Dorn & McGinty v. Cooper

139 Iowa 742

• Court: Supreme Court of Iowa
• Decided: July 9, 1908
• Status: Published

Opinion

Deemer, J.

A. A. Dorn, one of the members of plaintiff firm, was a competitor of defendant in the general merchandise business in the town of Neola, Pottawattamie County. He was also engaged with J. E. McGrinty in the business of buying live stock. In the town of Neola there was published a newspaper known as the “Reporter,” and defendant had a half page of this newspaper reserved for advertising purposes. Defendant composed and had printed in the Reporter the following upon the half page resérved by him:

Flour. Flour we bought two cars of Marshall’s Best Flour four months ago and sold them and bought two more and have about sold them. We buy flour to sell, not to carry through four of the hottest months in the year, May, June, July and August. I would advise a close inspection of flour carried through these hot months. 1 would sell it for anything I could get and invest it in hogs- — something that I could sell. The hog business is better than the flour business because hogs will always sell, at a good big profit. We are thinking of going into the hog business ourselves and see what effect it will have on the nice little pool that exists since our friend Mr. Osborn-left this market. We have noticed that Neola has changed from' one of the best hog markets in the whole country to one of the most bummy. My advice to the merchants is to imitate 'Underwood and " place a buyer here to pay what the stuff is worth. The best grade of hogs sold for 5.80 in So. Omaha Oct. 13 with the Neola market from 4.50 to 4.80. How long will the merchants of Neola and the farmers stand that kind of a margin?

This action is bottomed upon that publication, which it is alleged referred to plaintiffs, was false, scandalous, and malicious, and resulted in damage to plaintiffs and to their business. Defendant admitted the publication of the article, but denied that it was false and scandalous or malicious. He also averred that the charges therein contained were practically true, and that it was published in good faith, and for justifiable ends. He also pleaded that before publishing the article he made such inquiries as led him to believe that the charges therein were true: and that he published the same in good faith, honestly believing the same to he true and for justifiable ends. In another division of the answer he denied that the article referred to plaintiffs, and further pleaded that he did not know of the existence of plaintiff firm at the time he made the publication. Shortly after the action was commenced, and before it was brought on for trial, defendant offered to confess judgment in favor of plaintiffs for the sum of $6 and the costs accrued to that time. This offer was refused by plaintiffs, and the case went to trial, resulting in a verdict for plaintiffs in the sum of $1. Thereafter judgment was rendered upon the verdict, but the costs were taxed to plaintiffs because of their refusal to accept the offer to confess. The appeal challenges some of the rulings on the admission of testimony and certain of the instructions given by the trial court.

1. Slander andlibel: malice: evidence. Nor the purpose of showing actual, as distinguished from legal, malice upon the part of the defendant, plaintiffs undertook to show the market price of hogs at South Omaha, at Neola, and at the towns of Underwood and Minden, which towns were but a short distance from Neola, on the 13th day of October, 1903. In order to meet this showing, defendant was permitted, over plaintiff’s objections, to show what the market was at Neola on that day, and what he was told by others regarding the prices being paid at that time. For the purpose of rebutting the inference of legal malice, we think this testimony was admissible. It was not admissible in justification, for the truth was not pleaded as a defense; nor was it admissible in mitigation of actual damages for three reasons: (1) Because it was not pleaded in mitigation; (2) the article did not purport on its face to be based upon anything save defendant’s own knowledge; and (3) even if pleaded in justification, the testimony could not, under the authorities, be received in mitigation. But as testimony to the same point was offered by plaintiffs to establish actual malice, defendant was entitled to rebut the same by showing the actual market prices and his information . regarding the same at the time he made the publication.

