Continental Nat. Bank v. Bowdre

• Decision Date: 07 August 1893
• Citation: 23 S.W. 131,92 Tenn. 723
• Parties: CONTINENTAL NAT. BANK OF MEMPHIS v. BOWDRE et al.
• Court: Tennessee Supreme Court

23 S.W. 131

92 Tenn. 723

CONTINENTAL NAT. BANK OF MEMPHIS v. BOWDRE et al.

Supreme Court of Tennessee.

August 7, 1893

Appeal from circuit court, Shelby county; L. H. Estes, Judge.

Action by Bowdre Bros. & Co. against the Continental National Bank of Memphis. From a judgment for plaintiffs, defendant appeals. Reversed.

Morgan & McFarland and Estes & Fentress, for appellant.

M. B Trezevant, Metcalf & Walker, and Turley & Wright, for appellees.

McALISTER J.

This is an action of libel, brought by the firm of Bowdre Bros. & Co., in the circuit court of Shelby county, against the Continental National Bank of Memphis and C. F. M. Niles, its cashier. It appears from the record that on the 16th October 1890, Messrs. R. L. Bliss & Co., of Florence, Ala., drew a sight draft on Bowdre Bros. for the sum of $659.95. This draft was sent for collection, through the First National Bank of Florence, Ala., to the Continental National Bank at Memphis. It appears that R. L. Bliss & Co. were customers of Bowdre Bros. & Co., and shipped them large consignments of cotton. At the time this draft was drawn, Bowdre Bros. & Co. had funds in their hands belonging to Bliss & Co., and it was their duty to pay the draft. The Continental National Bank on the morning of October 16th, by its collector, presented the draft at the office of Bowdre Bros. & Co. It appears that neither member of the firm was in the office when the draft was presented. The bookkeeper of the firm requested that the draft might be left for a short time, but this request was declined, in accordance with the established usage of this bank. About 3 o'clock of the same day the bank asked Bowdre Bros. & Co., over the telephone, what they intended to do about the draft. W. T. Bowdre replied that the money was in his office to meet the draft, and he would pay it when presented. The bank then turned the draft over to a notary who presented it at the office of Bowdre Bros. & Co., and received payment in full, returning with the money to the bank. It further appears that soon after the draft was handed the notary by the bank, for collection, and after Bowdre Bros. & Co. had notified the bank, over the telephone, of their readiness to pay the draft on presentation, the corresponding clerk of the Continental National Bank addressed a postal card to the First National Bank of Florence, Ala., stating that "Bowdre [was] in the hands of a notary." This postal card, it reasonably appears from the record, was not mailed until 6 o'clock that evening. In the mean time, and about 5 o'clock, the money had been paid into the bank by the notary. It thus appears that Bowdre Bros. & Co. were not protested for the nonpayment of this draft, nor was said firm in the hands of a notary for protest, but, on the contrary, it must have been understood that the draft would be paid on presentation. The evidence is indisputable that at the time the postal card was mailed, stating that Bowdre was in the hands of a notary, the draft had been paid, and its proceeds were in the vaults of the Continental National Bank. There was proof on the trial below tending to show that a report became prevalent among the merchants of Memphis, having its origin in the publication of the postal card, that the Continental National Bank had protested the Bowdres, and that said firm had become involved. There was also proof tending to show that the commercial agencies subjected the Bowdres to an investigation. It is shown, also, that the rumor reached the customers of Bowdre Bros., and caused a withdrawal of large deposits. The trial resulted in a verdict and judgment against the bank for the sum of $20,000, but in favor of C. F. M. Niles, cashier. Motions for a new trial and in arrest of judgment having been overruled, the bank appealed, and has assigned errors.

