Getchell v. Auto Bar Systems Northwest, Inc.

• Decision Date: 09 May 1968
• Docket Number: No. 39191
• Citation: 73 Wn.2d 831,440 P.2d 843
• Court: Washington Supreme Court
• Parties: Robert GETCHELL and Jean Getchell, husband and wife, Respondents, v. AUTO BAR SYSTEMS NORTHWEST, INC., Lester Peake and Jane Doe Peake, husband and wife, Mel Rolfson and Jane Doe Rolfson, whose true name is Constance G. Rolfson, husband and wife, George Shoop and Jane Doe Shoop, husband and wife, Appellants.

Page 831

73 Wn.2d 831

440 P.2d 843

Robert GETCHELL and Jean Getchell, husband and wife, Respondents, v.AUTO BAR SYSTEMS NORTHWEST, INC., Lester Peake and Jane Doe Peake, husband and wife, Mel Rolfson and Jane Doe Rolfson whose true name is Constance G. Rolfson, husband and wifeGeorge Shoop and Jane Doe Shoop, husband and wife, Appellants.

No. 39191.

Supreme Court of Washington, Department 2.

May 9, 1968.

Rehearing Denied July 8, 1968.

John L. LaLonde, Vancouver, Theodore S. Bloom, Portland, Or., for appellants.

Robert E. Anderson, Spokane, for respondents.

HAMILTON, Judge.

This is an action in slander.Plaintiffs, seeking damages, alleged defendants wrongfully made statements imputing that plaintiffRobert Getchell was guilty of criminal conduct and the inability to meet business commitments.As a defense, defendants asserted truth and absolute or qualified privilege.Following trial and the overruling of defendants' motions for dismissal or directed verdict, the cause was submitted to the jury which returned a verdict awarding plaintiffs $15,000 and general damages.In denying defendants' post trial motions for judgment notwithstanding the verdict or in the alternative for new trial, the trial judge reduced the verdict to $10,000.Plaintiffs consented to the reduction and judgment was so entered.Defendants appeal.

Defendants set forth eight assignments of error.By their nature and the course of defendants' argument, the claims of error fall into three categories: (1) A challenge to the sufficiency of the evidence to warrant submission of the cause to the jury or to sustain its verdict; (3) asserted error in the admission and rejection of evidence; and (3) claimed error in failing to give two proposed instructions.We will discuss defendants' contentions in the order listed.

Briefly, and by way of background, the defendantAuto Bar Systems Northwest, Inc., is an Oregon corporation owned and managed by the defendantsGeorge Shoop, Mel Rolfson, and Lester Peake, president, vice-president, and secretary-treasurer, respectively.The principal business of the enterprise is the marketing, installation, and servicing of a particular brand of an automatic liquor dispensing device for use in cocktail bars.For this purpose, the corporation holds what the defendants designate as an exclusive franchise to distribute the device in certain northwestern states, including the state of Washington.

In late 1962 or early 1963, plaintiffRobert Getchell was engaged by defendants as a sales and service man in the Washington area.Plaintiffs contended the compensation arrangement provided for regular weekly draws of $125 to be charged against prospective commissions to be computed at 15 per cent of gross sales throughout Washington.Defendants, on the other hand, contended that the arrangement contemplated only a commission of 15 per cent upon actual sales made by plaintiffRobert Getchell with weekly draws permissible against earnings.Mr. Getchell provided service calls and made several sales during the early part of 1963.He claimed commissions due upon at least a $27,000 gross.Defendants disputed the amount of commissions claimed.

Mr. Getchell testified that the weekly payments due from defendants were irregular thereby causing him financial difficulties.This resulted, he contended, in frequent requests for payments, some lump sum payments, and finally a mid-July, 1963, conference with Mr. Shoop.Mr. Getchell asserted that this conference gave rise to an agreement authorizing him to retain for his use as needed, and in lieu of unpaid weekly draws, down payments from customers to whom he sold equipment, provided he accounted to defendants for any such funds retained.Thereafter, between August 2 and September 13, 1963, Mr. Getchell retained one down payment and two contract payments made by customers, totaling $1,073.40.According to Mr. Getchell, he accounted to defendants for these sums in September, 1963, following which defendants made additional, although irregular, advances and the employment relationship continued amicably until he voluntarily terminated it in early 1964.

