Summary
In Richards, the trial court faced a situation similar to that presented here — where an intervening supreme court decision had highlighted an instructional error.
Summary of this case from State v. HarpOpinion
No. 248.
Argued January 3, 1974. —
Decided February 5, 1974.
APPEAL from an order of the circuit court for Milwaukee county: GERALD A. BOILEAU, Circuit Judge. Affirmed.
For the appellant there was a brief by Walther Halling, attorneys, and David B. Halling of counsel, all of Milwaukee, and oral argument by David B. Halling.
For the respondent there was a brief by Ray T. McCann, attorney, and John T. McCann of counsel, both of Milwaukee, and oral argument by John T. McCann.
This is an appeal from an order setting aside the verdict and granting a new trial in the interest of justice after return of a verdict in a libel action awarding $2,000 compensatory damages and $8,000 punitive damages in favor of the plaintiff.
The factual background that gave rise to the publication of the statement in question is as follows:
In July of 1968, the plaintiff-appellant, Stephen Richards, contacted the defendant-respondent, Gerald A. Gruen, a licensed real estate broker, to sell his property in the city of Glendale. (The title to the property was in his wife's name.) The building on the land was an old building in a questionable state of repair. The first floor had originally been used as a store and later a beer depot. At the time Richards contacted Gruen this area was only used for miscellaneous storage by Richards. The second floor consisted of several rooms that were occupied by Richards and his family as their residence. Richards was self-employed — building ages, installing and repairing overhead garage doors and electric garage door operators. Richards was either contemplating or actually building a new home elsewhere.
Gruen, in addition to being a real estate broker, was and had been an alderman and, as such, was a member of the city council for the city of Glendale.
Gruen met Richards at the property and, with Richards, inspected it. Gruen was of the opinion that property would not sell for more than the encumbrances against it. Gruen did not agree to try to sell the property and no listing agreement was entered into. Gruen did suggest to Richards that the city of Glendale might be interested in purchasing the property pursuant to an ordinance whereby the city was empowered to buy land with nonconforming uses, raze the buildings and resell the land for redevelopment purposes. Gruen advised Richards to contact his own alderman, Mrs. Zeller, if he wanted to sell to the city. Richards did contact Mrs. Zeller; she brought the matter to the council's attention and on July 30, 1968, the council referred it to the finance and administrative committee. Gruen was a member of this committee.
The finance and administrative committee had not acted on the matter and on February 11, 1969, Richards appeared before the city council, complained of the delay and requested that the city purchase the land.
On March 18, 1969, the finance and administrative committee, at an open council meeting, recommended the city not purchase the property because a recently announced proposed new freeway-type highway would be on or very near the property.
Richards attended the meeting and when he heard the recommendation, asked for and was given the right to speak on the council floor. He spoke for more than thirty minutes in a loud, boisterous and angry manner. In substance, he claimed the city was obligated to buy the property; that the delay in the city's determination was due to Gruen's influence; that Gruen acted in an unethical manner to his own advantage and was guilty of a conflict of interests. He threatened to sue Gruen and to expose and destroy him.
After Richards' remarks the city council decided to refer the matter to the city attorney for his opinion as to any liability on the part of the city to purchase the property. At this time Gruen was a candidate for mayor of the city of Glendale in an election that was to be held in a few weeks. His opponent was also a council member.
On March 25, 1969, the council reconvened and Gruen, at the open, well-attended council meeting, read a prepared statement in response to Richards' charges of the week before. Gruen gave copies of this statement to three newspaper reporters who were present and subsequently articles were published concerning the matter.
The statement in its entirety appears in footnote 1.
In his complaint and the trial of the action, Richards claimed the references to the property as "dirty, deteriorated, and unfit for human habitation;" that Richards "apparently hoped to use the fear of blackmail against me, to cause me to urge purchase of his property;" that "Mr. Richards is a character-thief, and should be watched closely, as in his frustration, he is. a desperate man," and an erroneous statement as to the time of Richards' bankruptcy adjudication were libelous.
The defendant-Gruen did not request any specific jury instructions concerning the burden of proof and the matter was submitted as an ordinary common-law libel action without privilege. The jury returned a verdict finding the statements libelous and awarded damages as stated above.
The plaintiff-Richards appeals from the order granting the new trial.
"March 25, 1969 "Mr. Mayor —"I rise on a point of personal privilege. I do so to respond to the baseless accusations made by Mr. Richards here last week.