The first assignment of error arises upon the charge of the court with respect to the pleadings. The declaration avers that "plaintiffs are merchants and traders in the city of Memphis, and in the exercise of that calling, on the 16th October, 1890, in which calling a good financial credit and standing is and was on said day, and at all times, of great importance and value to them, and that on said 16th October, 1890, the defendants, wickedly intending to injure the plaintiffs, did maliciously compose and publish of and concerning the plaintiffs a certain false, scandalous, and defamatory libel; that is to say, it, through its officers, wrote and directed a certain United States postal card on said 16th October, 1890, and addressed the same to the First National Bank in the State of Alabama, and deposited the same in the United States post office at Memphis, Tenn., with legal postage prepaid, as follows: 'Continental Bank, Memphis, Tenn. Oct. 16, 1890. Yours of _____ received. We credit Bowdre in hands of notary. Entered for collection. Respectfully, C. F. M. Niles, Cashier,'-meaning thereby that the plaintiffs had suffered their financial credit and standing as merchants to become dishonored by a protest for nonpayment of their commercial paper at the hands of a notary, which said postal card was carried through the United States mail, and by due course was received by said First National Bank of Florence, and by it was publicly shown and exhibited to divers persons then and there, by means whereof the plaintiffs have been brought into public scandal and commercial disgrace, and greatly injured in their good name, and otherwise injured, to their damage fifty thousand dollars," etc. To this declaration the defendants pleaded the general issue. In this state of the pleadings, the circuit judge opened his charge to the jury, viz.: "The defendants, the Continental Bank and C. F. M. Niles, had the right to make any legitimate pleading that would defeat this suit. They did plead not guilty. They could have pleaded, further, if they had so desired, viz.: First. Justification generally,-that is, that the language written on the postal card, and the meaning or innuendo, as set out in the declaration, was true. Second. They might have pleaded specially,-that is, that the language written on the postal card was true,-and would have been compelled to prove it; and they might, also, have pleaded that the innuendo or meaning attributed to the language written on the postal card, as set out in the declaration, was not a legitimate construction of such language. If either of the foregoing pleas had been interposed and established, it would have defeated this action. Third. Defendants might have pleaded the general issue, and under it insist that the communication in the language written on the postal card was one which, in law, he had a right to make, and therefore it was privileged, or that he or it was protected in making it." The first assignment of error is that the circuit judge erred in charging the jury as follows: "If the last method of pleading, [viz. the general issue] is adopted, defendant thereby admits that the language used on the postal card is not true. In this case the court has to tell you that the course of pleading, as set out in the third item [viz. the plea of the general issue] is the one adopted by these defendants, and under it they admit that the language used in the postal card is not true." It is insisted that this charge is erroneous. It is admitted by counsel that in actions for libelous publications imputing crime or moral turpitude, and perhaps in cases clearly imputing commercial insolvency, the truth of the publication cannot be given in evidence under the general issue. But counsel insist that this is an action for libel "only in respect to special damages to commercial credit, and that the rule invoked by the court has no application. In the investigation of this question, we will first inquire what is admitted, as a matter of pleading, under the general issue, in an action of libel, and whether there is any difference in the application of the rule when the libelous matter is actionable per se, and when it is only actionable upon averment and proof of special damages.

The general principle that the defendant in an action of libel or slander cannot, under the general issue, prove the truth of the defamatory matter, is well settled in this state. McCampbell v. Thornburgh, 3 Head, 109; Shirley v. Keathy, 4 Cold. 29; West v. Walker, 2 Swan, 32; Hackett v. Brown, 2 Heisk. 264. In Hackett v Brown this court quotes with approval the following language from section 324, 1 Greenl. Ev., viz.: "It is perfectly well settled that under the general issue the defendant cannot be admitted to prove the truth of the words, either in bar of the action, or in mitigation of damages." The plea of the general issue, in an action of oral or written slander, operates as a denial of the speaking of the words, or the publication of the libel, and a denial, also, of the damages, in cases where the averment of special damages is necessary to maintain the action. Where the defense is that the libel or words were published or spoken, not in the malicious sense imputed by the declaration, but in an innocent sense, or upon an occasion which warranted the publication, this matter may be given in evidence under the general issue. Newell, Defam. p. 648. But it is well settled that under the plea of the general issue the defendant cannot be permitted to give in evidence any matters tending to establish the truth of the defamatory matter, either in bar of the action, or in mitigation of damages. The truth of the words charged to have been spoken or published is a conclusive defense to the action, but, in order to be available, must be relied on by a formal plea of justification. It is insisted, however, on behalf of the bank, that it was precluded from interposing a plea of justification as...