Mitchell v. Bradstreet Co.

22 S.W. 358, 116 Mo. 226, 1893 Mo. LEXIS 282

• Court: Supreme Court of Missouri
• Decided: May 24, 1893
• Status: Published

Opinions

Burgess, J.

Action for libel. On the twenty-fifth day of November 1889, and prior thereto, the plaintiffs were partners, engaged in the mercantile business in the town of Sugar Loaf, Cleburne county, Arkansas, under the firm name and style of Mitchell, Smith & Co. The plaintiffs kept a general store; their stock consisting of such goods as are usually carried by country merchants. While thus engaged the defendant, duly organized and doing business in St. Louis, Missouri, and conducting a mercantile agency, under the name of the “Bradstreet Company” on' the date aforesaid, published of and concerning the plaintiffs, the following language and accusation, to-wit: “Mitchell, Smith & Co., of Sugar Loaf, Arkansas, Gr. S., assigned.”

The petition alleges that the publication was false, and claims special damages for injuries sustained to their credit in various ways and with different onea of their patrons and customers.

The material part of the answer of defendant is as follows: “Andfurther answering said amended petition, defendant says: That it is a corporation organized for and engaged in the business of conducting a mercantile agency, and has been engaged in said business for many years, and is now and was on November 22, 1889, and had been for many years prior to said date, employed by a large number of merchants and manufacturers throughout the United States as their representative and agent to collect, procure and preserve for them, said patrons or employers, reports and information as to the estate, property, credit, conduct, character and trustworthiness of persons and corporations engaged in trade or commerce in the United States and elsewhere, so that defendant’s said employers, who are commonly known as subscribers to defendants’ agency, may have the knowledge and information necessary to enable them to safely and properly conduct business with strangers or distant customers, and it is expressly agreed between defendant and its said employers that all information, whether written, printed or verbal, furnished by defendant, its agents or servants, shall be held in strict confidence, and used exclusively for the benefit of such subscriber; and for the sole purpose of giving its said employers or subscribers, in strict confidence, and for their exclusive use and benefit as aforesaid, reports and information as to merchants and corporations engaged in mercantile pursuits in various parts of the country defendant issues from time to time in the city of St. Louis and elsewhere, to its said employers, small sheets containing such reports and information concerning merchants and manufacturers in various portions of the countryr as defendant believes to be true and of value or importance to its aforesaid subscribers; and if defendant published of and concerning plaintiffs the words complained of in plaintiff’s petition, defendant had good reason to believe, and did believe at the time of alleged publication, that the same were true; and defendant further says that at the time of alleged publication plaintiffs • were unknown to the agents and servants of defendants, and that said publication if made, was made innocently, without ■ malice, in the usual course of business, and to defendant’s said subscribers or employers only, in strict confidence, and for the exclusive use of said subscribers, and in the belief that plaintiffs were customers of defendant’s subscribers, or of some of them, and defendant says that said subscribers, or some of them, were creditors of plaintiffs or otherwise directly interested in the estate, property, credit, conduct and character of plaintiffs.”

The proof tends to show that plaintiffs were the only firm ,at the date aforesaid doing business in Sugar Loaf under the said name of “Mitchell,'Smith &'Co.” That at the time of said publication they were doing a large credit business with farmers, and were dependent upon their good standing and credit among merchants at St. Louis and elsewhere as a means of conducting and carrying on their said business. That at the time of said publication, owing to the partial failure of the cotton crops in their section of the country, they were unable to collect, in full, debts •due to them, and were dependent upon their credit and standing among their creditors as a means of successfully prosecuting their said business. They were somewhat indebted at the time of the publication to parties in the city of St. Louis, but their assets were ample to meet and pay all of their liabilities, had their credit •and standing among their said creditors been unimpaired by the publication aforesaid. Up to the time of .said publication the creditors of .the respondents were resting satisfied, and the business of respondents was being pursued in a safe and comparatively prosperous manner.

The proof also shows that the publication complained of was through the medium of what is known as Bradstreet’s Sheet, [a daily, paper published by defendant in the city of St. Louis, and circulated .among the merchants of said city and surrounding states.

It is also shown, that the defendant was notified, in a day or two after such publication, that the same was false, but it declined, or failed in the subsequent issue of its said sheet to retract or apologize, or make any explanation of said publication. The proof shows that plaintiffs, prior to said publication, had good credit in the city of St. Louis, that is credit to an extent commensurate with all their necessities; but on the coming out of said publication, their creditors became restless, some of them placing their claims in the hands of attorneys, some writing urgent letters, and one stopping goods in transit, while others in St. Louis became exceedingly apprehensive, and by their •repeated inquiries at the office of Hill, Eontaine & Co., plaintiffs’ principal creditor, compelled the latter to take urgent steps upon their claim, resulting in plaintiffs’ sale of their property at a sacrifice, the suspension of their business, and injury of their credit.

