HARRIS, Chief Justice.
This is a libel suit. Appellee, Joe Robinson, is engaged in the wholesale produce business in Springdale, Arkansas. Appellant, Dun & Bradstreet, Inc., is a mercantile agency, engaged in the business of gathering, compiling, and furnishing to its subscribers information concerning the credit and financial standing of individuals and organizations. Appellant, Mrs. Margaret Lawrence, was the Dun & Bradstreet correspondent in the Springdale area. Mrs. Lawrence was given employment by the company in February, 1958, and on February 27th, according to her testimony, during the course of taking a report from John Holyfield of Horner Tire Company of Springdale, appellant was asked by the latter if she had heard that Joe Robinson had taken bankruptcy.
In the meantime, Mrs. Lawrence, on February 28th, (the day following her initial report) received a request from the Little Rock office asking for further information in the nature of a report form to be filled in on Robinson. Mrs. Lawrence called Robinson's office, and talked with his secretary, who denied the report. Subsequently, Robinson called this appellant, and told her that the report was not true. Mrs. Lawrence
On March 15, 1958, appellee instituted suit against Dun & Bradstreet and Mrs. Lawrence seeking recovery of $750,000 for damages sustained as a result of the publication of the notices. The complaint alleged the published notices to be false and untrue, and asserted that the publications had caused Robinson's customers and potential customers to believe that his business had failed or was about to fail. The notices were alleged to have been published with malicious intent to injure Robinson in his business, and appellee asserted that such business had been greatly injured, in that he had suffered a great loss of customers and income, and would in the future so suffer; that his credit had been curtailed, and his reputation injured, as a result of the publication of the reports, and that he had suffered extreme personal embarrassment. After the filing of demurrers, which were overruled, appellants filed their separate answers, Mrs. Lawrence asserting that her communication to the company was made in good faith, under circumstances of reasonable caution as to its being confidential, and that the communications were privileged. She further asserted that the communication was true. Dun & Bradstreet alleged that the information was received from sources reasonably believed by it to be reliable; that the reports were sent only to subscribers as had theretofore requested information pertaining to appellee, and that the report was qualifiedly privileged. Further answering, the appellant company alleged its good faith and denied that the information was furnished maliciously. On trial, the jury returned a verdict for Robinson against the appellants in the amount of $30,000 for special compensatory damages, $10,000 being awarded for damages already suffered, and $20,000 awarded for future damages. The jury did not award punitive damages as sought by appellee. From the judgment entered in compliance with the jury verdict, appellants bring this appeal.
Obviously, plain logic supports the propriety of this rule. We think the words used in the report of March 3rd clearly, in their common acceptation, convey to the reader that appellee had discontinued operations, even to specifically giving the date of discontinuance, February 26, 1958. The second sentence of the report read, "Further investigation is underway for more complete details." More complete details on what? In our opinion, this language would be unquestionably construed by a subscriber to refer, not to whether operations had been discontinued, but rather, to the details of the circumstances leading to discontinuance. Since admittedly, Robinson had not ceased operations, the report sent out by Dun & Bradstreet was erroneous, and appellants have no valid defense in asserting the truth of the communication.
It is not really argued that the second communication was a correction or retraction of the first,
It might be well to here state that counsel for appellants and appellee, during oral argument, clearly stated to the Court, and agreed, that neither side desired the case to be remanded for another trial, i. e., appellants' argument was directed solely to the fact that the judgment should be reversed and dismissed, and appellee's argument (his cross-appeal having been abandoned) was directed to support of the judgment awarded.
Of all the instructions given (10), appellants now only complain of the definition of malice given by the court, found in Instruction No. 2. That definition is as follows:
Appellants contend that the communications were made upon conditionally privileged occasions, and that to overcome this conditional privilege, appellee must show actual malice, i. e., ill will, spite, or grudge, which actuated the publications. In other words, appellants, by the term "actual malice", mean malice in the moral sense— sometimes legally termed "malice in fact"— the feeling of hate—vindictiveness—animosity —which prompts one to say or write unkind things about another in the spirit of revenge, or other malevolent motive. We agree with appellants, and with the trial court, that the publications were made upon conditionally privileged occasions, and the jury was so instructed. Though there are a few decisions to the contrary, the rule supported by the weight of authority is that the defense of qualified privilege is available to a mercantile agency relative to reports referring to credit or financial standing and furnished subscribers having an interest in the matter. See 53 C.J.S. Libel and Slander § 119, p. 196. The reason for such a rule is well expressed in Restatement of the Law of Torts, Vol. 3, A.L.I., p. 240.
