Glenn v. Gidel

• Citation: 496 S.W.2d 692
• Decision Date: 16 April 1973
• Docket Number: No. 8341,8341
• Parties: Vernon GLENN, Appellant, v. Gene GIDEL et al., Appellees.
• Court: Texas Court of Appeals

Page 692

496 S.W.2d 692

Vernon GLENN, Appellant, v. Gene GIDEL et al., Appellees.

No. 8341.

Court of Civil Appeals of Texas,

Amarillo.

April 16, 1973.

Phillip D. Hardberger, San Antonio, for appellant.

Culton, Morgan, Britain & White, Donald E. Jackson, Amarillo, Leo C. Michaud, Bardwell D. Odum, Dallas, for appellees.

REYNOLDS, Justice.

In this lawsuit, plaintiff Vernon Glenn sought monetary damages from Gene Gidel and the American National Bank of Amarillo for slander, and from H. R. Gibson, Sr., and Gibson Products Company for slander, interference with a contract, and for wrongful cancellation of his Gibson franchises. Trial began before a jury and, after plaintiff had presented his evidence, all defendants moved the trial court to, and the court did, instruct a verdict favorable to all defendants. Judgment was entered accordingly. Plaintiff's three-point appeal challenges the propriety of the trial court's instructed verdict and judgment. Affirmed.

The first point of error asserts that the instructed verdict was erroneous because the evidence raised material issues of fact for resolution by the jury. The other two points assigned error in excluding certain evidence offered. A statement is necessary to properly posit the events leading to a consideration of the points of error.

The Events Preceding Litigation

H. R. Gibson, Sr., sometimes hereinafter referred to as Gibson, is the owner of the trademark names 'Gibson Products Company' and 'Gibson Discount Center.' Plaintiff Vernon Glenn and his brother, J . B. Glenn, were interested in establishing a Gibson discount store in Amarillo. Gibson would not consider granting them a Gibson franchise unless they could establish a line of credit of at least $200,000.00. The Glenn brothers made arrangements with the American National Bank of Amarillo in April, 1964, to borrow $200,000.00 to open and operate the store. The business was incorporated as Gibson Products Company of Amarillo with each brother owning 50,000 shares of stock, or fifty per cent of the total of the 100,000 shares of stock issued. A second store was opened in May or June in 1965. Subsequent to the April, 1964 transaction, the bank made loans to the Glenn brothers and the corporation for inventory and working capital purposes. In February, 1967, the outstanding indebtedness was consolidated into a $300,000.00 note, fifty percent of which was guaranteed by the Small Business Administration. One of the executed loan documents obligated the Glenn brothers to furnish to the bank or the Small Business Administration a semi-annual audit beginning June 30, 1967, and the year-end audit was to be certified.

Subsequent to the establishment of both stores, the Glenn brothers and H. R. Gibson, Sr., doing business as Gibson Products Company of Seagoville, Texas, executed two written agreements dated August 31, 1965. The two instruments were identical except for the number of the Glenn brothers' store for which the agreement was executed. By the material terms of the agreement, Gibson permitted the Glenn brothers the use of his registered trademark names in Amarillo for the period of ten years, and the benefit of volume purchasing power for which the Glenn brothers agreed to pay, depending upon the size of the store, either $150.00 or $200.00 per month. The contract specified that it was not assignable or transferable without the written approval of Gibson, and the only provision for cancellation contained in the agreement was the penultimate paragraph which reads:

'This contract may be cancelled at any time within Ninety (90) Days by written notice sent registered mail, by either party.'

On July 31, 1968, Tony Grillo, formerly employed by the Glenn brothers as a bookkeeper, went to the office of Gene Gidel, the vice-president of the American National Bank servicing the loan made to the Glenn brothers. At that time, the Glenn brothers had failed to submit, and the bank had not received, the certified audit due December 31, 1967. To Gidel, Grillo made certain statements concerning his problems with keeping the books and records of inventory for the corporation and the movement of merchandise between the stores. Gidel invited Garner Young, the Small Business Administration representative who was in Amarillo on business, and W . P. McWhirter, a certified public accountant retained by the Glenn brothers to prepare an audit, to the bank where Grillo repeated the report the previously had made to Gidel. This was done, Gidel testified, because '. . . this . . . could have all tied in with the reason why we could not get a certified statement.' The next morning, Gidel related Grillo's report to five members of the bank's loan committee.

