Lent v. Huntoon

• Decision Date: 01 November 1983
• Docket Number: No. 82-155,82-155
• Citation: 470 A.2d 1162,143 Vt. 539
• Parties: , 9 Media L. Rep. 2547 Ronald LENT v. H.J. HUNTOON and Huntoon Business Machines, Inc.
• Court: Vermont Supreme Court

Page 1162

470 A.2d 1162

143 Vt. 539, 9 Media L. Rep. 2547

Ronald LENT v. H.J. HUNTOON and Huntoon Business Machines, Inc.

No. 82-155.

Supreme Court of Vermont.

Nov. 1, 1983.

Kelley & Meub, Ltd., Middlebury, for plaintiff-appellee.

Joseph M. O'Neill, Rutland, for defendants-appellants.

Before BILLINGS, C.J., and HILL, UNDERWOOD, PECK and GIBSON, JJ.

UNDERWOOD, Justice.

Defendants appeal from a verdict and judgment rendered in the Rutland Superior Court. The jury found the defendants liable for defamation and awarded plaintiff a total of $40,000 in compensatory and punitive damages. We affirm the judgment.

Plaintiff in his complaint alleged libel and slander by defendant H.J. Huntoon, individually, and defendant Huntoon Business Machines, Inc. The suit resulted from events following the termination of plaintiff's employment by the defendants. A letter signed by H.J. Huntoon, who was president and agent of Huntoon Business Machines, Inc., and which was written on the corporation's letterhead was circulated to numerous business machine customers and was the basis of plaintiff's cause of action for libel. Several oral statements allegedly made by H.J. Huntoon as agent for Huntoon Business Machines, Inc. after publication of the letter form the basis of the cause of action for slander. Defendant denied the material allegations in the complaint, and, by way of an amended answer, advanced affirmative defenses of truth and privilege.

After plaintiff's case was completed, defendants moved for a directed verdict on the issues of special (economic) damages and punitive damages. The motion was denied. These same motions were renewed and denied after the close of all the evidence.

The jury was instructed on libel and slander, truth, privilege, malice, compensatory damages, and punitive damages. While perhaps special verdicts or jury interrogatories would have been preferable in a complicated case such as this, the trial court's instructions were essentially correct. Furthermore, defendants made no objection to the charge. The jury returned a verdict for the plaintiff of $15,000 in compensatory and $25,000 in punitive damages.

After judgment was entered, the defendants moved for judgment notwithstanding the verdict, or in the alternative for a new trial or remittitur. The trial court denied these motions as well.

Plaintiff worked for Huntoon Business Machines, Inc. (Huntoon Corporation) from 1964 until his employment was terminated in 1977--a period of thirteen years. During that time he worked his way up to the position of service manager. At the time he was hired, in 1964, the plaintiff informed defendant H.J. Huntoon (Huntoon) that he was on probation for a criminal conviction and that he had once been confined to the base for a period of time for a minor offense during his service in the Air Force. Defendants hired plaintiff with full knowledge of these events.

In the early part of 1977, plaintiff informed Huntoon that he would be leaving his job at Huntoon Corporation as he was moving to Florida as soon as he and his wife could sell their house. He offered to stay on long enough to train his successor. Shortly thereafter, and without any prior notice, Huntoon told plaintiff that he was discharged.

Plaintiff was unable to sell his house and so decided to remain in Rutland. In August of 1977, he started his own business equipment sales and service business, Lent Business Machines. Early in March of 1978, plaintiff was awarded a cash register sales and service franchise formerly held by the Huntoon Corporation. Thus, plaintiff and Huntoon Corporation became direct competitors. About this same time, plaintiff became aware that defendants sent a letter to the cash register franchise customers who were formerly serviced by Huntoon Corporation and for whose business both the plaintiff and defendants were then vying. The letter, which indicated that plaintiff had been discharged for "sound business reasons," formed the basis of plaintiff's libel count. Plaintiff asserted that the letter, taken in its totality, was defamatory since it implied that he was fired because of some dishonesty or incompetence. There was evidence that the letter caused plaintiff to become estranged from some of his customers, to suffer physical and emotional malaise, and to neglect his business to the point where it nearly collapsed.

