McCracken v. Evening News Ass'n

• Decision Date: 26 April 1966
• Docket Number: No. 112,No. 1,112,1
• Citation: 3 Mich.App. 32,141 N.W.2d 694
• Parties: William McCRACKEN, Plaintiff-Appellee, v. EVENING NEWS ASSOCIATION, a Michigan corporation, Defendant-Appellant. Cal
• Court: Court of Appeal of Michigan — District of US

Page 694

141 N.W.2d 694

3 Mich.App. 32

William McCRACKEN, Plaintiff-Appellee, v. EVENING NEWS ASSOCIATION, a Michigan corporation, Defendant-Appellant.

Cal. No. 112.

Court of Appeals of Michigan, Division No. 1.

April 26, 1966.

Butzel, Eaman, Long, Gust & Kennedy, by Rockwell T. Gust, Jr., George E. Brand, Jr., Joseph Pawl, Detroit, for appellant.

David S. DeWitt, Ripple, Chambers & DeWitt, Detroit, for appellee.

Before WATTS, P.J., and BURNS and GILLIS, JJ.

GILLIS, Judge.

In September 1960, plaintiff was president of the United Heat Engineering Co. which was engaged generally in commercial heating, ventilating and air-conditioning work. At this time, plaintiff's corporation was doing work for a general contracting firm, J. A. Fredman, Inc., which firm was building an addition to the veterans administration hospital in Allen Park, Michigan.

Around September 12, 1960, Raymond Westrick, the secretary-treasurer of the J. A. Fredman, Inc., had two or three conversations with Anthony Renne, an assistant prosecuting attorney for Oakland county, at the prosecutor's office. Mr. Westrick complained to the prosecutor that certain invoices from a supplier of plaintiff's corporation had been altered by plaintiff before being forwarded to the general contractor, J. A. Fredman, Inc., for payment.

The total face amount of the invoices as altered was $37,324.12. Mr. Westrick also showed the assistant prosecutor a certification as to stored materials which he contended plaintiff falsified in the amount of $39,797.77. On this basis, the assistant prosecutor Mr. Renne recommended a warrant against plaintiff.

On September 14, 1960 Westrick signed a complaint as to two of the items involved and a two count warrant was issued against plaintiff by the municipal court for the city of Pontiac. Specified in count I was the felonious uttering and publishing of an invoice allegedly altered from $7,384.85 to $17,384.85. ¹

Specified in count II was the felonious execution and delivery of the certificate that $39,797.77 of building materials were in plaintiff's possession, whereas plaintiff knew they were not. ² According to the subsequent testimony of Mr. Renne at trial, selection of only two of the items complained of was in accordance with the policy of the prosecutor's office.

Mr. Renne, also in accordance with the policy of the prosecutor's office, informed defendant's reporter of the complaints made by Westrick, the issuance of the complaint and warrant, and that the fraud involved approximately $100,000 based on his estimate of Westrick's complaints.

On September 15, 1960 the defendant, owner and publisher of the Detroit News, a daily newspaper of general circulation in the Detroit metropolitan area, published the following item:

NOTE: OPINION CONTAINS TABLE OR OTHER DATA THAT IS NOT VIEWABLE

On November 16, 1960, following examination, the judge of the municipal court for the city of Pontiac held that no probable cause existed for holding plaintiff for trial and thereupon discharged plaintiff and canceled his bond.

On September 14, 1961 plaintiff, in the circuit court for Wayne county, brought the instant suit for libel, alleging that the published report 'meant that plaintiff had been accused by law enforcing agencies of a crime involving a $100,000 fraud' and that 'said words were and are wholly false.' Defendant's answer asserted that the contents of the article were matters of public interest and the publication thereof was privileged; that the contents of the article and the gist thereof were true; and that the article was published with honest purpose and after reasonable care.

Trial commenced November 18, 1963 before the court without a jury. Plaintiff testified that United Heat Engineering Co. had ceased doing business the day after the publication complained of appeared in defendant's newspaper. He further testified that he owned 40% Of the stock of the corporation and received a salary of $200 per week as its president. He testified he was thereafter unable to get employment in the Detroit area because of this adverse publicity but that he finally got a job in Cleveland on March 20, 1961.

In an opinion dated February 21, 1964, the court held that, by virtue of C.L.S.1961, § 600.2911(3) (Stat.Ann.1962 Rev. § 27A.2911(3)), the defendant enjoyed a qualified privilege to publish a 'fair and true report of any public and official proceeding or any headnote of the article published,' but that 'this privilege shall not apply to any libel contained in any matter added by any person, or in the report of anything said, or done which was not a part of the official proceedings.'

With this in mind, the court further found that the complaint and warrant involved could not extend to an amount more than $37,000 to $39,000; that 'the headline read in connection with the first two paragraphs of the article would indicate to this court that the plaintiff was so charged with a $100,000 fraud, in the warrant mentioned in the article;' that this was not a fair comment on the official proceedings and is forbidden by the statute; and that 'it would have been just as easy to have reported it correctly.' The court also found that there was no malice on the part of the defendant.

On this basis, the court granted judgment for the plaintiff and awarded damages in the amount of $6,000.

From this judgment, defendant appeals, contending, among other things that the 'defendant newspaper was within the privilege accorded the publication of a fair and true report of any public and official proceeding where in good faith it reported that plaintiff was charged with an estimated $100,000 fraud and where in fact plaintiff was officially charged with fraud involving at least $39,000.'

Plaintiff argues that the information gathered by defendant's reporter, and thereafter published by defendant, was obtained from informal statements made by the assistant prosecutor, Mr. Renne, prior to the issuance...