According to Gidel, and he was the only witness called to testify about Grillo's report, the report Grillo made to him, and repeated at Gidel's request to Young and McWhirter, and then communicated by Gidel to the bank's loan committee members concerning the movement of merchandise was:

'. . . there was a movement of merchandise from one store to the other, or other locations, that he could not account for. . . .'

Gidel also testified that Grillo had told him that '. . . there evidently was some movement at night.' Parenthetically, it is noted that additional to the stores other buildings were used periodically as warehouses, and neither of the Glenn brothers knew whether the merchandise therein had been included in the year-end inventory. Approximately a week after the Grillo report an additional report came to Gidel and he approached Vernon Glenn. According to Vernon Glenn's version of the conversation, Gidel took the information to mean that the Glenn brothers were stealing truck loads of mortgaged merchandise out of the store at night.

Thereafter, the Glenn brothers entered Gidel's office when Gidel was engaged in a telephone conversation. Gidel addressed the party as 'Mr. Gibson' and, concluding the conversation, stated to the Glenn brothers, 'I just called Mr. Gibson to see what's going on.' Plaintiff could not state that Gidel was talking with H. R. Gibson, Sr., nor the nature of the conversation.

Approximately one or two weeks later, the Glenn brothers were notified by registered letter dated November 14, 1968, from Gibson's attorney that Gibson '. . . has elected to cancel and terminate . . . each of the . . . franchise agreements dated August 31, 1965, said cancellation and termination to be effective ninety (90) days from receipt of this notice by you.' Within thirty days thereafter, following negotiations with prospective purchasers of the stock, the Glenn brothers sold their shares of stock in Gibson Products Company of Amerillo to Bill Johnson and Raymond Akin. Some sixty days later, Vernon Glenn instituted this lawsuit.

Plaintiff's Allegations

Plaintiff Vernon Glenn founded his cause of action for slander against Gene Gidel and the American National Bank of Amarillo on allegations that Gidel, in his capacity as a bank officer, maliciously circulated a false report about plaintiff's honesty. The alleged report was that plaintiff and his brother were wrongfully removing truck loads of merchandise from the store at night.

The causes of action presented against H. R. Gibson, Sr., and Gibson Products Company were for slander, contractual interference and wrongful franchise termination. The slander complaints were that Gibson, to whom Gidel allegedly communicated the false report of which he is accused, wrongfully circulated the story to other people, including prospective buyers of plaintiff's business interest, and falsely stated that plaintiff's business books were erroneous and not reflective of the true financial condition of the stores. Contractual interference was charged '(f)or wrongfully interfering with the contract between Vernon Glenn and the buyers of his store.' In response to a special exception and with approval of the court, plaintiff added the following: 'Gibson did this by telling the Hookers, O'Kelly, Chaffins, Johnson and Akin that the store was not worth the money they were offering, and he didn't want them to pay that.' Plaintiff went to trial on this allegation. The franchise cancellation was pleaded to be wrongful in violation of the implied good faith continuance of the contract.

All of these acts by the defendants, plaintiff concluded, illegally forced him to sell his business interest at a loss. Punitive damages for plaintiff's loss of character, reputation, and standing in the community were also sought.

The Actions for Slander

1. Against Gidel and the Bank

From the foregoing major premises, plaintiff contends that he made out a submissive case of slander by Gidel and the bank for jury resolution. It is reasonable to infer, plaintiff says, that Gidel and the bank were guilty not only of slander but of slander per se in accusing plaintiff of the crime of stealing mortgaged merchandise, and publishing the accusation to Young, McWhirter, the bank's loan committee members and to Gibson. We do not accord that interpretation to the evidence.

To constitute actionable slander, there must be a defamatory statement orally communicated or published without legal excuse; the statement must be actionable per se, that is, defamatory in itself, or actionable per quod, that is, not actionable per se upon its face, but actionable only in view of actual damages resulting from slanderous words. McDaniel v. King, 16 S.W.2d 931 (Tex.Civ.App.--San Antonio 1929, no writ). See, also, the cases collated at 36 Tex.Jur .2d Libel & Slander § 2.

Aside from any question of the legal excuse of privileged communication interposed by Gidel and the bank, the statement of Grillo communicated by Gidel was not a defamatory statement per se applicable to plaintiff. The statement does not name any person, and particularly it does not designate Vernon Glenn, in connection with the movement of merchandise. It does not charge the commission of any crime. The...