Larrick v. Gilloon

• Decision Date: 18 December 1959
• Citation: 1 Cal.Rptr. 360,176 Cal.App.2d 408
• Court: California Court of Appeals Court of Appeals
• Parties: H. G. LARRICK, Sr., Ray Badger, George Dose and D. M. Bakewell, Plaintiffs and Respondents, v. Frank J. GILLOON, Defendant and Appellant. Civ. 6126.

Page 360

1 Cal.Rptr. 360

176 Cal.App.2d 408

H. G. LARRICK, Sr., Ray Badger, George Dose and D. M. Bakewell, Plaintiffs and Respondents, v. Frank J. GILLOON, Defendant and Appellant.

Civ. 6126.

District Court of Appeal, Fourth District, California.

Dec. 18, 1959.

William B. Murrish, Hollywood, John W. Porter, and Gostin & Katz, San Diego, for appellant.

Gray, Cary, Ames & Frye, San Diego, for respondents.

MUSSELL, Justice.

This is an action for damages for false, defamatory and libelous statements published by the defendant containing accusations and insinuations of collusion, bad faith, fraud, misuse of public office, dishonesty, and falsification of minutes of a directors' meeting of the Santa Fe Irrigation District in San Diego county. A jury awarded plaintiffs $400 compensatory and $10,000 punitive damages and defendant Frank J. Gilloon appeals from the judgment entered thereon.

The complaint and the supplement and amendment thereto contains seven causes of action based upon a series of press releases and political advertisements published by defendant. Plaintiffs H. G. Larrick, Sr., Ray Badger and George Dose were directors of the Santa Fe Irrigation District and plaintiff D. M. Bakewell was its secretary and manager. Defendant Frank J. Gilloon owned property in said district. He had served as a director of the District from 1933 to 1937 and had an intimate knowledge of its affairs.

The first cause of action is based upon statements which were published by defendant in the Rancho Santa Fe Times in its edition of December 20, 1956, as shown by exhibits A and B attached to the complaint. In it Gilloon demanded the immediate resignation from office of manager Bakewell and all board members and stated that if the resignations were not forthcoming at once, he would call on the county grand jury for an indictment and their removal from office. He further stated that Mr. Easton, the San Diego County Tax Collector, by persuading the board of supervisors of San Diego county to refuse to make a purchase option agreement with the District had stopped a 'racket' which had defrauded the county and District of large revenues for several years; that the District sold land to its favorites under contracts which he (Gilloon) considered showed definite evidence of conspiracy, collusion and fraud; that if Larrick, Dose, Badger and Bakewell did not remove themselves promptly from all official connection with the District, he (Gilloon) would lay before the grand jury evidence in the contracts, in the minutes, in policy and in action or statements which he (Gilloon) felt sure would bring about their indictment and removal from office. In exhibit B it was stated that 'Gilloon has specifically charged the board with collusion, fraud, bad faith and dishonesty' in its sale of 96 acres of tax-deeded land to Holland J. Ford, contract for which was executed on May 18, 1954. In this publication Gilloon also stated that 'It is my belief that in effect the contract is a conspiracy to defraud the District and the county of assessments and taxes' and that 'On the basis of the terms of the last Ford contract and conditions surrounding it as outlined, it is my belief that it shows collusion, fraud and bad faith and dishonesty'. Gilloon further stated that he had discovered that Bakewell, with the connivance of the board members, had deliberately falsified the minutes of the board by inclusion of a condition therein not discussed or agreed upon by the board members.

The second cause of action is based on a publication in the Encinitas Coast Dispatch on December 27, 1956, and the third cause of action is based on a publication in the San Dieguito Citizen on December 27, 1956. In these publications defendant Gilloon set forth a number of questions relative to the District's dealings with Ford and demanded that the directors answer them or resign--'or * * * would you rather quit and go home * * * now * * * or to the grand jury'. In a publication in the Encinitas Coast Dispatch on January 3, 1957, which is the basis of the fourth cause of action, Gilloon stated that 'phony service charges' had been 'loaded on the residents and property owners of the District by Larrick, Badger, Dose, their confederates and their predecessor friends'. The fifth cause of action is based on a publication in the San Dieguito Citizen, under date of January 3, 1957, in which Gilloon stated that he had bid for the State's title to 700 acres of land lying between Rancho Santa Fe and Solana Beach in an effort to block what he believed was a 'set up' for a 'land grab' of 1,000 to 1,600 acres of District land and a 'give away' of that land on terms similar to the notorious Ford-SFID agreement. The sixth cause of action is based on the publication on January 31, 1957, in the Solana Beach Advertiser. This article was addressed to the voters of the District and in it Gilloon stated that all the facts stated by him were true and verifiable and that the directors of the District 'know that the interpretation of these facts can only show one or a combination of the following: stupidity, incompetence, lack of planning, favoritism of the grossest sort, vindictiveness, bad faith, collusion and lack of integrity'. This publication was also published on January 31, 1957, in the Encinitas Coast Dispatch and is the basis of the seventh count in the supplement and amendment to the complaint.

