Troxler v. Charter Mandala Center, Inc.

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365 S.E.2d 665 (1988)

Reginald V. TROXLER v. CHARTER MANDALA CENTER, INC. and Charter Medical Executive Corporation.

No. 8721SC812.

Court of Appeals of North Carolina.

March 15, 1988.

*667 Kennedy, Kennedy, Kennedy and Kennedy by Harvey L. Kennedy and Harold L. Kennedy, III, Winston-Salem, for plaintiff-appellant.

Allman Spry Humphreys Leggett & Howington, P.A. by James R. Hubbard and David C. Smith, Winston-Salem, for defendants-appellees.

SMITH, Judge.

Plaintiff assigns as error the trial court's granting of defendants' motion for summary judgment as to both causes of action. First, he contends that the circumstances under which Holthusen first related to Davis the alleged sexual misconduct did not constitute a "privileged occasion" and the qualified privilege defense is inapplicable. Second, plaintiff contends that the defense of qualified privilege, if it existed, was lost by excessive publication and malice on the part of Holthusen and Erbe. Third, plaintiff contends that the nature and manner in which the statements were published amount to extreme and outrageous conduct on the part of defendants so as to entitle plaintiff to a trial on his cause of action for intentional infliction of emotional distress. We reject plaintiff's arguments and affirm the trial court's order.

A trial court shall grant summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that any party is entitled to a judgment as a matter of law." G.S. 1A-1, Rule 56(c); Keesing v. Mortgage Corp., 278 N.C. 523, 180 S.E.2d 823 (1971). In ruling on the motion, the court must consider the evidence in the light most favorable to the non-movant. Walker v. Westinghouse Electric Corp., 77 N.C.App. 253, 335 S.E.2d 79 (1985), disc. rev. denied, 315 N.C. 597, 341 S.E.2d 39 (1986). The non-movant must be given all favorable inferences which may reasonably be drawn from the facts proffered. English v. Realty Corp., 41 N.C.App. 1, 254 S.E.2d 223, disc. rev. denied, 297 N.C. 609, 257 S.E.2d 217 (1979); Whitley v. Cubberly, 24 N.C. App. 204, 210 S.E.2d 289 (1974). Therefore, any documents presented which support the movant's motion must be strictly scrutinized while the non-movant's papers are regarded with indulgence. Miller v. Snipes, 12 N.C.App. 342, 183 S.E.2d 270, cert. denied, 279 N.C. 619, 184 S.E.2d 883 (1971).

The record contains two affidavits which are in direct conflict with each other. Kennedy's affidavit, furnished by plaintiff, states that Kennedy never talked to Holthusen and that Holthusen was resentful and bitter toward plaintiff. Holthusen's affidavit, furnished by defendant, states that Kennedy told him that plaintiff and others had sexual relations with a minor female patient and that he reported the story to his supervisor after normal working hours.

It is apparent to this court that plaintiff has attempted to put forth two conflicting arguments. On the one hand, plaintiff has argued that defendants are liable under respondeat superior because Holthusen was acting within the scope of his employment. On the other hand, plaintiff has argued that defendant's employee, Holthusen, was motivated by malice and resentment. *668 If we accept Kennedy's statement, Holthusen would be outside the scope of his employment and defendants are not liable under the doctrine of respondeat superior. If we accept Holthusen's statement, he would be within the scope of employment and the defense of qualified privilege would apply. Defendant is entitled to summary judgment under either theory.

To be within the scope of employment, an employee, at the time of the incident, must be acting in furtherance of the principal's business and for the purpose of accomplishing the duties of his employment. Hogan v. Forsyth Country Club Co., 79 N.C.App. 483, 340 S.E.2d 116, disc. rev. denied, 317 N.C. 334, 346 S.E.2d 140 (1986). If an employee departs from that purpose to accomplish a purpose of his own, the principal is not liable. Id. If we assign every favorable inference to Kennedy's affidavit and thus accept it as true, then Holthusen's statements to Davis were to further a malicious purpose of his own and are thus outside the scope of his employment.

Even if we accepted Gregory Holthusen's affidavit that he was acting out of concern for patient welfare and found him to be within the scope of his employment, defendant would still be entitled to summary judgment because Holthusen then had a qualified privilege for his allegations regarding plaintiff.

`A qualified or conditionally privileged communication is one made in good faith on any subject matter in which the person communicating has an interest, or in reference to which he has a right or duty, if made to a person having a corresponding interest or duty on a privileged occasion and in a manner and under circumstances fairly warranted by the occasion and duty, right or interest.'

