Case Name: HAWLEY v. PROFESSIONAL CREDIT BUREAU, INC.
Court: Michigan Supreme Court
Jurisdiction: Michigan
Decision Date: 1956-05-14
Citations: 345 Mich. 500
Docket Number: Docket No. 26, Calendar No. 46,648
Parties: HAWLEY v. PROFESSIONAL CREDIT BUREAU, INC.
Judges: Dethmers, C. J., Sharpe, Boyles, Kelly, and Carr, JJ., concurred with Reid, J.
Reporter: Michigan Reports
Volume: 345
Pages: 500–518

Head Matter:
HAWLEY v. PROFESSIONAL CREDIT BUREAU, INC.
1. Libel and Slander — Bad Faith — Collection of Debt — Letter to Employer.
Plaintiff, in action, for libel, to whose employer defendant local credit bureau and its manager wrote a letter to enlist cooperation in securing payment of money to an out-of-town creditor which had referred the account for collection, failed to make any showing that defendants were acting in bad faith in ' believing plaintiff owed the debt, where, over at least a 6-months’ period, plaintiff had refused to make any payments upon it and had not denied the debt to the creditor, such failure being corroborated by failure to object within a reasonable time to statements rendered to him.
2. Account Stated — Conversion of Open Accounts.
The conversion of an open account into an account stated is an operation by which the parties assent to a sum as the correct balance due from one to the other, and although it may still be impeached for fraud or mistake, in the absence of such impeachment, it serves in place of the original account as the foundation of an action.
References for Points in Headnotes
33 Am Jur, Libel and Slander §§ 59-61, 112, 119.
1 Am Jur, Accounts and Accounting §§ 16, 30, 31.
33 Am Jur, Libel and Slander § 280.
Z. Libel and Slandee — Collection of Debt — Lettee to Debtor’s Employer.
Circumstances which led to credit bureau’s writing of a letter to plaintiff’s employer to enlist cooperation in payment of $21.98 owing an out-of-town creditor, which represented the balance of an account upon which plaintiff had made payments after receiving a favorable adjustment held, not to have constituted an invasion of plaintiff’s right of privacy nor to have disclosed a basis for plaintiff’s claim of libel or malice, especially where plaintiff ignored repeated statements and had not denied the debt to the creditor during period of 6 months following the making of the last payment.
'Smith and Black, JJ., dissenting.
Appeal from Muskegon; Fox (Noel P.), J.
Submitted January 4, 1956.
(Docket No. 26, Calendar No. 46,648.)
Decided May 14, 1956.
Case by Fred Hawley against Professional Credit Bureau, Inc., a Michigan corporation, and Carl F. Funnell, for damages for invasion of right of privacy by reason of collection effort in form of letter to his employer. Verdict and judgment for plaintiff. Defendants appeal.
Reversed and remanded for entry of judgment for defendants.
Alexis J. Rogoski and Robert Bunker Rogoski, for plaintiff.
Stribley & Rude (Arthur M. Rude, of counsel), for defendants.

Opinion:
Reid, J.
Plaintiff brought this suit because of the writing of a certain letter attributable to both defendants, written to the director of a junior college, the employer of plaintiff. As claimed by plaintiff, the letter imputes dishonesty to plaintiff, is libelous per se, and was presumably prompted by malice. The plaintiff claims the letter is actionable for having unlawfully invaded the plaintiff's right of pri vacy, and plaintiff claims that the letter was written in furtherance of a threat by collection agency,defendant twice made to destroy plaintiff's credit. From a judgment against them of $2,000, defendants appeal. '>
The letter captioned at defendant credit bureau's office in Muskegon, Michigan, is as follows.: i
"October 13, 1951
_ "Asst. Director of Junior College
Hackley School Building
Muskegon, Michigan
"Re:
Your Employee: Fred Hawley
Owing Silver Moving & Storage $21.98
since 3-5-51
"Dear Sir:
"The above individual has been given every reasonable opportunity to pay or make satisfactory arrangements. Failure to do so justifies collection by legal action. This will, of course, bring additional expense upon yoiir employee and inconvenience you as garnishee; defendant. We would like to prevent both.
