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Public Finance Corp. v. Davis





Appeal from the Appellate Court for the Fifth District; heard in that court on appeal from the Circuit Court of St. Clair County; the Hon. Robert J. Saunders, Judge, presiding.


Rehearing denied January 28, 1977.

In this case Luella Davis (Davis), the defendant and counterclaimant, seeks to recover from Public Finance Corporation (Public Finance), plaintiff and counterdefendant, under the allegations in her amended counterclaim for mental anguish and emotional distress allegedly caused by the agents of Public Finance in attempting to collect money which Davis owed. The circuit court of St. Clair County held that the amended counterclaim failed to state a cause of action. The appellate court affirmed. (36 Ill. App.3d 99.) We granted leave to appeal.

From the pleadings it appears that Davis was indebted to Public Finance on a promissory note executed by her and secured by a security interest in her household goods. She made regular payments on the obligation until August 1, 1974. On February 24, 1975, Davis then being in default, Public Finance filed a complaint seeking judgment against her for the balance due on the note. Davis counterclaimed and, following the allowance of a motion to dismiss the counterclaim, filed an amended counterclaim which is in two counts, both counts seeking recovery on the theory of intentional infliction of severe emotional distress. The sole question to be decided is whether the amended counterclaim stated a cause of action. We find that it did not.

In Knierim v. Izzo (1961), 22 Ill.2d 73, this court recognized the intentional causing of severe emotional distress as a separate and additional tort which one author has been prompted to call a "new tort." (Prosser, Intentional Infliction of Mental Suffering: A New Tort, 37 Mich. L. Rev. 874 (1939).) Although this tort was not recognized in the 1934 Restatement of Torts, the 1948 supplement contained an amended section 46 recognizing the existence of a cause of action based on this theory. (Restatement of Torts sec. 46 (Supp. 1948).) The reason for the change as partially stated in the supplement is: "The change in Section 46 is necessary in order to give an accurate Restatement of the present American law. There is a definite trend today in the United States to give an increasing amount of protection to the interest in freedom from emotional distress." Although the 1948 supplement contained the caveat that "[t]he [American Law] Institute expresses no opinion as to whether one who recklessly causes severe emotional distress to another is or is not liable for it," the Institute, in Restatement (Second) of Torts, section 46 (1965), recognizes the existence of a cause of action for severe emotional distress caused by intentional or reckless conduct. Knierim, which predated the second Restatement, by innuendo adopted the viewpoint of the 1948 supplement recognizing only a cause of action based on intentional conduct. (See Note, Torts — Intentional Infliction of Mental Suffering: A New Tort in Illinois, 11 De Paul L. Rev. 151 (1961).) Although recklessness has been rejected in one jurisdiction as a basis for recovery for severe emotional distress (see Alsteen v. Gehl (1963), 21 Wis.2d 349, 124 N.W.2d 312), we do not find the reason for that decision applicable in Illinois. We therefore will test the two counts of the amended conterclaim by the requirements of the cause of action as stated in section 46 of the second Restatement, the decisions of other jurisdictions recognizing the cause of action and by the authors on the subject. See Magruder, Mental and Emotional Disturbance in the Law of Torts, 49 Harv. L. Rev. 1033, 1059 (1936); Prosser, Law of Torts sec. 12 (4th ed. 1971).

The extensive comments and illustrations to section 46 are helpful in delineating the conduct which gives rise to this cause of action. First, the conduct must be extreme and outrageous. The liability clearly does not extend to mere insults, indignities, threats, annoyances, petty oppressions or trivialities. "It has not been enough that the defendant has acted with an intent which is tortious or even criminal, or that he has intended to inflict emotional distress, or even that his conduct has been characterized by `malice,' or a degree of aggravation which would entitle the plaintiff to punitive damages for another tort. Liability has been found only where the conduct has been so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency * * *." Restatement (Second) of Torts, sec. 46, comment d (1965).

Second, infliction of emotional distress alone is not sufficient to give rise to a cause of action. The emotional distress must be severe. Although fright, horror, grief, shame, humiliation, worry, etc. may fall within the ambit of the term "emotional distress," these mental conditions alone are not actionable. "The law intervenes only where the distress inflicted is so severe that no reasonable man could be expected to endure it. The intensity and the duration of the distress are factors to be considered in determining its severity." Comment j. See also Prosser, Law of Torts sec. 12, at 54 (4th ed. 1971).

Third, reckless conduct which will support a cause of action under the rules stated is conduct from which the actor knows severe emotional distress is certain or substantially certain to result. (Comment i.) Liability extends to situations in which there is a high degree of probability that severe emotional distress will follow and the actor goes ahead in conscious disregard of it. Prosser, Law of Torts 60 (4th ed. 1971).

Fourth, as is stated in comment e, the extreme and outrageous character of the conduct may arise from an abuse of a position or a relation with another which gives the actor actual or apparent authority over the other or power to affect his interests. This interpretation of the rule is applicable to collecting creditors and would apply to a creditor in its attempt to collect a lawful obligation.

