Washburn v. Wright

• Decision Date: 03 May 1968
• Citation: 261 Cal.App.2d 789,68 Cal.Rptr. 224
• Parties: Watson WASHBURN et al., Plaintiffs and Appellants, v. Doris WRIGHT, Dorothea Stacker, Marilyn Ryan and Jane Oseid, Defendants and Respondents. Civ. 8765.
• Court: California Court of Appeals Court of Appeals

Page 224

68 Cal.Rptr. 224

261 Cal.App.2d 789

Watson WASHBURN et al., Plaintiffs and Appellants, v. Doris WRIGHT, Dorothea Stacker, Marilyn Ryan and Jane Oseid, Defendants and Respondents.

Civ. 8765.

Court of Appeal, Fourth District, Division 1, California.

May 3, 1968.

[261 Cal.App.2d 791] Wright & Finley, Santa Ana, for appellants.

Launer, Chaffee & Hanna, Fullerton, for defendants.

OPINION

WHELAN, Associate Justice.

Plaintiffs, as trustees of Reading Reform Foundation, a nonprofit trust declared and existing under the laws of the State of New York, appeal from a judgment of dismissal entered upon an order sustaining without leave to amend a demurrer to their second amended complaint.

The action brought on behalf of Reading Reform Foundation (RRF) sought damages for an alleged libel.

The alleged libelous material appeared as a part of an advertisement published in a newspaper on April 27, 1964 under the caption 'Who is Dr. William V. Lawlor?-- What is his interest?' The caption, in letters 3/8 high, was followed by 48 lines in small print, among them being the following:

'He serves as executive secretary of Responsibility in Education and the Reading Reform Foundation, both of which are extremist organizations founded by John Birch Society members.'

That paragraph contains the alleged defamatory matter claimed by plaintiffs to be libelous Per se.

Following the 48 lines of small print was an exhortation in letters 3/8 in height: 'Vote Yes on Recall Tuesday.'

The complaint alleges that RRF:

'* * * has as its purpose to restore the alphabet to its proper place as the basis of elementary reading instruction in English and to improve the method of teaching reading, writing, and spelling in public and private schools, and said foundation is dependent for its income wholly upon contributions, from persons affiliated with the foundation and from the public at large, but said foundation is prohibited by its declaration of trust from carrying on propaganda, or otherwise attempting to influence legislation, or to participate in any political campaign for any candidate for public office and, in fact, said foundation has not violated said prohibition and did not and was not involved in the recall election referred to in the advertisement which is Exhibit 'A' hereto and incorporated herein by reference with the same force and effect as if set forth in full, and Dr. William V. Lawlor, referred to in said advertisement, was acting in his individual capacity in connection with said recall election and was not acting for or on behalf of or as a representative of said READING REFORM FOUNDATION.'

The complaint contains no other language by way of inducement and no innuendo. It alleges damages, but plaintiffs concede that they have not alleged that RRF suffered special damages within the meaning of section 48a, Civil Code.

The complaint alleges also that a demand for retraction was timely made under section 48a, Civil Code; then alleges:

'Defendants, nor any of them, did not publish a correction of said statements in substantially as conspicuous a manner as the original libelous publication.'

The failure to allege, except by negative pregnant, whether a retraction was in fact printed within the time allowed by the code section was made the subject of a ground of demurrer for uncertainty and ambiguity. If that were the only ground upon which the demurrer had been sustained, opportunity to amend would no doubt have been given.

A sufficient ground for sustaining the demurrer, however, would be that the language complained of was not libelous on its face.

Before passing to a consideration of that question, we note certain other matters that bear upon the sufficiency of the complaint to state a cause of action.

The question of the right of RRF, an unincorporated association, to maintain an action, or to allege a cause of action for defamation, was not raised in the court below.

The question does properly arise, however, in considering whether the complaint states a cause of action: this is whether a cause of action is tated on behalf of RRF as an entity, and whether the complaint states a cause of action on behalf of the individual members of RRF as distinguished from the organization considered as an entity.

The bringing of a class action under section 382, Code of Civil Procedure, on behalf of all members of a voluntary association was held proper in Jellen v. O'Brien, 89 Cal.App. 505, 264 P. 1115.

We have no way of knowing who are the members of RRF, nor how many of them there are. Conceivably, one or more of them might belong to the John Birch Society; if the label of membership in that society is libelous, any person having dual membership in RRF and the John Birch Society would not have the same right of action as a member of RRF who was not a member of the Birch Society. For that reason, and because of the language of the complaint, we conclude that such a class action was not intended, but rather an action in which RRF as an entity claims damage to its reputation on which it depends for revenue from voluntary subscriptions.