Appellant argues that the action below in entirety violated freedom of speech and was unconstitutional because affecting 'libel' of government officers in their governmental capacity only. We are not in accord with this argument.

In 30 California Jurisprudence 2d, Libel and Slander, section 4, page 661, it is said that the constitutional provision that every citizen may freely speak, write and publish his sentiments on all subjects, being responsible for the abuse of such right, and that no law shall be passed to restrain or abridge the liberty of speech or the press, by its very terms implies that the liberties of speech and of the press are not unlimited, but are subject to reasonable limitations.

In Emde v. San Joaquin County, etc., Council, 23 Cal.2d 146, 154, 143 P.2d 20, 25, 150 A.L.R. 916, the court, in discussing publications concerning a labor dispute, said:

'Although the publicizing of the facts of a labor dispute in a peaceful manner is within the liberty of free discussion guaranteed by the Fourteenth Amendment to the United States Constitution, a party to the controversy has no absolute privilege to discuss such matters so as to avoid civil responsibility for injury to another caused by a malicious and false statement made in the course of the differences between them.'

In Dauphiny v. Buhne, 153 Cal. 757, 763, 96 P. 880, it is said that libel is no more justifiable when published about a candidate for public office than if published about him on any other occasion. In Jarman v. Rea, 137 Cal. 339, 353, 70 P. 216, it is said that the publication of falsehood and calumny against public officers or candidates for public offices is an offense most dangerous to the people, and deserves punishment, because the people may be deceived, and reject the best citizens, to their great injury, and it may be to the loss of their liberties.

In Schomberg v. Walker, 132 Cal. 224, 230, 64 P. 290, 292, it is said that the right of a citzen to comment on the proceedings of public officers is limited by the condition that 'he does so fairly and with honest purpose,' and that the line be observed 'where defamation commences [and] true criticism ends.' In Snively v. Record Publishing Co., 185 Cal. 565, 198 P. 1, it is held that the publication must be both false and unprivileged in order that it shall constitute actionable libel and that Dauphiny v. Buhne and Jarman v. Rea, supra, should be overruled in so far as they declare that a privileged communication must be true in order to make it privileged.

The next argument advanced by appellant is that the writings were absolutely privileged under Civil Code, section 47, subdivision 2, because expressed during and in the course of an official proceeding authorized by law. This argument is without merit. It is true that under subdivision 2 of section 47 of the Civil Code publications made in the course of a judicial proceeding are absolutely privileged (Albertson v. Raboff, 46 Cal.2d 375, 379, 295 P.2d 405) and that par. 3 of subdivision 2 of said section extends the rule to a publication made in any other proceeding authorized by law. However, in Gunsul v. Ray, 6 Cal.App.2d 528, 45 P.2d 248, it was held that there is no rule of public policy which would give to a citizen actuated by malice a greater immunity from suits for libel in cases arising out of recall elections than in cases arising out of ordinary elections, and that publications made in connection with such elections, if false, must be made without malice.

In MacLeod v. Tribune Publishing Co., 52 Cal.2d 536, 343 P.2d 36, it was held that a complaint stated a cause of action where it alleged a political libel against a candidate for public office published on the day of an election. It appeared from the complaint in that action that plaintiff was a candidate for public office and that defendant's article reported facts relevant to his qualifications. The defendant contended that the article was privileged and that plaintiff's allegations of malice were insufficient to defeat the privilege. The court held that the allegations of malice were sufficient and stated that the privilege was lost if the defendant had no reasonable grounds for believing his statements to be true.

In Morcom v. San Francisco Shopping News, 4 Cal.App.2d 284, 287-288, 40 P.2d 940, 941, the court said:

'Section 47 of the Civil Code defines five classes of publications which are declared to be privileged. The claim of privilege in the instant case is made under subdivision 3 of that section, which defines...