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Whitby v. Associates Discount Corp.

MAY 13, 1965.




Appeal from the Circuit Court of Peoria County; the Hon. ROBERT E. HUNT, Judge, presiding. Reversed in part and remanded.


Rehearing denied June 8, 1965.

This is an appeal by the plaintiffs, Francis O. Whitby and Nancy Whitby, from an order of the Circuit Court of Peoria County, dismissing their complaint for failure to state a cause of action.

Plaintiffs' complaint contains two counts, Count I seeking recovery for libel and slander against Associates Discount Corporation and Rossetter Motor Company, defendants, and Count II seeking recovery for malicious conversion against Associates Discount Corporation, defendant.

According to the plaintiffs' complaint, this controversy arose out of a transaction between the plaintiffs and Rossetter Motor Company, wherein these parties, on October 5, 1962, executed a conditional sales contract. This contract provided for the purchase by plaintiffs from Rossetter of a 1963 automobile for a price of $2,893.30, which sum was to be paid in 36 monthly installments of $70.10, the first payment to be on December 9, 1962. Rossetter assigned this contract to Associates Discount Corporation who thereafter, with the knowledge and consent of Rossetter Motor Company, but without that of plaintiffs, changed the first installment payment date to November 9, 1962. When the plaintiffs failed to make the payment on November 9, 1962, Associates Discount Corporation declared the contract in default, repossessed the automobile, and sold it on November 28, 1962, at public auction. On December 5, 1962, Associates notified the plaintiffs of the sale and advised plaintiffs of a deficiency balance of $282.10. Thereafter, Associates, either verbally or by written instrument, gave notice to the Credit Bureau of Greater Peoria of the alleged deficiency. In Count I the plaintiffs allege that the giving of this notice to the Credit Bureau of Greater Peoria constituted libel and/or slander, and as a result thereof plaintiffs' good reputation for the payment of debts was severely damaged. There was no allegation in Count I that plaintiffs were prejudiced in their trade or profession, nor is there any allegation of special damages.

In Count II, plaintiffs allege that the repossession and sale of the automobile while the plaintiffs were not in default under the terms of the conditional sales contract, constituted a malicious conversion by Associates, for which the plaintiffs are entitled to damages. Count II alleges the ownership of the automobile in the plaintiffs subject to the conditional sales contract, and also alleges that the plaintiff was given a trade-in allowance of $369.70 by Rossetter on the purchase of the new automobile.

Defendants argue that Count I for libel and slander is insufficient in law because it fails to allege that the plaintiffs were engaged in a business or profession which was prejudiced by the alleged defamation, and that Count I also fails to allege any special damages. With respect to Count II, it is defendant's theory that this count fails to state a cause of action for malicious conversion, because the complaint alleges no title or property interest of the plaintiffs in the automobile which could be converted.

A defamation is the publication of anything injurious to the good name or reputation of another, or which tends to bring him into disrepute. Restatement of Law, Torts, Vol 3, § 559, states that "a communication is defamatory if it tends so to harm the reputation of another as to lower him in the estimation of the community or to deter third persons in associating or dealing with him." A defamation designed for visual perception is a libel; an oral defamation is a slander.

Under Illinois common law, there are five classes of words which give rise to a cause of action for slander if falsely communicated. The five classes of words are as follows:

1. Those imputing the commission of a criminal offense;

2. Those imputing infection with a communicable disease of any kind which, if true, would tend to exclude one from society;

3. Those imputing inability to perform or want of integrity in the discharge of duties of office or employment;

4. Those prejudicing a particular party in his profession or trade;

5. Defamatory words, which though not in themselves actionable, occasion the ...

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