Thelma Crais v. Neal Haynes, et al.--Appeal from 40th District Court of Ellis County

IN THE

TENTH COURT OF APPEALS

No. 10-93-078-CV

THELMA CRAIS,

Appellant

v.

NEAL HAYNES, ET AL.,

Appellees

From the 40th District Court

Ellis County, Texas

Trial Court # 91-04-47,535

O P I N I O N

Thelma Crais appeals a judgment notwithstanding the verdict rendered in favor of Neal Haynes, president of Mountain Peak Water Supply Corporation, and Joe Lee, a member of the board or directors of Mountain Peak. Because we find that Haynes and Lee, defendants below, were not entitled to judgment as a matter of law, and reasonable minds could differ as to the truth of the controlling facts, we will reverse the judgment n.o.v. and render judgment for Crais based on the jury's verdict.

FACTUAL BACKGROUND

Crais sued her former employer Mountain Peak as well as two members of the board of directors, Neal Haynes and Joe Lee, for defamation, "false light" invasion of privacy, and intentional infliction of emotional distress. Mountain Peak is a water cooperative that supplies water to over a thousand members in the Midlothian area. Crais began working for Mountain Peak in May 1985. She basically ran the cooperative's office with the aid of a part-time assistant, Ellen Prewitt. She also handled the payments customers made on water bills as a part of her responsibilities.

In December 1990, Alicia Barron, a member of the cooperative, telephoned Crais at the Mountain Peak office to complain that someone had altered her most recent water payment check by adding a $6.00 late charge that Barron insisted she did not owe. She told Crais that, after receiving her check in her bank statement, she noticed that the amount of the check had been altered from $31.10 to $37.10. Crais assured Barron that she would investigate the problem. Ellen Prewitt assured Crais that she had not altered Barron's check. Crais then located a photocopy of the check maintained in Mountain Peak's records and all of the records pertinent to Barron. She informed Neal Hayes, her immediate supervisor, of Barron's complaint when he returned to the office the following day. Crais handed the documents she had gathered over to Haynes. Both Crais and Prewitt testified that Haynes leafed through the documents and ordered Crais to "file the matter," which she did.

Barron took no further action concerning the check until mid-March 1991, when she contacted Joe Lee, showed him the check, and complained that she had received no response to her inquiry, though she owed no late charges. Barron furnished Lee with copies of the check two days later, and Lee gave the copies to Haynes. When Haynes was questioned by Lee as to what they should do, Haynes indicated that the matter would have to be decided by the board of directors.

On March 14, Lee and Haynes talked with Crais about the altered check. Haynes, holding a copy of the check, indicated that they needed to resolve the problem because Barron intended to file a complaint with the district attorney's office. Crais then presented Haynes with the information and documentation she had gathered. Crais testified that, while Haynes reviewed the materials she had handed him, Lee twice accused her of altering the check and also questioned her right to receive bonuses and reimbursement for company expenses. When Crais told Lee that he was a troublemaker, he responded by drawing back his fist and telling Crais that "if she were a man he would take her out back and show her what he was." She then copied the file for Haynes and told him that she would provide him with a written account of what had occurred thus far. Crais testified that she had not been asked whether she had altered the check and felt "frightened" and "terrible" following this encounter with Lee and Haynes.

On Friday, March 15, Barron stopped by Lee's home and requested that he take her to the Ellis County district attorney's office so that she could file charges against Crais. Lee called Haynes, and Haynes accompanied them to the district attorney's office. Haynes testified that, as president of the company, he needed to know what went on. Although both Lee and Haynes were aware of the purpose of their trip, neither attempted to talk Barron out of filing criminal charges against Crais. At this time, Haynes had not brought the matter to the Mountain Peak board's attention, nor had Haynes discussed the altered check with Barron.

Upon arriving at the district attorney's office, they were directed to the county jail to speak with the sheriff. Lee and Haynes introduced themselves to a deputy as a director and the president of Mountain Peak. Haynes informed the deputy that Barron had a problem with an altered check and that she believed it had been changed by the secretary at Mountain Peak, who had been the only person in the office the day Barron's payment had been posted. Haynes identified the secretary as Thelma Crais and gave the deputy the documents he had collected. The deputy then informed them that Barron would have to file her complaint with the Midlothian police department.