At the close of plaintiffs’ evidence defendant asked, the following instructions:

“The court instructs the jury that, under the pleadings and evidence, plaintiffs are not entitled to recover-in this action, and you will therefore find for defendant.”

The court refused to give this instruction, to which refusal defendant duly excepted.

At the close of the whole case defendant askéd the-following six instructions, to-wit:

“1. The court instructs the jury that there is no-evidence in this case showing that defendant published of plaintiffs the words complained of with malice in fact, that is through hatred, ill will, or a desire to injure-plaintiffs as merchants or individuals.

“2. The court instructs the jury, that defendant had the right to report to such of its customers as were-creditors of the plaintiffs any information touching plaintiffs’ financial condition which it received in the-usual' course of business and believed to be true, and that defendant is not liable to plaintiffs for any damage-that may have been caused them through such report so made.

“3. The court instructs the jury that, if they believe-from the evidence that defendant, on or about November 23, 1889,-published of plaintiffs the words complained of, and at that time plaintiffs were insolvent, that is, could not pay out of their assets their debts as-they matured in the ordinary course of business, then they will find for defendant.

“4. The court instructs the jury that, if Ihey believe from the evidence that the damages claimed by plaintiffs were not caused by reason of the publication by defendant of the words complained of, but were brought about by the circulation by others of reports injurious to the financial condition or responsibility of plaintiffs, or because plaintiffs were insolvent, that is, unable to pay out of their assets their obligations as they matured in the usual course of business, they will find for defendant.

“5. The court instructs the jury that, if they believe from the evidence that plaintiffs by compromising their debts, or some of them, saved more money than they lost through their suspension of business,, they will find for defendant.

“6. The court instructs the jury that, although they may find for plaintiffs, yet if they believe from the evidence that plaintiffs by compromising their debts, or some of them, saved more money than they lost through their suspension of business, then they will find for plaintiffs, nominal damages.” . ■

All of which instructions the court refused to give, to which refusal the defendant then and there at the time duly excepted.

The court then, of its own motion, gave the following instruction:

“The court instructs the jury as follows, viz: Under the evidence adduced, your verdict must be for the plaintiffs; the only questions left for your decision, therefore, are those relating to the amount of damages-to be assessed.

“Damages are three kinds, viz: Nominal, compensatory and punitive. Nominal damages are given when there has been no material injury shown by the evidence to have resulted to the plaintiff from the act of the defendant complained of and when punitive damages are not to be awarded. Compensatory damages are given when the evidence satisfies the jury that the plaintiffs have sustained material or substantial injury,, and that that injury was the result of the wrongful act ■of the defendant complained of. Compensatory damages should be a sum necessary and sufficient to compensate the plaintiffs for such injury.

“Punitive damages are awarded in a proper case in ■addition to nominal and compensatory damages, for “the purpose of punishing the defendant for the wrongful act, and setting an example before the community. Punitive damages are never allowed unless the evidence is sufficient to satisfy the jury that in the doing of the wrongful act complained of, the defendant was actuated by feelings of ill will or hatred towards the plaintiffs, or reckless disregard of the consequence of the act.

“There is no evidence in this case that would justify you in the infliction of punitive damages. Youi inquiry, therefore, is limited to the question as to whether or not the plaintiffs sustained material or substantial injury, and if that injury was caused by the publication in question, and if yea, then how much money will be necessary and sufficient to compensate "the plaintiffs for that injury; and that should be your reward or damages.

“If you are not satisfied from the evidence that the plaintiffs have sustained material or substantial injury, ■and that that injury was caused by the publication in question, then you should assess nominal damages ■only.”

To the giving of said instructions the defendant then and there at the time duly excepted. Under the instruction of the court the jury found a verdict for plaintiffs for the sum of $5,500, from which verdict and .judgment thereon defendant prosecutes this appeal.

I. Defendants’ first contention is that the publication sheet was privileged, in the absence of motives, as to subscribers who were creditors of plaintiffs, and that the court erred in allowing the proof of publication to such subscribers. If tbe proof showed that no other persons, than the creditors of plaintiffs had received the publication sheet in which the libelous matter is shown to have been published, there are authorities which hold that in the absence of malice in the publication, owing to. the confidential relations existing between-such creditors and the defendant, the publication was privileged,, and defendant was not liable in damages therefor, although the same was false. 1

In the case of Trussell v. Scarlett, 18 Fed. Rep. 214, it was held that “when a mercantile agency makes' a communication to one of its subscribers who has an interest in knowing it, concerning the financial condition of another person, and when such communication is made in good faith, and under circumstances of reasonable caution as to its being confidential, it is a protected, privileged communication, and an action for libel cannot be founded upon it, even though the-information given thereby was not true in fact, and though the words themselves are libelous.” See, also,, Locke v. Bradstreet Go., 22 Fed. Rep. 771.