"We therefore suggest that you confer with, this debtor to secure cooperation to that end. If the individual's resources will not permit payment in .full, we suggest payroll deductions to provide assurance of regular remittance to this office. Payments of $5.00,or more per,.week are acceptable.
"Your help to avoid suit will be appreciated.'
"Sincerely,
"/S/ C. F. Funnell
"0. F. Funnell,
"Manager "
"Member of Michigan Association of Collection Agencies,
"Muskegon Merchants Service Bureau and Commercial Law,-League."
The facts which caused the writing of the letter are as follows:
Plaintiff and his wife lived at Alpena, Michigan, for several years prior to 1946, when they moved to Muskegon. Before leaving Alpena, plaintiff stored his furniture with Silver Moving & Storage Company at Alpena at an agreed-on storage rate. The-furniture remained in storage until July 11, 1950. In June, 1950, plaintiff wrote Silver Moving & Storage Company a letter from Muskegon which, among other things, contained the following:
"Gentlemen: Undoubtedly you have trips coming-down in this vicinity. What would it cost to transfer our .furniture here during one of these trips?"
On July 8,1950, Silver sent the following telegram t'o plaintiff at Muskegon:
"Plan to deliver your furniture Tuesday, July 11. Wire collect if O.K. R. G. Silver."
This telegram was not received by Mrs. Hawley until just before the furniture arrived in Muskegon. Plaintiff Mr. Hawley was at Bay View teaching in a summer college. On;July 11, 1950, the furniture arrived in Muskegon and was delivered to plaintiff's address. The driver' presented a bill for the balance of storage and transportation charges of $89.48. Mrs. Hawley paid $30 on the bill and reluctantly accepted the furniture. This left a balance of $59.48. On October 2, 1950, plaintiff wrote Silver Moving & Storage. Company a letter complaining about the charges for moving the furniture and as a result obtained an adjustment on the bill of $12.50, which reduced the unpaid balance of the bill to $46.98. At different dates following this adjustment, plaintiff paid a total of $25 on the bill, leaving a balance of $21.98, and then plaintiff discontinued his payments. During 1951, after such discontinuance, plaintiff re eeived bills from Silver Moving & Storage Company requesting payment of the $21.98. Some time in September or October, 1951, plaintiff received a telephone message from defendant Professional Credit Bureau, Inc., saying they had a bill from Silver Moving & Storage for $21.98. During 6 months in 1951, in which he received various statements, plaintiff did not in anywise let Silver know that he claimed not to owe the $21.98 or any part of it.
This is not a suit against plaintiff's creditor but against the collection agency. The determinative question in the case is, was the writing of the letter hereinbefore set forth a violation of any right of plaintiff respecting privacy?
Plaintiff testified on cross-examination as follows:
"Q. And that left a balance, then, of $46.98, did it not?
"A. I presume that would be it.
"Q. All right, then, now that's the balance as of November 1, 1950. Now, during November, 1950; January, 1951; February, 1951; and March, 1951, you paid a total of $25 on the bill, did you not?
"A. That's right.
"Q. And you testified on direct examination that there was no communication between you and Silver Moving & Storage about the declining balance on your bill, you didn't write them or phone them, or tell them you weren't going to pay the balance, did you?
"A. No, I didn't.
"Q. You just continued to pay on the bill. Now, deducting the $25 you paid on the $46.98, left a balance of $21.98.
"A. That's right.
"Q. That was the status of the account as of March, 1951, is that right?
"A. That's right.
"Q. Then yoii discontinued your payments, didn't you?
"A. That's right.
"Q. But you didn't write Silver Moving & Storage, or the Alpena Credit Bureau, that you were discontinuing your payments, and that you refused to pay the balance of $21.98, did you?
"A. No, sir.
"Q. You just ignored it, didn't you?
"A. Thát's right, yes.'
"Q. All right, now we are in 1951, and the bill is $21.98. This is a year after they delivered the furniture to Muskegon, isn't it?
"A. That's right.
"Q. Now, April, 1951, went by, May, June, July,. August, and September, and during that time you received bills from Silver Moving & Storage, for this $21.98?