That same afternoon, Crais received a telephone call at work from a customer who informed her that the police had been dispatched to the Mountain Peak office. Over the weekend, Crais received a call from another Mountain Peak board member who told her that he had been contacted by Haynes concerning a special board meeting in which Haynes intended to have Crais fired.

On Monday, March 19, Lee drove Barron to the Midlothian police station where they met with Lieutenant Fowler. Lieutenant Fowler testified that Lee had introduced himself as a Mountain Peak board member and that he had the definite impression that Lee was acting on behalf of Mountain Peak. Lee had voluntarily given to Lieutenant Fowler Crais' time card, which reflected that she was the sole employee in the office on the date the check had been posted. According to Fowler, Lee assured him that Crais was the only person who had had the opportunity to alter the check, that she should already have been fired over the matter, and that he fully supported Barron in filing her complaint.

Fowler testified that, because he did not believe Crais had altered the check, he inquired of Barron whether she might not settle the problem without filing charges. Barron told him that she would not withdraw her forgery complaint unless Crais was terminated. Fowler testified that he contacted the bank and spoke with the commercial teller who told him that Crais had deposited the check.

Lee drove Barron home after she filed charges. Lee then returned to the police department with Barron's check register, which reflected that the amount of the check in question had been recorded as $31.10. As a result, Fowler contacted Crais the following day to inform her that Barron had filed a complaint and that she was charged with passing a forged instrument. He indicated that the matter would be referred to the grand jury and that Crais needed to seek legal advice. Crais testified that she became extremely upset as a result of her phone conversation with Lieutenant Fowler and believed her life had been destroyed.

The Mountain Peak annual stockholders meeting was held on April 2, with between thirty and forty directors, employees, shareholders and members of the community present. The topic of Crais' problem arose when Ellen Prewitt, Crais' assistant, asked whether Mountain Peak would pay Crais' legal expenses. The question was never answered. Haynes responded only that he had spoken with a police officer regarding the charges and that Crais' guilt or innocence would be determined by a grand jury. Crais objected to this discussion of her guilt or innocence as an invasion of her privacy. Nevertheless, the board continued to discuss the issue. Lee commented that he wanted Crais fired and that now the board had a reason to fire her. Crais testified that Lee told her that if it took ten years, "he would get me fired. `I hired you and I'll fire you.'" Lee had long been resentful of her, Crais claimed, because she had successfully blocked his son's attempt to become a Mountain Peak board member.

Crais appeared before the grand jury near the end of April. The grand jury returned a "no bill." On June 4, she was terminated from her position with Mountain Peak.

The jury in the present case found that statements made by Neal Haynes and Joe Lee placed Crais in a false light, that both men intentionally inflicted emotional distress on Crais, that $75,000 would compensate Crais for her mental anguish that resulted from Haynes' and Lee's conduct, and that both men, by their conduct, acted willfully, intentionally, or with callous and reckless indifference to the rights of Crais. The jury failed to find, however, that either Haynes, Lee, or Mountain Peak slandered Crais. The jury was instructed that, for Crais to establish her claim of invasion of privacy by placing her before the public in a false light, she must prove that:

1.the defendants published or communicated to the public at large or to a significant number of individuals statements concerning Crais;

2.Crais was placed in a false light which would be highly offensive to a reasonable person; and

3.the defendants had knowledge, or acted in reckless disregard of the falsity of the publicized matter and the false light in which Crais would be placed.

