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Short v. News-Journal Co.

Supreme Court of Delaware

July 30, 1965

Clifton Stanley SHORT, Jr., Plaintiff Below, Appellant,
v.
The NEWS-JOURNAL COMPANY, a corporation of the State of Delaware, Defendant Below, Appellee.

Page 719

Upon appeal from summary judgment entered in favor of the defendant by the Superior Court in and for New Castle County. Affirmed.

[58 Del. 593] James H. Hughes, III, Dover, for plaintiff below, appellant.

[58 Del. 594] Louis J. Finger, of Richards, Layton & Finger, Wilmington, for defendant below, appellee.

[58 Del. 593] WOLCOTT, C. J., and CAREY and HERRMANN, JJ., sitting.

[58 Del. 594] HERRMANN, Justice.

This is a libel action. The ultimate question on the appeal is whether the newspaper publication here involved was privileged.

I.

The facts are uncontroverted:

On January 11, 1963, Eugene Knoblauch, a reporter for the defendant, The News-Journal Company, made a routine check of the Wilmington office of the District Director of Internal Revenue Service (hereinafter 'Director'). Knoblauch asked the Director whether he had any news for press release. In the Director's presence and with his consent, the Chief of the Delinquent Accounts and Returns Branch of the office related to Knoblauch the details of a seizure for taxes, just made, of the property of a man whose name he gave as C. Stanley Short, Jr.

On the basis of Knoblauch's report, the defendant published a news story in the Wilmington Morning News of January 12, 1963 which was a correct summary of the information furnished to Knoblauch; and an abbreviated version of the same story appeared in the Evening Journal of the same date.

Both news stories contained the erroneous information, as furnished to Knoblauch, that the name of the person whose property was seized was C. Stanley Short, Jr. In fact that name of the taxable involved was C. Stanley Short, Sr.; otherwise the news stories were [58 Del. 595] accurate. The defendant published retractions immediately upon learning of the mistake.

C. Stanley Short, Jr. brought this libel action against the defendant newspaper publishing company only. Plaintiff contends that the issuance of the news release was not within the scope of the duties of the Director; that, therefore, the release was not privileged; and, under the common law maxim that 'tale bearers are as bad as tale makers', that the defendant stands liable to the plaintiff for publication of the false and defamatory statement. The defendant raised the defense of privilege. The plaintiff conceded the absence of malice and of abuse of privilege. The Superior Court held that the publication was privileged [205 A.2d 6] and granted summary judgment in favor of the defendant. This appeal followed.

II.

This court has not been called upon heretofore to consider the precise questions here involved.

The law of defamation embodies the public policy that, generally, individuals must be protected so as to enjoy their good reputations unimpaired by defamatory statements. The general rule is that the publisher and republisher of defamatory matter are strictly accountable and liable in damages to the person defamed, and neither good faith nor honest mistake constitutes a defense, serving only to mitigate damages. E.G., Star Publishing Co. v. Donahoe, Del.,58 A. 513, 65 L.R.A. 980 (1904).

There is, however, a counter public policy requiring that, in certain situations, a paramount public interest permits speaking and writing freely and without restraint by the possibility of defamation action. In such situations, the law recognizes certain privileges and immunities from liability. The defense of privilege in defamation

Page 720

cases 'rests upon the * * * idea, that conduct which otherwise would be actionable is to escape liability because the defendant is acting in furtherance of some interest of social importance, which is entitled to [58 Del. 596] protection even at the expense of uncompensated harm to the plaintiff's reputation.' Prosser on Torts (3d Ed.) p. 796. The privilege may be absolute or conditions. An absolute privilege affords a complete defense irrespective of accuracy or malice; a conditional privilege affords protection only in the absence of malice. Klein v. Sunbeam Corporation, 8 Terry 526,94 A.2d 385 (1952); Pierce v. Burns, Del.,185 A.2d 477 (1962).

