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Wanless v. Rothballer

OPINION FILED AUGUST 14, 1985.

FRANK W. WANLESS, PLAINTIFF-APPELLEE,

v.

RHONDA ROTHBALLER ET AL., DEFENDANTS-APPELLANTS.



Appeal from the Circuit Court of Peoria County; the Hon. Richard E. Eagleton, Judge, presiding.

JUSTICE GREEN DELIVERED THE OPINION OF THE COURT:

On December 29, 1977, plaintiff filed a complaint in the circuit court of Peoria County against defendants, Rhonda Rothballer and the Peoria Journal Star, Inc. (Journal Star), claiming defamation and seeking compensatory and punitive damages. On April 20, 1983, an amended complaint was filed. On April 2, 1984, after a trial by jury, judgments were entered in favor of plaintiff and against both defendants. Compensatory damages were fixed in the sum of $250,000 each. Punitive damages were awarded in the sums of $1,000 against Rothballer and $249,000 against the Journal Star. Defendants have appealed. We reverse.

The evidence showed that Rothballer was a reporter for the Journal Star and wrote three articles which were published by that newspaper in its January 20, 1977, edition. Plaintiff was the attorney for the village of Morton (village). The articles concerned plaintiff's conduct of his public office as such attorney and centered on his relationship with people who were affected by actions of the governing board of the village. We have no difficulty upholding the determination, inherent in the judgments, that at least some statements in the articles were false. However, we hold that the evidence was insufficient to support a determination that the articles were published with the "actual malice" required to make tortious a statement made about a public official. New York Times Co. v. Sullivan (1964), 376 U.S. 254, 11 L.Ed.2d 686, 84 S.Ct. 710.

• 1 In addition to contending that the proof of actual malice failed, defendants also contend that (1) plaintiff failed to prove the falsity of the defamatory statements, (2) the trial court erred in refusing to submit to the jury an interrogatory tendered by defendants, and (3) the court erred in instructing the jury. As we will explain, the evidence was sufficient to prove the falsity of certain statements made in the articles. Because of the disposition we make, we need not pass upon defendants' other contentions.

In its opinion in the seminal case of New York Times, the court held that for a statement critical of a public official to be actionable, the statement must be false and made "with knowledge that it was false or with reckless disregard of whether it was false or not." (376 U.S. 254, 280, 11 L.Ed.2d 686, 706, 84 S.Ct. 710, 726.) Subsequent United States Supreme Court opinions have given at least as limited a definition of the mental state giving rise to actual malice. One opinion stated that the mental state of the publisher of the statement must be such that he "in fact entertained serious doubts as to the truth" of the statement. (St. Amant v. Thompson (1968), 390 U.S. 727, 731, 20 L.Ed.2d 262, 267, 88 S.Ct. 1323, 1325.) Another opinion stated the publisher must have a "high degree of awareness of * * * probable falsity." (Garrison v. Louisiana (1964), 379 U.S. 64, 74, 13 L.Ed.2d 125, 133, 85 S.Ct. 209, 216.) That opinion also indicated that ill will toward the public official by the one making the statement is insufficient to constitute actual malice. 379 U.S. 64, 74, 13 L.Ed.2d 125, 132, 85 S.Ct. 209, 215.

The opinions in New York Times and in virtually all of its progeny have stated that the trier of fact can properly find actual malice only upon proof that is clear and convincing. The posture of the reviewing court is somewhat different than in other cases when passing on the sufficiency of the proof of actual malice. In New York Times, the court stated that a reviewing court is required to "`make an independent examination of the whole record'" to make sure "that the judgment does not constitute a forbidden intrusion on the field of free expression." (376 U.S. 254, 285, 11 L.Ed.2d 686, 709, 84 S.Ct. 710, 729.) The United States Supreme Court explained that doctrine in further detail in Bose Corp. v. Consumer Union of United States, Inc. (1984), 466 U.S. 485, 80 L.Ed.2d 502, 104 S.Ct. 1949. The extent of the stricter scrutiny required is not easily articulated. However, apparently, the reviewing court should give the usual deference to the trier of fact's determination of underlying facts and the veracity and accuracy of witnesses but is to make a more independent determination, from the whole record, as to whether actual malice may be inferred from those underlying facts.