STANDARD OF REVIEW

The trial court may disregard a jury's findings and grant a motion notwithstanding the verdict only when there is no evidence to support the findings. Tex. R. Civ. P. 301, 324(c); Mancorp, Inc. v. Culpepper, 802 S.W.2d 226, 227 (Tex. 1990); Exxon Corp. v. Quinn, 726 S.W.2d 17, 19 (Tex. 1987). In reviewing the granting of a motion for judgment n.o.v., we must determine whether the record contains any evidence upon which the jury could have made its findings. See id. We review the record in the light most favorable to the findings, considering only the evidence and inferences which support them and rejecting the evidence and inferences contrary to the findings. See Navarette v. Temple Indep. Sch. Dist., 706 S.W.2d 308, 309 (Tex. 1986); Williams v. Bennett, 610 S.W.2d 144, 145 (Tex. 1980). If the record contains more than a scintilla of competent evidence to support the jury's findings, the judgment n.o.v. must be reversed and the jury verdict reinstated. Southern States Transp., Inc. v. State, 774 S.W.2d 639, 640 (Tex. 1989); Navarette, 706 S.W.2d at 309.

The trial court, in entering the judgment n.o.v. in this case, expressly stated that the n.o.v. was proper as to the false light invasion of privacy and intentional infliction of emotional distress causes of action because the evidence was legally insufficient to support the verdict. We disagree.

FALSE LIGHT INVASION OF PRIVACY

Invasion of privacy may encompass the publication of a matter concerning someone that places them before the public at large in a false light, if the false light would be highly offensive to a reasonable person and one knew or acted in reckless disregard of the falsity of the publicized matter and the false light in which the other person would be placed. Restatement (Second) of Torts 652E (1977); Clarke v. Denton Publishing Co., 793 S.W.2d 329, 331 (Tex. App. Fort Worth 1990, writ denied); Gill v. Snow, 644 S.W.2d 222, 224 (Tex. App. Fort Worth 1982, no writ). For an objectionable remark to qualify as false light invasion of privacy, it must be given "publicity," which is more than merely being published to a third party. Industrial Foundation of the South v. Texas Indus. Accident Board, 540 S.W.2d 668, 683-84 (Tex. 1976), cert. denied, 430 U.S. 931, 97 S. Ct. 1550 (1977); Wilhite v. H.E. Butt Co., 812 S.W.2d 1, 6 (Tex. App. Corpus Christi 1991, no writ). "Publicity . . . means that the matter is made public, by communicating it to the public at large, or to so many persons that the matter must be regarded as substantially certain to become one of public knowledge." Restatement (Second) of Torts 652D, cmt. a (1977); Moore v. Big Picture Co., 828 F.2d 270, 273 (5th Cir. 1987). As Haynes and Lee acknowledge, there is no "bright line" test to determine how many people are necessary to constitute the public at large. As few as ten people may be deemed the public at large. Boyles v. Kerr, 806 S.W.2d 255, 258-61 (Tex. App. Texarkana 1991), reversed on other grounds, 855 S.W.2d 593 (Tex. 1993).

Lee and Haynes do not attempt to argue that the tort of false light invasion of privacy is not a recognized cause of action in Texas. See Diamond Shamrock Refining and Marketing Co. v. Mendez, 844 S.W.2d 198, 199 (Tex. 1992). Although the Supreme Court has never expressly held that such a tort exists in Texas, that court has recognized that it is one of the four usual categories of private actions for invasion of privacy. Id.; Industrial Foundation of the South, 540 S.W.2d at 682. The objectionable statement need not be defamatory but must merely be false or capable of conveying a false impression. Braun v. Flynt, 726 F.2d 245, 253 (5th Cir.), cert denied sub nom., Chic Magazine, Inc. v. Braun, 469 U.S. 883, 105 S. Ct. 252 (1984). The trial court must make the threshold determination that the publication in question is capable of conveying a false meaning; whether the publication actually places the subject in a false light is a question of fact for the jury. Id. The factfinder must consider the communication in its full context, in light of its implications and overall effect. The context and manner in which a statement appears determine to a great extent the impact it will have on others. Braun, 726 F.2d at 254; Mitre v. Brooks Fashion Stores, Inc., 840 S.W.2d 612, 622 (Tex. App. Corpus Christi 1992, writ denied).

By allowing the case to go to the jury, the court made the affirmative threshold determination that Crais' claim constituted a viable cause of action in Texas and that the publication in question was capable of conveying a false meaning. See Braun, 726 F.2d at 253. However, in granting the n.o.v. based upon the legal insufficiency of the evidence, the court disregarded the role of the factfinders and, in essence, found no evidence that the publication actually placed Crais in a false light. See id.