Defendants, in substance, denied their advances against commissions were unsystematic, asserted that total advances exceeded earned commissions, that any retention of customer payments was unauthorized and wrongful, and that Mr. Getchell had not advised them of any such retained payments before November, 1963.

Following termination of the employment arrangement in early 1964, Mr. Getchell continued to make service calls upon at least one of defendants' customers and made arrangements whereby he undertook to sell reconditioned liquor dispensing units of the brand franchised to defendants.In the course of his activities in this latter respect, Mr. Getchell sold a reconditioned unit to the Wenatchee, Washington, Elks Club, and entered into negotiations for the sale of a unit to the Spokane, Washington, Elks Club.Upon becoming aware of Mr. Getchell's efforts, defendants contacted various officers of the two Elks Clubs and the customer to whom Mr. Getchell was furnishing unit service.In substance, according to witnesses representing the organizations contacted, defendants advised them that Mr. Getchell was no longer an employee of defendants, that he had wrongfully retained company funds, and that he would be unable, due to defendants' franchise, to provide parts and service for the reconditioned units he was offering for sale.In addition, two of the witnesses stated that Mr. Shoop and Mr. Rolfson told them that the defendants were out to 'got' Mr. Getchell, and a third witness stated he was told that defendants could file charges against Mr. Getchell for misappropriation of funds.Defendants denied making the statements attributed to them, except the substance of the statement relative to Mr. Getchell's inability to obtain parts and furnish adequate service, which they contended was true by virtue of their franchise.They further indicated that in their view Mr. Getchell had actually, wrongfully, and without authorization retained company funds, hence had they made any such statements the same would likewise have been true.

As an upshot of defendants' calls upon the respective Elks Clubs, the officers thereof conducted an investigation, following which the Wenatchee Elks Club retained the equipment purchased from Mr. Getchell, and Spokane Elks Club purchased the units offered by Mr. Getchell.The evidence indicated that Mr. Getchell had an arrangement with a California distributor which permitted him to obtain replacement parts as well as to provide a service warranty upon the reconditioned equipment.

At or about the time of the foregoing events, defendant Peake, on behalf of the other defendants, came to Spokane, the home of plaintiffs, and telephoned Mr. Getchell.According to Mr. Getchell, Mr. Peake requested that he refrain from selling the reconditioned equipment and return as a salesman for defendants.To this, Mr. Getchell stated, he told Mr. Peake he would think it over and answer by mail.According to Mr. Peake, the conversation revolved about his request that Mr. Getchell return the funds he owed defendants and Mr. Getchell's response that he would explain his financial situation by letter.Both testified the conversation, whatever its content, was amicable.

The day following the telephone conversation, Mr. Peake contacted a deputy prosecuting attorney for Spokane County, presented him with the cancelled checks representing the customer payments Mr. Getchell had retained, and discussed the criminal aspects with him.This was done pursuant to a conversation between the individual defendants as to whether criminal charges should and could be brought.The deputy prosecuting attorney referred the matter to the Spokane City Police Department for investigation.The detective in charge of the investigation testified that Mr. Peake came to his office and talked with him.Mr. Peake denied any contact with the police officer.The officer called Mr. Getchell and asked that he report into the police station.This Mr. Getchell did, and thereafter no further official action was taken.

Plaintiffs claimed that as a result of the actions of defendants, they suffered embarrassment, loss of reputation, and mental anguish.They voluntarily dismissed during trial, any claim of special damages, I.e., loss of earnings.

Against the backdrop of the testimony as outlined, the trial court submitted the issues of slander, truth, qualified privilege, malice and general damages to the jury.

In support of their assignments of error challenging the sufficiency of the evidence, defendants first argue that the evidence indisputably establishes the truth of the alleged slanderous statements.We cannot agree.The testimony is in outright conflict as to (a) whether some of the purported statements were made, (b) whether Mr. Getchell had authority to withhold or retain customer payments, (c) whether Mr. Getchell properly, timely, and in keeping with his authority reported the payments he withheld, and (d) whether Mr. Getchell could obtain replacement parts for and furnished service upon the reconditioned devices he sold.A jury question was clearly presented and properly submitted.Had the trial court followed any other course it would have been in error.

Defendants next argue (1) that the statements made or presented to the deputy prosecuting attorney were absolutely privileged, and (2) if such statements or the data supplied to the deputy prosecuting attorney were only conditionally privileged, then there was no evidence upon which a finding...