But the answer in the case at bar admits, and the-proof shows that the publication sheet under consideration was not only sent to the creditors of plaintiff, but-was sent to all of the subscribers of defendant, regardless of their location or interest in the financial standing-of plaintiffs. While it may be conceded that the business of defendant is a laudable one, and, in so far as it. concerns the tradesmen, ■ bankers, manufacturers and business of the country, almost indispensable, it cannot, be that a company for hire, a moneyed consideration paid to them, can make a false statement or publication as to the financial standing of'any person or persons or business firm, send it all over the country, to persons who-are not the creditors of any such person or firm, as well as to those who are, and ruin them in their credit and business, and then claim immunity from liability therefor upon the ground that such publication was privileged. We are not inclined to give our sanction to a doctrine which .seems to us to be so harsh, and so unjust, and in this position we are sustained by courts of high authority.

In the case of Pollasky v. Minchener, 9 Lawyer’s Reports Annonated 102, which was a suit against the agent of a commercial agency for libel, the supreme court of Michigan says: “The notification sheet containing the false statement respecting the acts of Pollasky Bros, was not alone sent to those who were dealing with them and extending them credit, but to between six and seven hundred subscribers in Michigan, and others residing out of the state, from some of whom they might wish to purchase goods upon credit, and this without any request being made to be informed of the standing or credit of the Pollasky Bros., and others of whom, and by far the greater number, were engaged in different lines of business, and who were in no manner interested in knowing their standing, or financial ability or business integrity: To all such the communication was not privileged. It cannot be said that a blacksmith, a saw-miller and a lumber dealer, a furniture manufacturer, a dealer in hardware, a chemist, mineral water bottlers, butchers, book agents, physicians or druggists, or other business men mentioned in the notification sheets, who are not engaged in wholesale or retail dealing in dry goods, clothing or boots or shoes, are at all interested in the business standing of a dealer in dry goods, clothing and boots and shoes. No court has gone so far as to hold all communications made by a mercantile agency to their subscribers, if made in good faith, but made generally, without request, or to those inquiring concerning or interested in knowing the condition and financial standing of a person, are privileged. On the contrary, courts have uniformly held that privilege does not extend to false publications made to patrons who have no such interest in the subject-matter. Goldstein v. Foss, 2 Car. & P. 252; Com. v. Stacey, 8 Phila. 617; Taylor v. Church, 8 N. Y. 452; Ormsby v. Douglass, 37 N. Y. 477; Sunderlin v. Bradstreet, 46 N. Y. 188; King v. Patterson, 49 N. J. L. 417; Bradstreet Co. v. Gill, 2 L. R. A. 405; s. c., 72 Texas, 115; Johnson v. Bradstreet Co., 77 Gra. 172; Erber v. Dun, 12 Fed. Rep. 526.”

“The law guards most carefully the credit of all merchants and traders. Any imputation on their solvency, any suggestion that they are in any pecuniary difficulties, is, therefore, actionable without proof of special damages * * * of merchants, tradesmen and others in occupations where credit is essential to the successful prosecution, any language is actionable without proof of special damages which imputes a want of credit or responsibility or insolvency.” Newell on Defamation, Slander and Libel, secs. 34 and 35, pages 192 and 193.

In the case in hand, the defendant was not even applied to by any of its patrons for information in regard to the financial standing of the plaintiffs, and the publication of the statement that plaintiffs had assigned was merely voluntary on their part, false in fact, and compelled them to retire from business. When asked to retract the statement they' declined to do so. Under such circumstances the statement was in no wise privileged. The information acquired by defendant was its own, and was communicated to others or made public in such form and upon such terms as it dictated.

Neither the welfare or convenience of society will be promoted by a publication of matters, false in fact, injuriously affecting, the standing and credit of merchants and tradesmen, broadcast through the land, within the protection of privileged communications. While the defendant’s business is lawful, yet in its-conduct and management it must be subjected to the ordinary rules of law and its proprietors' and managers held to the liability which the law attaches to the like-liability of others.

■ 2. The next contention of defendant is that the-publication was true, that plaintiffs were in fact insolvent at the time thereof, and that the court for that reason should have given the instruction in the' nature of a demurrer to the evidence. A firm is understood to be insolvent when unable to pay their debts as they fall due in the usual course of trade or business.. Bouvier’s Dictionary, Insolvency, 809. It “implies as well the present ability of the debtor to pay out of his estate all his debts, as also such attitude of his property as that it may be reached and subjected by process of law, without his consent, to the payment of such debts.” Eddy v. Baldwin, 32 Mo. 369; Thompson v. Thompson, 4 Cush. 127; Bank v. Walton, 5 L. R. A. 765.

