L. Gene ALLARD, Plaintiff, Cross-Defendant and Respondent,
v.
CHURCH OF SCIENTOLOGY OF CALIFORNIA, Defendant, Cross-Complainant and
Appellant.
Civ. 45562.
Court of Appeal, Second District, Division 2, California.
May 18, 1976.
Hearing Denied July 15, 1976.
Plaintiff brought action against defendant church for malicious prosecution,
and defendant brought cross complaint for conversion. The Superior Court, Los
Angeles County, Parks Stillwell, J., entered judgment on verdict awarding
plaintiff compensatory and punitive damages and, from a judgment for plaintiff
and against defendant on cross complaint, defendant appealed. The Court of
Appeal, Beach, J., held that defendant was not deprived of a fair trial on
ground of prejudicial misconduct by plaintiff's trial counsel, that procedure
and verdict below did not constitute a violation of defendant's First Amendment
free exercise of religion, that question as to whether inferences could be
drawn that defendant, through its agents, was carrying out its own policy of
fair game in its criminal actions against plaintiff was for jury, that trial
court's voir dire of prospective jurors was not improper by reason of alleged
failure to question jurors as to their religious prejudices or attitudes, that
it was not prejudicial error to direct jury, in its assessment of malicious
prosecution claim, to disregard evidence that plaintiff stole travelers' checks
from defendant, that award of $50,000 compensatory damages was proper, and that
plaintiff was entitled to punitive damages, but that award of punitive damages
would be reduced to $50,000 under circumstances.
Affirmed as modified.
[1] APPEAL AND ERROR
When the evidence on appeal is very conflicting, the Court of Appeal must
relate those facts supporting the successful party and disregard the facts to
the contrary.
[1] APPEAL AND ERROR
When the evidence on appeal is very conflicting, the Court of Appeal must
relate those facts supporting the successful party and disregard the facts to
the contrary.
[2] TRIAL
Though several of individual statements and questions made by plaintiff's trial
counsel were inappropriate, where there often were no objections by counsel for
defendant when an objection and subsequent admonition would have cured any
defect, or there was an objection and trial court judiciously admonished jury
to disregard comment, there was no prejudicial conduct by plaintiff's trial
counsel, and defendant was not deprived of a fair trial.
[2] TRIAL
Though several of individual statements and questions made by plaintiff's trial
counsel were inappropriate, where there often were no objections by counsel for
defendant when an objection and subsequent admonition would have cured any
defect, or there was an objection and trial court judiciously admonished jury
to disregard comment, there was no prejudicial conduct by plaintiff's trial
counsel, and defendant was not deprived of a fair trial.
[3] ESTOPPEL
A party whose reprehensible acts are the cause of harm to another and the
reason for the lawsuit by the other cannot be heard to complain that its
conduct is so bad that it should not be disclosed.
[4] RELIGIOUS SOCIETIES
Evidence of policy statements and other peripheral mention of practices of
defendant church was admissible in action for malicious prosecution where
members of church were allowed to trick, sue, lie to, or destroy "enemies" and,
if plaintiff was considered to be an enemy as claimed, policy was relevant to
credibility issues.
[5] CONSTITUTIONAL LAW
Introduction of evidence of policy statements and other peripheral motion of
practices of defendant church did not constitute a violation of defendant's
First Amendment free exercise of religion in action for malicious prosecution
where members of church were allowed to trick, sue, lie to, or destroy
"enemies" and, if plaintiff was considered to be an enemy as claimed, policy
was relevant to issues of credibility. U.S.C.A.Const. Amend. 1.
[6] MALICIOUS PROSECUTION
Whether officer of defendant church was within scope of his employment when he
lied about plaintiff's alleged theft from a safe and whether inferences could
be drawn that defendant, through its agents, was carrying out a policy of fair
game in its actions against plaintiff were questions of fact for jury in action
for malicious prosecution.
[7] JURY
Trial court's thorough questioning of prospective jurors as to whether they had
any belief or feeling toward any of the parties that might be regarded as a
bias or prejudice for or against any of the parties was not improper in action
against church for malicious prosecution, notwithstanding claimed failure to
question prospective jurors as to their religious prejudice or attitudes, where
questioning served purpose of voir dire, which was to select a fair and
impartial jury, not to educate jurors or to determine exercise of peremptory
challenges.
