Vowles v. Yakish

Decision Date04 October 1920
Docket Number32668
Citation179 N.W. 117,191 Iowa 368
PartiesJOSEPH VOWLES, Appellee, v. M. F. YAKISH et al., Appellants
CourtIowa Supreme Court

REHEARING DENIED APRIL 6, 1921.

Appeal from Linn District Court.--MILO P. SMITH, Judge.

ACTION for slander. The facts are fully stated in the opinion. There was a verdict and judgment for plaintiff in the court below for $ 5,000 against both defendants, who appeal.

Reversed.

Bollinger & Block and Trewin, Simmons & Trewin, for appellants.

Rickel & Dennis, for appellee.

STEVENS J. LADD, EVANS, and SALINGER, JJ., concur. WEAVER, C. J PRESTON, J., (dissenting).

OPINION

STEVENS, J.

On and for a few months prior to June 3, 1916, plaintiff conducted a grocery store in a building owned by him in Kenwood, Iowa. On the date above mentioned, the whole was totally destroyed by fire. At the time of the loss, he held a policy, issued by the defendant Security Fire Insurance Company of Davenport, Iowa, upon the building and stock of groceries. On the day of the fire, the defendant Yakish, one of the state agents of the defendant insurance company, went to the home of plaintiff, and made some inquiry as to the origin of the fire and the extent of the loss. During the conversation, the defendant informed plaintiff that it would be necessary for him to produce his invoices. It developed, however, that the invoices were all destroyed by the fire, and plaintiff had to procure duplicates from the dealers of whom he had purchased merchandise. After several attempts to adjust the loss, plaintiff, on June 29th, went with Mr. Steenberg, who was assisting him, to the office of Yakish in Cedar Rapids, in a further effort to effect a final settlement. According to the testimony of plaintiff, the conversation, which lasted for about an hour, was carried on largely between Steenberg and Yakish, and related principally to certain items of freight, which formed at that time the principal matter in controversy between them.

The plaintiff, who is corroborated by Steenberg, testified that Yakish, at the conclusion of the above negotiations, said:

"I don't want to hear nothing about it. I ain't going to have nothing to do about it. I will make him go some. We have the goods on him."

He further testified that Steenberg then said: "You don't mean to say Mr. Vowles burned his store out, do you?" To which the defendant replied: "Yes, I do."

He also testified that, on a subsequent occasion, plaintiff and Yakish, at the request of the latter, went to a bank in Cedar Rapids, where he informed plaintiff that he was going to swear him, and put him through a test. Concerning this transaction, plaintiff testified in part:

"I says: 'I don't know. I don't see no judge nor jury. I don't see that I am in nobody's courtroom.' He says: 'That don't make no difference. I have the power to swear you.' I says: 'You can go to hell, too.' I turned around and started out of the bank. He followed me right out of the bank. He says: 'We will make you go some.' I says: 'You can go plumb to hell;' and I started up the sidewalk. He stepped down off the step and shook his finger, and says: 'I will make you go some. I have the goods on you for burning it up.'"

The foregoing are the slanderous words complained of. In his petition, which is in two counts, plaintiff alleged that, at the time the slanderous words were uttered, Yakish was the adjusting agent of the defendant insurance company, and acting for and on its behalf; that all of the statements were false, and made maliciously, and with the intent to injure and destroy the confidence of the public in plaintiff. He asks damages in the sum of $ 10,000. The answer of the defendant consisted of a general and specific denial, and a special plea in mitigation of damages, which, in view of the conclusion reached, is given no consideration herein. There was a verdict and judgment for plaintiff against both defendants in the sum of $ 5,000.

I. At the conclusion of plaintiff's testimony, the defendant moved the court for a directed verdict, upon the ground, among others, that the evidence wholly failed to show that, if the slanderous words were in fact uttered by the defendant Yakish, he was, at the time, acting within the scope of his authority as an adjusting agent for the insurance company. This presents the first question for our consideration.