Gibby v. Murphy, 73 N.C.App. 128, 132-133, 325 S.E.2d 673, 676 (1985), quoting, Stewart v. Check Corp., 279 N.C. 278, 285, 182 S.E.2d 410, 415 (1971). A "privileged occasion" arises "`when for the public good and in the interests of society one is freed from liability that would otherwise be imposed on him by reason of the publication of defamatory matter.'" Ponder v. Cobb and Runnion v. Cobb and Rice v. Cobb, 257 N.C. 281, 295, 126 S.E.2d 67, 78 (1962), quoting 53 C.J.S., Libel and Slander, section 87, pp. 142 and 143.

The health care industry plays a vital and important role in our society. It plays a critical part in helping us to maintain our physical and mental well-being. We as a society, therefore, are interested in the quality and trustworthiness of the care which the medical community provides.

In response to society's concern, defendants, as owners and operators of medical facilities, have an interest in fostering public confidence in their ability to provide safe and expert patient care and treatment. Part of the task of fostering such confidence involves hiring and maintaining a skilled and trustworthy staff and investigating any allegations of patient abuse or mistreatment by members of that staff. Thus, the statements made by the employees (other than Holthusen) of Mandala and Charter Medical in investigating the charges of sexual misconduct were privileged.

Holthusen, an employee of defendant who was directly responsible for patient care, had an ethical if not employment-based duty to report any allegations of abuse. If his affidavit is taken as true, he was protecting the public interest as well as the interests of the patients and defendants. In this context, the allegations reported by Holthusen to his immediate supervisor and to similarly interested personnel were made on a "privileged occasion." If he was within the scope of his employment, he had qualified privilege. Additionally, because Holthusen, according to his affidavit, was acting to further defendants' business, he would be within the scope of his employment and the privilege which freed him of liability would be imputed to defendants. See generally Morrison v. Kiwanis Club, 52 N.C.App. 454, 279 S.E.2d 96, disc. rev. denied, 304 N.C. 196, 285 S.E.2d 100 (1981).

*669 On previous occasions our courts have held that allegations made during the course of investigations are privileged. See Jones v. Hester, 260 N.C. 264, 132 S.E.2d 586 (1963) (corporate president's investigation of employee held to be privileged); Hartsfield v. Hines, 200 N.C. 356, 157 S.E. 16 (1931) (defendant's investigation of corporate mismanagement held to be privileged); Gattis v. Kilgo, 140 N.C. 106, 52 S.E. 249 (1905) (investigation of charges against college president by board of trustees held to be privileged); Pressley v. Can Company, 39 N.C.App. 467, 250 S.E.2d 676, disc. rev. denied, 297 N.C. 177, 254 S.E.2d 37 (1979) (employment evaluation report by defendant's agent and sent to defendant's manager held to be privileged). The undisputed facts here make clear the privileged nature of the communications made by Erbe, the hospital administrator. The record shows that Erbe only made statements regarding plaintiff to protective services, an agency to which he was legally bound to report (See G.S. 7A-543), to the police, to supervisory personnel at Charter Medical and to personnel who were part of the investigation process.

Plaintiff has asserted that defendants' qualified privilege was lost because of Erbe's malice toward plaintiff and excessive publication. We do not agree. Plaintiff has put forth no evidence that Erbe spoke to anyone outside of those who had a corresponding interest in the communication and were part of the investigative process. Nor did he provide any evidence to show malice other than an alleged statement by Erbe to plaintiff that plaintiff was facing a possible prison term. On its face, such a statement can hardly be said to indicate malice.

Finally, plaintiff contends that statements made by defendants' employees and the alleged manner in which they were communicated constituted an intentional infliction of emotional distress. We disagree. The entire record is devoid of any evidence of outrageous conduct on the part of defendants' employees. To the contrary, the record shows that defendant's administrator received information concerning sexual abuse of a minor in its care. Erbe had a duty to the patients and to defendant to investigate these charges. He was further bound, under G.S. 7A-543, to report these allegations to protective services. All of the people with whom he spoke were part of the investigative process. Given these circumstances, Erbe's conduct cannot be considered outrageous or extreme. Plaintiff relies on Falwell v. Flynt, 797 F.2d 1270, reh'g denied, 805 F.2d 484 (4th Cir.1986). That opinion was recently reversed, Falwell v. Flynt, ___ U.S. ___, 108 S. Ct. 876, 99 L. Ed. 2d 41 (1988), and does not apply to the facts before this court. Defendants herein did not publish the allegations of sexual misconduct to the general public intending to expose plaintiff to public ridicule. Defendants here conducted a confidential and necessary investigation to protect patients under their care.


HEDRICK, C.J., and BECTON, J., concur.

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