Larmour v. Campanale

California Court of Appeal Aug 30, 1979 No. Civ. 18588Published

Before: Buttermore

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Holding. A demand letter sent by an attorney to a potential adversary and copied to an escrow holder is absolutely privileged under Civil Code section 47. The court further held that while the trial court erred by failing to specify reasons for sustaining a demurrer, reversal is only required if the appellant demonstrates prejudice.

Issues

Whether a demand letter sent by an attorney to a potential adversary and copied to an escrow holder is protected by the litigation privilege.
Whether the trial court's failure to specify reasons for sustaining a demurrer requires reversal absent a showing of prejudice.
Whether the second cause of action for breach of contract sufficiently stated a claim to survive a demurrer.

Disposition. Affirmed in part, reversed in part.

Quotations verified verbatim against the opinion

“While we are not prepared to say the letter is in fact libelous if it can be so construed, we hold it was fully privileged”

“If the publication has a reasonable relation to the action and is permitted by law, the absolute privilege attaches.”

“Failure to specify the reasons for sustaining the demurrer was error, but a reversal is not required unless there is an affirmative showing of prejudice”

[568]

Opinion

BUTTERMORE, J.

In a first amended cross-complaint, appellants sought damages for libel and breach of a contract to buy their home. Respondents had agreed to purchase the home through an escrow at Mission Escrow Company, Inc. and to seek a loan commitment from the Veterans Administration. The deal fell through and this litigation followed.

The first cause of action for libel set forth a demand letter to appellants from respondents’ attorney, with a copy to Mission Escrow. Following his demand for performance, counsel wrote he had advised his clients of their right to sue for specific performance and “possibly for punitive damages based upon fraud.” A general demurrer to that cause was sustained without leave and no reasons were specified by the trial court as required by Code of Civil Procedure section 472d. While we are not prepared to say the letter is in fact libelous if it can be so construed, we hold it was fully privileged

(Lerette

Dean Witter Organization, Inc.,

60 Cal.App.3d 573 [131 Cal.Rptr. 592]).

The purpose of the privilege under Civil Code section 47

is to afford litigants the utmost freedom of access to the courts, to preserve and defend their rights

(Albertson

Raboff,

46 Cal.2d 375, 380 [295 P.2d 405]) and to protect attorneys during the course of their representation of their clients

(Smith

Hatch,

271 Cal.App.2d 39, 50 [76 Cal.Rptr. 350]). “It is . . . well established legal practice to communicate promptly with a potential adversary, setting out the claims made upon him, urging settlement, and warning of the alternative of judicial action.”

Larmour v. Campanale

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BUTTERMORE, J.

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