Fulton v. Advertiser Co.

Decision Date19 September 1980
Parties7 Media L. Rep. 1351 David H. FULTON et al. v. The ADVERTISER COMPANY et al. 79-217.
CourtAlabama Supreme Court

Jere L. Beasley and Frank M. Wilson, Montgomery, for appellants.

M. R. Nachman, Jr., of Steiner, Crum & Baker, Montgomery, for The Advertiser Co.

M. R. Nachman, Jr., Jerry Weidler, Sp. Asst. Attys. Gen., for David Bronner.

PER CURIAM.

This is an appeal from a summary judgment for defendants The Advertiser Company and David Bronner in a defamation suit seeking compensatory and punitive damages. We reverse and remand.

Defendant David Bronner, Finance Director of the State of Alabama and by virtue of that position a member of the State of Alabama Building Commission, acting within his official capacity as Chairman of the State Building Commission's Executive Committee on Personnel and Finance, initiated an investigation into alleged abuses and misconduct within the Commission. As a result of this investigation and the Committee's examination of the Commission, six Commission employees, including plaintiffs William Wyatt, the Deputy Director of Technical Staff, and David Fulton, a building inspector, were fired.

With regard to these dismissals, defendant Bronner held a press conference May 29, 1979, during which he issued a press release, made some additional statements, and answered questions from members of the assembled press, which included a representative of defendant Advertiser. The same day both plaintiffs were notified of their dismissal by letters from the Committee. On May 30, the Advertiser published an article in its morning edition concerning the investigation and the dismissals.

As a result of the press release, additional statements made at the press conference, and the subsequent newspaper article, Wyatt, Fulton and others not involved in this appeal filed separate complaints seeking compensatory and punitive damages for libel and slander against Bronner and the Advertiser. Bronner and the Advertiser moved to dismiss on a number of grounds. Certain of these grounds were denied and a hearing was set on the remaining grounds. Affidavits were filed by both sides and after arguments the trial court granted summary judgments for both defendants. That court held that Bronner's statements were qualifiedly privileged and that there was no evidence in the record indicating actual malice. Accordingly, the court found that the Advertiser's report of the press conference was fair and that Bronner's privilege also protected the newspaper. Wyatt and Fulton appeal.

The basic issue presented by this case is whether summary judgment was appropriate. Prior to any resolution of this issue, however, an examination of the alleged defamatory statements is necessary.

The press release issued by Bronner stated the following:

A financial investigation authorized by Title 41 of the Code of Alabama has been conducted into the Alabama Building Commission.

The investigation was conducted by the Examiners of Public Account, the Department of Public Safety and the Finance Office, which included taking sworn deposition from employees of the Building Commission, architects, contractors and testing firms from throughout Alabama.

As a result of this financial investigation, evidence of questionable activities and management was received relating to the following:

(1) The utilization of state employees on state time to do private business.

(2) The discovery of employees on the payroll who provided little or no service to the state.

(3) Allowing and/or initiating construction change orders resulting in contractors receiving greater profits.

(4) The utilization of gratuities and/or agents in order to secure state business.

Based on the information produced by the financial investigation and a thorough review of the qualifications and past performance of the present Building Commission personnel, the "Personnel and Finance Committee" of the Building Commission discharged six employees.

All results of the investigation will be turned over to the Attorney General to be utilized as he sees fit.

In his affidavit, Bronner stated the following concerning his comments at the press conference:

In response to a question, I gave the names of the six employees referenced in the statement-names which included plaintiffs Wyatt and Fulton ....

At no time did I state that any charges had been or would be lodged against them. In fact, when asked by a reporter what charges had been made against any specific individuals, I answered, "What charges? I have made no charges about anyone. As far as the Committee is concerned, they were dismissed because of qualifications and performance."

The article published by the Advertiser in response to the press conference reads, in pertinent part, as follows:

The director, deputy director and four other employees of the State Building Commission were fired Tuesday in the wake of an investigation into mishandling of building contracts and state work on private property.