It is not claimed by counsel that a corporation is never liable for damages on account of slanderous utterances of its agent, but that liability is imposed only when the slander charged was uttered by the agent within the scope of his authority, express or implied. This question has been frequently discussed and passed upon by the courts of other jurisdictions, but with considerable diversity of holding. While a few courts and text-writers have announced the doctrine that a corporation is never liable for slanderous words uttered by its agent, the overwhelming weight of authority is to the contrary. The majority rule seems to be that, if the agent, acting within the scope of his employment and in the actual performance of the duties thereof, touching the matter in question, utter a slander, though without the knowledge of the corporation or with its approval, liability attaches. Fensky v. Maryland Cas. Co., 264 Mo. 154 (174 S.W. 416); Rivers v. Yazoo & M. R. Co., 90 Miss. 196 (43 So. 471); Sawyer v. Norfolk So. R. Co., 142 N.C. 1 (9 Ann. Cas. 440, 54 S.E. 793); Republic I. & S. Co. v. Self, 192 Ala. 403 (68 So. 328); International Text-Book Co. v. Heartt. 136 F. 129; Case v. Steel Coal Co., 162 Ky. 68 (171 S.W. 993); Kane v. Boston M. L. Ins. Co., 200 Mass. 265 (86 N.E. 302); Crelly v. Missouri & K. Tel. Co., 84 Kan. 19 (113 P. 386); Hypes v. Southern R. Co., 82 S.C. 315 (17 Ann. Cas. 620, 64 S.E. 395); Redditt v. Singer Mfg. Co., 124 N.C. 100 (32 S.E. 392); Palmeri v. Manhattan R. Co., 133 N.Y. 261 (30 N.E. 1001); Waters-Pierce Oil Co. v. Bridwell, 103 Ark. 345 (147 S.W. 64).

The test generally applied by the cases is: (a) Was the person who uttered the slanderous words an authorized agent of the corporation? (b) If so, was he at the time acting within the scope of his employment? (c) Was the language charged used in the actual performance of his duties touching the matter in question? Other courts have, however, held that a corporation is not liable for slander uttered by its agent, unless it affirmatively appears that the agent was expressly authorized thereby to speak the slanderous words complained of, or that the company subsequently approved or ratified the same. Behre v. National C. R. Co., 100 Ga. 213 (27 S.E. 986); Lindsey v. St. Louis, I. M. & S. R. Co., 95 Ark. 534 (129 S.W. 807); Jackson v. Atlantic C. L. R. Co., 8 Ga.App. 495 (69 S.E. 919); Duquesne Dist. Co. v. Greenbaum, 135 Ky. 182 (24 L. R. A. [N. S.] 955, 121 S.W. 1026); McIntyre v. Cudahy Pkg. Co., 179 Ala. 404 (60 So. 848); Flaherty v. Maxwell Motor Co., 187 Mich. 62 (153 N.W. 45); Singer Mfg. Co. v. Taylor, 150 Ala. 574 (43 So. 210).

The agency of the defendant Yakish to adjust the loss for his codefendant is admitted; and, while there is direct conflict in the evidence as to whether any of the language complained of was used upon either of the occasions mentioned, the finding of the jury upon this question has support in the evidence.

The real question here to be determined is: Was the defendant, at the time he uttered the words complained of, acting within the scope of his employment, and in the actual performance of his duties touching the subject-matter of the negotiations or transaction? The mere fact that the defendant Yakish was, at the time, the agent of the insurance company to adjust the loss, and that the defamatory words were used during the negotiations, does not establish liability on the part of the company. Kane v. Boston M. L. Ins. Co., supra; Crelly v. Missouri & K. Tel. Co., supra; Dolan v. Hubinger, 109 Iowa 408, 80 N.W. 514; Sawyer v. Norfolk R. Co., supra; Waters-Pierce Oil Co. v. Bridwell, supra; Singer Mfg. Co. v. Reeves Lbr. Co., 95 Ark. 363 (129 S.W. 805).

We find nothing in the record specifically defining the authority of Yakish, or prescribing the scope of his employment. This is left to inference. It is, however, manifest from the purpose of the agency that Yakish had authority to adjust and agree upon a settlement of the loss that would be binding upon the company. This is conceded; but is it sufficient to establish liability? A brief review of the evidence touching the several transactions from the time of the fire will aid us at this point.

Except some general inquiry by Yakish of plaintiff, on the day of the fire, as to the possible origin thereof, the subsequent negotiations for the settlement proceeded without reference thereto, until the morning of June 29th, when plaintiff claims the defamatory words were first used. The loss on the building and fixtures was adjusted about a week after the fire. The insurance on the building was $ 2,500; the amount agreed upon and paid, $ 2,350. The walls of the building were left standing, and were used in its reconstruction. The fixtures were a total loss, and the full amount of the insurance thereon was paid. As already stated plaintiff's invoices were destroyed by the fire, and there was some delay in procuring duplicates. A controversy arose, at the meeting on June 29th, over an item of $ 168 for freight. The adjusters contended that the trade discounts, which were not otherwise taken into consideration in fixing the value of the stock, should offset this item. It was found, however, that the freight exceeded the discounts by $ 108. The amount finally agreed upon and paid in settlement of the loss on stock was $ 2,000. The exact proportion paid by the defendant is...

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