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12/15/88 Jerry Costello, v. Capital Cities

December 15, 1988





532 N.E.2d 790, 125 Ill. 2d 402, 126 Ill. Dec. 919 1988.IL.1806

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. Roger Scrivner, Judge, presiding.


JUSTICE WARD delivered the opinion of the court. CUNNINGHAM and STAMOS, JJ., took no part in the consideration or decision of this case.


Jerry Costello, elected chairman of the St. Clair County board, filed an action for libel in the circuit court of St. Clair County against Capital Cities Media, Inc. (Capital Cities), the owner of the Belleville News Democrat (News Democrat), a newspaper of general circulation in St. Clair County, and Richard Hargraves, the editor of the News Democrat's editorial page. The complaint alleged that the defendants had libeled the plaintiff in an editorial published on December 30, 1980, in the News Democrat. The circuit court dismissed the plaintiff's complaint for failure to state a cause of action.

The appellate court reversed, judging that the complaint stated a cause of action for libel per se and remanded the cause to the circuit court for further proceedings. (Costello v. Capital Cities Media, Inc. (1982), 111 Ill. App. 3d 1009 (Costello I).) The defendants' petition for leave to appeal to this court was denied and the case proceeded to trial.

The circuit court after a bench trial entered judgment for the plaintiff and awarded Costello $450,000 in actual damages against both defendants, and $600,000 in punitive damages against Capital Cities. The appellate court, with one Judge Dissenting, affirmed the judgment for the plaintiff but reversed the award of punitive damages. The court also reduced the award of actual damages to $200,000. (153 Ill. App. 3d 956 (Costello II).) This court granted the defendants' petition for leave to appeal (107 Ill. 2d R. 315).

The facts underlying this appeal were set out by the appellate court in Costello II. Because the resolution of the issues raised in this appeal depends importantly upon the facts, however, we will state again the background of this litigation. In 1980 a dispute arose regarding the method of funding mass transit in the St. Louis metropolitan area. The Bi-State Development Agency furnished public transportation to this metropolitan area, which included St. Clair, Madison and Monroe Counties, located in Illinois. Our legislature responded to the funding debate by amending the Local Mass Transit Act (Ill. Rev. Stat. 1979, ch. 111 2/3, par. 351 et seq.) to give the county boards of St. Clair, Madison, and Monroe Counties authority to create transit districts. This amendment also gave the chairman of these respective county boards authority to appoint trustees to govern these transit districts. If the county boards exercised their authority to create a transit district, the amendment empowered the trustees of these districts to impose a sales tax up to one-fourth of one cent, the proceeds of which would be used to fund public transportation. The News Democrat strongly opposed the creation of transit districts and the imposition of any sales tax to subsidize public transportation without a public referendum through which the voters could express approval or disapproval of a tax.

At the time of the debate over the method of funding mass transit, the plaintiff was a candidate for the office of chairman of the St. Clair County board. In September 1980, the editorial board of the News Democrat informed the plaintiff that it was considering endorsing his candidacy and invited him to meet with it to discuss his views. The plaintiff met with defendant Hargraves, reporter Steven Pounds and, at times, Darwin Wiles, the publisher of the News Democrat, in the paper's offices, where they discussed the plaintiff's views on taxation and other local governmental matters. The parties at trial gave differing accounts of the plaintiff's statements regarding the creation of a transit district and the implementation of a tax to subsidize mass transit.

Costello testified that he told the editorial board only that he would not be in favor of any new tax during his first term without a referendum. Hargraves testified that, at the meeting, Costello expressed opposition to the imposition of a transit tax without a referendum and "left the impression" that he would vigorously use the political influence he would have as county board chairman to oppose such a tax without a referendum.

Defendant Wiles testified that Costello positioned himself at the meeting as a fiscal conservative, who would do everything possible to oppose any tax increases without a referendum. Wiles testified that, to his mind, Costello was stating a position and making a pledge or commitment to do everything he could to oppose a tax increase. He testified that Costello made it clear during the interview that he was going to be a strong county board leader who had not only the will to oppose taxes, but the ability to deliver on his promises.

The News Democrat subsequently endorsed Jerry Costello for chairman of the county board in an editorial published on October 19, 1980. This editorial stated that Costello had "pledged," in his endorsement interview with the News Democrat, that he did not favor the imposition of any new tax without a referendum and that he saw no need for any tax increase during his term. The editorial concluded with reasons why the News Democrat believed Costello had the ability to accomplish his goals. In the subsequent November election, Costello was elected chairman of the St. Clair County board.

After the election, the dispute over the creation of a transit district and the implementation of a sales tax intensified. A committee appointed by Costello's predecessor in office recommended that the St. Clair County board adopt a proposed resolution to create a transit district. This resolution was placed on the agenda for consideration by the post-election county board at its first meeting, scheduled for December 29, 1980.

On December 29, Costello met with David Hickey, another county board member who opposed the transit district resolution, to devise a strategy to defeat the resolution. At this meeting, they collaborated in preparing a motion to table the resolution until the matter could be submitted to the voters in an advisory referendum in April 1981. Costello agreed to recognize Hickey, who would present the motion to table, and to contact another board member to second the motion. That evening, the county board met for its first regular meeting following the November election. Members of the public and media were present, including Steven Pounds, the county government reporter for the News Democrat. Costello presided at the meeting. As presiding officer, Costello's role was restricted to that of a parliamentarian. Costello testified that he was prohibited from voting on measures before the board and from speaking in favor of or in opposition to the substance of matters coming before the board by the Revised Code of St. Clair County, which governed the conduct of the board's business.

During this meeting, a proponent of the resolution to create a transit district called for its adoption. As prearranged, Costello recognized Hickey, who moved to table the resolution pending an advisory referendum. Costello's brother, Joseph Costello, a county board member, seconded the motion. A roll call vote was taken and the motion to table was defeated 22 to 6. The board subsequently adopted the resolution creating a transit district by a vote of 22 to 6. Costello made no statements in opposition to the resolution and did not vote against it, as he was prohibited from doing so. Immediately after the board adopted the resolution, Costello nominated three trustees for the district and the board confirmed the nominations.

On December 30, defendants learned that the board had voted to create a transit district. Hargraves testified that publisher Wiles and he decided that the News Democrat should publish two editorials: one critical of the county board for adopting a resolution to create the transit district without a voter referendum, and the second critical of ...

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