As summarized above, more than a scintilla of evidence supports the jury's finding that Crais had been placed in a false light. Lee and Haynes ignored Crais' protestations that the public discussion of her guilt or innocence at the shareholders' meeting invaded her right to privacy. When considered as a whole, this discussion, as well as the community's knowledge of the accusations against Crais of having altered a customer's check, portrayed her as a person of questionable character and integrity and as someone who had been engaged in or was capable of criminal conduct. Lee's statement at the shareholder's meeting, before the grand jury's decision had been made, that she should be fired now that they had a reason to fire her, and the fact that it arose because of what the evidence shows was a lengthy and well-known personal vendetta between Lee and Crais, further enhanced the implication that she was guilty of passing a forged instrument. Hayes' additional comment at the meeting that her guilt or innocence would be determined by a grand jury only served to bolster the allegations in the mind of the public. Crais' daughter testified that she had been informed by a former schoolmate that rumors were circulating in the community that Crais was embezzling money. Ellen Prewitt, Crais' co-worker at Mountain Peak, testified that the allegations had been discussed in the community and were a matter of public knowledge.

Likewise, more than a scintilla of evidence supports the jury finding that Lee and Hayes had knowledge of, or acted in reckless disregard of, the falsity of the offensive statements and the false impression people would have of Crais as a result. The allegations imputed guilt and cast doubt upon Crais' moral character. At the time of the annual meeting, Lee was aware that no grand jury decision had been made concerning Crais; nevertheless, he urged the Mountain Peak board to discharge her because now they "had a reason to fire her." The grand jury later no-billed the case. This discussion continued at the meeting in spite of Crais' protests. In addition, though both Haynes and Lee knew that Barron intended to file a complaint with the district attorney, neither brought the problem to the attention of the Mountain Peak Board prior to charges being filed in mid-March 1991. No one connected with Mountain Peak conducted a thorough investigation of the complaint. Haynes, the board president, made no effort to speak with Barron prior to accompanying her to the D.A.'s office, nor did he attempt to resolve her complaint in an amicable manner but rather aided and abetted Barron's determination to file formal charges against Crais. Based on the evidence, the jury could have reasonably believed that neither Lee nor Haynes was concerned whether the allegations were true and the impact they might have upon Crais in the community. Their actions constitute more than a scintilla of evidence to support the jury's finding of malice. Accordingly, we reverse the trial court's judgment n.o.v. to the extent it disregarded the jury's findings of the elements of false light invasion of privacy and reinstate those findings on that cause of action.

INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS

In point two, Crais contends that the trial court erred in granting judgment n.o.v. on Crais' claim for intentional infliction of emotional distress. Subsequent to judgment being rendered in this case, the Supreme Court expressly recognized intentional infliction of emotional distress as an independent tort in Texas. See Twyman v. Twyman, 855 S.W.2d 619, 621 (Tex. 1993). The Supreme Court adopted the elements of the tort as expressed in the Restatement (Second) of Torts 46 (1965) and as set forth in Tidelands Automobile Club v. Walters, 699 S.W.2d 939 (Tex. App. Beaumont 1985, writ ref'd n.r.e.): (1) the defendant acted intentionally or recklessly; (2) the conduct was extreme and outrageous; (3) the actions of the defendant caused the plaintiff emotional distress; and (4) the emotional distress suffered by the plaintiff was severe. Id. The charge submitted to the jury in this case included each of these elements. According to the Restatement, liability for outrageous conduct should be found "only where the conduct has been so outrageous in character and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community." Restatement (Second) of Torts 46 (1965); Twyman, 855 S.W.2d at 621; Wornick Co. v. Casas, 856 S.W.2d 732, 734 (Tex. 1993).