"First, I want to make it crystal clear that I am not now, and never have been Mr. Richards' broker. Last year when I looked at the Richards' property at 812 W. Glendale Avenue, I was appalled. I did not know that there was so wretched a property in Glendale. It is dirty, deteriorated, and unfit for human habitation. The property is a discredit to Mr. Richards, to the Glendale Avenue neighborhood, and to the City of Glendale.
"Upon seeing the property, I refused to consider handling it, and in an effort to be helpful to the City, and incidentally to Mr. Richards, I suggested that he contact Mrs. Zeller, his alderman, to see if she was interested in proposing that the city acquire the property under its Ordinance which allows the purchase of dilapidated and non-conforming property by the city, so that the dilapidated properties can be torn down and the land re-sold for private re-development.
"I do not know what conversations were held by Mr. Richards with Mrs. Zeller, but I can say that I refused several times to discuss the matter with Mr. Richards, feeling that it was Mrs. Zeller's role to bring the matter forward, if she wished to do so, for whatever action the council would then take.
"There was no money in the Glendale budget to acquire the property in 1968.
"The 1969 budget includes $15,000 for this purpose. But since passage of the budget late in 1968, the matter did not come to the council until February 17, 1969, when Mr. Richards appeared to urge the city's purchase. At that time the official minutes show that there was a motion by Alderman Hynek, 2nd by Alderman Zeller, to refer the matter to the Legislative Judiciary Committee. I am not a member of the Legislative Judiciary Committee. The understanding on Feb. 17 was that Mr. Richards land, adjoining to the west, to the City Attorney for review. The 30 ft. of additional land, if added to the Richards property, would provide enough land for 2 building lots.
"I have never seen this option, and I don't know if the Legislative Judiciary Committee ever did.
"On February 25, 1969, Mr. Grober, Chairman of the Legislative Judiciary Committee, suggested that the city secure an appraisal, as he felt, very correctly, that the private appraisal submitted by Mr. Richards and the report of our former assessor, did not satisfy the requirements of our rehabilitation ordinance. A motion was made on February 25, 1969, by Alderman Zeller, seconded by Mr. Hammill, authorizing the independent appraisal services of Mr. Fred Hug, and upon the receipt of such appraisal, to submit the file to the Finance Administrative Committee, of which I am chairman, for review and recommendation.
"The appraisal [not legible] in City Hall about March 10. I scheduled a meeting of the Finance and Administrative Committee on Monday evening, March 17, to consider the matter.
"As chance, or fate, or luck, or whatever you call it, would have it, the recommended plans for the Bay Freeway were released the prior Saturday, and maps showing location, appeared in the daily press Saturday and Sunday preceding our meeting.
"The recommended routes of the Bay Freeway pass right over the property we're talking about.
"The freeway location announcement, in the unanimous opinion of the Finance Administrative Committee (the other members are Alderman Fred Mayer Alderman Dale Grober), makes it impossible for the city to accomplish the purposes of Glendale's rehabilitation ordinance, namely, to buy the property, tear down the building, and re-sell the land, because there would be no buyers for the land. The City would not be able to re-sell the cleared land to new owners for re-development.
"Mr. Richards, after hearing the recommendation of the Finance Administrative Committee, launched into a vicious tirade against me, centering upon me all of his anger and frustration. Mr. Richards is clever, and cunning enough to know that disclaimers rarely catch up with loud charges, and under the special circumstances of a coming election, apparently hoped to use the fear of blackmail against me, to cause me to urge purchase of his property. This I refuse to do.
"I submit to you that Mr. Richards is a character-thief, and should be watched closely, as in his frustration, he is a desperate man. An independent investigation today reveals an Action in Bankruptcy against him, dated December, 1968, with 11 judgments filed. The property on 812 W. Glendale Avenue is in the name of Helen Richards. I could not find either Stephen or Helen Richards on the Glendale polling list.
"I would like to hear the report of the City Attorney concerning the City's obligation to Mr. Richards, if any, in this matter, but beyond that, if Mr. Richards is to be allowed by the chair to speak, I insist that a qualified court reporter be summoned, as I do not feel that I can be compelled to sit here, defenseless and vulnerable to baseless verbal charges of any sort.
"I subscribe wholeheartedly to the Code of Ethics of the Milwaukee Board of Realtors, and am proud to say that there never has been an ethics charge against me. If Mr. Richards has any charges to make, I invite him to take them to the Board of Realtors for investigation. I would like to say further that a Code of Ethics has been passed by the Village of Greenfield, requiring candidates for public office to declare their real estate holdings, and I will be glad to act with the new council in supporting such an Ordinance for Glendale.