However, we hold the second part of appellants' contention, viz., that malice in the moral sense must be shown to overcome this privilege, to be unsound, as well as against the great weight of authority. In taking this view, we are not unmindful of the cases cited by appellants to the contrary.
The court held that whether the proof showed "constructive malice" was a question of fact to be submitted to the jury. This is in line with our own case of Thiel v. Dove, 229 Ark. 601, 317 S.W.2d 121, 123, wherein this Court said:
Dun & Bradstreet enjoys the implicit confidence of its subscribers, as attested by witnesses in the cause before us. This confidence in the accuracy of Dun & Bradstreet reports places an even greater responsibility upon the company, and requires that its reports be compiled with regard to the effect that such report may have upon the rights or feelings of the person reported on, if it should develop that the information given is false. In applying the law given by the court in its instruction heretofore quoted, we look to the evidence to determine whether a jury question was presented. Clearly, we think the answer is, "Yes." It would have been an easy matter for Mrs. Lawrence to have called Robinson on February 27th before communicating the rumor to the Dun & Bradstreet offices in Little Rock; in fact, Mrs. Lawrence did call Robinson's office the next day. Likewise, though the Little Rock office asked Mrs. Lawrence on February 28th for additional information, the special report to subscribers was mailed out from Little Rock before receiving Mrs. Lawrence's response to this request; at that, it was not sent until Monday, March 3rd, four days after
We come now to the question of damages. Though quite a bit of evidence was offered on behalf of appellee as to loss of business from people who were not subscribers to the reporting service of Dun & Bradstreet, and who had allegedly ceased or curtailed business with Robinson because of hearing of the report from subscribers, the trial court instructed the jury not to consider any unauthorized republication in determining special compensatory damages. We see no need to discuss the issue of republication, i. e., when one may be liable for unauthorized republication of defamatory statements, since the instruction was favorable to the appellants, and appellee has made no complaint, and further, since we take the view that the evidence reflects a sufficient loss of customers and loss of credit from Dun & Bradstreet subscribers to justify the amount awarded. We do agree with appellants (and the trial court so ruled) that the publication of March 3rd was not libelous per se, but rather was actionable per quod. As stated in 53 C.J.S. Libel and Slander § 8, p. 41:
Of course, words that are actionable per se support a recovery of general damages, while words actionable per quod only support special damages. The court properly instructed the jury in this respect.
H. E. Schmieding, engaged in the produce business, a partner in H. E. Schmieding Produce Company, president of Schmieding Brothers, Inc., and a stockholder in Schmieding Brothers, Inc., of Colorado, testified that all these businesses "are worked together." The companies are engaged in buying and selling fruit and vegetables. The witness testified that he had been engaged in business in Springdale twenty-two years, and that he received the two notices from Dun & Bradstreet on March 4th and 5th, 1958.
T. G. Hill & Company of Atlanta, Georgia, was sent the notices issued by Dun & Bradstreet. Robinson testified that prior to March 3, 1958, he bought quite a lot of soy bean meal and cotton seed meal from that company. "If they had someone that wanted to buy in Florida, for instance, they funneled the business into our office." The witness testified that his gross volume business with the Hill company during the year 1957 and up until March 3, 1958, was $30,860.42. He further testified that he could find no record of any business with that organization since the latter date. No explanation was offered for this loss of business, as no official of the company testified. Robinson testified that in 1957, he had a gross volume of business with Cook & Company of Atlanta, Georgia, in the amount of $3500, but nothing after March 3, 1958. No official of this company testified as to the reason for discontinuing business with Robinson. Appellee testified relative to a decrease in volume of business from several companies after March 3, 1958, among them Sunkist Growers of Ontario, California, for whom he had transported oranges and lemons; Okoma Frozen Foods of Omaha, Nebraska, for whom he had transported frozen poultry and turkeys, and Fairmont Foods of Omaha, for whom he had also previously hauled frozen turkeys and poultry, but not after March 3, 1958. Fred Hoeffner, credit manager of Okoma, by deposition testified that the company had not at any time had business transactions with Robinson; that his attitude concerning the credit standing of Robinson did not change in any way after receiving these special reports (why the special notice reports were sent to a company that had no business transactions with Robinson is not made clear). John P. Macnamara, general credit manager of Fairmont Foods Company, testified that the credit reports had nothing to do with the drop in business to Robinson, but that the company had changed its method of operations.