We do not think that this contention is borne out-by the evidence, as according to' the statement of' Mitchell, one of the plaintiffs, who testified in the case, and who knew all about the business of the firm and its assets, it had ample available means with which to have liquidated its indebtedness.

3. It is next contended that the publication was-not libelous per se, and that therefore it was necessary for plaintiffs to allege in their petition, and also prove-special damages, before being entitled to recover. The authorities cited by defendant do not sustain this contention. If the libel complained of is not actionable: per se then, defendant’s position is correct, otherwise not. \

In the case of Weiss v. Whittemore, 28 Mich. 366, the supreme court of that state say: “The definition of a libel, [as given by Mr. Townshend upon a review of the authorities is, that it is a wrong done by writing or effigy; and if false and malicious, certainly, and for the purpose of injuring another in reputation, trade, employment or property, every publication of language concerning a man or his affairs, which, as a necessary or natural and proximate consequence, occasions pecuniary loss to another, is prima facie a libel, if the publication be by writing.”

A definition of libel, as quoted and approved by this court in Nelson v. Musgrave, 10 Mo. 648, is: “A malicious publication, expressed either in printing or writing, or by signs or pictures, tending either to blacken the memory of the dead, or the reputation of one who is alive, and expose him to public hatred, contempt or ridicule.” This definition has been cited with approval in Price v. Whitely, 50 Mo. 439; and Legg v. Dunleavy, 80 Mo. 563. “Any printed publication that tends to bring a man into disrepute, ridicule or contempt is a libel in a legal sense.”

In the case of Hermann v. Bradstreet Company, 19 Mo. App. 227, it was held that the following words: “Joseph Hermann, brickmaker, is in the hands of the sheriff,” which were published of and concerning Hermann who was engaged in the business of brick making, were libelous and actionable per se. Words written or spoken of one’s trade are actionable when they might not be. so, if spoken of the individual simply. Townshend on Slander and Libel, sections 132-179.

Every willful and unauthorized publication, written or printed, which imputes to a merchant or other business man conduct which is injurious to his character .and standing as a merchant or business man, is a libel and implies malice. Locke v. Bradstreet Co., 22 Fed. Rep. supra.

So it was held ,in the case' of Newell v. How, 22 Minn. 235, that in those trades or professions in which, ordinarily, credit is essential to their successful prosecution, as, for example, that of merchant, language is actionable per se which imputes to one in such trade or profession a want of credit or responsibility, or insolvency, past, present or future. Such language necessarily or naturally and presumptively, causes pecuniary loss to the person of whom it is published.” See also McGinnis v. Knapp, 109 Mo. 137.

These authorities abundantly show that the publication here complained of, to-wit: “Mitchell and Company, assigned,” was actionable per se, and that from the publication, the same being false, malice is implied; and that the court did not commit error in instructing the jury to find for plaintiffs.

4. It is also contended that the damages assessed by the jury are excessive, so much so that the jury must have been governed by passion or prejudice in arriving at their verdict. There does not seem to be anything in the case to justify this position, when all the facts connecbed with the publication and the result thereof are taken into consideration. The plaintiffs seem to have been doing a large and lucrative business, principally upon credit, and the act of defendant compelled them to retire therefrom and in fact almost entirely destroyed their credit. The verdict, in our opinion, was not more than they were entitled to recover under the evidence and instruction of the court.

5. The final contention on the part of defendant is, that under art. 2, sec. 14, Constitution of Missouri, ■which provides, “That no law shall be passed impairing the freedom of speech; that'every person shall be free to say, write or publish whatever he will on any subject, being responsible for all abuse of that liberty; and that in all suits and prosecutions for libel, the truth thereof may be given in evidence, and the jury, under the direction of the court, shall determine the law and the factthat it was the duty of the court to have instructed the jury that they were the judges of the law as well as of the fact, and that because of the failure to. do so, that the instruction given in the case was erroneous. No instruction of this character or presenting this phase of the case to the jury was asked by ■defendant.

Section 2188, Revised Statutes, 1889, provides that when the evidence is concluded, and before the case is argued or submitted to the jury or to the court sitting as a jury, either party may move the court to give instructions on any point of law arising in the cause, which shall be given or refused. And that the court may of its own motion give like instructions, etc. Defendant cannot now be heard to complain of the refusal of the court to give an instruction'which was not asked. It is hot made the duty of the trial court by statute in civil, as it is in criminal cases, to instruct the jury whether it is asked to do so or not. Besides, no such question is made in the motion for new trial.

Being unable to discover any prejudicial error in the trial of the cause, either in the admission or exclusion of evidence, or the refusing or giving instructions, and the judgment being for the right party it is affirmed.

All concur.