"In anticipation that the item under new business, entitled `Ethics' is another part of this scurrilous reputation-thievery that is going on, I hereby declare that the following is a complete list of all of the real estate I own in Glendale, or own jointly with my wife:
"1. Residence, 214 W. Mt. Royal Road, Glendale assessment last year, $19,700.
"2. Residence, 6944 N. Range Line Road, Sold on Land Contract in May of 1966, my approximate equity is $3800 as of April 1. This property has been out of my control since May, 1966.
"I repeat, to the Mayor, and to Mr. Hammill, that if Mr. Richards is to be allowed by the chair to speak, I insist that a qualified court reporter be summoned, as I do not feel that I can be compelled to sit here, defenseless against scurrilous verbal charges.
"I would now like to hear the report of the City Attorney."
The issues stated by the appellant are:
"I. Did the trial court err in ordering a new trial in the `interest of justice?'
"II. Was defendant entitled to a jury instruction on a higher burden of proof as set forth in New York Times v. Sullivan?"
If the trial court has set forth valid reasons in its order or memorandum opinion, this court will affirm an order for a new trial in the interest of justice unless there is a clear showing of abuse of discretion.
See sec. 270.49(1) and (2), Stats.
McPhillips v. Blomgren (1966), 30 Wis.2d 134, 140 N.W.2d 267; Lien v. Pitts (1970), 46 Wis.2d 35, 41 and 45, 174 N.W.2d 462.
The reasons set forth by the trial court in its memorandum opinion are as follows:
"Throughout the trial no reference was made by counsel for either party to the so-called New York Times case or the standards set forth therein, nor was any reference made to the other United States Supreme Court decisions which expanded upon the rulings in that case.
At the time counsel were in chambers discussing burden of proof the Court advised counsel that it was its intention to give Wisconsin Jury Instruction, Civil, 200 on BURDEN OF PROOF. No objections were made thereto and no suggestions came forth relative to the burden of proof. The trial of this case began on April 25, 1972 and concluded on May 2, 1972. The case of Polzin v. Helmbrecht, ___ Wis.2d ___ (1972), was filed in the office of the Clerk of the Supreme Court of Wisconsin on May 4, 1972 and, of course, was not available to counsel or to the Court during the trial of this action. In Polzin v. Helmbrecht, Court made it amply clear, if clarification was necessary, that New York Times standards must be complied with in courts of this state.
"In New York Times Company v. Sullivan (1964), 376 U.S. 254, 84 S. Ct. 710, 11 L.Ed.2d 686, the court held, in effect, that `Public officials had a conditional privilege which permitted them to speak with more freedom upon public issues than private persons would have.' In other words, the Supreme Court in recognition of the First Amendment to the United States Constitution held that public officials should not be unduly limited in the right of freedom of speech stating that `(I)t is a prized American privilege to speak one's mind, although not always with perfect good taste, on all public institutions. . . . and this opportunity is to be afforded for "vigorous advocacy" no less than "abstract discussion."
"`Thus we consider this case against the background of a profound national commitment to the principle that debate on public issues should be uninhibited, robust, and wide-open, and that it may well include vehement, caustic, and sometimes unpleasantly sharp attacks on government and public officials.'
"Subsequent decisions have also broadened the New York Times rule so as to make it applicable to `public figures' as well as `public officials.' Greenbelt Cooperative Publishing Ass'n v. Bresler (1970), 398 U.S. 6, 90 S. Ct. 1537, 26 L.Ed.2d 21.
"In Rosenbloom v. Metromedia, Inc. (1971), 403 U.S. 29, 91 S. Ct. 1811, 29 L.Ed.2d 296, the court expanded the New York Times rule to make it applicable to libel actions involving previously anonymous individuals who are neither `public officials' or `public figures' but who had become involved in matters of public or general interest. See also Beatty v. Ellings (Minn. 1969), 173 N.W.2d 12. Many other cases decided by the United States Supreme Court have expanded the New York Times rule. Rosenbloom expanded the New York Times rule to include not only `public figures' but also any person who became involved in an event of general public interest.
