Russell v. McMillen

• Decision Date: 24 May 1984
• Docket Number: No. 82CA0706,82CA0706
• Citation: 685 P.2d 255
• Parties: 10 Media L. Rep. 1888 Jack E.L. RUSSELL and Elsie M. Russell, Plaintiffs-Appellants, v. Don McMILLEN, Susan McMillen, Michael Cochran, Joel Kassiday, McMillen Publishing Company, Inc., a Colorado corporation, and The Triangle Review, Defendants-Appellees. . I
• Court: Colorado Court of Appeals

Page 255

685 P.2d 255

10 Media L. Rep. 1888

Jack E.L. RUSSELL and Elsie M. Russell, Plaintiffs-Appellants, v. Don McMILLEN, Susan McMillen, Michael Cochran, Joel Kassiday, McMillen Publishing Company, Inc., a Colorado corporation, and The Triangle Review, Defendants-Appellees.

No. 82CA0706.

Colorado Court of Appeals Div. I.

May 24, 1984.

Tucker & Brown, C. Jean Smollett, William Tucker, Denver, for plaintiffs-appellants.

Cooper & Kelley, P.C., Thomas B. Kelley, Denver, for defendants-appellees.

BABCOCK, Judge.

In this libel action, plaintiffs, Jack E.L. and Elsie M. Russell, appeal from the trial court's entry of summary judgment in favor of defendants. We affirm.

The action arose from a series of articles, editorials, and cartoons published in the Triangle Review, a semi-weekly Fort Collins newspaper, in October 1976, August 1977, and October 1977. The publications brought into question the propriety of a purchase of certain land by the Russells from the Platte River Power Authority (PRPA), a corporate political subdivision, created by contract among four municipalities.

In September 1976, defendant Don McMillen read an item in the Rocky Mountain Journal which reported a purchase of real property by the Russells from PRPA for the sum of $85,000, secured by a deed of trust in favor of PRPA in the amount of $79,000. This item caused McMillen concern because it appeared that Russell, a city councilman, had borrowed money and purchased real property from a subsidiary agency of the city.

McMillen reviewed the deed of trust and promissory note, dated September 13, 1976, and recorded with the clerk and recorder for Larimer County on September 16, 1976. The deed of trust recited that PRPA "hereby sells and conveys" certain real property to the Russells. Nothing of record indicated that the Russells had entered any contract for the purchase of the property prior to the dates of the recorded instruments. To McMillen, the recorded documents confirmed that plaintiffs had in fact purchased land and obtained a loan from PRPA on September 16, 1976.

Thereafter, McMillen spoke to several officers and directors of PRPA. From them he learned that the property had been sold to the Russells for a profit, but that PRPA did not know that the Russells were the buyers; that the property was initially purchased by PRPA for the purpose of securing a powerline easement with the intent to resell it; and that, at the time of the transaction with the Russells, PRPA had no policy regarding the sale of land to municipal officials. McMillen was informed that the real estate agent retained by PRPA for McMillen then spoke to Russell about the transaction. Russell informed him that the agent had handled several prior real estate transactions for him, that he trusted the agent, and that he permitted the agent to handle the PRPA purchase for him. Russell stated that the agent handled this purchase anonymously, that he (Russell) was not informed of the seller's identity until after the transaction, and that he then checked with the Fort Collins city attorney to ascertain whether there was a conflict of interest. The city attorney told him that there was not. In addition, Russell informed McMillen that he had been recently appointed by the city council as an alternate member of the PRPA Board of Directors (PRPA Board).

the purpose of securing powerline easements personally handled the transaction between PRPA and the Russells. McMillen placed an anonymous telephone call to the agent, but sought only general information about the property rather than specific details of the transaction between PRPA and the Russells.

McMillen's follow-up with the city attorney indicated that his opinion as to the absence of a conflict of interest was based upon Russell's statement that he had not acted on any knowledge obtained in his official capacity. The city attorney also stated that, to his knowledge, Russell had not been appointed an alternate member of the PRPA Board at the time of the land transaction.

However, McMillen's review of the city council minutes reflected that Russell's appointment to the PRPA Board occurred on August 24, 1976. This information, together with the documents recorded on September 16, 1976, led McMillen to conclude that Russell was an alternate member of the PRPA Board at the time of the sale.

On October 6, 1976, the Triangle Review published an article reporting the details of McMillen's investigation. In connection with the article, an editorial entitled, "Should Officials Be Involved in Land Deals?" and a cartoon were run. The editorial raised two questions: (1) Whether PRPA should sell surplus land through a real estate agent or whether such land should be sold through legal advertising aimed at the general public; and (2) whether Councilman Russell should have purchased the PRPA land.

Shortly after publication of the October 6, 1976, edition of the Triangle Review, Russell happened to meet Triangle Review managing editor, Joel Kassidy, and informed him that the information contained in the publications "wasn't so." In addition, McMillen was advised by a third person that certain information contained in the article regarding a proposed road in the area of the property was incorrect. However, McMillen did not receive any other information from any other source indicating that the information in the article and editorial was incorrect.

In August 1977 McMillen read another item in the Rocky Mountain Journal reporting that Russell had sold the property for $131,600. McMillen called Russell who confirmed the sale and stated, "It was an investment, and it paid off. I felt myself very fortunate." Russell did not, however, indicate that anything contained in the previously published article and editorial was false.

On August 31, 1977, the Triangle Review published another article, editorial, and cartoon concerning the initial purchase and subsequent resale of the property by Russell. The article recited the circumstances of the purchase and resale and restated Russell's original explanation of the purchase. The editorial expressed the opinion that the actions of the public officials involved in the transaction, including Russell, constituted a conflict of interest and questioned PRPA's land sale policy.

Shortly thereafter an article appeared in the local daily newspaper from which McMillen learned for the first time that Russell contended the purchase of the property from PRPA had occurred on August 10, 1976, the date on which Russell had executed a specific performance contract. In response, McMillen published additional editorials in the Triangle Review on On October 15, 1977, another article was published in the Triangle Review which stated that the district attorney intended to discuss the transaction with Russell. This article again raised the question of conflict of interest.

October 1, 1977, and October 5, 1977. These editorials restated McMillen's position with respect to the transaction and referred to the September 16, 1976, recording date as the date the transaction "became official" and as the time the "sale was finalized."

In January 1978, the Russells filed their complaint. In their motion for summary judgment, defendants asserted that the statute of limitations barred an action in libel based on the August 6, 1976, publications; that the only statement of fact of which the Russells complained, i.e., that Russell was a member of the PRPA Board at the time he purchased the property, was not published with actual malice; and that the remaining portions of the publications of which plaintiffs complained constituted privileged expressions of opinion.

In granting defendants' motion for summary judgment, the trial court concluded the Russells failed to show by clear and convincing evidence that the factual matters contained in the publications were published with reckless disregard as to their truth or falsity or with knowledge of their falsity. Although the trial court did not address specifically the statute of limitations or the issue of opinion, constitutional defamation cases compel de novo appellate review. Bose Corp. v. Consumers Union of United...