2. Evidence: order of introduction: exclusion. A witness for defendant was asked as to what another firm engaged in buying hogs in Neola said was the market price of hogs at Neola on the 12th of October, 1903. Plaintiffs objected to this, and the court inquired 0f defendant’s counsel if he ex-peeted to follow it up by showing that the information was imparted to the defendant. Upon being informed by counsel that he expected to do so, and that in his opinion the testimony was admissible any way, the trial court received the testimony. Counsel did not comply with his promise to show that defendant was informed of the matter, and plaintiffs counsel made no motion to have the testimony excluded. Such being the state of the record, plaintiffs have no legal ground for complaint. The order of the introduction of testimony lies in the sound discretion of the trial court, and the judge was justified in receiving the evidence upon the statement or promise of defendant’s counsel. If it thereafter appeared that the testimony was inadmissible, plaintiff’s counsel should have moved to strike it from the record. The conclusions so' far reached regarding the introduction of testimony are sustained by the following, among other, authorities: Gaar v. Nichols, 115 Iowa, 223; Riech v. Bolch, 68 Iowa, 526; Beardsley v. Bridgman, 17 Iowa, 291; Hanners v. McClelland, 74 Iowa, 318; Marker v. Dunn, 68 Iowa, 720; Clifton v. Lange, 108 Iowa, 472.

3. Libel: damages: evidence. Over plaintiffs’ objections, defendant was permitted to show that before the publication of the article he never had had any trouble with either Dorn or McGinty, and, over plaintiffs’ objections, was permitted to answer this question: “You may tell the jury what, if any, ill feeling there was upon your part towards either of the plaintiffs, or upon their part towards you, . if you know.” Under our rule this latter ruling, if not the former, was erroneous. Barr v. Hack, 46 Iowa, 308. See, also, Berger v. Freeman, 132 Iowa, . Counsel for appellee attempt to distinguish tnese cases, but in our opinion the Barr case is exactly apposite.

4. Same. II. Defendant’s plea of mitigation, has already been stated and it will be noticed that it is a narrow one. It is based upon alleged inquiries made by him as to the prices paid-for hogs at Neola, and) upon what should have been paid at that place, and the fact that he did not know of the existence of plaintiff firm. In instructing the jury with reference to these matters, the trial court gave the following:

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Now if any or all of these matters are shown by the evidence, the defendant would be entitled to have said matters so shown considered in mitigation of any damages that you might award against him, and also as bearing upon the question of whether in publishing said article or not he acted with express or actual malice, the burden resting with the defendant to show said mitigating circumstances by the greater weight of the evidence. You will understand that the above matters, if shown, would not be a complete defense to- the publication of said article, if same was published concerning the plaintiff firm, but are only to be regarded in mitigation, of damages and as bearing upon the question whether the defendant in making said publication acted with express malice or not. If it appears from the evidence that, at the time the defendant published said article, he did not know of the existence of Dorn & McGinty, as a copartnership, said matter should be considered in mitigation of damages as above explained.

We have already indicated our views with reference to the testimony admitted to sustain the plea interposed by defendant. Such testimony was admissible only to negative the thought of express or actual malice. It should not be considered in mitigation of the actual damages sustained, for defendant professed to speak of his own knowledge, and not from information derived of others. The trial court in its instructions told the jury that the testimony might be considered not only in its bearing upon tbe question of malice, but in mitigation of the actual damages sustained. In this 'there was manifest error. Marker v. Dunn, supra; Wallace v. Homestead Co., 117 Iowa, 348; Townshend on Slander & Libel, section 411; Buckstaff v. Hicks, 94 Wis. 34 (68 N. W. 403, 59 Am. St. Rep. 853) ; Williams v. Fuller, 68 Neb. 354 (94 N. W. 118, 97 N. W. 246) ; Rep. Co. v. Miner, 12 Colo. 77 (20 Pac. 345); Hinkle v. Davenport, 38 Iowa, 355; Sickra v. Small, 87 Me. 493 (33 Atl. 9, 47 Am. St. Rep. 344) ; Callahan v. Ingram, 122, Mo. 355 (26 S. W. 1020, 43 Am. St. Rep. 583); Thompson v. Powning, 15 Nev. 195.

5. Same. The latter part of the instruction relating to defendant’s knowledge of the existence of the plaintiff firm is also erroneous for two reasons: First, because the testimony showed without conflict that defendant did know or believe that plaintiffs were in the business of buying hogs; and for the further reason that, even if he did not know, his lack of knowledge would not mitigate the actual damages sustained. At most, the testimony would tend to show want of malice — this, and this alone. The instruction should not have been given.

