Holmes v. Royal Fraternal Union

• Decision Date: 29 June 1909
• Citation: 222 Mo. 556,121 S.W. 100
• Parties: HOLMES v. ROYAL FRATERNAL UNION.
• Court: Missouri Supreme Court

121 S.W. 100

222 Mo. 556

HOLMES v. ROYAL FRATERNAL UNION.

Supreme Court of Missouri, Division No. 2.

June 29, 1909.

1. LIBEL AND SLANDER (§ 45) — PRIVILEGED COMMUNICATIONS — QUALIFIED PRIVILEGE.

A qualified privilege in the law of libel extends to all communications made bona fide on any subject-matter in which the person making them has an interest, or in reference to which he owes a duty to a person having a corresponding interest or duty of a moral or social character of imperfect obligation.

2. LIBEL AND SLANDER (§ 51) — "PRIVILEGED COMMUNICATIONS" — QUALIFIED PRIVILEGE.

A privileged communication is one made under such an occasion as rebuts the inference arising prima facie from a statement therein prejudicial to the character of another, and the latter must prove the existence of express malice.

3. LIBEL AND SLANDER (§ 45) — PRIVILEGED COMMUNICATIONS — WHAT ARE.

In determining whether a communication is privileged, the court must consider the exigencies of the situation of the party making the communication as to whether they warranted the charges made for the protection of the interest such party had under his control, or whether the language, under the circumstances,

was warranted or was of such a nature and character as to indicate an abuse of privilege.

4. LIBEL AND SLANDER (§ 45) — "PRIVILEGED COMMUNICATIONS."

Communications, otherwise actionable, are privileged where made by a voluntary society in the course of an investigation of the conduct or character of an officer or member, since the member by accepting membership voluntarily submits himself to the jurisdiction of the society so long as it acts within its authority.

5. LIBEL AND SLANDER (§ 45) — PRIVILEGED COMMUNICATIONS.

An agent of a fraternal beneficiary association employed to solicit business, take applications, and collect money, collected money which he failed to remit to the association as required by the contract of employment. The agent threatened to sue the association, and to take, on leaving the employment, a large number of the members thereof. Thereafter the association notified members that the agent had been discharged and that he had collected money which he had not remitted, and advising the members to remit to a person named or to the association. The association had examined into the affairs of the agent. Held, that the communication was a qualified privileged one.

6. LIBEL AND SLANDER (§ 123) — PRIVILEGED COMMUNICATION — QUESTION FOR COURT.

Where a libelous communication is alleged to be privileged, the court must determine the question of privilege in the first instance.

7. LIBEL AND SLANDER (§ 101) — PRIVILEGED COMMUNICATIONS — BURDEN OF PROOF.

A defendant in libel has the burden of proving the privileged character of the communication complained of.

8. LIBEL AND SLANDER (§ 101) — PRIVILEGED COMMUNICATIONS — BURDEN OF PROOF.

Where the court determines that the communication complained of as libelous is a privileged one, the burden of proof shifts to plaintiff to show express malice, and where there is no substantial evidence of such malice the court must sustain a demurrer to the evidence.

9. LIBEL AND SLANDER (§ 112) — PRIVILEGED COMMUNICATIONS — EXPRESS MALICE — EVIDENCE.

In an action for libel based on a qualified privileged communication, evidence held not to show the existence of express malice.

10. LIBEL AND SLANDER (§ 112) — PRIVILEGED COMMUNICATIONS — EVIDENCE — SUFFICIENCY.

In an action for libel based on a qualified privileged communication, evidence held to show that the statements in the communication were substantially true.

Appeal from Circuit Court, Buchanan County; C. A. Mosman, Judge.

Action by R. A. Holmes against the Royal Fraternal Union. From a judgment for plaintiff, defendant appeals. Reversed.

This cause is here by appeal from a judgment of the Buchanan county circuit court in favor of the plaintiff.

This is an action for libel, and is based upon a letter written by the appellant at St. Louis, Mo., addressed to one Clint Hull at St. Joseph, Mo., dated December 22, 1904, containing, as alleged in the petition, several false, scandalous, malicious, and defamatory matters of and concerning the respondent in his business. It is also alleged in the petition that appellant on the same date wrote and mailed the same letter to a number of other persons at St. Joseph, Mo., containing, as alleged, the same libelous matter. The petition charges libel in the usual form, based upon the publication of said letter by the parties therein named opening and reading same.

