Hartsfield v. Harvey C. Hines Co.

• Decision Date: 18 February 1931
• Docket Number: 204.
• Parties: HARTSFIELD v. HARVEY C. HINES CO. et al.
• Court: North Carolina Supreme Court

157 S.E. 16

200 N.C. 356

HARTSFIELD v. HARVEY C. HINES CO. et al.

No. 204.

Supreme Court of North Carolina

February 18, 1931

Appeal from Superior Court, Lenoir County; Devin, Judge.

Action by T. G. Hartsfield against Harvey C. Hines Company, and Harvey C. Hines, individually. From a judgment granting partial relief to plaintiff against the defendant last named plaintiff and defendant last named appeal.

In slander action, privilege is question of law for court.

On plaintiff's appeal, no error; and, on defendant's appeal, new trial.

The plaintiff was employed by the individual defendant fourteen or fifteen years ago. Subsequently the business was incorporated and was thereafter known as the Harvey C. Hines Company. The plaintiff began work at $60 or $65 a month, and at the time of the utterance of the slanderous words hereinafter complained of, he was making $4,200 per year. The plaintiff had general supervision of the entire business of defendant and was, at the time the cause of action arose treasurer of the defendant corporation and held a share of stock therein. The defendant corporation transacted a large volume of business and had many employees.

The evidence tended to show that the defendant Hines and the plaintiff were close friends and visited the homes of each other frequently, and each apparently had implicit confidence in the other. The defendant Harvey C. Hines was president of the corporation and in such capacity had general supervision and control of all the affairs of the company. Some time prior to August 6, 1926, certain trusted employees made certain complaints and reports to Harvey C. Hines, president, with respect to certain transactions of plaintiff, which tended to leave the impression that the plaintiff was misappropriating the money of his employer. As a consequence of such reports, the defendant Harvey C. Hines undertook to make an investigation of the transactions of plaintiff, in the course of which investigation he examined the plaintiff's bank account and other business transactions, and, as a result of inquiries so made, the defendant Hines, on the morning of August 6, 1926, called the plaintiff into his private office. At the time there were also in the office Mr. Walters, Mr. Weise, and Mr. Small, who were all trusted employees of the corporation. Walters was vice president of the company; Weise was head bookkeeper, and had charge of invoices and records; and Small was night clerk or the man in charge of the business during the night. These were the only persons in the private office of defendant Hines.

The conversation in the private office was narrated by the plaintiff as follows: "I took a seat opposite Mr. Hines. He said: 'Tom, I guess you know what I want to talk with you about?' I told him I did not. He said, 'Well, we feel like you have not been dealing fair with us,' and I said, 'I don't understand any such accusation and I would like for you to explain,' and he said, 'I mean that you have simply been dishonest with us and I have made my investigation and am pretty well satisfied.' I said, 'You may be satisfied, but I would like to be satisfied. I would like for you to tell me what you are getting at.' He said it did not need any explanation, and he said, 'You don't deny these papers, do you?' He laid before me certain papers, and I told him those papers did not mean anything, and I asked him if he had anything besides that, and he said Mr. Small was his eye witness. I continuously asked him if he would not give me some definite reason for it. He said no, it did not need any explanation, and all he was going to ask of me was to resign and he would not prosecute me and that that was all that was necessary. I told Mr. Hines I would hand in my resignation, but first I would like for him to let me know just what his charges were, and if he would I would like to talk to him privately, and that instant we left the office and went out in the warehouse," etc.

The defendant offered testimony tending to show that the plaintiff did not deny misappropriating money, but confessed to the same. Employees of defendant testified that when the defendant returned from the warehouse where he and plaintiff had had a private conversation that the defendant Hines was shedding tears and was greatly distressed over what he considered the unfaithfulness of a trusted friend. The plaintiff, however, denied that he ever made any confession in private.

