held an unsworn statement to a police officer about an alleged crime qualifiedly rather than absolutely privileged. In Merriman v. Lewis, 141 Fla. 832, 194 So. 349 (1940), the defendant included a libel in a sworn statement to an insurance company. This statement was the basis for a claim that defendant intended to enforce in court, if necessary, and the statement also constituted the preliminary proof of loss necessary to sustain an action against the insurer. The Supreme Court held this statement qualifiedly rather than absolutely privileged.

Here we must decide whether publications allegedly made as part of settlement negotiations prior to filing suit may constitute necessarily preliminary acts as contemplated by the court in Ange v. State. More particularly we must decide whether the publication alleged in Count I was necessarily preliminary to the New York judicial proceeding.

Appellees argue that the publication of Draft I to Posner's attorney constituted part of pre-litigation settlement efforts, therefore the trial court properly found this publication absolutely privileged. First, we note that the trial court did not find that the publication constituted part of pre-litigation settlement efforts. It entered summary judgment on the ground that this publication was preliminary to and pertinent to a proposed judicial proceeding subsequently commenced by filing of the New York complaint. Second, even if appellees have properly characterized this publication, pre-litigation settlement efforts cannot be considered necessarily preliminary to the institution of judicial proceedings unless required by statute, administrative regulation or contract. Nonetheless, the courts of Florida encourage pre-litigation settlement negotiations. It is in the interest of society to reach equitable and mutually satisfactory resolution of disputes without the necessity of suit, an expensive proposition in terms of time, money, and emotional resources. We hold that this policy reason is sufficiently enhanced, and the parties sufficiently protected, by the qualified privilege. Our reasoning is consistent with Coogler v. Rhodes, 38 Fla. 240, 21 So. 109 (1897), in which the Supreme Court first set forth the concept of qualified privilege:

"Where a person is so situated that it becomes right, in the interest of society, that he should tell to a third person certain facts, then, if he bona fide, without malice, does tell them, it is a privileged communication." Townsh.Sland. & L. (4th Ed.) § 209. This definition is considered more exact in leaving out the word "duty," because it is privileged in the interest of society for a man to bona fide and without malice say those things which no positive legal duty may make it obligatory upon him to say. Id. That the matter stated in accordance with the above definition with good motives, and upon reasons apparently good, should turn out to be untrue, will not render...