As with Crais' claim for false light invasion of privacy, the court granted judgment n.o.v. on her emotional distress claim on the grounds that the evidence was legally insufficient to support the verdict. Therefore, the standard of review discussed in conjunction with point one applies here as well; that is, the judgment n.o.v. may be upheld only if the record contains no evidence of probative force upon which the jury could have based it's verdict. See Ortiz v. Flintkote Co., 761 S.W.2d 531, 534 (Tex. App Corpus Christi 1988, no writ). All evidence must be viewed in the light most favorable to the jury's findings, and only the evidence and inferences which support the verdict may be considered. Id.; White v. Southwestern Bell Telephone Company, Inc., 651 S.W.2d 260, 262 (Tex. 1983).

In addition to the testimony outlined above, Crais stated that she became frightened and "very upset" as a result of the accusations and Lee's threatening behavior toward her. Although it was chiefly Haynes' responsibility as president of the Mountain Peak board to bring the matter to the board's attention, especially after Lee informed him that Barron intended to file a complaint with the district attorney, Haynes made virtually no investigation of the problem and did not discuss the complaint with Barron. Furthermore, Haynes wholly failed to try to settle the problem short of filing a formal complaint with the authorities. Nor did he discourage Lee from assisting Barron.

The same day that Lee and Haynes met with the sheriff's department and provided them with the documentation Haynes had been given by Crais, Crais received a telephone call at work from a customer who informed her that the police had been dispatched to the Mountain Peak office. During the following weekend, Crais was contacted by a board member who informed her that Haynes planned to call a special board meeting to have her terminated.

Lieutenant Fowler testified that at the time Lee produced Crais' time card, he stated that Crais was the only person who could have altered the check, that she should already have been terminated over the matter, and that he fully supported Barron in her filing of the official complaint.

Lieutenant Fowler contacted Crais the next to day to advise her that Barron had filed charges against her for altering the check. He told Crais that the matter would probably be referred to the grand jury, that she might be jailed, and that she needed to seek an attorney. Fowler and Crais both testified that she became very upset as a result of their conversation and feared that her life had been destroyed.

In late April 1991, Crais appeared before the grand jury to defend herself against Barron's allegations. Although the grand jury returned a no-bill, she had been required to discuss the charges with the grand jury, her husband, children, other family members, and the Texas Employment Commission. Furthermore, she was aware of the rumors in the community that she had embezzled money.

outrageous conduct intentional or reckless

Whether behavior is sufficiently outrageous to satisfy the requirements of intentional infliction of emotional distress is a question of fact for the jury as the sole judge of the credibility of the witnesses and the weight to be given their testimony. Massey v. Massey, 807 S.W.2d 391, 400 (Tex. App. Houston [1st Dist.] 1991, writ denied). The court is called upon to make only an initial determination whether the defendant's conduct may be regarded as so outrageous as to permit recovery. Guzman v. El Paso Natural Gas Co., 756 F. Supp. 994, 1002 (W.D. Tex. 1990); Tidelands Automobile Club, 699 S.W.2d at 945.

The jury could have reasonably believed from the evidence that both men acted with substantial certainty that Crais would be emotionally harmed or at least acted recklessly of that likelihood, and that they nevertheless persisted in acting in conscious disregard of, or with indifference to, such risk. See Twyman v. Twyman, 855 S.W.2d at 621. From their conduct of Lee and Haynes as described above their total failure to even attempt to mitigate or diffuse the situation or to leave the problem to be solved in its entirety by the legal system running its course the jury could have reasonably inferred from the evidence that their actions were outrageous in that they were anything but inadvertent. See id. at 622. The jury was free to disbelieve the protests of Lee and Haynes that they intended no harm and to draw the necessary inferences to establish intent, especially in light of the fact that the alleged "forgery" involved no more than $6.00. Id. at 623.

