Plea: Not guilty. Issue thereon.[[480]]
It was objected on behalf of the defendants that there was no evidence of a publication of the libel, and that it was a privileged communication. The Chief Baron overruled the objections, but reserved leave to the defendants to move to enter a nonsuit on both points. The plaintiff having proved his special damage, the jury found a verdict for £500.
A rule having been obtained to enter a nonsuit pursuant to the leave reserved,
Holker, Q. C., and Gorst, showed cause.
Manisty, Q. C. (R. C. Fisher with him), in support of the rule.
Mellor, J. I am of opinion that the rule should be made absolute to enter a nonsuit. Had I been able to perceive that any substantial injustice might have been done by not leaving any question to the jury, I should have been disposed to send the case down for a new trial. But I think there was no evidence of express malice which ought to have been left to the jury.
As I understand the facts of the case, the plaintiff was employed as the agent of the defendants in Egypt, and his transactions were necessarily brought under the notice of the auditors, who are appointed by Act of Parliament, or at all events by the articles of association of the company, and who are fit persons to investigate the accounts of the company. The auditors considered that a deficiency in the stock of the company was owing in some sense to the plaintiff’s default, and they expressed that opinion in their report. It seems they did this after having received such explanations as Mr. Bell could offer, but it must be observed that those explanations were offered to the auditors and not to the directors. What the directors did was this, in their report to a meeting of the shareholders they appended the statement which had been made to them by the auditors. There is nothing whatever to show that the directors had any reason to doubt the truth of that statement, and there was no evidence of any act on their part from which malice could be inferred, and therefore I think the Chief Baron was right in not putting the question of malice to the jury. As to the question of intrinsic or extrinsic evidence, the report was one which the directors were fully warranted in believing was correct; and there is nothing to show that the directors acted otherwise than bona fide in communicating it to the shareholders. No doubt the directors are to make their report to a meeting of the shareholders, to be called for that purpose, and it is clear that those who are absent are bound by the acts of those who are present, but the absent shareholders are interested in the prosperity or adversity of the company, and in knowing all the circumstances upon which the welfare of the company depends. It seems to me, therefore, that to print the report was a necessary and reasonable mode of communicating it to all the shareholders, who must be more or less numerous.
This case does not fall within the rule in Cooke v. Wildes, 5 E. & B. 328; 24 L. J. Q. B. 367. There the question of malice was properly left to the jury, because the letter contained defamatory expressions which were unnecessary; the defendant was not content with stating the facts that he had heard, but he made a calumnious observation of his own and put a gloss on the plaintiff’s conduct which was libellous. There was therefore intrinsic evidence of malice, and that the defendant had not acted bona fide, and these questions were properly left to the jury. I think we are bound by the cases of Somerville v. Hawkins and Taylor v. Hawkins, 16 Q. B. 308; 20 L. J. Q. B. 313. The principle there laid down is, that where there is no evidence of malice the judge ought not to leave any question to the jury. Here I think the conduct of the directors negatives malice on their part, and it is clear that they acted bona fide. I think we should be going against what I may call progress, if we were to hold that the delivery of the manuscript of the report to the printer, for the purpose of having it printed, is a publication which prevents the communication from being privileged. I also think that it was the duty of the directors to communicate the report not only to the shareholders present at the meeting, but to all the shareholders, and that they had an interest in receiving it. I am glad that Mr. Holker called our attention to the American authority, for it supports the judgment of the court. In Philadelphia, Wilmington, and Baltimore Railroad Company v. Quigley, 21 Howard (Rep. Sup. Court, U. S.), 202, it was held that it was within the course of business and employment of the president and directors for them to investigate the conduct of their officers and agents, and to report the result to the stockholders. It was also held, in the absence of malice and bad faith, that the report to the shareholders was privileged; therefore, to this extent, that case appears to me to be an express authority. But, independently of any authority, I am quite prepared to hold that a company, having a great number of shareholders all interested in knowing how their officers conduct themselves, are justified in making a communication in a printed report, relating to the conduct of their officers, to all the shareholders, whether present or absent, if the communication be made without malice and bona fide. The communication in this case is prima facie privileged, and there being no evidence intrinsic or extrinsic of malice, that question was very properly not left to the jury. I think the conclusion at which the Chief Baron arrived at nisi prius without hearing any argument erroneous, and with great deference to that eminent and learned judge, I am of opinion this rule to enter a nonsuit should be made absolute.
Rule absolute.[[481]]