Count I of the amended counterclaim alleges the conduct of Public Finance which Davis claims entitles her to recover. Stripped of the conclusions, it is charged that on or about September 1, 1974, Davis informed Public Finance she was no longer employed, was on public aid and did not have enough money to make regular payments on her obligations; that in order to collect the account Public Finance from September 1, 1974, to April 4, 1975, called Davis several times weekly, frequently more than once a day; that in order to collect the account agents of Public Finance went to Davis' home one or more times a week; that on October 15, 1974, when Davis' daughter was in the hospital, an agent of Public Finance, in order to collect the account, called the defendant at the hospital; that on that day Davis informed the agent of the severity of her daughter's condition, that she, herself, was sick and nervous and asked that Public Finance refrain from calling her at the hospital; that on the same day an agent of Public Finance again called Davis at the hospital; that after an employee of Public Finance induced Davis to write a check and promised that the check would not be processed, Public Finance phoned an acquaintance of Davis and informed her that Davis was writing bad checks; that in November 1974 an employee of Public Finance called at Davis' home and after being told that Davis had no money with which to make a payment, with Davis' permission, used her phone to call Public Finance and to describe and report the items of Davis' household goods; that on that day the employee "failed or refused" to leave Davis' home until her son entered the room.

Count II realleges the conduct of Public Finance alleged in count I and further alleges that Davis suffered from hypertension and a nervous condition; that she was particularly susceptible to emotional distress; that she had frequently informed agents of Public Finance of her condition and that Public Finance had notice that Davis was particularly susceptible to emotional distress.

The conduct alleged is not of such an extreme and outrageous nature as to constitute a basis for recovery under the theory alleged. Davis was legally obligated to Public Finance and was in default in making the payments. As stated in Restatement (Second) of Torts, section 46, comment g, in such a case the actor is not liable "where he has done no more than to insist upon his legal rights in a permissible way, even though he is well aware that such insistance is certain to cause emotional distress." A creditor must be given some latitude to pursue reasonable methods of collecting debts even though such methods may result in some inconvenience, embarrassment or annoyance to the debtor. The debtor is protected only from oppressive or outrageous conduct. Dawson v. Associates Financial Services Co. of Kansas, Inc. (1974), 215 Kan. 814, 529 P.2d 104; Norris v. Moskin Stores, Inc. (1961), 272 Ala. 174, 132 So.2d 321.

In cases wherein courts have permitted the action to be brought or have sustained recovery for severe emotional distress, the collecting tactics of the creditor have involved the use of abusive and vituperative language, shouting and railing at the debtor, repeated threats of arrest and ruination of credit, threats to appeal to the debtor's employer to endanger his employment and accusations of dishonesty. "[L]iability usually has rested on a prolonged course of hounding by a variety of extreme methods." Prosser, Law of Torts 57 (4th ed. 1971). See Barnett v. Collection Service Co. (1932), 214 Iowa 1303, 242 N.W. 25; LaSalle Extension University v. Fogarty (1934), 126 Neb. 457, 253 N.W. 424; Warrem v. Parrish (Mo. 1969), 436 S.W.2d 670; Rugg v. McCarty (1970), 173 Colo. 170, 476 P.2d 753; Annot., 15 A.L.R.2d 108, 158-163 (1951). See also Annot., 46 A.L.R.3d 772 (1972); Prosser, Intentional Infliction of Mental Suffering: A New Tort, 37 Mich. L. Rev. 874 (1939).

Returning to the allegations in count I we note that Davis alleges that the course of conduct pursued was in order to collect the account. This Public Finance had a right to do, as long as the methods employed were not outrageous. As to the numerous telephone calls, there is no allegation as to what was said by the person making the calls. The same is true of the allegations of the several visits to Davis' home and of the calls to Davis at the hospital. Davis has not alleged that the agents of Public Finance used abusive, threatening or profane language or that they conducted themselves other than in a permissible manner. There is no allegation concerning these calls or the visits to the house that can serve to characterize Public Finance's conduct as extreme or outrageous. The mere fact that a second call was made to Davis at the hospital after she had requested that they not call her there cannot be so considered, since there is no allegation as to what was said or even that the second call was for the purpose of collecting the past due obligation.

As to the visit of an employee of Public Finance to Davis' home and using her phone to call Public Finance and to inventory and describe her household goods, again we must consider that her obligation was past due and that it was secured by the household goods. Also the allegation that the employee of Public Finance "failed or refused" to leave until Davis' son entered the room contains only an innuendo and not an allegation of any threatening or coercive conduct which could be called outrageous.

We consider the most serious allegation to be the charge that Public Finance induced Davis to write a check for the amount owed with the assurance that the check would not be presented for payment and then subsequently phoned Davis' acquaintance and informed her that Davis was writing bad checks. This conduct was wrong and no doubt caused Davis considerable embarrassment and distress. However, this appears to be a single isolated act. In Lewis v. Physicians and Dentists Credit Bureau, Inc. (1947), 27 Wn.2d 267, 273, 177 P.2d 896, 899, the court stated that persons "who do not pay their bills cannot object to some publicity in connection with attempts to collect them; their tender sensibilities are protected only from `undue or oppressive publicity.'" Also, in comment j to section 46 it is stated that the intensity and duration of the distress are factors to be considered in determining the severity of the emotional distress. We do not consider that the specific allegation of this single impermissible act constitutes extreme and outrageous conduct calculated to cause severe emotional distress.

There can be no doubt that the conduct of the employees of Public Finance disturbed Davis and possibly caused her emotional distress. The allegations demonstrate that the employees were persistent in their efforts to collect the past due obligation and possibly were persistent to the point of being annoying; however, with the possible exception noted, count I contains no allegation of extreme or excessive ...

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