Montgomery Ward & Co. v. Watson

Decision Date12 January 1932
Docket NumberNo. 3231,3232.,3231
Citation55 F.2d 184
PartiesMONTGOMERY WARD & CO. v. WATSON. SAME v. JAMISON.
CourtU.S. Court of Appeals — Fourth Circuit

Arthur F. Kingdon, of Bluefield, W. Va. (Silas H. Strawn and C. B. Fullerton, both of Chicago, Ill., on the brief), for appellant.

A. J. Lubliner, of Bluefield, W. Va., and John Kee, of Bluefield, W. Va., for appellees.

Before PARKER, NORTHCOTT, and SOPER, Circuit Judges.

PARKER, Circuit Judge.

These are appeals in two actions to recover damages for slander instituted in the circuit court of Mercer county, W. Va., and removed by the defendant into the court below. The plaintiffs were former employees of Montgomery Ward & Co., and that corporation was defendant. The slander alleged was a charge of stealing made by the local manager of the defendant against the plaintiffs. The declaration in each of the cases alleged also a cause of action under the "Insulting Words" statute of West Virginia, chapter 55, art. 7, § 2 of the West Virginia Code 1931. The cases were tried together in the court below, and were heard together in this court on appeal. The jury returned a verdict for the plaintiff in each case in the sum of $10,000, which, however, was reduced by the trial judge to $5,000. There are a number of assignments of error; but, as we are of opinion that in each case the prayer of defendant for a directed verdict should have been granted, we need consider only the question as to the sufficiency of the evidence to carry the case to the jury.

The facts may be briefly stated: The plaintiffs were employed by defendant in its store at Bluefield, W. Va.; the plaintiff Jamison being the brother-in-law of the plaintiff Mrs. Watson. The manager of the store at the time was one Niehaus, and, on March 24, 1931, he received information which led him to believe that plaintiffs were attempting to steal some men's shirts belonging to defendant, and he thereupon questioned them with regard to the matter and discharged them. The conversations with regard thereto were had in the defendant's office in the presence and hearing of a young lady office manager. An elevator boy claims to have overheard a part of the conversation with Mrs. Watson.

The plaintiffs deny that they were attempting to steal the shirts. According to their version of the matter, Mrs. Watson wrapped up three shirts and laid them aside for a man named Turner, who promised to return later in the day and take and pay for them. Shortly thereafter Jamison purchased a shirt from her, and she wrapped it up also and laid it with the three shirts of Turner. While she was waiting on another customer, Niehaus took the package containing the three shirts and the ticket showing the sale of one shirt to Jamison and carried them to the office. Mrs. Watson saw him do this; and, after she had finished waiting on the customer, she went to the office and made inquiry as to his action, whereupon he accused her of attempting to steal the extra shirts and smuggle them out through Jamison. He later interviewed Jamison relative to the matter, and accused him of being implicated with her in an attempt to steal the shirts. According to her testimony, Niehaus used profane language in making the accusation against her, asking her "what in the G---- d---- h----" she meant in trying to steal and smuggle out the company's goods through Jamison, and telling her that the statement that she had wrapped the shirts up for another man was "a G---- d---- lie." The elevator boy testified to hearing profane language; his version, however, being that Niehaus told Mrs. Watson that her story was "too G---- d---- thin."

Defendant introduced Niehaus, who denied using the profane language and denied accusing plaintiffs of stealing, but admitted questioning them with regard to the shirts and paying them off and discharging them from employment pending further investigation. He testified that the office manager called his attention to a ticket's having come into the office showing a sale of only one shirt to Jamison, and stated that she had seen Jamison take three shirts and hand them to Mrs. Watson as if to make a purchase; that he looked over the balcony and saw Mrs. Watson finish wrapping up the shirts and put the package under the counter; that he then went to the counter, got the package, and carried it to the office; that the package contained three shirts, and attached to it was a ticket showing the sale of only one shirt to Jamison. He testified that he then found Jamison and asked him whether he had purchased a shirt, and that Jamison replied that he had, and, upon further questioning stated that he had purchased a white one; that, when he returned to the office, he found Mrs. Watson, who asked him whether he got the package containing three shirts from under the counter, stating that a customer had bought the three shirts; that Jamison had bought one shirt, and that she had put his ticket on the wrong package; that she then handed him a package containing one shirt, which, upon opening, he found to contain a blue shirt; that, after questioning Mrs. Watson and Jamison, he paid them off and let them go, telling them that he would have to investigate the matter. The office manager testified to seeing Jamison give the three shirts to Mrs. Watson and to seeing her wrap them up, to receiving a ticket showing the sale of only one shirt, and to seeing Mrs. Watson place the duplicate ticket on the package which she had wrapped up containing the three shirts.

