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CASE LAW - 2001

Statements Made to Initiate a Police Report or Criminal Prosecution Cannot Expose the Maker of the Statement to Liability for Defamation. Beroiz v. Wahl (2000) 84 Cal.App.4^th 485, 100 Cal.Rptr.2^d 905 [originally in Guralnick & Gilliland's Fifteenth Annual Legislative Update]

CASE HISTORY

Denny J. Berioz, Robert Delmer, and Samuel T. Rees ("plaintiffs"), homeowners in a condominium complex in Mexico, sued fellow homeowners Elena Gladys Alamo Janine, Therese Marian, and Tony Wahl ("defendants") in California for defamation. (Presumably most or all of the parties had their principal place of residence in California, and not Mexico.) The Trial Court granted motions for summary judgment by defendants. The plaintiffs appealed, and the Court of Appeal affirmed the Trial Court's decision.

The parties were all residents of a condominium complex in Mexico and members of its homeowners association. Alamo refused to pay overdue fees to the homeowners association, and she built a home without its approval. The association's property manager, upon the board's instructions, refused to provide Alamo gas and gardening services, and she was denied entry to the complex when the association refused to issue a sticker to her identifying her as a resident, because she could not qualify to obtain her beneficiary's interest from the trustee who owned the complex due to her noncompliance with the association's rules.

Plaintiffs served for periods of time on the association's board of directors. In 1994, the board took legal action to secure demolition of Alamo's home. Plaintiff Rees testified that while he served on the board of directors, it responded to misconduct by defendants Alamo, Wahl, and Marian. In 1994, the association fired its property manager, and Defendants Wahl and Marian, along with others, then seized the homeowner association's office by force and held it for several months. [Note -- don't try this at home! We also can't help saying "Remember the Alamo"]

Defendant Alamo consulted with a Mexican attorney, who advised her that she had a sufficient basis for alleging the crime of "dispossession" under Mexican law. Therefore, Alamo filed a complaint with the local district attorney office in Mexico, stating that the property manager, in conjunction with members of the complex's board of directors, had dispossessed her by denying services and access to her residence, a crime under Mexican law.

Plaintiffs' complaint alleged that, as a result of the incidents described above, Alamo, Wahl and Marian developed animosity toward plaintiffs and that defendants entered into a conspiracy to defame plaintiffs by making defamatory criminal accusations of "dispossession" against them. Defendants filed motions for summary judgment, arguing that their conduct was "privileged" under California Civil Code § 47 ("Section 47").

The Trial Court agreed that the complaints made to the district attorney in Mexico were privileged and that defendants could not be held liable for defamation under California law, granting summary judgment in favor of defendants. On appeal, the Court of Appeal affirmed the Trial Court's decision.

ANALYSIS

The Appellate Court stated that the key issue presented was the application of the absolute and qualified privileges in Section 47 to defendants' conduct in connection with Alamo's complaints of "dispossession".

"Privilege" is an affirmative defense to a claim of defamation, meaning that even if certain statements are legally defamatory, the person making the defamatory statements is immune from liability if they qualify for the privilege. In California, the so-called "absolute privilege" of Section 47(b) provides broad protection to statements made by participants in litigation and in other "official proceedings". Generally, this privilege applies to any communication (1) made in judicial or quasi- judicial proceedings; (2) by litigants or other participants authorized by law; (3) to achieve the objects of the litigation; and (4) that have some connection or logical relation to the action. The Appellate Court noted that the California Supreme Court has held that the absolute privilege promotes several goals important to our system of justice, including "ensuring free access to the Courts, promoting complete and truthful testimony, encouraging zealous advocacy, giving finality to judgments, and avoiding unending litigation," and thus the privilege has been called "the backbone to an effective and smoothly operating judicial system."

The Appellate Court also considered the so-called "qualified privilege" in Section 47(c), which protects otherwise defamatory statements, made without malice, to protect a recognized interest. This privilege protects good faith, well-intended communications serving significant interests.

The Court concluded as a threshold matter that Section 47 could be applied to conduct in Mexico. The Court noted that applying the absolute privilege to fair judicial proceedings in foreign countries encourages American citizens in these countries to resolve disputes in the courtroom, rather than by self-help and protects their good faith communications regarding their legitimate interests.

Next, the Court considered the question of the extent to which defendants' conduct falls within the absolute privilege of Section 47(b), observing that California courts have issued conflicting decisions about whether communications that initiate or prompt criminal investigations are subject to the absolute privilege. However, the Appellate Court concluded that the majority of courts hold that the absolute privilege does shield statements made to report or initiate a criminal proceeding, for the reason that absolute privilege was necessary to provide the "open channel of communication" between citizens and police needed for effective investigation of crimes. The Appellate Court agreed with the Trial Court that the statements made by defendants in connection with Alamo's complaint to the district attorney in Mexico were absolutely privileged and could not expose defendants to liability for defamation.

Finally, plaintiffs argued that they were "forced" to repeat the accusations made by defendants in connection with the Alamo's dispossession complaint at homeowners' meetings, and that defendants should be liable for defamation under this circumstance.

The Court of Appeal stated that they "were not persuaded", noting that in some cases, a person making a defamatory statement may be liable for defamation when the victim repeats the statement to third parties, provided that the originator of the statement "has reason to believe that the person defamed will be under a strong compulsion to disclose the contents of the defamatory statement to a third person." However, the Court observed that this rule was limited to a narrow class of cases where a plaintiff is compelled to republish the statements in order to disprove them."

PRACTICAL APPLICATION

Unfortunately, the question of whether statements made by members of a homeowners association might subject the person making the statement to liability for defamation arises frequently. Often, members of the board or property managers are asked to intervene when heated comments are made between members or at a homeowners meeting.

The Beroiz case makes clear that statements made to initiate a police report or criminal prosecution cannot expose the maker of the statement to liability for defamation, because such statements are absolutely privileged under California law. In the event that a board member or property manager is in the position of filing a criminal complaint with the police or district attorney for any reason, he/she will not be liable for defamation merely for making the report. (However, claims which are actually false can expose the person making the false claim to a civil action for malicious prosecution, a fact discussed by the Court in Beroiz.)

Additionally, Beroiz discusses the qualified privilege which creates immunity for communications between, for example, members of homeowners associations concerning matters affecting their community, so long as the statements are made without "malice", which means knowledge that the statement is false or reckless disregard as to whether or not it was true. It also important to remember that in defamation lawsuits, truth is a complete defense.

An association considering filing a lawsuit for defamation or facing accusations of defamation should conduct a careful investigation of the facts and seek assistance from its general counsel.

Finally, although we do not opine on Mexican law, we are astonished at the extremes of Mexico's self-help remedies.

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