The Helena independent. [volume] (Helena, Mont.) 1875-1943, 1892-02-27
TALKS ON LAW
Status Of Mercantile Agencies Dis
cussed by VIM. c. sprague,
Of Detroit.
TO What Extent Are Reports Sent
Out by Them Privileged
Communications?
No legal Liability Attaches to Such Com
municntions Unless Malice Is Shown
Gases in Point.

The business of a mercantile agency is to
collect information relating to the credit.
character, responsibility and reputation of
merchants for the purpose of furnishing
the information to subscribers. The most
Important question that has arisen relating
to this kind of business is to what extent
are the reports sent out BY mercantile
agencies privileged communications-that
is, how far are such companies protected in
giving information affecting the credit of
business men from liability for damages in
case of false statements.
As we shall use the term privileged COM
munication' frequently, let us understand
it's meaning. 1t is such a communication as
is made in good faith, upon any subject in
which the party communicating has an in
terest, or in reference to which he has a
duty. public or private, either legal, moral
or social. if made to a person having a cor
responding interest or duty. No legal liza
bility attaches to such communications,
unless malice BIO shown. 1t may first be
said that the publication of false defama-
ton by a mercantile agency to the world at
large is not privileged. So that such pub
locations affecting the credit of business
men as are made by agencies and scattered
broadcast, or put carelessly or indisorimi-
natoly before the public, are neither justi-
fed nor protected.
Agencies are not in the habit of being
thus prodigal of their information. how
ever. The most omlnon form of giving
information is that of publishing books of
ratings, or weekly or daily sheets of bust
ness changes, failures. mortgages, indg-
monts, ct %cetera, and furnishing tho same
to all their subscribers regularly. The
question has arisen, is al agency liable for
a false report on Il merchant 30 made to n
large number of subscribers, only n few of
whom are interested in that merchant?
There il no question, it may bs said, of the
privileged communication to persons
known to be directly into. ested in
that merchant, or to such MS ask
for n report on such merchant. but
how about the communication going to
hundreds of thousands of subscribers who
are not Interested, and do not ask for this
information and 90 not need it? Refer to
our definition of privileged communica-
ton. 1t must be made TO 4 person having
Il corresponding interest or duty in tho sub
ject. | am a iobber in hardware. My
agency sheet to-day tells me that my neigh
have net sought nor can find any uss for
the information. 1t is interesting gossip
to me-nothing more. Suppose the report
ia false. Can tho agency hide behind IA
''priveleged communication'' when brought
to defend an action? The weight and ma.
jority of decisions deny the agency's right
80 to do. and such may be considered tho
Inv. The first case that nrose was in
Massachusetts. 1t was brought by a NOR
chant against n Russell, who conducted
the Boston Mercantile Agency" Here Rus
sell reported the incorrect and unjust in
formation to only such subscribers az were