Finance Director David Bronner said Building Commission Director Hugh Adams, Deputy Director William Wyatt, Energy Division chief John Cluck and three building inspectors were fired by the commission's executive committee after the investigation uncovered widespread abuses in the department.

Bronner directed the six-week investigation by members of the Examiners of Public Accounts, the Department of Public Safety, and the Finance Department.

The results were turned over to Attorney General Charlie Graddick for further investigation.

W. G. Stevenson, a professional engineer and veteran employee of the commission, was appointed temporary director of the department. Other vacancies will be filled later, but Bronner said some of the vacancies will probably remain unfilled.

The finance director said one of the fired building inspectors had not turned in an inspection report in seven years.

The dismissed inspectors were identified as David Fulton, Ray Martin and Howard Wilson.

Bronner said the investigation uncovered evidence of questionable activities and management in four areas:

-The use of state employees on state time to do private business.

-The discovery of employees on the payroll who provided little or no service to the state.

-Allowing or initiating construction change orders resulting in contractors receiving greater profits.

-The use of gratuities and agents in order to secure state business.

Contractors and architects wanting to do business with the state were told they would have to get an agent with political influence before they could get a state contract, Bronner said. The contractor or architect negotiated with the agent to use his influence, the finance director added.

But contractors and architects who used agents in the past would not be barred from doing business with the state, he said.

"This is more a problem of the state than of the architects and contractors," he said. "They had to go through the system, and the system was bad."

Bronner said in reply to questions that none of the private work involved the new home of former Gov. George Wallace or property of his relatives.

The finance director declined to answer when asked if the private work involved property belonging to any of the dismissed employees.

Change orders were freely given with the result that contractors could bid low on a project and then add unbid modifications to increase the price to a more profitable level, he said.

The investigators examined commission activities over a five- or six-year period during which contracts involving millions of dollars in school and other building construction were issued.

... Wyatt was appointed to the commission staff as deputy director in 1971.

... Bronner said the dismissed employees were not given a chance to resign because they knew for at least two weeks they were being investigated and had not resigned.

This article was accompanied by a headline in bold type which stated: "Officials Fired Following Probe."

The letters of dismissal to both plaintiffs simply informed them that the Committee had met "to review qualifications and performance of Commission employees" and that their (plaintiffs') employment had been thereby terminated.

In an action for defamation, an initial determination of the status of the allegedly defamed person as a public official, public figure, or a private individual must be made. E.g., American Benefit Life Ins. Co. v. McIntyre, 375 So.2d 239 (Ala.1979). This is a question of law for the trial judge. Rosenblatt v. Baer, 383 U.S. 75, 86 S.Ct. 669, 15 L.Ed.2d 597 (1966), Mobile Press Register, Inc. v. Faulkner, 372 So.2d 1282 (Ala.1979).

In Mobile Press Register, Inc., supra, this Court stated This issue (status) must be resolved first because the manner of its resolution determines what elements of proof are necessary for recovery. New York Times v. Sullivan, 376 U.S. 254, 84 S.Ct. 710, 11 L.Ed.2d 686 (1964), and its progeny mandate that no public figure may recover compensatory or punitive damages for libel unless actual malice as defined in Sullivan is proved: a publication made with actual knowledge of its falsity or made with reckless disregard of its truth or falsity. If plaintiff be a private figure, he or she need not prove Sullivan malice unless punitive damages are claimed. Gertz v. Robert Welch, Inc., 418 U.S. 323, 94 S.Ct. 2997, 41 L.Ed.2d 789 (1974). (footnotes omitted)

As Justice Almon noted in the recent decision of Gray v. WALA-TV, 384 So.2d 1062 (Ala.1980): "This actual malice standard was further elaborated on in St. Amant v. Thompson, 390 U.S. 727, 88 S.Ct. 1323, 20 L.Ed.2d 262 (1968); there it was stated that reckless disregard requires "... sufficient evidence to permit the conclusion that the defendant in fact entertained serious doubts as to the truth of the publication."

Privilege is another issue which bears directly upon the issue of proof of malice.

Bronner contends that the...

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