"A. I preshme so — not regular.
"Q. Not regular bills, but you received some bills during that 6-months' period for that $21.98?
"A. That's right.
"Q. And you ignored all the bills?
"A. That's right.
"Q. Then, in September, or October, 1951, you received a call from Professional Credit Bureau, as you just testified, saying that they had a bill from Silver Moving' & Storage, for $21.98, is that right?
"A. Which call?
"Q. I'm talking about the first telephone call to you.
"A. That's right, yes.
"Q. Was thát received at your home or at your office?
'A. At my home.
"Q. And you — and that telephone call was as a result of this post card which has been offered in evidence ?
"A. That's right.
"Q. Now, up to this point, you have not communicated to Silver Moving & Storage, or the Alpena Col lection Service, or the Professional Credit Burean, your counterclaim for damages, have you? You haven't communicated to them about that up to this point — that is, up to the time you got this phone call?
"A. No, I haven't.
"Q. You have been carrying that- around in your own mind all this time, nobody else knew about that claim, did they ? . '
"A. No, I don't know whether you. want to call that a counterclaim or nok '
• "Q. We will get to that shortly, but at least, you haven't made any claim back against Silver Moving & Storage up until the time you got the card from Professional Credit Bureau, did you?
"A. That's' right.
"Q. So the ' Silver Moving & Storage, and the Alpena Credit Bureau, had no way of knowing that you didn't owe the $21.98, did they? They had no way of knowing that, because you just said you didn't tell anybody, is that right?
"A. That's right."
Plaintiff made no showing that defendants were acting in bad faith in believing that plaintiff owed the debt. Over at least a 6-months' period he had refused to make any payments upon it, and had not denied the debt to the creditor, Silver.
Plaintiff's testimony, as above quoted, is corroborated by his failure to object within a reasonable time to statements rendered to him. See Pabst Brewing Company v. Lueders, 107 Mich 41; Raub v. Nisbett, 118 Mich 248; Joslin v. Cook, 341 Mich 236, 241.
"The conversion of an open account into an account stated, is an operation by which the parties assent to a sum as the correct balance due from one to the other. The parties may still impeach it for fraud or mistake. But so long as it is not impeached, the agreed statement serves in place of the original account, as the foundation of an action." White v. Campbell, 25 Mich 463, 468.
Plaintiff states in his brief, "The letter imputes dishonesty to plaintiff, is libelous per se, and was presumably prompted by malice." Such can be the case only if the nonpayment by plaintiff was dishonest; hence, the question of law for us to determine is, was the nonpayment by plaintiff a matter of such nature that he was entitled by law to require all people that knew of it to say nothing about it? The writing of the letter sued on as libelous was the invasion of no right of privacy of plaintiff. Defendants gave no unnecessary publicity to plaintiff's conduct. Plaintiff made no statement in his brief of inability to pay the debt on terms offered him.
Prom plaintiff's own testimony, the account at one time was agreed on as correct, after a reduction in the amount; several payments were made by him on the account as thus agreed on; for about 6.months after the last of such payments, statements of the account agreed on as thus reduced, were rendered to plaintiff by the creditor; plaintiff did not make denial at the time of any of those statements to plaintiff. Our attention is also directed to Larsen v. Stiller, 344 Mich 279, 288, 289.
The letter complained of shows that defendants had been informed of the history of the account between plaintiff and Silver, which history shows facts which would inevitably lead defendants to consider that there was honestly owing to Silver the debt the account for which the defendants had received for collection. The circumstances leading up to the writing of the letter complained of, do not show a basis for plaintiff's claim of libel and malice. This suit is over the sending of the letter and not a suit involving the amount actually due on the account between plaintiff and Silver.
The trial court was in error in denying defendants' motion for a judgment notwithstanding the verdict and in submitting the ease to the jury and in entering judgment upon the verdict. Judgment for plaintiff is reversed. The case is remanded to the trial court with instructions to enter judgment for the defendants of no cause of action. Costs to defendants.
Dethmers, C. J., Sharpe, Boyles, Kelly, and Carr, JJ., concurred with Reid, J.