The right of an association formed under the laws of a sister state to sue in a California court has been recognized, if the laws of the sister state give such right and that right is alleged in the complaint. (Parks Canal and M. Co. v. Hoyt, 57 Cal. 44.)

The rule generally accepted is that an unincorporated association has a cause of action for defamation in those circumstances in which a corporation has such a cause of action.

A corporation, even though not engaged in business, being organized for social welfare work, may maintain an action for libel without proof of special damage where it is dependent for its support on voluntary contributions the number and amount of which are likely to be affected by the publication of which complaint is made. (New York Soc. etc. v. MacFadden Publications, 260 N.Y. 167, 183 N.E. 284, 86 A.L.R. 440.) Both California and New York recognize the right of an unincorporated trade union to sue in its own name upon a cause of action for libel (Kirkman v. Westchester Newspapers, 287 N.Y. 373, 39 N.E.2d 919; Daniels v. Sanitarium Ass'n Inc., 59 Cal.2d 602, 30 Cal.Rptr. 828, 381 P.2d 652.)

Thus we come to the problem whether the language complained of is defamatory of RRF as an entity.

It is questionable that the allegedly libelous language could be said to include RRF as well as its founders, in view of the stated rule that:

'Words spoken or written of a stockholder or officer give no right of action to the corporation unless spoken or written in direct relation to the trade or business of the corporation. If they relate solely to the stockholder, officer or employee in his private or personal capacity, only the individual can complain. Brayton v. Cleveland Special Police Co., 63 Ohio St. 83, 57 N.E. 1085, 52 L.R.A. 525; Adirondack Record, Inc. v. Lawrence, 202 App.Div. 251, 195 N.Y.S. 627; Midland Pub. Co. v. Implement Trade Journal Co., 108 Mo.App. 223, 83 S.W. 298; Memphis Tel. Co. v. Cumberland Tel. & Tel. Co., 6 Cir., 145 F. 904; Willfred Coal Co. v. Sapp, 193 Ill.App. 400, 405, 414.' (Life Printing & Publishing Co. v. Field, 324 Ill.App. 254, 58 N.E.2d 307, 310.)

(Cf. Pollock v. Evening Herald Pub. Co., 28 Cal.App. 786, 154 P. 30.)

In Life Printing & Publishing Co. v. Field, supra, the alleged libelous matter asserted that one of the incorporators of an antisemitic organization was publisher of a newspaper owned and published by the plaintiff corporation. The rule was iterated in the later decision of Life Printing & Publishing Co. v. Field, 327 Ill.App. 486, 64 N.E.2d 383, in National Automobile Ass'n v. Strunk, 122 Neb. 890, 240 N.W. 294; Brayton v. Cleveland Special Police Co., 63 Ohio St. 83, 57 N.E. 1085; and Everett v. Gross, 22 A.D.2d 257, 254 N.Y.S.2d 561.

In Life Printing & Publishing Co. v. Field, supra, 324 Ill.App. 254, 58 N.E.2d 307, 311, the following observation was made:

'The articles complained of were published to expose and denounce the Gentile Co-operative Association and its founders and promoters. * * * The statements as to the residence of Ferree and his occupation as publisher of Cicero Life were merely incidental and for the purpose of identifying him. On the motion to dismiss and on this appeal these statements must be regarded as untrue. However, there is not the slightest intimation of any wrongdoing or impropriety of conduct at the alleged residence or in connection with his alleged occupation as publisher of the Cicero Life. Whatever is said derogatory to Ferree is in connection with the Gentile Co-operative Association and his part as an incorporator of it. Nothing is said of Ferree or of Flitcraft in relation to the business of plaintiff corporation, and the publications complained of are not libelous per se as to plaintiff.'

The language attributing to the founders of RRF membership in the John Birch Society does not say, and cannot be interpreted as saying, anything concerning the manner of performance by the officers of the RRF of the duties and responsibilities of their office so as to permit the argument that the language charging wrongdoing to the officers has a natural tendency to affect the corporation disadvantageously in its business, which was the situation in Kirkman v. Westchester Newspapers, 39 N.E.2d 919, 287 N.Y. 373.

According to the Random House Dictionary and the Encyclopaedia Brittanica (1968 ed.), ¹ the John Birch Society was founded in December 1958; we have no information as to the time of foundation of RRF.

It is not possible to know from the language of the complaint if the plaintiffs contend that the language used meant that the founders of RRF were at the time of foundation members of the John Birch Society or that they were then and continued to be such members; or that they had since become and were on the date of publication such members; and if the latter were meant...