"In the instant case plaintiff made a speech before the Common Council of the City of Glendale on March 18, 1969 in which he severely attacked the defendant and in particular with respect to his conduct as a public official, claiming that he had conducted his private business in conflict with his public business. Mr. Gruen, the defendant, was then an Alderman in the City of Glendale and was a candidate for Mayor. Thus plaintiff's condemnation and criticism of the defendant as an Alderman and candidate for Mayor got himself involved in a matter of public and general interest. During the trial of this case the Court did not consider whether or not the plaintiff, Richards, was a `public figure' or that he had become involved in a matter of public or general interest, because it felt that defendant's statements were being made with reference to a private individual and that the question of conditional privilege was not involved. Had the New York Times rule, and its subsequent expansion, been called to the Court's attention or had the Court had the same in mind, the Court would have been obliged to determine whether or not the plaintiff, Richards, had become a `public figure' or engaged in a matter of public or general interest. If the plaintiff was engaged in a matter of public or general interest, then the defendant, Gruen, had a conditional privilege to reply to plaintiff's remarks about him.
"The New York Times rule is also authority for the fact that an action brought by a public official for libel requires clear and convincing proof that the defamation was published with `knowledge that it was false or with reckless disregard of whether it was false or not.' In view of the fact that this rule has been expanded to include `public figures' and persons with a `public or general interest', it appears that the same burden of proof should apply in this case. In Polzin v. Helmbrecht the Wisconsin Supreme Court stated as follows:
"`The New York Times case involved the alleged libel of a public figure. We do not reach the question here of whether the respondent was a public figure as there determined, in view of the more recent decision of the United States Supreme Court in Rosenbloom v. Metromedia. In Rosenbloom a plurality of the court extended the "public figure" test and indicated that the New York Times rule applied when the controversy related to an "event of public or general concern."'"
"It seems clear to this Court that the so-called New York Times rule, as expanded by subsequent United States Supreme Court decisions, was not followed during the trial of this case. It also seems clear that in view of Polzin v. Helmbrecht this Court must, in the interest of justice, grant a new trial so that all issues can properly be tried in the manner directed by Polzin v. Helmbrecht."
From this quotation it is amply clear that the trial court was of the opinion that the case should have been tried under the legal standards set forth in the New York Times Co. v. Sullivan decision, and in the Wisconsin case, Polzin v. Helmbrecht (1972), 54 Wis.2d 578, 196 N.W.2d 685.
(1964), 376 U.S. 254, 84 Sup. Ct. 710, 11 L.Ed.2d 686.
We agree with the trial court that when Richards, of his own volition, appeared before the city council in the manner in which he did to urge the purchase of his property and challenge the ethics and integrity of Gruen, who was not only an alderman but a candidate for mayor in an imminent election, he placed himself in an area of matters of public or general interest.
The purchase of property by the city involved the expenditure of public funds. The expenditure of public funds under almost any test is a matter of public or general interest. The ethical conduct and the moral judgments of a councilman and a candidate for mayor are also matters of public or general interest.
Because Richards involved himself in these matters of public or general interest, Gruen was cloaked with a conditional privilege in his response before the council on March 25, 1969. Before this response can be declared to be libelous it must be tested by the New York Times v. Sullivan standards.
The appellant-Richards argues that because the defendant-Gruen did not request appropriate instructions, made no objections to the proposed verdict and instructions, Gruen is now foreclosed from obtaining a new trial. He cites several cases which give some support to his argument. True, the respondent-Gruen cannot insist upon a new trial as a matter of right because of a procedural failure of his own making. It does not follow that a trial court cannot grant a new trial in the interest of justice when it is of the opinion that justice has miscarried or a verdict is returned based upon erroneous instructions as the law. It cannot be said that counsel was derelict in his duty or unfairly sat idly by in not making requests for instructions or objections to the verdict when the decision that clarified these propositions of law had not yet been announced.
See Boller v. Cofrances (1969), 42 Wis.2d 170, 166 N.W.2d 129; Withers v. Tucker (1965), 28 Wis.2d 82, 135 N.W.2d 776; Grinley v. Eau Galle (1956), 274 Wis. 177, 179, 79 N.W.2d 797; Savina v. Wisconsin Gas Co. (1967), 36 Wis.2d 694, 154 N.W.2d 237.
If the trial court exercises this discretion based upon stated valid reasons, this court, upon appellate review, will not reverse that order.
Our review convinces us that the trial court did not abuse its discretion and the order setting aside the verdict and granting a new trial in the interest of justice should be affirmed.
The plaintiff also contends that even if the New York Sullivan standards apply, the evidence is sufficient to meet these standards. From our examination of the record we do not believe the evidence compels that conclusion. A reasonable jury could arrive at different findings as to whether the statements were libelous and as to the amounts of damages.
By the Court. — Order affirmed.