6. Nominal damages: instruction. III. Part of the instructions relating to damages read as follows: “Damages in a case of this kind are of three kinds, to wit, nominal damages, actual damages, and exemplary damages. Nominal damages are given m cases where a wrong has been committed but no actual injury or damage has resulted to the person against whom the wrong was committed, and in such eases some small sum as one cent or ten cents is awarded as damages in order to cany the costs against the person committing the wrong. In this case, if you find that the article in question was published of and concerning the plaintiff firm of Dorn & McGinty, but you believe from the evidence that no injury has resulted to the plaintiff therefrom, then you snould award only nominal damages.” Whilst it is no doubt true that nominal damages only may be awarded in libel suits, yet as a general rule, the law presumes actual damages from the publication of an article libelous per se. Aside from this, however, the jury has nothing to do with the matter of costs, and it is better practice not to refer to it in the instructions. If it is referred to, the jury should not be misled regarding the matter. The instruction here given, in view of the offer made to confess judgment, was positively misleading, in that an award of the nominal damages stated would' not carry costs. A jury, in such eases, is prone to return a compromise verdict, and it is well known that they frequently return their verdicts with an eye to the adjustment of the costs. It is common knowledge of the profession that in such cases juries more frequently than otherwise consider the matter of costs in making their awards. With this fact in mind, it is better to say nothing, about the costs. But if reference is made to the matter, it should not be so stated as to mislead the jury. Under the English practice it was the custom of judges not to refer to the matter of costs even at the jury’s request. See Townshend on Slander and Libel (4th Ed.), 517, and cases cited; Wilson v. Reed, 2 Fost. & F., 149; Shay v. Water Co., 6 Cal. 286; Steketee v. Kimm, 48 Mich. 322 (12 N. W. 177). We are constrained to hold that this instruction, in view of the circumstances disclosed by the record, should not have been given.

Appellee says, however, that the jury did not follow the instruction, in that it awarded compensatory damages in the sum of $1. It will hardly do to say that a verdict for $1 is compensatory; but, if it be, this does not cure the error in the instruction. The award may have been made in order that there might be no question as to who should pay the costs without any reference to compensation to the plaintiff; but, if this be not true, the vice of the instruction with reference to mitigation of damages becomes apparent. That is to say, the jury may have concluded that the mitigating facts pleaded should be considered in reduction of actual damages suffered. Upon no ground can the instruction quoted be sustained.

7. Libel: definition. Although we do not regard the proposition involved in the case, it may be well to' speak of defendant’s claim that the article is not libelous, per se. Plaintiffs were charged, or at least the jury was authorized †0 so find, with entering into a pool to control the prices in the hog market at Neola. The trial court instructed that this charged them with a crime. Defendant contends that this is not so, and cites in support of his contention Achorn v. Piper, 66 Iowa, 694. It is true that that case seemsi to so hold, although not as broadly as defendant contends. But sections 5060, 5061, and 5062 of the Code, in force when the publication was made, made pools and . combination to regulate or fix the price of any commodity a crime. These statutes did not exist when the Achorn case was decided. But. counsel insist that these statutes were and are unconstitutional and void, and that the law is in fact the same as when Achorn’s case was decided. This contention overlooks the proper definition of libel, and, were we to concede for the purposes of the case that the statutes are unconstitutional, it does not follow that plaintiff was not slandered and defamed not only in their business or trade, but in the eyes of the people. The Legislature in declaring' the public policy of the State had spoken in an authoritative way, and although the statutes may have been void because not uniform in their operation, or because of the varying degrees of punishment, the acts with which plaintiffs were charged were none the less contrary to the public policy of the State as declared by proper legislative authority, and the publication thereof would of necessity tend to expose plaintiffs to public hatred or contempt, and to deprive them of the benefits of public confidence or social intercourse. This latter is the definition of libel 'for civil as well as criminal cases. Morse v. Printing Co., 124 Iowa, 713; Stewart v. Pierce, 98 Iowa, 136. Manifestly the words written of plaintiffs would injure them in their trade or business. Since Achorns case was decided, there has been a remarkable change not only in public opinion, but in the law as well, regarding pools, combinations, and trusts calculated to stifle competition, control prices, or regulate the output of goods, and the law of libel must of necessity keep pace with public opinion as reflected in the public prints as well as in legislation. Conceding arguendo that the law is unconstitutional, and that defendant may attack it collaterally, it does not follow that it may not be considered in determining the libelous character of the publication.