The answer of appellant admitted that the letter charged was written and mailed to Clint Hull, as well as other members of the Royal Fraternal Union at St. Joseph, and alleges that it was not mailed to any one else or otherwise published. It is denied that the letter was libelous, and the innuendoes of the petition are denied. In defense, the truth of the letter is pleaded, and appellant further pleaded that it was a privileged communication. Appellant alleged its good faith in writing and publishing the letter.

The appellant is a fraternal beneficiary association incorporated under the laws of this state with headquarters at St. Louis. Holmes was a member of the association, and for two years prior to the publication of the alleged libelous letter was employed by the association in soliciting members, organizing subordinate councils, and taking applications for beneficiary certificates or policies.

The letter written by the association to Clint Hull, C. B. Peasley, and others, at St. Joseph, Mo., of and concerning respondent as its agent, dated December 22, 1904, is as follows:

"Dear Sir and Brother: You are hereby notified that we have canceled the authority of our former representative at St. Joe, Mo., Mr. R. A. Holmes, to represent this order in any manner whatever. He is not authorized to take applications or to collect or to receipt for dues. Mr. Holmes has not remitted to this office any of the collections that he has made at St. Joe for the last two months; while he has reported to us the names and amounts collected he has failed to remit the money he has collected, due the Order, so you are advised not to make any more payment of dues to Mr. Holmes, as he has no authority to collect dues or receipt for payments made to him. As we had advised you to make your payments to Mr. Holmes, we have credited you and the other members at St. Joe with all the payments they made to him and stood the loss ourselves.

"We have arranged with the firm of Hull & Chittenden at No. 610 Edmond street, St. Joe, Mo., to take care of the collections until some other arrangements can be made. They have the collection list in their office and are authorized to receipt for monthly dues. If it is more convenient for you to remit your dues direct to the home office than to pay to them you are at liberty to do so, but in either event the payment must be made on or before the last day of the month. Please call at their office and make your payment to them at your earliest convenience. Kindly keep in mind that it will be necessary for you to go to the office of the above firm (Hull & Chittenden) to make your payments — they will not send a collector to your home. We regret exceedingly that it has become necessary to cancel Mr. Holmes' authority and we hope you and the other members at St. Joe will appreciate the situation and retain your membership in the Order. We will endeavor to secure an active agent at St. Joe as soon as possible.

                  "With best wishes, I remain
                                 "Fraternally yours
                              "F. H. Pickrell, President."
                

In December, 1902, respondent was employed by the association by a written contract to act as its agent, with territory in the state of Kansas. Under the provisions of this contract he was to receive, as full commission for all services rendered, all the first payments collected at the time of taking applications, and, in addition thereto, the third, fifth, seventh, tenth, and twelfth assessments received at the home office on business written by Holmes, or agents appointed by him. Respondent soon became dissatisfied with the commissions received under this contract when the association offered him another, which was rejected. Again in July, 1903, the association undertook to satisfy him by a new contract, and invited him to come to St. Louis, the association agreeing to pay one-half the expenses. This was also rejected, and at the same time respondent, in a letter to the association, threatened suit if matters were not adjusted to his satisfaction. On November 2, 1903, a new contract was entered into between respondent and the association. This new contract covered nine counties in the state of Kansas and four counties in Northwest Missouri, including St. Joseph. The powers given by the new contract to respondent were similar to those embraced in the first contract, but set out more in detail. Under this new contract respondent, for all services rendered by him, or any subagent he might appoint, was to receive upon the health and accident business all the policy fee collected by the agents, 40 per cent. of the first twelve monthly dues, and 20 per cent. of subsequent monthly dues, as well as some contingent commissions which are not necessary to be noticed in this statement. The dues on policies under this last contract were to be remitted monthly by respondent to the association on or before the 3d day of the month to which the dues applied. The association was to report and remit to respondent his commissions on the 25th of the same month. The new contract superseded the old contract. The respondent, after entering into the new contract, was still entitled under the old to commissions on dues paid by members obtained during its life, up to and including the twelfth monthly payment. The alternate payments to which respondent was entitled under the old contract were called "skip" payments,...