Domestic Linen Supply & Laundry Co. v. Stone

• Decision Date: 28 January 1982
• Docket Number: Docket No. 54540
• Parties: DOMESTIC LINEN SUPPLY & LAUNDRY COMPANY, Plaintiff-Appellant, v. Arnold STONE, Ray Cantrell, James C. Stewart, and Custom Uniform, Inc., Defendants-Appellees. 111 Mich.App. 827, 314 N.W.2d 773
• Court: Court of Appeal of Michigan — District of US

Page 773

314 N.W.2d 773

DOMESTIC LINEN SUPPLY & LAUNDRY COMPANY, Plaintiff-Appellant, v. Arnold STONE, Ray Cantrell, James C. Stewart, and Custom

Uniform, Inc., Defendants-Appellees.

Docket No. 54540.

111 Mich.App. 827, 314 N.W.2d 773

Court of Appeals of Michigan.

Submitted Nov. 12, 1981.

Decided Dec. 16, 1981.

Released for Publication Jan. 28, 1982.

[111 MICHAPP 829] Levin, Levin, Garvett & Dill by Jeffrey A. Heldt, Southfield, for plaintiff-appellant.

Davidson, Gotshall, Kohl, Secrest, Wardle, Lynch & Clark by Thomas G. Herrmann, Farmington Hills, for defendants-appellees Cantrell and Stewart.

Before CAVANAGH, P. J., and ALLEN and MacKENZIE, JJ.

ALLEN, Judge.

Plaintiff appeals by leave granted on December 10, 1980, from a judgment of no cause of action in favor of the defendants Stewart, Mayor of the City of Romulus, and Cantrell, City Purchasing Director.

Plaintiff, for several years before 1976, supplied uniforms and linen service for the City of Romulus. Early in 1976, Purchasing Director Cantrell terminated the relationship and awarded the contract to defendant Custom Uniform.

When plaintiff learned of this, it petitioned the city council for competitive bidding. The request was placed on the council's agenda for May 25, 1976. Purchasing Agent Cantrell published a memo to the council, dated May 20, 1976, stating:

"In the past, we have experienced many difficulties with Domestic Linen Company. Their services were not dependable nor were the quality of uniforms and linens commensurable with the price we were paying.

"If you will check your warrant for the past year, we were paying from $900.00 to in excess of $1200.00 per month to Domestic.

"The new company Custom Uniform will give a better quality uniform and a more prompt dependable service for $752.60 monthly.

"We are therefore, changing from Domestic Linen to Custom Uniform. As you can see, the savings are substantial."

[111 MICHAPP 830] At the May 25, 1976, meeting, plaintiff merely requested that the contract be put up for bidding. Cantrell then complained that plaintiff had failed to replace the uniforms every 18 months as agreed upon and that the quality of service was poor. Specifically, he stated:

"A man turns in a uniform. It may be ripped or the pockets may be torn out, something to that effect, he's supposed to tie it in a knot. Some of the uniforms come back still tied in a knot.

"If they are repaired, they are repaired in the manner that they are very badly creased or, you know, they are not justifiable, I'd say, for our employees to wear. They are in very bad condition.

"One of the drivers, the driver, told Mr. Utsie, which is the foreman down at the DPW, the other day that when he started working at Domestic, approximately two years ago, that the uniforms were in very poor shape at that time and he was ashamed to even pick them up or deliver them."

He reiterated his position later in the meeting:

"I don't think price is a big thing because what our employees have, you know-went through in the last few years-it's not because of the price, it is the quality. It is very bad uniforms, as far as I am concerned. Their service is very poor, as far as I am concerned, and this is what I am out for."

After the council voted to require bidding on the contract, Mayor Stewart continued the discussion with respect to the bill submitted by plaintiff. He stated:

"Well, the thing is, though, I just want to point out some of these figures to you that where you were trying to fool the Council into thinking-you brought your [111 MICHAPP 831] three lowest bills in and presented them to the Council. You didn't bring your highest bills in, so all I want to do is point this out to the Council so they wouldn't be fooled into thinking that the department head had lied about the bills."

At the June 29, 1976, meeting of the city council, Cantrell recommended the contract be awarded to Custom Uniform. He stated:

"Mr. Chairman, Council members. The first item on my report is Bid 76-25 which is the linen service.