Crais was openly accused of criminal activity. Lee accused Crais of altering Barron's check in a public, face-to-face confrontation and further informed the authorities that Crais could be the only suspect, though he had not investigated the matter himself. The jury could have reasonably believed from the evidence that both Lee and Haynes, acting in official capacities but without board authority, assisted Barron in filing the criminal charges. In total disregard of their duties as officers and directors of Mountain Peak to protect the corporation from potential exposure and liability, they used their positions in an effort to make it appear that Barron had the full backing of Crais' employer, thus emphasizing Crais' apparent culpability. Finally, both Haynes and Lee discussed the charges in public and tried to use them as a basis for persuading the board to terminate Crais. The only evidence "against" Crais consisted of her own time card, that she had been the only person present in the Mountain Peak office on the date the check was posted. The actions taken by Lee and Haynes far exceed what might be characterized as insults or indignities or merely employment disputes. See Johnson v. Merrell Dow Pharmaceuticals, Inc., 965 F.2d 31, 33 (5th Cir. 1992); Horton v. Montgomery Ward & Co., Inc., 827 S.W.2d 361, 369 (Tex. App. San Antonio 1992, writ denied). The evidence raised a fact issue concerning intentional or reckless outrageous conduct, and the record contains more than a scintilla of probative evidence to support the jury's findings.

emotional distress

Finally, to recover for mental anguish, one must prove severe, painful emotions such as indignation, shame, despair, wounded pride, or public humiliation. Mitre v. Brooks Fashion Stores, Inc., 840 S.W.2d at 621. Although proof of physical injury is no longer required to sustain a recovery, the emotional pain or distress inflicted must be so acute that no reasonable person could be expected to endure it without experiencing unreasonable suffering. Havens v. Tomball Community Hospital, 793 S.W.2d 690 (Tex. App. Houston [1st Dist.] 1990, no writ); Mitre v. Brooks Fashion Stores, Inc., 840 S.W.2d at 621.

Public humiliation and fear of harm to one's reputation within the community have been held sufficient to constitute distress severe enough to support a claim for intentional infliction of emotional distress. Id. Similarly, insomnia and inability to concentrate may comprise sufficient evidence to support a claim of severe emotional distress. Dean v. Ford Motor Credit Co., 885 F.2d 300, 307 (5th Cir. 1989). In a case in which the plaintiff admitted that he wasn't sure if he wished to go on living and that he was depressed and frustrated, the jury's verdict for intentional infliction of emotional distress was upheld. American Medical International, Inc. v. Giurintano, 821 S.W.2d 331, 343-44 (Tex. App. Houston [14th Dist.] 1991, no writ).

Crais own testimony, including her adamant denial that she altered the check, provided evidence that she had suffered unbearable embarrassment and shame because of the accusations and the manner in which the matter was handled. Crais stated that she is of German descent, fifty-nine years of age, and that the mere accusation destroyed her own honor and that of her family and friends. Crais testified that her family and friends did not stand behind her throughout the ordeal. She considered her life destroyed she had never incurred so much as a traffic ticket before. She believed that she had been unable to find a new job because of being fired from Mountain Peak.

Crais' daughter and co-workers testified that her personality and behavior changed drastically following the check incident. According to her daughter, she became irritable and withdrawn. She cried frequently and got to the point where she refused to leave her home. She consulted a psychologist, Dr. Michael Glick, who decided that Crais was suffering from a form of post-traumatic stress disorder and depression which necessitated continuing treatment. Dr. Glick attributed Crais' symptoms to the abuse and harassment she experienced while employed at Mountain Peak. Her co-worker, Ellen Prewitt, testified that Crais appeared to be ashamed and that people no longer trusted her. She considered her to be dysfunctional and explained that she had withdrawn from her friends and family and refused to take part in normal activities. Dr. Glick enumerated her numerous physical symptoms, which included pounding heart, trembling and shaking, indigestion, fatigue, recurrent nightmares, diarrhea, breathing trouble, mental confusion, inability to concentrate and focus on a specific task, frequent crying and chronic depression with thoughts of suicide. He became concerned enough about both her physical and emotional well-being that he developed a contingency plan to hospitalize her if it became necessary. We sustain Crais' second point of error.

CONCLUSION

Having reviewed the record under the applicable standard of review, and finding some competent evidence to support the jury's verdict, we reverse the court's judgment notwithstanding the verdict, reinstate the verdict, and render judgment for Crais in accordance with the jury findings.

BOBBY L. CUMMINGS

Justice

Before Chief Justice Thomas,

Justice Cummings, and

Justice Vance

Reversed and rendered

Opinion delivered and filed February 23, 1994

Do not publish