Appellee testified quite at length relative to special damages suffered due to loss of credit following the publication of the notices. According to the witness, on March 3, 1958, he was indebted to Diamond-T Motor Company of Chicago in the amount of $21,723. Following the special notices, the company cancelled orders for five new trucks which were already on order. T. J. Carmody, vice-president of the company, and in charge of credit, testified by deposition as follows: that the dollar amount of business transacted with Robinson for parts in 1955 was $202.71; in 1956, $123.09; in 1957, for parts, $1140.56, and for trucks, $24,080, and in 1958, for parts, in the amount of $20.64. The witness stated that Robinson was indebted to the company on March 3, 1958, in the sum of $21,723, and the indebtedness was past due in the amount of $669. Carmody stated that his attitude concerning Robinson changed after March 3, 1958, in that it became less favorable, but that this change in attitude was due to Robinson's delinquency in accounts, rather than because of receiving the special notices. The witness admitted, however, that following receipt of these notices, he called appellee and said, "What's going on down there, Robinson? I have a notice that you are out of business." Carmody insisted, however, that the reports had nothing to do with his less favorable attitude toward Robinson's credit.
Appellee testified that he had bought motor truck equipment from the White Motor Company of Dallas since 1945, and owned the first White tractor that ever came to
Robinson testified that he had bought large quantities of motor truck equipment from International-Harvester since 1940, but after March 3, 1958, the company repossessed three tractors, upon which an indebtedness was due.
W. A. Cary, credit manager for International-Harvester in Little Rock, testified that Robinson purchased three motor trucks from the company's Fayetteville dealer in August, 1956, under the terms of 10% down and the balance due in thirty-six equal monthly installments. Mr. Cary stated that on March 3, 1958, appellee was indebted to the company in the amount of $19,000, several monthly payments being past due. The witness testified that it became necessary to repossess this equipment in April, 1958. He said that he received the special notice reports issued by Dun & Bradstreet referring to Robinson, but that these notices had no connection whatsoever with the repossession of the trucks. Cary stated the company, during that same period of time, had an open account with Robinson for service work done, and for parts furnished for these trucks by the service department and various company installations around the country; that the account was current on March 3, 1958. The witness testified that appellee had not been satisfied with the engines in the trucks, and had contended that the engines would not perform the job. Cary stated that considerable work was done on these engines by Cummins (maker of the engines), probably about a thousand dollars each on all three, but that Robinson was never completely satisfied with the results. Cary agreed that the past due accounts on the trucks were due almost entirely to the fact that Robinson was claiming engine trouble. The witness stated that when the trucks were sold to Robinson, the latter's financial condition was investigated, and the line of credit authorized. He testified that he considered Dun & Bradstreet a reliable company, and felt that credence could be placed in their reports.
Robinson testified that he had been buying diesel trucks from Mack Trucks, Inc., of Plainfield, New Jersey, since 1955, and that the last purchases were made in 1957. Appellee stated that after March 3, 1958, the company so pressed him for money on the last two trucks purchased, that he agreed to clean them up, overhaul them, repaint them, and sell them, in order to pay the indebtedness. A. F. Seiferth, division credit manager for Mack Trucks, Inc., of Dallas, Texas, testified by deposition, that the account was delinquent during the year preceding March 3, 1958, and though he had recommended that the trucks be repossessed, it was decided that the debtor would be given on opportunity to refinance the indebtedness and become current. The witness stated that the first refinance payment was due in February, 1958, but the check was returned for insufficient funds, and the payment was not made until April. The March refinance payment was made in May. Mr. Seiferth testified that the Dun & Bradstreet special reports did not affect in any way the credit or business relationship between Robinson and the company, though he admitted that he sent a telegram on March 10, 1958, to Keith Skelton in Springdale, dealer for Mack Trucks, as follows: "Dun & Bradstreet advise Joe Robinson out of business 2/26. What about our trucks?" The witness stated that the reason for the telegram was to urge repossession of the trucks, since the indebtedness was past due.