[8] APPEAL AND ERROR
It was not prejudicial error to direct jury, in its assessment of malicious
prosecution claim against defendant church, to disregard evidence that
plaintiff purportedly stole travelers' checks from defendant.
[9] APPEAL AND ERROR
Regardless of whether trial court in action for malicious prosecution was
justified in denying defendant's request for discovery of factual basis for
obtaining of a dismissal by district attorney of criminal case against
plaintiff, prejudicial error did not occur where, during trial, counsel for all
parties stipulated that criminal proceedings against defendant were terminated
in his favor by a dismissal by a judge of that court upon recommendation of
district attorney.
[10] LIBEL AND SLANDER
In matters of slander that are libelous per se, such as the charging of a
crime, general damages are presumed as a matter of law.
[11] MALICIOUS PROSECUTION
Damages in actions for malicious prosecution are similar to those in defamation
and, thus, damage to one's reputation can be presumed from a charge
that is libelous per se, i. e., that a person committed the crime of theft.
[12] APPEAL AND ERROR
Refusal to allow, in connection with issue of damages in action for malicious
prosecution, introduction of evidence on defendant's prior reputation was not
error, much less prejudicial error, in absence of an offer of proof from
defendant regarding such reputation.
[13] MALICIOUS PROSECUTION
Presumed damage to plaintiff's reputation from an unfounded charge of theft
leveled by defendant, along with imprisonment for 21 days, and mental and
emotional anguish that must have followed were such as to justify a jury
finding of $50,000 in compensatory damages in action for malicious prosecution.
[14] MALICIOUS PROSECUTION
The jury in an action for malicious prosecution must have found knowledge of
falsity or reckless disregard for the truth in order to award punitive damages.
[15] MALICIOUS PROSECUTION
"Fair game" policy which was initiated by founder and chief official of
defendant church and which operated to authorize members of church to treat
"enemies" in such a manner as led to filing of criminal theft charge against
plaintiff was sufficient to establish ratification necessary for an award of
punitive damages.
[16] MALICIOUS PROSECUTION
Disparity between compensatory damages of $50,000 and punitive damages of
$250,000 suggested that jury may have been so enraged by defendant's conduct
toward plaintiff that award of punitive damages in action for malicious
prosecution may have been more the result of feelings of animosity, rather than
a dispassionate determination of an amount necessary to assess defendant in
order to deter it from similar conduct in the future; accordingly, award for
punitive damages would be reduced to $50,000.
[17] APPEAL AND ERROR
Claim that trial court instruction on probable cause in action for malicious
prosecution was prejudicially erroneous could not be raised for first time on
appeal.
[18] MALICIOUS PROSECUTION
While jurors in an action for malicious prosecution may consider that
magistrate at preliminary hearing in previous criminal matter found probable
cause for defendant's bringing charge against plaintiff, that should be in no
way conclusive of jurors' own determination of probable cause.
*443 **799 Morgan, Wenzel & McNicholas by Gerald E. Agnew, Jr., Charles
B. O'Reilly, Los Angeles, for plaintiff, cross-defendant and respondent.
Murchison, Cumming, Baker & Velpmen by Michael B. Lawler, Los Angeles, Tobias
C. Tolzmann, Honolulu, Hawaii, Joel Kreiner, Los Angeles, for defendant, cross-
complainant and appellant.
BEACH, Associate Justice.
L. Gene Allard sued the Church of Scientology for malicous prosecution.
Defendant cross-complained for conversion. A jury verdict and judgment were
entered for Allard on the complaint for $50,000 in compensatory damages and
$250,000 in punitive damages. Judgment was entered for Allard and against the
Church of Scientology on the cross-complaint. Defendant-cross complainant
appeals from the judgment.
FACTS:
[1] The evidence in the instant case is very conflicting. We relate those
facts supporting the successful party and disregard the contrary showing.