The defendant pleaded truth and justification. The defendant filed an itemized list of money and property which he claimed the plaintiff had appropriated to his own use. This list appears in the record as Exhibit A and consists of a certain sum of money in the compartment of the safe of the corporation used exclusively by the plaintiff. In addition to sums of money, the said Exhibit A charged that the plaintiff had taken goods, wares, and merchandise from the defendant's store for his own consumption, consisting of Coca-Cola, coal, canned goods, and other items.

The plaintiff, as a witness in his own behalf, offered evidence tending to explain the items of money. Some of these items of money the plaintiff contended belonged to the Ku Klux and represented collections turned over to him from time to time by members of said order.

On October 2, 1926, Asa C. Hawkins, a deputy sheriff of Lenoir county, arrested Mr. Small, an employee of defendant corporation, and one of those present on August 6th at the conference between the plaintiff and the defendant when the first alleged slanderous utterances were made by the defendant Hines. Small was charged with illegal possession of whisky. The evidence tended to show that on October 2, 1926, at about 2:00 o'clock in the morning, the defendant Hawkins called the defendant Hines over the telephone and informed him that he had arrested one of his employees. Thereupon Hawkins, in company with Mr. Wilcox, chief of police, went to the home of Mr. Hines. Hines came out on the porch in his bath robe, and it was then between, 1, 2, or 3 o'clock in the morning. Hawkins reported to Hines that he had one of his employees under arrest for violation of the law, and that he had found some of the property of the corporation down in the woods where the arrested employee was. The deputy sheriff testified that he "made a remark to him (Hines) that it was probably where some of his shortage came from." Hines replied, "Tom (plaintiff Hartsfield) has been at that for two or three years." There was no evidence that Wilcox, the police officer, heard any of the conversation.

This conversation before daybreak at Hines' house on the 2d day of October, 1926, constitutes the second cause of action.

At the conclusion of the evidence, the trial judge held as a matter of law that the conversation of August 6, 1926, in the private office of defendant Hines was privileged, and withdrew from the jury all consideration of the first cause of action based upon said conversation. In deference to such intimation of the court, the plaintiff took a nonsuit as to the first cause of action and assigned the ruling of the judge as error.

Thereupon, the trial judge submitted the following issues to the jury:

1. Did the defendant Harvey C. Hines on or about October 2, 1926, and in the presence of Asa Hawkins, speak of and concerning the plaintiff in substance the words alleged in the complaint?

2. If so, were they true?

3. What compensatory damages, if any, is the plaintiff entitled to recover therefor?

4. What punitive damages, if any, is the plaintiff entitled to recover therefor?

The jury answered the first issue "Yes"; the second issue "No"; the third issue "$10,325.00"; the fourth issue "$2,766.66."

The trial judge in his discretion set aside the verdict as to the fourth issue relating to punitive damages, and thereupon entered judgment that the plaintiff recover from the defendant Harvey C. Hines the sum of $10,325, with interest from June 9, 1930, until paid. It was further ordered that the plaintiff recover nothing of the corporate defendant.

The plaintiff testified in reference to the relation between Hines and himself that up until August 6, 1926, "I had always considered that my relations with Mr. Hines had not only been most pleasant but had been cordial. I considered it so up until this very hour. He had shown me every consideration that I could expect from him. He had always treated me in a nice way. I felt like I had served him properly and he always respected me."

From judgment rendered both parties appealed.

George C. Green, of Weldon, McLean & Rodman, of Washington, N. C., and Whitaker & Allen and Rouse & Rouse, all of Kinston, for plaintiff.

Dawson & Jones, Sutton & Greene, and F. E. Wallace, all of Kinston, and Varser, Lawrence & McIntyre, of Lumberton, for defendant Harvey C. Hines.

BROGDEN J.

The determinative questions of law presented by the record are:

1. Was the trial judge correct in holding that the conversation on August 6, 1926, in the private office of defendant was privileged?

2. Was the conversation between the defendant and the deputy sheriff Hawkins on October 2, 1926, privileged?

3. Must privilege be...