Robinson testified that because of a loss of credit, he had been unable to finance his business; that since March 3, 1958, he had continued to operate by selling equipment, borrowing from relatives, borrowing on life insurance, and had been forced to "just scramble any way I could to get some working
Appellants vigorously contend that there is no competent evidence to establish special damages, and that to be entitled to special damages, appellee must have shown (1) that damages sustained were caused solely by the publications, and (2) evidence of a specific nature must be offered to enable a jury to measure in dollars the amount of damages suffered. They point out, that in most instances, representatives of the companies who received the publications stated that these publications had no effect upon their relationship with Robinson. Appellants lean to the view that any loss of business, or loss of credit suffered by appellee, was occasioned by the fact that Robinson was "slow pay", and they assert that he was already suffering reverses before the special notices were sent out. They further contend that, even though their first assertion be incorrect, appellee has shown no specific monetary loss; that the testimony relative to loss of business is of no value because this evidence was based on gross business with the several concerns; that a claim for damages cannot properly be based on gross figures because there are too many extraneous factors that would affect the amount of profit.
We agree, in this case, that appellee's damages cannot be based upon loss suffered from customers who were not subscribers to the service furnished by Dun & Bradstreet, and that the award made must be substantiated by proof of losses occurring from subscribers, because of the influence of these reports. We do not agree, however, that appellee was required to pinpoint, with the specificity urged by appellants, the monetary loss suffered by him, and to be suffered by him, in order to recover. According to Robinson, his gross volume business with the Hill Company in 1957, and up until March 3, 1958, was nearly $31,000, and he had handled no business for that company since that date. This was not denied. The witness testified that in 1957 he had a gross volume of business with the Cook Company of $3500, but nothing after the aforementioned date. This was not denied. No figures were given, but he testified that he had previously hauled frozen poultry for Fairmont Foods of Omaha, but had handled no business after March 3. The proof relative to Smeidling Brothers showed that Robinson was still handling business, but the shipments were of a less profitable nature, and Smeidling testified that this was because "there was a definite question in our mind as to his operation after we received the reports."
Nothing is more important to the success of a business than its ability to obtain credit, for but few concerns are able to operate on a cash basis, and a loss of credit is fatal to the average business. This would be particularly true in the type of operation owned by Robinson, where the failure to obtain trucks and hauling equipment would simply put an end to the enterprise. The old adage, "Nothing succeeds like success", is certainly quite true, and likewise, nothing is more likely to bring about a complete failure of an undertaking than a belief on the part of ones' creditors that the endeavor is failing. Everyone is willing to extend credit to the successful man; few will extend credit to the business which they believe to be tottering. Loss of credit has long been recognized as coming within special damages. As stated in 53 C.J.S. Libel and Slander § 268b, p. 390:
See also 1 Harper & James, the Law of Torts, § 5.14, p. 389. We think there was sufficient evidence offered to justify a finding that Robinson had suffered a loss of credit from subscribers to the Dun & Bradstreet special reports. It is true that officials of the truck companies testified that the reports did not affect their attitude toward Robinson, but in view of their actions on receiving the reports, we think this was a question for the jury. As has been oft times stated, juries determine questions of fact. They pass on the reasonableness of evidence. They are privileged to accept or reject the testimony of a witness. They may believe some of his statements, and disbelieve others.
Let it also be borne in mind that counsel for all parties agreed during oral argument that no remand was desired, and the Court was asked to either affirm, or reverse and dismiss, this judgment in its entirety. We are of the view that, under this agreement, any special damage established by appellee would require an affirmance. Be that as it may, we deem the proof more than adequate to uphold special past compensatory damages in the amount of $10,000, and future special compensatory damages in the amount of $20,000.
Cullum v. Dun & Bradstreet, Inc., 228 S.C. 384, 90 S.E.2d 370.
Johns v. Associated Aviation Underwriters, 5 Cir., 203 F.2d 208.