Title: Battles v. Ford Motor Credit Co.
Citation: 597 So. 2d 688
Docket Number: 1901753
State: Alabama
Issuer: Alabama Supreme Court
Date: April 10, 1992

597 So. 2d 688 (1992)
Gregory T. BATTLES
v.
FORD MOTOR CREDIT COMPANY.
1901753.

Supreme Court of Alabama.
April 10, 1992.
Leon Garmon, Gadsden, for appellant.
J. Rushton McClees of Sirote &amp; Permutt, P.C., Birmingham, for appellee.
INGRAM, Justice.
Ford Motor Credit Company ("FMCC") sued Gregory T. Battles for a deficiency on Battles's lease of a Ford truck that he voluntarily surrendered to FMCC prior to the expiration of the lease term. Battles counterclaimed, alleging that FMCC had committed an intentional fraud against him, specifically, that FMCC had represented to Battles that he could surrender the leased truck prior to the expiration of the lease term without incurring a penalty or *689 an early termination fee. In a subsequent amendment to his counterclaim, Battles alleged that FMCC had slandered him by willfully publishing false information regarding the repossession of the truck and his being in default on the payments under the lease with FMCC.
Battles also filed a third-party complaint against Eastwood Ford, Inc. ("Eastwood"), the automobile dealership from which he actually had acquired the truck. Battles claimed that the sales personnel at Eastwood had acted as the agents of FMCC in the negotiations that led to Battles's leasing the truck and that Eastwood, in its agency capacity, had misrepresented the effect of his early termination of the lease.
FMCC moved for a summary judgment, supporting its motion with affidavits, depositions, answers to interrogatories, and briefs. After hearing oral argument on FMCC's summary judgment motion, the trial court entered a summary judgment for FMCC as to all of Battles's claims and made the judgment final pursuant to Rule 54(b), A.R.Civ.P. Battles appealed, and the trial court stayed further proceedings on FMCC's deficiency claim against Battles pending the resolution of this appeal.
In entering the summary judgment for FMCC, the trial court held that FMCC had made a prima facie showing that Eastwood was not the agent, servant, or employee of FMCC, and that, therefore, even if the alleged misrepresentations were made by employees of Eastwood, FMCC was not liable for those misrepresentations or for the breach of any contract that might have resulted from those misrepresentations. The trial court also held, with regard to Battles's slander claim, that FMCC had made a prima facie showing that it did not publish false or inaccurate information concerning Battles's credit record with FMCC. The court concluded that neither prima facie showing had been rebutted.
The issues raised on this appeal are: 1) whether the trial court erred in holding that, as a matter of law, no agency relationship existed between FMCC and Eastwood by which to impute liability to FMCC for the allegedly fraudulent misrepresentations made by Eastwood sales personnel; and 2) whether the trial court erred in holding that the credit information FMCC published regarding Battles's account with FMCC would not support a slander action.
Initially, we note that a motion for summary judgment may be granted only when there is no genuine issue as to any material fact and the moving party is entitled to a judgment as a matter of law. Rule 56(c), A.R.Civ.P.; Southern Guar. Ins. Co. v. First Alabama Bank, 540 So. 2d 732 (Ala.1989). The burden is, therefore, upon the moving party to clearly show that there is no material fact in dispute, and all reasonable inferences from the evidence are to be viewed most favorably to the nonmovant. Southern Guar. Ins. Co., supra.
Rule 56 is read in conjunction with the "substantial evidence rule," § 12-21-12, Ala.Code 1975, for actions filed after June 11, 1987. See Bass v. SouthTrust Bank of Baldwin County, 538 So. 2d 794 (Ala.1989). In order to defeat a properly supported motion for summary judgment, the plaintiff must present substantial evidence, i.e., "evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved." West v. Founders Life Assurance Co. of Florida, 547 So. 2d 870, 871 (Ala.1989).
Addressing now the issue whether the trial court erred in holding that no agency relationship existed between FMCC and Eastwood, we note the principle that when a defendant's liability is based on the theory of agency, agency may not be presumed, and that to defeat a defendant's properly supported summary judgment motion, the plaintiff must present substantial evidence of an agency relationship. Carlton v. Alabama Dairy Queen, Inc., 529 So. 2d 921 (Ala.1988). Furthermore, agency is not determined by how the parties characterize their relationship, but by the facts of the case, Federal Land Bank of New Orleans v. Jones, 456 So. 2d 1 (Ala.1984), although an agency relationship may arise from facts that lead others to believe that such a relationship has been created. *690 Wood v. Holiday Inns, Inc., 508 F.2d 167 (5th Cir.1975).
The trial court, in entering the summary judgment for FMCC, summarized the facts before it at that time:
In entering the summary judgment for FMCC, the trial court relied primarily on Kimbrel v. Mercedes-Benz Credit Corp., 476 So. 2d 94 (Ala.1985). In Kimbrel, this Court addressed the issue whether an agency relationship existed under facts quite similar to those of the present case. There, the question was whether an agency relationship existed between a finance company and the seller of a tractor so as to make the finance company liable for the actions of the seller. While the finance company in Kimbrel had a right of approval of the buyer's credit and its name appeared on the contract of sale and it dictated the terms of the buyer's payments, the Court concluded that none of those facts was inconsistent with the extending of credit by an institution. The Court further held that those facts would not legally amount to a ratification of any statements *691 made during negotiations by the employees of the seller of the tractor and that there was nothing in the record that would support a finding of agency.
