• Key point. Statements made to others concerning a matter of common interest generally are protected by a “qualified privilege,” meaning that they cannot be defamatory unless made with malice. Statements are made with legal malice if they are made with a knowledge that they are false, or with a reckless disregard as to their truth or falsity.

A Texas court ruled that a church was not liable for defaming a former secretary as a result of statements made to church members claiming that she had misappropriated church funds. A church operated a private school. Its minister of education, who also served as principal of the school, resigned after admitting that he misappropriated church funds, destroyed church records, forged signatures, and committed other criminal acts. He later pleaded guilty to criminal charges for his admitted conduct in misappropriating school funds. He informed the church that a woman who served as a secretary at the school participated in the misappropriations. After an audit confirmed the principal’s accusations the church asked the secretary to resign. The church published: (1) a letter to its members claiming that the secretary misappropriated school funds; (2) a letter to the school children’s parents claiming that the secretary deposited tuition funds into the wrong accounts and later used the funds for her personal benefit; destroyed checks, financial records, and bank records; forged signatures; covered up these indiscretions; received seventy dollars extra per pay period for nearly two years as well as other undocumented “reimbursements”; and (3) a report to the church members reporting the secretary’s resignation and claiming that she deposited tuition funds into the wrong account and then used the funds to support programs and individuals outside of and over the budget adopted by the congregation. At a meeting of church members, church officials orally accused the secretary of depositing tuition funds into the wrong account and then using the funds for her personal benefit or for other people or projects as she and the principal saw fit; destroying checks, bank records, and financial records; forging signatures; and covering up many of these indiscretions. The secretary later sued the church and the individual members of the church audit committee, claiming that the church’s actions defamed her, placed her in a false light, and inflicted emotional distress. A trial court dismissed the lawsuit, and the secretary appealed. A state appeals court agreed with the trial court’s decision. Its analysis of the secretary’s three claims is summarized below.

defamation

The court noted that a statement is defamatory if it is “published” or communicated (orally or in print) to third persons, and “tends to harm the reputation of another so as to lower him in the estimation of the community or to deter third persons from associating or dealing with him, or if it tends to expose him to public hatred, contempt, or ridicule.” However, the court pointed out that some words that otherwise might be defamatory may be “legally excused.” This includes the defense of qualified privilege. The court defined this exception to defamation as follows:

A privilege will be granted to statements that occur under circumstances wherein any one of several persons having a common interest in a particular subject matter may reasonably believe that facts exist that another, sharing that common interest, is entitled to know. A qualified privilege attaches to bona fide communications, oral or written, upon any subject in which the author or the public has an interest or with respect to which the author has a duty to perform to another owing a corresponding duty. This privilege is termed conditional or qualified because a person availing himself of it must use it in a lawful manner and for a lawful purpose. The effect of the privilege is to justify the communication when it is made without actual malice. Thus, when a statement is privileged, Texas law requires a showing of actual malice to overcome that privilege. Actual malice means with knowledge that the statement was false or with reckless disregard of whether it was false. Reckless disregard requires proof that a false defamatory statement was made with a high degree of awareness of its probable falsity. Generally, when publication is made under circumstances creating a qualified privilege, the plaintiff has the burden to prove malice …. Malice exists when the evidence shows that the speaker entertained serious doubts as to the truth of his statements.

The court concluded that the evidence “conclusively showed” that the church acted without malice and in good faith, and therefore was protected by the qualified privilege. It observed:

All of the members of [the church] have a common interest in the church’s use of their financial contributions to the church; thus, the members have a common interest in information about those funds. The members who made the statements in question reasonably believed that the misappropriation took place and that the board, the members, and the parents shared a common interest in the use of the funds and information about those funds. [The church] reasonably believed that these people were entitled to know of the misappropriation. [It] had a duty to perform for the board, the members, and the parents. [It] made the communications without actual malice. [The principal] confessed his and [the secretary’s] involvement, and [he] later pleaded guilty to criminal charges. [The church’s] audit confirmed all of [his] statements. [The secretary] never swore under oath in an affidavit in opposition to summary judgment that the statements were lies. [She] kept the misappropriated funds in a shoe box in her closet and returned the funds when accused. [The principal] testified that the statements were true. [The secretary] admits receiving personal benefit from the misappropriation of funds. [She] admits she destroyed records. [The church] neither entertained serious doubts as to the truth of the statements nor made these statements with a high degree of awareness of their probable falsity. The communications appeared accurate, [the church] reasonably believed [the principal], and church members and parents who received information had an interest in the funds and information about the funds.

false light

The court also rejected the secretary’s claim that the church invaded her privacy by placing her in a “false light.” It noted that the Texas Supreme Court “recently held that the claim of false light invasion of privacy does not exist in Texas, even though several Texas courts of appeals and several federal courts interpreting Texas law previously recognized this claim.”

emotional distress

The court rejected the secretary’s claim that the church’s actions amounted to an intentional infliction of emotional distress. The court noted that the elements of an intentional infliction of emotional distress claim are (1) the defendant acted intentionally or recklessly; (2) the conduct was extreme and outrageous; (3) the actions of the defendant caused the victim emotional distress; and (4) the emotional distress suffered by the victim was severe. The court stressed that liability should be found “only when 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.” The court conceded that the church depicted the secretary as a “thief,” but concluded that this statement was not “sufficiently outrageous” to demonstrate an intentional infliction of emotional distress.

Application. This case illustrates the limited but important protection that is granted to churches in many states when sharing matters of common interest with church members. In many states, such comments cannot be defamatory unless made with malice. As this case illustrates, this is a difficult standard to meet. However, it is important to note that the privilege does not extent to communications made to nonmembers, or to matters that in fact are not of “common interest” to members. Churches can lose the protection of the qualified privilege by making statements during church services that are attended by members and nonmembers alike. To repeat, the law provides substantial protection to churches when sharing information of common interest to members. But, this protection does not apply when the communication is directed to nonmembers having no legitimate interest in the content of the communication. Hanssen v. Our Redeemer Lutheran Church, 938 S.W.2d 85 (Tex. App. 1997). [ Defamation, Invasion of Privacy]

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