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Midwest Glass Co. v. Stanford Development Co.

NOVEMBER 12, 1975.




APPEAL from the Circuit Court of Cook County; the Hon. NATHAN ENGLESTEIN, Judge, presiding.


Plaintiff, Midwest Glass Company (hereinafter referred to as Midwest), commenced this action against defendant, Stanford Development Company (hereinafter referred to as Stanford), for payment of $400.92. This debt was incurred pursuant to an oral contract entered into by the parties on February 25, 1974, wherein Midwest installed, on two separate occasions, mirrors in various apartments of Stanford's condominium development. Stanford and Samuel E. Schwartz, its president, filed a counterclaim and subsequently an amended counterclaim in which damages were sought against Midwest on two counts, namely, (1) for invasion of privacy by public disclosure of private debts and (2) slander of title. The trial court dismissed the amended counterclaim for failure to state a cause of action concerning both counts, thus giving rise to the instant appeal.

On appeal, counterclaimants contend that their pleadings present genuine issues of fact which should have been tried on the merits. With regard to the invasion of privacy contention, it is posited that the amended counterclaim does contain the requisite elements necessary to warrant an adjudication on such issue. In count I, it is alleged that Stanford is in the business of purchasing, developing and selling real estate, including the building in which Midwest installed the mirrors. Concerning the agreement to purchase the mirrors, counterclaimants allege that the oral contract did not contain any terms governing the time and manner of payment, that Stanford did not tender any payment, and that Samuel E. Schwartz did not personally enter into a contract for the purchase of mirrors. It was alleged further that on or about August 1, 1974, Midwest intentionally and maliciously published orally to various parties, including a customer and purchaser of a condominium unit, that payment was overdue and a lien would be filed against the respective units. Moreover, to compound this effort to harass and coerce Schwartz into rendering payment, on August 2, 1974, the following notice was mailed to 65 individuals, including each of the persons who had purchased condominiums or were tenants.

"The Stanford Development Co. purchased 26 mirrors from the Midwest Glass Co. and we were advised that there would be one mirror for each condominium. If you were the recipient of this mirror then you are subject to a Mechanics Lien notice which we intend to file with our attorney.

After numerous calls Mr. Sam Schwartz and the Stanford Development Co. have refused to reply to our request for payment. We therefore have no alternative than to proceed with this matter at once.

We regret the inconvenience we will cause you unless you can convince the proper parties that a settlement should be made."

The amended countercomplaint indicated that such oral and written publications of Stanford's accounts with Midwest and Schwartz's refusal to make payments constituted an invasion of privacy since these matters were of a private and not a public concern. As a result of such disclosures, the counterclaimants alleged that they were exposed to public contempt and ridicule and incurred a loss of future sales. To redress such injuries, the counterclaimants sought general, special, and punitive damages.

Counterclaimants also contend that the pleadings satisfy the common law elements necessary for bringing an action based on slander of title. Besides repeating many allegations contained in the invasion-of-privacy count, count II alleged that on August 2, 1974, Midwest maliciously sent a letter to several specified persons as well as prospective purchasers of condominium units in which the following fallacious statement appeared:

"* * * you are subject to a Mechanic's Lien notice which we intend to file with our attorney."

As a result of such publication, counterclaimants contended they were unable to sell any condominium units from August 4 through September 6, 1974, and subsequently sold an average of only one unit per month in contrast to a pre-August 4, 1974, average of four units per month. Analogous to the invasion-of-privacy count, relief in the form of general, special, and punitive damages were sought.

• 1 Before resolving the issues raised on appeal, we agree with counterclaimants that, the motion to strike and dismiss the amended counterclaim raises only a question of law (Capital Records, Inc., v. Vee Jay Records, Inc., 47 Ill. App.2d 468, 475, 197 N.E.2d 503, 508) and the nonmoving parties well pleaded allegations are admitted by the movant for the purpose of the motion. O'Fallon Development Co., Inc. v. Ring, 37 Ill.2d 84, 88, 224 N.E.2d 782, 784; Clay v. Chicago Board of Education, 22 Ill. App.3d 437, 439, 318 N.E.2d 153, 154.

With reference to counterclaimants' first count, the right to privacy as well as the right to a remedy for invasion of such right have received both legislative (Ill. Const., art. I, §§ 6, 12) and judicial sanction (Leopold v. Levin, 45 Ill.2d 434, 440, 259 N.E.2d 250, 254) in Illinois. In analyzing the common law right to privacy, Professor William L. Prosser has delineated four distinct kinds of torts which constitute an invasion of privacy. This breakdown, which has been adopted by the Restatement (Second) of Torts § 652A (Tent. Draft No. 13, 1967) as well as many other foreign jurisdictions (e.g., Marks v. Bell Telephone Co. (1975), ___ Pa. ___, 331 A.2d 424, 430; Dotson v. McLaughlin (1975), 216 Kan. 201, 207-08, 531 P.2d 1, 6) comprise the following situations: (1) an unreasonable intrusion upon the seclusion of another, (2) the appropriation of another's name or likeness, (3) a public disclosure of private facts or (4) publicity which unreasonably places another in a false light before the public. Prosser, Law of Torts § 117 (4th ed. 1971).

• 2 Applying these concepts to the instant case, it is obvious that we are concerned with the third category of invasion of privacy, in particular, the public disclosure of a private debt. Since the instant controversy is one of first impression in Illinois, deference must be given to legal precepts emanating from foreign jurisdictions. Although those reviewing courts, which have considered this issue, are not uniformly in accord as to what constitutes actionable conduct, it can be fairly stated that the requisite elements for this tort entail (1) an intentional giving of unreasonable publicity (2) to private debts, (3) without the debtor's consent, (4) which is made for the purpose of coercing or harassing the debtor into payment of the debt or of exposing the debtor to public contempt or ridicule. (See "Public Disclosure of a Person's Indebtedness as Invasion of Privacy," Annot.. 33 A.L.R.3d 154, 156-57 (1970); 62 Am.Jur.2d Privacy § 39, at 736 (1972).) With reference to these elements, it appears that the extent of publicity or degree of harassment, rather than the character of the oral or written communication, is dispositive of whether a debtor's right to privacy was invaded. "Public Disclosure of a Person's Indebtedness as Invasion of Privacy," Annot., 33 A.L.R.3d 154, 157; 62 Am.Jur.2d Privacy § 39, at 738 (1972).

• 3 In light of the above legal tenets, we are not persuaded that the facts in the instant case warrant Stanford nor Samuel E. Schwartz to maintain an action for invasion of privacy. Midwest's oral communications of August 1, 1974, did not amount to a privacy infringement since it has been held that in actions involving attempts to collect debts, the general rule is that an invasion of privacy cannot be based merely on oral communications. (E.g., Gautier v. General Telephone Co. (1965), 234 Cal.App.2d 302, 309, 44 Cal.Rptr. 404, 409; Pangallo v. Murphy (Ky.App. 1951), 243 S.W.2d 496, 497; but see Norris v. Moskin Stores, Inc. (1961), 272 Ala. 174, 178, 132 So.2d 321, 325.) Moreover, Midwest's written notice of August 2, 1974, did not constitute a public disclosure of a private debt. It must be remembered that the right of privacy is not absolute but is subject to limitations where there is express or implied consent and legitimate interests. (Bloomfield v. Retail Credit Co., 14 Ill. App.3d 158, 173, 302 N.E.2d 88, 100.) It is also important to note that a creditor has a right to take reasonable action to pursue his debtor and ...

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