In Bose Corp., the United States Supreme Court held that Federal Rule of Civil Procedure 52(a) (28 U.S.C. § 52(a) (1982)) should not be followed by a circuit court of appeals in reviewing the sufficiency of proof of actual malice in a defamation case. That rule directed a reviewing court not to set aside the findings of fact made in the trial court, unless the findings were "clearly erroneous" and also required deference to the credibility given by the trial court to the witnesses. We are not subject to Rule 52(a), but it is very similar to our usual rule in civil cases where by the determination of the trier of fact is not to be set aside unless it is contrary to the manifest weight of the evidence, i.e., clearly wrong. (Village of Wilsonville v. SCA Services, Inc. (1981), 86 Ill.2d 1, 426 N.E.2d 824.) The Bose Corp. court was applying first amendment principles to a defamation case. Its ruling is as applicable and binding on us as on Federal courts.

• 2 Problems of conflict of interest are inherent in the usual situation where an attorney in private practice is also a city or village attorney. The problems are intensified in a municipality of the size of Morton. The newspaper articles in question criticized the manner in which plaintiff handled these problems. In doing so, the articles contained some falsifications, inaccuracies, and exaggerations which could have been avoided with the use of more care. In explaining why we deem the evidence insufficient to support a finding of actual malice, we examine the contents of the various articles and the surrounding circumstances.

One of the articles was headlined "VILLAGE ATTY. WANLESS PAID BY PRIVATE CLIENTS, TAXPAYERS." In its lead sentence, it stated that plaintiff "had been paid twice for preparing annexation papers — by the village and by clients wishing to annex to the village." This was not accurate. Actually, he had been paid by a few clients for preparing annexation papers which were then presented at meetings of the village board where he, acting in his capacity as village attorney, advised the board as to the sufficiency of the petitions. He also testified that he drafted one petition without charge for a person to whom he owed a favor. No evidence indicated that he charged the village anything for his time spent on this drafting. He did receive pay for examining the various annexation petitions that were presented to the board, and he was paid for being present at the meetings where the petitions were presented. Plaintiff testified that when annexation petitions which he had drafted were presented to the village board, he did not need to examine them after presentation. Thus, he did not make an additional charge for examining the petitions. He was paid, however, for attending the meetings where the petitions were presented and did give advice to the village as to whether the petitions were in proper order.

The situation involving a possible conflict of interest was generally described with accuracy. Plaintiff was being paid by the village and represented it in matters which involved petitions which he had drafted for persons who paid him a fee or for whom he prepared the petition as a return for a favor. An attorney-client relationship developed thereby. Plaintiff was paid both by the taxpayers and his private clients for his work in these proceedings. Rothballer and the Journal Star carelessly described the practice as one whereby plaintiff received the dual pay for preparation of petitions rather than for his total participation in the matter. Considering the strength of proof necessary to infer actual malice required by New York Times and cases following it, we deem the evidence insufficient to support a determination of actual malice. The evidence does not show a reckless disregard for truth nor a high degree of awareness that the statement was probably false.

Other portions of the foregoing article described a proceeding by the village to construct a sewer and to levy assessments to defray the costs. Among the properties to be affected by the sewer was the Waldheim subdivision, which was developed by WRCL Company, a corporation owned by various members of the Zobrist family, one of whom was a village trustee. The evidence showed that plaintiff had represented this family and, at the time involved in the article, was the registered agent for several corporations owned by them. A hearing was held by the board at which WRCL Company was not represented by plaintiff but by a Peoria law firm. Plaintiff represented the village during this proceeding. WRCL Company objected to the assessment, as did several others. The Waldheim subdivision was then undeveloped. An agreement was reached whereby the Waldheim subdivision would not be assessed, but tax receipts would be used in lieu of assessments from property owned by WRCL Company. Later, when lots were sold and attachments were made to the sewer, each lot owner would be required to pay to the village a sum equal to a pro rata share of what the assessment for the subdivision would have been plus interest.

In describing the background of the sewer project, the article stated:

"At a public hearing in August 1975 for a special assessment sewer project on N. Morton Ave., where Waldheim is located, Wanless said he was the attorney for the subdivision's development company known as WRCL Co.

So, he was representing Trustee Zobrist in his annexation request, as well as representing the village. He also was preparing the special assessment project that would affect his ...


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