"It is the recommendation of Mr. Paul and myself that we award this to Custom Uniform for the total amount of $172.85 per week. There was a difference in price of approximately $17 between Domestic and Custom Uniform, which we only had two bids on it.

"Due to the fact that we've had such poor service with Domestic in the past years-and this is one of the primary reasons that we went out to bid on this-we can't see any justification in awarding it to Domestic at this time."

Council accepted the recommendation and awarded the contract to Custom Uniform with only one dissenting vote.

In a four-count complaint, plaintiff alleged five causes of action as follows:

Count I: Defamation against all defendants except Mayor Stewart.

Count II: Intentional interference with contract and interference with economic expectancy, against all defendants.

Count III: Unfair competition, conspiracy to accomplish the same, as to all defendants.

Count IV: Conspiracy and combination in restraint of trade (M.C.L. § 445.701; M.S.A. § 28.31) against all defendants.

[111 MICHAPP 832] Defendants Cantrell and Stewart moved to bar the admission into evidence of any statements or writings made or read at the council meetings, arguing that such communications were absolutely privileged. Plaintiff stipulated that without these statements it could not prove its case. The lower court found the statements were absolutely privileged and entered summary judgment in favor of the mayor and purchasing director as to all four counts. Proceedings against the remaining defendants have been stayed pending appeal.

In this appeal, plaintiff claims that the trial court erred in holding that the statements made at a city council meeting by a nonmember of the council carried an absolute privilege. Plaintiff also asserts, in an issue of first impression for this Court, that the lower court erred in holding that the doctrine of privilege applies to bar admission into evidence of the challenged statements when they are offered to prove torts other than defamation. While we disagree with plaintiff's first contention, we believe the trial court erred as alleged in the second.

To better understand both issues, a preliminary discussion of privilege is helpful. "Privilege" has different meanings in the law of evidence and the law of torts. ¹ For evidentiary purposes, statements that are privileged are inadmissible into evidence because those statements are regarded as too private and confidential to be disclosed in court. See generally MRE 501. Thus at common law and by [111 MICHAPP 833] statute, confidential communications to a clergyman may not be revealed in court unless the person making the communication waives his right to confidentiality. Wirtanen v. Prudential Ins. Co. of America, 27 Mich.App. 260, 183 N.W.2d 456 (1970), M.C.L. § 600.2156; M.S.A. § 27A.2156. A similar right of confidentiality has been protected when the communication is between a patient and his doctor. M.C.L. § 600.2157; M.S.A. § 27A.2157, between client and attorney, Parker v. Associates Discount Corp., 44 Mich.App. 302, 205 N.W.2d 300 (1973), and between spouses, M.C.L. § 600.2162; M.S.A. § 27A.2162.

"Privilege" has a much different meaning in the law of torts. For certain torts, privilege may be asserted as a defense so that acts that would otherwise be tortious are permissible because of the circumstances in which they occur. Privilege, or immunity as it is often called, permits a defendant freedom of action because his own interests or the interests of the public at large are best served by protecting the act, even at the expense of damage to the plaintiff. Prosser, Torts (4th ed), § 16, p. 98. Thus a person using reasonable force to prevent any harmful or offensive body contact is not liable for assault and battery. Prosser, § 19, pp. 108-112. Similarly, use of reasonable force is permitted in defense of property. Tumbarella v. Kroger Co., 85 Mich.App. 482, 492, 271 N.W.2d 284, 289 (1978).

Different privileges also are available for the torts of defamation, libel and slander, and for intentional interference with business relations. For each tort, certain actions are considered protected whenever public policy dictates that that conduct should be protected to promote the public or certain individuals' good even at the expense of the injured plaintiff. As the nature of the interest [111 MICHAPP 834] protected changes and as the tort changes, so the nature of the privilege varies.

In the case at bar, the trial court ruled that the statements and writings made and read at a city council meeting were absolutely privileged and hence inadmissible into evidence. This ruling failed to distinguish between a "privilege" under the law of evidence, which protects some confidential communication between individuals, and a "privilege" in the law of torts, which protects certain actions by making the circumstances in which they were performed a defense to otherwise actionable torts. Nothing said at a public meeting of the Romulus City Council should be regarded as a...