There was no extrinsic evidence of any malice or ill will on the part of Niehaus against either of the plaintiffs or of any effort on his part to accomplish any ulterior purpose in making the charges against them. On the contrary, the uncontradicted evidence is that he had raised the wages of Mrs. Watson shortly prior to the occurrence, and that he had retained Jamison in the service of the company, notwithstanding a shortage in his department, and notwithstanding certain suspicious circumstances which had arisen some weeks before with reference to the sale of an automobile tire.

While there is much conflict both in the testimony and in the inferences to be drawn therefrom, we must view it in the light most favorable to plaintiffs in considering a motion for a directed verdict for defendant; and, when so viewed, there can be no question but that the language used charged the plaintiffs with dishonesty, and that, in the absence of privilege, it would be sufficient to carry the case to the jury. On the other hand, it is equally clear that, if the occasion was privileged, the defendant may not be held accountable in damages for the language used, unless the publication exceeded that which the occasion justified or unless Niehaus, in making the charge, was actuated by express malice. Three questions, therefore, are presented for our consideration: (1) As to whether the occasion was privileged; (2) as to whether the publication exceeded that which the occasion justified; and (3) as to whether there was evidence of express malice sufficient to take the case to the jury, notwithstanding the privilege. We think that all of these questions must be answered in favor of the defendant.

As to the first question, there can be no doubt but that the occasion was one of qualified privilege. Such privilege exists with respect to a statement where it concerns a matter as to which the person making it has a bona fide duty or interest and is made in good faith in the performance of the duty or the protection of the interest to a person having a corresponding duty or interest with relation thereto. Newell on Slander and Libel (4th Ed.) § 389; 17 R. C. L. 341; White v. Nicholls, 3 How. 266, 286, 11 L. Ed. 591; Wise v. Brotherhood of Locomotive Firemen and Enginemen (C. C. A. 8th) 252 F. 961; New York & Porto Rico S. S. Co. v. Garcia (C. C. A. 1st) 16 F.(2d) 734, 738; Brown v. N. & W. R. Co., 100 Va. 619, 42 S. E. 664, 60 L. R. A. 472. The rule is thus stated by the late Judge Walker in Harrison v. Garrett, 132 N. C. 172, 43 S. E. 594, 596: "This case was tried upon the theory that the communication of Garrett to his employee in Texas (Saunders) was one of qualified privilege, in accordance with the rule that any communication between employer and employee is protected by this privilege, provided it is made bona fide about something in which (1) the speaker or writer has an interest or duty; (2) the hearer or person addressed has a corresponding interest or duty; and provided (3) the statement is made in protection of that interest or in the performance of that duty. There must also be an honest belief in the truth of the statement. When these facts are found to exist, the communication is protected by the law, unless the plaintiff can show malice on the defendant's part; the burden in this respect being upon the plaintiff."

Here it was the duty of Niehaus as local manager of defendant's business to investigate any charge of dishonesty among its employees. He had received information tending to show that plaintiffs were guilty of dishonest conduct; and it was proper that he communicate to them the basis of his suspicions. The right to the enjoyment of the good reputation to which one is entitled should be jealously guarded by the courts, but the protection of this right does not require that an employer be unduly limited or circumscribed in making a bona fide investigation of alleged dishonesty or other misconduct among his employees. It is in the...

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