Raymond v. Croll, 40.

• Decision Date: 22 December 1925
• Docket Number: No. 40.,40.
• Citation: 206 N.W. 556,233 Mich. 268
• Parties: RAYMOND v. CROLL.
• Court: Michigan Supreme Court

233 Mich. 268

206 N.W. 556

RAYMOND

v.CROLL.

No. 40.

Supreme Court of Michigan.

Dec. 22, 1925.

Error to Circuit Court, Gladwin County; Guy E. Smith, Judge.

Action by Benjamin F. Raymond against Henry Croll, Jr. Judgment for plaintiff, and defendant brings error. Reversed, with directions to enter judgment for defendant.

Argued before McDONALD, C. J., and CLARK, BIRD, SHARPE, MOORE, STEERE, FELLOWS, and WIEST, JJ.Andrew B. Dougherty, Atty. Gen., and O. L. Smith, Asst. Atty. Gen. (J. C. Shaffer, of Gladwin, of counsel), for appellant.

McDONALD, C. J.

In an action for slander the plaintiff recovered a verdict and judgment against the defendant for $3,000 in the circuit court of Gladwin county.

The plaintiff lives on a farm in Grout township, Gladwin county. For five or six years prior to the time when the cause of action arose he had been engaged in the building of covert roads in Gladwin county. He had never built any state award highways. In September, 1923, in response to a notice from the state highway department, he submitted a proposal for the construction of approximately 4 3/4 miles of state trunk line, M-18, near Skeels in Gladwin County, at a contract price of $47,960. He was the lowest bidder. But his bid was rejected, and the contract was let to Russell & Russell, the next lowest bidder, for $53,672.73.

Mr. Croll, the defendant, is a state official entitled to be called budget director. In addition to his other duties he was required by the state administrative board to purchase material for the construction of highways and to investigate the financial responsibility of bidders for state trunk line contracts.

When the plaintiff's bid was rejected he claims that he went to Lansing and there learned that, although he was the lowest bidder, he was not awarded the contract because Mr. Croll, the defendant, had reported to the administrative board ‘that he was not qualified to perform the contract, that he could not finance the job, that he had trouble in paying his men on former jobs, and had trouble with the district engineers.’ The plaintiff says that the statement made by Mr. Croll was not true, and was made by him with malice and for the purpose of injuring him and securing the contract for the next lowest bidder, with whom he was associated in business. To recover his damages he has brought this suit. His declaration contains two counts. In the first he alleges damages to his ‘good name, fame, credit, and reputation.’ In the second he alleges damages for refusal to award him the contract and to his reputation and business. The defendant's plea of the general issue was accompanied by the following notices of special defense:

‘(1) Privilege.

‘(2) An independent investigation of plaintiff's financial ability to complete the contract in question, made subsequent to the alleged slander, which resulted in a refusal of the state administrative board to award the contract to the plaintiff.

‘(3) Justification.’

At the close of the plaintiff's opening statement to the jury and at the close of his case, and again at the close of all the proofs, the defendant made a motion for a directed verdict. After the verdict there was a motion for a judgment non obstante veredicto and for a new trial. All of these motions were denied and a judgment entered on the verdict for the plaintiff. The defendant brings error.

The first question to be considered relates to the refusal of the circuit court to direct a verdict for the defendant. In support of this motion counsel for the defendant contended that the undisputed evidence showed the occasion on which the slander was published to be one of absolute privilege.

‘In the law of slander there are two classes of privileged communications. There are communications which are absolutely privileged; and there are communications which have a qualified privilege. A communication absolutely privileged-as, for instance, words spoken by a judge in his judicial capacity in a court of justice, is not actionable, even though spoken maliciously. Where the privilege is qualified, the communication is not actionable if made in good faith. Trimble v. Morrish, 152 Mich. 624, 116 N. W. 451,16 L. R. A. (N. S.) 1017.

‘Cases of absolute privilege are not numerous, and the courts refuse to extend their number. They are divided into three classes: (1) Proceedings of legislative bodies; (2) judicial proceedings; and (3) communications by military and naval officers.’ Newell on Libel and Slander (3d Ed.) § 508 p. 509.

It is the policy of the courts to keep the doctrine of absolute privilege within these narrow limits, because, as Mr. Newell says:

‘It rests upon the same necessity that requires the individual to surrender his personal rights and to suffer loss for the benefit of the common welfare.’

‘Generally speaking, absolute privilege is confined to cases in which the public service or the administration of justice requires complete immunity from being called to account for the language used. It applies more directly to matters of public concern, such as language used in legislative, judicial and executive proceedings; and it is not intended so much for the protection of those engaged in the service, as it is for the promotion of the public welfare.’ 36 C. J. § 204, pp. 1239, 1240.

Our court recognizes the rule of absolute privilege, but it has repeatedly refused to extend its application beyond the necessities of the judicial legislative, and military occasions. Mundy v. Hoard, 216 Mich. 478, 185 N. W. 872;Bolton v. Walker, 197 Mich. 699, 164 N. W. 420, Ann. Cas. 1918E, 1007;Trebilcock v. Anderson, 117 Mich. 39, 75 N. W. 129;Wachsmuch v. Merchants' Nat. Bank, 96 Mich. 426, 56 N. W. 9,21 L. R. A. 278.

We know of no authority for holding that the defendant was entitled to the benefit of an absolute privilege on the occasion in question. He was not a member of the state administrative board, and had no duties or relations to any legislative body that would clothe him with such a privilege.

Circumstances determine the question of privilege; and it has been said that the occasion is one of qualified privilege--

‘where the circumstances of the occasion cast upon the defendant the duty of making a communication to a certain other person to whom he makes such communication in the bona fide performance of such duty.’ Newell, Libel and Slander (3d Ed.) § 561, p. 574.

Within this rule the defendant was clothed with a qualified privilege on...