The trial court in the present case, in entering the summary judgment, stated:
After reviewing our decision in Kimbrel and the facts that were before the trial court when it entered the summary judgment for FMCC on Battles's fraud claim, we conclude that the summary judgment was proper as to that claim. Our conclusion in this regard is further supported by our recent decision in Butler v. Aetna Finance Co., 587 So. 2d 308 (Ala.1991).
In Butler, the plaintiffs claimed, among other things, that Aetna fraudulently misrepresented certain information to them. The fraud claims were predicated on the plaintiffs' allegations that salespersons at an electronics store at which the plaintiffs purchased a television on credit were agents of Aetna, the company to which the store subsequently assigned the credit contract. In affirming a summary judgment for Aetna, we stated:
587 So. 2d  at 311.
In arguing that the summary judgment for FMCC was improper, Battles relies primarily on Potomac Leasing Co. v. Bulger, 531 So. 2d 307 (Ala.1988). In Potomac Leasing, in which a defendant appealed from a judgment entered on a jury verdict, we held that there was sufficient evidence in the record from which the jury could find that an agency relationship existed between Potomac and Royal Equipment Company. The evidence showed that a Royal employee proposed that Bulger lease *692 an ice cream machine for the snack bar that Bulger owned. After Bulger executed the lease and received a copy, he attempted to rescind the agreement because it did not contain an option to purchase the machine. Thereafter, Potomac sued Bulger for the amount due under the lease, and Bulger filed a fraud counterclaim against Potomac, alleging that Royal was an agent of Potomac and that the Royal employee represented to him that the lease did contain a purchase option. In affirming the judgment for Bulger, we noted that the verdict was supported by, among other things, evidence that "Potomac Leasing placed its leasing documents with Royal and encouraged Royal to present them as a `financing alternative' to prospective customers." 531 So. 2d  at 309.
After considering the facts in Potomac Leasing and the facts in the present case, we find the cases to be distinguishable in one crucial respect. In Potomac Leasing, Bulger entered the lease agreement directly with Potomac on a lease form that had been provided to Royal by Potomac. This evidence, along with the fact that Potomac encouraged Royal to present the lease to its customers, created a different situation from that in the present case. Here, the evidence shows that Battles entered into a lease agreement with Eastwood and that Eastwood subsequently assigned the lease to FMCC. Also, the evidence reveals that FMCC was not obligated to purchase the lease from Eastwood, if FMCC elected not to do so. Finally, there is no evidence in the present case that FMCC encouraged Eastwood to persuade customers to enter into lease agreements.
Considering the evidence that was before the trial court in the present case, in the context of our prior decisions concerning the existence of an agency relationship, we conclude that the trial court correctly entered a summary judgment for FMCC on Battles's fraud claims, based on its conclusion that Battles had presented no substantial evidence of an agency relationship between FMCC and Eastwood.
The second issue raised on this appeal is whether the trial court erred in entering the summary judgment for FMCC on Battles's slander claim. In an amendment to his counterclaim, Battles alleged that FMCC slandered him by publishing a false and defamatory statement that the truck that Battles leased had been repossessed and that he had defaulted on the payments required under the terms of the lease.
With regard to this issue, the record reveals that Battles admitted in his deposition that he signed a four-year lease and agreed for the lease executed by him to be a four-year lease. Battles also admitted that before he signed the lease, he read over all of the contract. Battles also admitted that he was obligated to pay 48 monthly lease payments unless FMCC allowed him under paragraph 19 of the lease executed by him to terminate the lease early and that he never got an agreement with FMCC to terminate the lease early. At the end of the second year of the four-year lease, Battles ceased making payments on the lease and then FMCC, with Battles's consent, repossessed the vehicle; FMCC then sold it, sued for the deficiency, and reported this information to Merchants' Credit Association and Credit Bureau, Inc. In response to FMCC's motion for a summary judgment on Battles's slander claim, Battles presented no evidence to rebut FMCC's prima facie showing that there had been no slander.
It is well established in Alabama that in an action alleging defamation, truth is a complete and absolute defense. See Jakob v. First Alabama Bank of Montgomery, 361 So. 2d 1017 (Ala.1978), cert. denied, 439 U.S. 968, 99 S. Ct. 460, 58 L. Ed. 2d 428 (1978); Ripps v. Herrington, 241 Ala. 209, 1 So. 2d 899 (1941). In view of the evidence in the record, we conclude that FMCC met its burden of making a prima facie showing that no false information was reported. We further conclude that Battles did not meet his concomitant burden of showing by substantial evidence that FMCC had slandered his credit reputation. Therefore, the summary judgment *693 for FMCC is also due to be affirmed as to Battles's slander claim.
AFFIRMED.
MADDOX, SHORES, ADAMS, STEAGALL and KENNEDY, JJ., concur.