Roemer v. Retail Credit Co.

Opinion

DRAPER, P. J.

In this libel action, jury verdict, on a 9 to 3 vote, was in plaintiff’s favor for $7,500 compensatory damages and $50,000 exemplary damages. Judgment was entered upon the verdict and motion for new trial denied. Defendant appeals.

Defendant is a mercantile agency. The reports here asserted to be defamatory were made to insurance companies which were considering appointment of plaintiff as an agent, and had sought information as to his character and business standing. Falsity of the reports was admitted by defendant. The defense was based wholly on the qualified privilege (Civ. Code, § 47, subd. 3).

This privilege does extend to mercantile agencies

(Stationers Corp.

v.

Dun & Bradstreet, Inc.,

62 Cal.2d 412, 418 [42 Cal.Rptr. 449, 398 P.2d 785]).

The privilege, however, is termed “qualified” or “conditional” because

[371]

it applies only to “a communication without malice” (Civ. Code, § 47, subd. 3). The parties correctly concede that the privilege is inapplicable here if the defamatory statements were made with malice. The principal fact issue submmitted to the jury was whether the evidence established malice.

The trial court correctly instructed the jury that if the privilege applies, even a false statement is not actionable, but that it can apply only if the statement is made without malice. It then continued: “However, if you find that the defendant knew the defamatory statement was false, and had an improper motive for publishing it, or was negligent in not making a sufficient inquiry into the facts upon which the statement was based, then you are instructed that the conditional privilege of defendant no longer existed.” Defendant-appellant asserts error in this instruction.

There can be little question that the privilege is lost if defendant published the article with knowledge of its falsity