We now address ourselves to the specific questions of privilege presented, first as to the Director and his subordinate, and secondly as to the defendant publishing company.

III.

Since the Director and his colleague were federal officials, the nature of their privilege is governed by federal case law. This was settled in Howard v. Lyons,360 U.S. 593, 79 S.Ct. 1331, 3 L.Ed.2d 1454 (1959); compare Carr v. Watkins,277 Md. 578, 177 A.2d 841, 845 (1962).

The federal rule governing the privilege of officials of the executive branch of government was recently stated in Barr v. Matteo,360 U.S. 564, 79 S.Ct. 1335, 3 L.Ed.2d 93 (1959). Prior to that case, [1] the United States Supreme Court had held in Yaselli v. Goff (2 Cir. 1926)12 F.2d 396, aff'd per curiam 275 U.S. 503, 48 S.Ct. 155, 72 L.Ed. 395 (1927), that the immunity of the absolute privilege extended to a Special Assistant to the Attorney General of the United States; and in Spalding v. Vilas,161 U.S. 483, 16 S.Ct. 631 (1905), it [58 Del. 597] held that the absolute privilege protected the Postmaster General of the United States. In Barr v. Matteo, however, the executive privilege was widely extended. There, following a congressional challenge to the integrity of the operations of the Office of Rent Stabilization, the Acting Director of that agency issued a press release in which he gave reasons why he intended to suspend two other officers of the agency. These officers thereafter brought a libel suit against the Acting Director based upon the statements contained in the release; and the Acting Director pleaded privilege. The majority of the Court held that the privilege of the Vilas case should not be limited to executive officials of cabinet rank and that the absolute privilege should be extended to the news release issued by the Acting Director. Thus, the cloak of absolute privilege was extended to news releases of federal executive officials of lower echelons, provided that such releases are 'within the outer perimeter' of the official's 'line of duty' (79 S.Ct. 1341). [2]

Page 721

We are not called upon to agree or to disagree with the holding of Barr v. Matteo. As noted above, the status of the privilege of the Director and his subordinate is controlled by the federal rule in any event. We expressly reserve until another day the question of the extent to which members of the executive branch of our State government are privileged. [3]

Thus, the only question before us, in ascertaining the privilege status of the Director and his colleague, is whether the news release in the instant case was within the 'outer perimeter' of their 'line of [58 Del. 598] duty'. We think it was.

It appears that the Director was explicitly charged by the Commissioner of Internal Revenue with the responsibility 'to release enforcement news' in implementing the general policy of the Internal Revenue Service 'to conduct a continuous information program in order to enhance public compliance with tax laws and regulations, augment the activities of enforcement programs and promote respect for and confidence in the Service.' In line with this policy, and 'in order to provide the strongest possible deterrent to violation of the Internal Revenue laws' the District Director was 'encouraged to co-operate with representatives of news media in the publication of enforcement news which is a matter of record.'

Thus, it was clearly within the scope of the specified duties of the Director to release to news media information of tax seizures and sales as a deterrent to other taxables and as part of the well recognized enforcement program of the Internal Revenue Service. Manifestly, the release of information in the subject case, made by the Head of Branch in the Director's presence and with his consent, falls squarely within such enforcement program.

We hold, therefore, that the action of the Director and his associate, in issuing the news release, was within 'the outer perimeter' of their 'line of duty.' Under the Barr case, their action in so doing, was privileged. Compare Babylon Milk & Cream Co., Inc. v. Rosenbush [58 Del. 599] (E.D.N.Y.1964) 233 F.Supp. 735.

IV.

The law recognizes a privilege in favor of a newspaper to report the governmental acts of executive officials of government. We are of the opinion that the news release of the Director and his associate in the instant case was in the category of governmental acts covered by such privilege.

This privilege is based upon the theory that it is pro bono publico for information to be widely circulated regarding the governmental

Page 722

activities of public officials. As stated in Restatement of Torts, p. 240:

'In order that such information may be freely given, it is necessary to ...


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