Selle v. Pierce

Decision Date18 November 1992
Docket NumberNo. 17850,17850
Citation494 N.W.2d 634
PartiesJames SELLE, Plaintiff and Appellee, v. Harold G. PIERCE, Petitioner and Appellant. . Considered on Briefs
CourtSouth Dakota Supreme Court

Rick Johnson, Stephanie E. Pochop of Johnson, Eklund & Abourezk, Gregory, for plaintiff and appellee.

Robert B. Anderson of May, Adam, Gerdes & Thompson, Pierre, for petitioner and appellant.

HENDERSON, Justice.

PROCEDURAL HISTORY/ISSUES

On January 30, 1990, Appellee James Selle (Selle) filed a defamation action against Appellant Harold G. Pierce (Pierce) in the Sixth Judicial Circuit, Gregory County, South Dakota. Both parties are residents of Nebraska. After some discovery, Pierce filed a motion seeking application of Nebraska law. Based on briefs and a hearing, the trial court, from an Order dated February 25, 1992, rejected Pierce's motion and held that South Dakota's substantive law would be applied.

This Court granted Pierce's Petition for Allowance of Intermediate Appeal by Order dated March 27, 1992. Petitioner seeks reversal of the trial court order and seeks an order directing that Nebraska substantive law be applied. On appeal, Pierce raises the following issue:

Did the trial court err in determining that South Dakota law should be applied in this multi-state defamation action?

Based on the facts of this case and our recent decisions in Chambers v. Dakotah Charter, Inc., 488 N.W.2d 63 (S.D.1992), and Brazones v. Prothe, 489 N.W.2d 900 (S.D.1992), we reverse.

FACTS

Selle, a Nebraska resident, was appointed to serve on the Boyd County Monitoring Committee, a committee established by Nebraska statute, to monitor plans to construct a low-level radioactive waste storage facility (facility) in his home county of Boyd County, Nebraska. Recognizing that leakage from the facility could have potentially dangerous effects on people living in neighboring Gregory County, South Dakota, Selle attended meetings there to discuss the facility.

Meanwhile, the committee retained Pierce, an area Nebraska resident, to compile and analyze data relating to the geological and geophysical activities at the proposed storage site. Later, Dr. Arden Davis of Rapid City, South Dakota, was retained to conduct a second geological survey at the facility site.

Citing difficulties in working with the committee and apparently upset with the committee seeking a second opinion from Dr. Davis, Pierce resigned his position on December 6, 1989. Two days later, he authored a letter which stated, in part, that Selle found it acceptable to "falsify data, issue false and misleading statements, trespass in order to gain 'evidence,' misquote, remove from context, in short, all things reprehensible and dishonest." Pierce mailed the letter to Dr. Davis in Rapid City and sent a copy of the letter to Dr. J.C. Marcum of Spencer, Nebraska, chair of the committee. Both the mailing and the writing apparently occurred in Nebraska.

Pierce has declined to retract statements made in the letter. Consequently, Selle filed a libel action in South Dakota alleging that he has been damaged in his capacity as both a business person and as a member of the committee. When the trial court ruled that South Dakota law applied, Pierce filed this appeal requesting that this Court reverse that ruling and direct the trial court to apply Nebraska substantive law.

DECISION

When the lower court ruled that South Dakota law applied to these proceedings, multi-state choice of law questions were determined by the traditional lex loci delicti rule. However, three special concurrences in Owen v. Owen, 444 N.W.2d 710 (S.D.1989), indicated that this rule would be abandoned. In the case before us, the trial court had the foresight to analyze choice of law under several approaches, including the "most significant relationship" test which has been advanced by our recent decisions in Chambers and Brazones. Although the trial court held that the most significant relationship test indicates that South Dakota law should apply, the Findings of Fact and Conclusions of Law do not clearly indicate how the decision was reached.

In applying the most significant relationship test, courts are to consider the following (1) The rights and liabilities of the parties with respect to an issue in tort are determined by the local law of the state which, with respect to that issue, has the most significant relationship to the occurrence and the parties under the principles stated in Sec. 6.

(2) Contacts to be taken into account in applying the principles of Sec. 6 to determine the law applicable to an issue include:

(a) the place where the injury occurred,

(b) the place where the conduct causing the injury occurred,

(c) the domicile, residence, nationality, place of incorporation and place of business of the parties,

and

(d) the place where the relationship, if any, between the parties is centered.

These contacts are to be evaluated according to their relative importance with respect to the particular issue.

Chambers at 68; Brazones at 904; Restatement (Second) of Conflict of Laws Sec. 145 (1971). The principles under Sec. 6 are:

(1) A court, subject to the constitutional restrictions, will follow a statutory directive of its own state on choice of law.

(2) When there is no such directive, the factors relevant to the choice of the applicable rule of law include

(a) the needs of the interstate and international systems,

(b) the relevant policies of the forum,

(c) the relevant policies of other interested states and the relative interests of those states in the determination of the particular issue,

(d) the protection of justified expectations,

(e) the basic policies underlying the particular field of law,

(f) certainty, predictability and uniformity of result, and

(g) ease in the determination and application of the law to be applied.

Chambers at 68; Brazones at 904; Restatement (Second), supra, Sec. 6 (1971).

After applying this approach, the lower court found that South Dakota had the most significant relationship to the occurrence and parties involved. Our standard of review is to uphold the trial court unless its findings are "clearly erroneous." A finding is "clearly erroneous" when after reviewing all of the evidence, we are left with a definite and firm conviction that a mistake was made. Permann v. S.D. Dep't. of Labor, Unemp. Ins. Div., 411 N.W.2d 113 (S.D.1987); Vaughn v. Eggleston, 334 N.W.2d 870 (S.D.1983). Upon review, we find that South Dakota did not have the most significant relationship and reverse.

In this case, a Nebraska resident mailed an allegedly defamatory letter about another Nebraska resident to a person in South Dakota and sent a copy of the letter to a person in Nebraska. Because the claimed defamation was published in two states, we turn to the Restatement (Second) for advice by reviewing the section specifically addressing multistate defamation and the most significant relationship test.

(1) The rights and liabilities that arise from defamatory matter in any ... aggregate communication are determined by the local law of the state which, with respect to the particular issue, has the most significant relationship to the occurrence and the parties under the principles stated in Sec. 6.

(2) When a natural person claims that he has been defamed by an aggregate communication, the state of most significant relationship will usually be the state where the person was domiciled at the time, if the matter complained of was published in that state.

. . . . .

Restatement (Second), supra, Sec. 150 (1971).

Selle, a registered voter in Nebraska, does not dispute that he is domiciled in Nebraska and admits that a copy of "the matter complained of" was sent to Dr. Marcum of Nebraska. As a practice of the secretary of the monitoring committee, a copy of the letter was...

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