About this time, plaintiff became aware of numerous verbal statements made about him by Huntoon to customers sought after by both plaintiff and defendants. Testimony revealed that these statements asserted that plaintiff had a criminal "record a mile long," had stolen merchandise from the defendants, had stolen money from the cash register of Huntoon Corporation, was an incompetent serviceman, and was generally untrustworthy. Testimony indicated that most of these statements were made by Huntoon in competitive business situations. Plaintiff asked Huntoon to stop making the statements, apparently to no avail, as there was further testimony that some of the statements were made even after plaintiff's lawsuit was initiated. Some testimony indicated that the defendants were fully satisfied with plaintiff's work prior to termination and had never complained about any thefts by plaintiff prior to his leaving Huntoon Corporation. Defendants also knew he intended to leave his job voluntarily and was not fired.

We take this opportunity to review the law of defamation as applicable to this case. Seldom, if ever, in our previous decisions has an overview of defamation been attempted, and, except for the First Amendment cases involving public figures, most of Vermont's guidelines for this odd and somewhat complicated area of tort law must be gleaned from nineteenth century case law. Our somewhat extended clarification at this time will delineate the law applicable to this appeal so that we may make a meaningful evaluation of the issues raised.

Defamation is comprised of the complementary torts of libel and slander. Although these torts evolved from different antecedents, both were eventually cognizable in the King's courts in England prior to reception of the common law in Vermont. See generally Veeder, The History and Theory of the Law of Defamation, 3 Colum.L.Rev. 546 (1903); W. Prosser, Handbook of the Law of Torts 737-39 (4th ed. 1971). Because of the permanence of the written word, libel was considered the more serious tort, with slander, or the spoken word, considered the less serious. The distinction between written and spoken defamation has resulted in a host of special rules with corresponding special legal terminology. Herein lies much of the confusion which abounds even today.

Libel is generally considered "actionable per se"; that is, the plaintiff need not allege nor prove that he or she suffered any "special damages" as a direct or proximate result of the libel. Special damages, in short, are presumed. Special damages have a unique connotation in the law of defamation. Special damages are those of a pecuniary nature, and historically they have included loss of customers or business, loss of contracts, or loss of employment. W. Prosser, supra, at 760-61. In addition,

modern decisions have shown some tendency to liberalize the old rule, and to find pecuniary loss when the plaintiff has been deprived of benefit which has a more or less indirect financial value to him. Thus the loss of the society, companionship and association of friends may be sufficient when ... it can be found to have a money value.

Restatement (Second) of Torts § 575 comment b, at 198 (1977).

Slander, on the other hand, is generally not actionable per se; that is, special damages are not presumed and must be alleged and proven. Several kinds of slander, however, were identified at English common law as more serious than others and these were held to be actionable per se. Spoken defamation involving (1) imputation of a crime, (2) statements injurious to one's trade, business or occupation, or (3) charges of having a loathsome disease were deemed slander per se and were actionable without proof of special damages. W. Prosser, supra, at 754. The decisions of our Court are in accord with this common law exception. Most American jurisdictions added still a fourth exception: charging a woman to be unchaste. Thus "actionable per se" simply means special damages need not be proved in libel actions or in those slander actions which fall into one of the exceptions categorized as slander per se.

The general elements of a private action for defamation (libel and/or slander) are: (1) a false and defamatory statement concerning another; (2) some negligence, or greater fault, in publishing the statement; ¹ (3) publication to at least one third person; (4) lack of privilege in the publication; (5) special damages, unless actionable per se; and (6) some actual harm so as to warrant compensatory damages.

For reasons probably lost in history, a special rule of procedure developed for the trial of a defamation action. Once the plaintiff's evidence was in, the court had to determine whether the written or spoken words were defamatory as a matter of law. If the court was in doubt because the connotation of the written or spoken words was ambiguous, then the court had to submit the question to the jury to decide. Lancour v. Herald & Globe Association, 111 Vt. 371, 379, 17 A.2d 253, 256 (1941) (Lancour I ). In libel actions, when the court determined that the written words were libelous as a matter of law, the term "libel per se" was used. This unfortunate terminology when used in conjunction with such terms as "slander per se" and " actionable per se" has greatly confused courts and counsel. "Libel per se" simply means defamatory as a matter of law. Since all libel is actionable per se, it makes no difference whether the court rules that the written words are defamatory as a matter of law, or that the written words are ambiguous and the jury...