Century Management, Inc. v. Spring

905 S.W.2d 109, 1995 Mo. App. LEXIS 1502, 1995 WL 507431
CourtMissouri Court of Appeals
DecidedAugust 29, 1995
DocketWD 50324
StatusPublished
Cited by4 cases

This text of 905 S.W.2d 109 (Century Management, Inc. v. Spring) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Century Management, Inc. v. Spring, 905 S.W.2d 109, 1995 Mo. App. LEXIS 1502, 1995 WL 507431 (Mo. Ct. App. 1995).

Opinion

SPINDEN, Judge.

After members of the Walden Homeowners Association circulated a document complaining about the way their subdivision was being managed, the managers, Century Management, Inc., Jerry E. Clemons and Patricia L. Clemons, 1 sued for defamation- and for tortious interference with business expectancy. The circuit court granted summary judgment for the association members *111 on both counts. It ruled that the members of the association enjoyed a qualified privilege which protected against liability for defamation, and it ruled that CMI had no business expectancy in a renewed contract.

CMI asserts that this was error because it established a genuine issue of whether the members acted with malice in derogation of any privilege they enjoyed as members of a homeowners association and because it established that, but for the respondents’ defamatory accusations, the association’s board of directors would have renewed CMI’s contract. We disagree and affirm the circuit court’s judgment.

CMI managed real estate. Jerry Clemons owned all of its stock and was its president. His wife, Patricia Clemons, was its secretary.

On March 20, 1990, the Walden Homeowners Association hired CMI to manage the subdivision’s common grounds for three years, until May 31, 1993. CMI had managed the subdivision’s common grounds for the previous 11 years.

Shari Spring, Gordon Hadley, Paul Kirk, Everett Davis, Josephine Davis, Dick Smith, Robert Bair, Jan Bair, James McAtee, and Fran Ronnau (respondents) belonged to the homeowners association, a not-for-profit corporation controlled by a board of directors. Owners of houses and townhouses in the subdivision elected the board members.

Many, if not all, of the respondents belonged to a group known as the Townhomes Liaison Subcommittee. Robert and Jan Bair and Shari Spring headed the group. The record does not explain the group’s origin or whether the association’s constitution and bylaws sanctioned it.

During Fall 1991, the association’s board of directors asked Robert Bair and Fran Ron-nau to inform it of any complaints concerning CMI’s performance. Robert Bair prepared a list of numerous complaints, including allegations that CMI had misled the association concerning what work CMI was doing and the manner in which CMI was doing it. Robert Bair took the list to Ronnau for her review. Ronnau suggested that they attach a cover letter, and they did. The cover letter was addressed to CMI from the board of directors. Together, Robert Bair and Ron-nau copied their letter and list of complaints and distributed them to board members.

The subcommittee later decided, for reasons not explained in the record, to distribute a copy of the document to all of the houses and townhouses in the subdivision. The decision was made at a meeting attended by all of the respondents except Ronnau. The respondents donated money to defray copy and delivery costs. Robert and Jan Bair and Shari Spring reviewed another cover letter to attach to the previous cover letter and the list of complaints. The second letter encouraged association members to put their association dues in an escrow account instead of paying them to CMI and explained that the list of complaints was “representative ... of concerns and causes for placing our dues in escrow.” In October 1991, Shari Spring, Eldon and Josephine Davis, Gordon Hadley, Fred Kirk, and Dick Smith delivered copies of the document to every house and townhouse in the subdivision.

Two weeks later, CMI sued the respondents for defamation and libel and for tor-tious interference with a contract or business expectancy. In the meantime, CMI continued to manage the subdivision property until its contract with the homeowners association expired on May 31, 1993. Association members voted against renewing the contract.

In response to the lawsuit, respondents filed motions for summary judgment. As to the defamation claim, the trial court granted summary judgment in favor of all respondents and said:

1. That the written communication that is the subject of this cause was circulated between the members of the Walden Home Owners Association of which all the Defendants herein were members.
2. That all of the aforesaid Defendants had a common interest in the subject matter of the communication because all of the Defendants were property owners in addition to being members of the Association.
3. That some of the Defendants claim that they did not participate in the distribution of the document.
*112 4. That all of the Defendants had a qualified privilege to participate in the distribution of the document among the members of the Association.
5. That there is no evidence to indicate that the circulation of the document would take them out of the qualified privilege.
IT IS THEREFORE ORDERED that Defendants’ Motions for Summary Judgment as to Count I of [CMI’s] Petition for Defamation is sustained.

We agree, and CMI concedes, that the respondents enjoyed a qualified privilege whereas this was a case in which the publishers of the allegedly defamatory statements (the respondents) and the recipients (fellow association members) had a common interest (upkeep of their subdivision) and the communication was of a kind reasonably calculated to further that interest. See Henry v. Halliburton, 690 S.W.2d 775, 780-81 (Mo. banc 1985). The privilege, however, was not absolute. The privilege protected the respondents only for so long as they acted in a reasonable maimer and for a proper purpose. Unreasonable use of a privilege for an improper purpose, such as perpetrating a deliberate lie, will forfeit the privilege. See Hellesen v. Knaus Truck Lines, Inc., 870 S.W.2d 341, 345 (Mo.1963).

CMI argues that it established a genuine issue of whether the respondents forfeited the privilege by circulating their complaints anonymously and with the suggestion that it was from the association’s board of directors.

We disagree. Although one of the cover letters prepared by the respondents said that it was from the “Walden Homeowners Association Board of Directors” to CMI, the other cover letter, addressed to ‘Walden Neighbor,” said:

[A]fter trying every way we knew to work with the management company and the Board of directors, ... several town-home members spoke in private audience with six members of the board who were present. Nearly all those addressing the board expressed dissatisfaction with the attitude and business practices of the management company.
Currently, the attached list of concerns is in the hands of Walden’s attorney as requested by the board. Several of the most serious concerns cannot be published because they are currently under investigation. These concerns, together with the apparent attitude of some board members that we must

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Bluebook (online)
905 S.W.2d 109, 1995 Mo. App. LEXIS 1502, 1995 WL 507431, Counsel Stack Legal Research, https://law.counselstack.com/opinion/century-management-inc-v-spring-moctapp-1995.