For the errors pointed out, the judgment must be, and it is, reversed.

Supplemental Opinion.

Per Curiam.

In a petition for rehearing the rule announced in the first division of the opinion with reference to the admissibility of defendant’s testimony as to his feelings toward the plaintiff is strongly challenged." It is argued that the Barr-Hack case, 46 Iowa, 308, does not decide the question; and in the petition, for the first time during the progress of the case, we are asked to overrule that case, if it cannot be distinguished.

As the element of express malice is involved in every action of libel or slander, and may be found from the nature of the publication itself or from the circumstances surrounding the publication, it is clear that the Barr case is directly in point upon the proposition that defendant’s prior feelings toward the plaintiff cannot be shown for any purpose. There is no _way of distinguishing the case. Since its announcement that case does not seem to have been cited in support of the ruling, and we have but the single one upon this proposition. It is argued that the case is wrong, both on principle and authority, and that it should be overruled. As already intimated, this is the first time such request has been made during the progress of this action. As it is to be retried and the question will again arise, we have thought it best to reconsider the Barr-Hack case in the light of authorities.

8. Libel: malice: evidence. It is a general rule that, when intent, motive, or malice is directly in issue, a party may testify directly to his intent or purpose, and, if malice be involved, to his friendly feelings toward the other party. Heap v. Parish, 104 Ind. 36 (3 N. E. 54:9) ; Campbell v. Railroad, 97 Md. 321 (55 Atl. 532); Sherbourne v. Rodman, 51 Wis. 474 (8 N. W. 414) ; Brown v. Insurance Co., 151 Mass. 127 (23 N. E. 733); Brewer v. Watson, 71 Ala. 299 (46 Am. Rep. 318) ; Boddy v. Henry, 113 Iowa, 462 (85 N. W. 771, 53 L. R. A. 769); Watson v. Cheshire, 18 Iowa, 203; Frost v. Rosecranz, 66 Iowa, 405. But he cannot testify to another’s intent, as that would be a mere inference or conclusion. Hamer v. Bank, 9 Utah, 215 (33 Pac. 941); Hurlburt v. Boaz, 4 Tex. Civ. App. 371 (23 S. W. 446) ; Dutton v. Seevers, 89 Iowa, 302; Sweet v. Wright, 62 Iowa, 215. As the question of malice is directly at issue in a libel case, it is held almost without exception that the defendant may testify to his lack of malice and that his feelings toward plaintiff were friendly both before and recently after the publication. Burdette v. Argill, 94 Ill. App. 171; Faxon v. Jones, 176 Mass. 206 (57 N. E. 359; Friedman v. Pulitzer Pub. Co., 102 Mo. App. 683 (77 S. W. 340); Wrege v. Jones, 13 N. D. 267 (100 N. W. 705, 112 Am. St. Rep. 679); Palmer v. Mahin, 120 Fed. 737 (57 C. C. A. 41); Atwater v. News Co., 67 Conn. 504, (34 Atl. 865); Ranson v. McCurley, 140 Ill. 626 (31 N. E. 119) ; Peoples v. Detroit P. & T. Co., 54 Mich. 457 (20 N. W. 528) ; Mowry v. Raabe, 89 Cal. 606 (27 Pac. 157).

Tbe only case to tbe contrary, aside from those cited in tbe opinion itself, is Barr v. Hack. Much of tbe argument used in support of that opinion by way of analogy and otherwise has already been repudiated in many cases decided since that time, and, as we think the doctrine of the opinion unsound, tbe decision is overruled. It follows that the objection to tbe question, in so far as it called for defendant’s opinion regarding plaintiff’s feelings toward him, should have been sustained; but, as the witness in answer gave simply his feelings toward plaintiff, no prejudice resulted.

Other points are made in the petition for rehearing, hut they are without merit.

The first division of the opinion is modified to the extent indicated, and the petition for rehearing will be overruled.