Opinion ID: 1318460
Heading Depth: 2
Heading Rank: 3

Heading: did the trial court improperly grant summary judgment on the defamation claim?

Text: In her complaint, Schneider alleged that co-defendant Randall Cry, the store's loss prevention manager, defamed her by maliciously accusing her of stealing money from the store. Pay'N Save's answer denied the defamation charge and asserted an affirmative defense of conditional privilege. Subsequently, Pay'N Save successfully moved for summary judgment on each of the claims ... stated in plaintiff's complaint. Schneider claims that the trial court improperly granted summary judgment dismissing her defamation claim against Pay'N Save because it had insufficient evidence to rule on the defamation issue. She argues that Pay'N Save failed to submit affidavits or other admissible evidence to rebut the defamation claim and support its affirmative defense of conditional privilege. Pay'N Save claims that Randall Cry's defamatory statement, if indeed it was, was conditionally privileged because he made it while acting in the employer/employee relationship. Pay'N Save urges us to uphold the trial court's ruling on the ground that it appropriately determined, on the undisputed facts before it, that Randall Cry's statement was conditionally privileged. When reviewing a grant of summary judgment, we will reverse only if the evidence in the record, taken in the light most favorable to the non-moving party, poses genuine issues of material fact. Zeman v. Lufthansa German Airlines, 699 P.2d 1274, 1284 (Alaska 1985) (citations omitted). A material issue of fact exists where reasonable jurors could disagree in the resolution of the factual issues as presented by the moving papers. Green v. Northern Publishing Co., 655 P.2d 736, 742 (Alaska 1982), cert. denied, 463 U.S. 1208, 103 S.Ct. 3539, 77 L.Ed.2d 1389 (1983). Restatement (Second) of Torts § 593 provides: One who publishes defamatory matter concerning another is not liable for the publication if: a) the matter is published upon an occasion that makes it conditionally privileged and b) the privilege is not abused. The defendant must establish the existence of a privileged occasion for the publication by proving a recognized public or private interest which justifies the utterance of the words. W. Prosser, The Law of Torts § 115, at 796 (4th ed. 1971) (hereinafter W. Prosser). Whether the occasion gives rise to a privilege is a question of law for the court. Id.; Restatement (Second) of Torts § 619 (1977). If the facts are in dispute, the jury determines whether a conditional privilege has been abused. W. Prosser, supra, § 115 at 796.
Restatement (Second) of Torts § 595 provides: (1) An occasion makes a publication conditionally privileged if the circumstances induce a correct or reasonable belief that (a) there is information that affects a sufficiently important interest of the recipient or a third person, and (b) the recipient is one to whom the publisher is under a legal duty to publish the defamatory matter or is a person to whom its publication is otherwise within the generally accepted standards of decent conduct. This court has recognized two types of conditional privileges: 1) the conditional privilege accorded the media to print items of public interest, Green, 655 P.2d 736; West v. Northern Publishing Co., 487 P.2d 1304 (Alaska 1971), and 2) the conditional privilege based on circumstances where any one of several persons having a common interest in a particular subject matter believes that there is information that another sharing the common interest is entitled to know, Lull v. Wick Construction Co., 614 P.2d 321 (Alaska 1980) (privilege based on joint business interest). We have never addressed a conditional privilege based on the employer/employee relationship. The comments to Restatement § 595 indicate that a statement made for the protection of a lawful business, professional, property or other pecuniary interest falls within this rule if it is called for by a legal or moral duty or by generally accepted standards of decent conduct. W. Prosser, supra § 115, at 787; Restatement (Second) of Torts § 595 comments d, e (1977). The privilege is clearest when a legal relationship exists between the defendant and the person on whose behalf he intervenes. Prosser states that a physician may speak to protect the interest of his patient, an attorney that of his client, or an agent or employee that of his principal or employer. W. Prosser, supra, § 115 at 788. We find the reasoning of Prosser and the Restatement persuasive. Therefore, we recognize a conditional privilege based upon the employment relationship absent a showing of abuse. See generally, 50 Am.Jur.2d Libel and Slander § 271, at 789 (1970). Applying the Restatement (Second) of Torts § 595 to the uncontroverted evidence as stated in the facts and before the trial court, we conclude that the court correctly decided as a matter of law that Randall's Cry's statements were conditionally privileged. First, Cry's statements to Pay'N Save regarding Schneider's failure to ring up certain control sales affected a sufficiently important interest of Pay'N Save to warrant the communication. Pay'N Save had a legitimate proprietary interest in protecting its lawful business from theft or mishandling of money. Second, Cry, as manager of loss prevention, had a duty to report to Pay'N Save the information regarding the short cash register and Schneider's failure to ring up the control sales. Cry's statement therefore satisfies the requirements of Section 595. We conclude that reasonable jurors could not disagree that Cry's statements were conditionally privileged.
The protection afforded by the employer/employee relationship is conditioned upon publication in a reasonable manner and for a proper purpose. See generally, Restatement (Second) of Torts § 599 (1977). This court has stated that a conditional privilege which is abused by the writer or speaker is lost and he must answer for the legal consequences of his publication. Fairbanks Publishing Co. v. Francisco, 390 P.2d 784, 793 (Alaska 1964). Ordinarily, once a defendant establishes the existence of a privilege the plaintiff has the burden of proving that it has been abused. W. Prosser, supra, § 115, at 796. Whether a defendant has abused a privilege is a question of fact for the jury unless the facts are such that only one conclusion can reasonably be drawn. W. Prosser, supra, § 115, at 796. By granting summary judgment against Schneider on the defamation claim, the trial court found that reasonable jurors could not differ in concluding that Cry did not abuse his privilege. The comments to Restatement (Second) of Torts § 599 provide that a conditional privilege may be abused because of: the publisher's knowledge or reckless disregard as to the falsity of the defamatory matter ...; because the defamatory matter is published for some purpose other than that for which the particular privilege is given ...; because the publication is made to some person not reasonably believed to be necessary for the accomplishment of the purpose of the particular privilege ...; or because the publication includes defamatory matter not reasonably believed to be necessary to accomplish the purpose for which the occasion is privileged. Restatement (Second) of Torts § 599 comment a (1977). We adopt these four bases of determinating whether a speaker or writer has abused a conditional privilege. The present case involves a suit between a non-media defendant and a private figure. Cry's statement involves no issue of public concern. This court has never addressed whether the actual malice standard from New York Times Co. v. Sullivan, 376 U.S. 254, 84 S.Ct. 710, 11 L.Ed.2d 686 (1964) and Gertz v. Robert Welch, Inc., 418 U.S. 323, 94 S.Ct. 2997, 41 L.Ed.2d 789 (1974), applies in a private party context. However, we do not decide this issue now since Cry's statement does not satisfy the lowest showing of fault necessary for liability. In cases involving private individuals and issues of private concern, liability attaches if the speaker or writer at the very least acted negligently in publishing the defamatory statement. See Restatement (Second) of Torts § 580B and comments g, h (1977); Gertz, 418 U.S. at 347-48, 94 S.Ct. 418-19, 41 L.Ed.2d at 809-10; cf. Dun & Bradstreet, Inc. v. Greenmoss Builders, Inc., 472 U.S. ___, 105 S.Ct. 2939, 86 L.Ed.2d 593 (1985) (recovery of presumed and punitive damages in defamation cases involving private individuals and issues, absent showing of actual malice, does not violate first amendment). Here, the undisputed evidence establishes that Cry personally reviewed the detail tape and daily sales report from Schneider's register, found that Schneider failed to ring up certain sales and that her register was short. From this evidence, Cry could reasonably believe that Schneider had taken the money. Additionally, Cry acted reasonably in checking on the truth or falsity of the communication before publishing it. Restatement (Second) of Torts § 580B comment g (1977). We conclude that reasonable jurors could not disagree that Cry reasonably and not negligently published the statement. Second, Cry did not make the statement for an improper purpose. Pay'N Save hired Cry as their loss prevention manager to help protect its business from theft and the mishandling of money. Cry's statement that Schneider took the money was directly related to the purpose of protecting Pay'N Save from theft or mishandling of money. There is no evidence showing that Cry made the statement out of spite or ill will, which is an abuse of the privilege. See Restatement (Second) of Torts § 603 comment a (1977). Indeed, Schneider admitted that Cry had always been polite to her. Third, there is no evidence that Cry excessively published his statement by speaking the defamatory words in the presence of persons whose knowledge of them was unnecessary to the protection of the interest in question. See Restatement (Second) of Torts § 604 comment a (1977). The evidence shows that Cry made the statement to Schneider in a closed meeting, which only included Schneider, Cry, the store manager and a female member of Pay'N Save's management. [5] Each person had a legitimate interest in the subject matter of the meeting. Finally, we must decide whether Cry abused his privilege because his statement was unnecessary to accomplish the purpose that justified his privilege. See Restatement (Second) of Torts § 605 comment a (1977). For example, one who is privileged to tell a police officer that the plaintiff committed a crime abuses the privilege if he makes charges against the plaintiff's moral character that have no reasonable bearing upon the offenses attributed to him. Id. As previously indicated, Cry's purpose at Pay'N Save was to protect it from theft of property or the mishandling of money. An accusation of theft has a reasonable bearing upon the offense with which Schneider was being investigated. Therefore, we conclude that reasonable jurors would agree Cry did not abuse the employer/employee privilege when he accused Schneider of theft.