(Nestle v. City of Santa Monica, 6 Cal.3d 920, 925--926, 101 Cal.Rptr. 568,
496 P.2d 480.)
In March 1969, L. Gene Allard became involved with the Church of Scientology
in Texas. He joined Sea Org in Los Angeles **800 and was sent to San Diego
for training. While there, he signed a billion-year contract agreeing to do
anything to help Scientology and to help clear the planet of the 'reactive
people.' During this period he learned about written policy directives that
were the 'policy' of the Church, emanating from L. Ron Hubbard, the founder of
the Church of Scientology. [FN1] After training on the ship, respondent was
assigned to the Advanced Organization in Los Angeles, where he became the
director of disbursements. He later became the Flag Banking Officer.
FN1. One such policy, to be enforced against 'enemies' or 'suppressive
persons' was that formerly titled 'fair game.' That person '(m)ay be
deprived of property or injured by any means by any Scientologist without
any discipline of the Scientologist. May be tricked, sued or lied to or
destroyed.' (Exhibit 1.)
*444 Alan Boughton, Flag Banking Officer International, was respondent's
superior. Only respondent and Boughton knew the combination to the safe kept
in respondent's office. Respondent handled foreign currency, American cash,
and various travelers' checks as part of his job.
In May or June 1969, respondent told Boughton that he wanted to leave the
Church. Boughton asked him to reconsider. Respondent wrote a memo and later a
note; he spoke to the various executive officers. They told him that the only
way he could get out of Sea Org was to go through 'auditing' and to get direct
permission from L. Ron Hubbard. Respondent wrote to Hubbard. A chaplain of
the Church came to see him. Lawrence Krieger, the highest ranking justice
official of the Church in California, told respondent that if he left without
permission, he would be fair game and 'You know we'll come and find you and
we'll bring you back, and we'll deal with you in whatever way is necessary.'
On the night of June 7 of early morning of June 8, 1969, respondent went to
his office at the Church of Scientology and took several documents from the
safe. These documents were taken by him to the Internal Revenue Service in
Kansas City; he used them to allege improper changes in the records of the
Church. He denies that any Swiss francs were in the safe that night or that he
took such Swiss francs. Furthermore, respondent denies the allegation that he
stole various travelers' checks from the safe. He admitted that some
travelers' checks had his signature as an endorsement, but maintains that he
deposited those checks into an open account of the Church of Scientology.
There is independent evidence that tends to corroborate that statement.
Respondent, having borrowed his roommate's car, drove to the airport and flew
to Kansas City, where he turned over the documents to the Internal Revenue
Service.
Respondent was arrested in Florida upon a charge of grand theft. Boughton had
called the Los Angeles Police Department to report that $23,000 in Swiss francs
was missing. Respondent was arrested in Forida; he waived extradition and was
in jail for 21 days. Eventually, the charge was dismissed. The deputy
district attorney in Los Angeles recommended a dismissal in the interests of
justice. [FN2]
FN2. Leonard J. Shaffer, the deputy district attorney, testified outside
the presence of the jury that members of the Church were evasive in
answering his questions. He testified that the reasons for the dismissal
were set forth in his recommendation; the dismissal was not part of a plea
bargain or procedural or jurisdictional issue.
*445 CONTENTIONS ON APPEAL:
1. Respondent's trial counsel engaged in flagrant misconduct throughout the
proceedings below and thereby deprived appellant of a fair trial.
2. The verdict below was reached as a result of (a) counsel's ascription to
appellant of a religious belief and practices it did not have and (b) the
distortion and disparagement of its religious character, and was not based upon
the merits of this case. To allow a judgment thereby achieved to stand would
constitute a violation of appellant's free exercise of religion.
**801 3. Respondent failed to prove that appellant maliciously prosecuted
him and therefore the judgment notwithstanding the verdict should have been
granted.
4. The refusal of the trial court to ask or permit voir dire questions of
prospective jurors pertaining to their religious prejudices or attitudes
deprived appellant of a fair trial.
5. It was prejudicial error to direct the jury, in its assessment of the
malicious prosecution claim, to disregard evidence that respondent stole
appellant's Australian and American Express travelers' checks.
6. The order of the trial court in denying to appellant discovery of the
factual basis for the obtaining of a dismissal by the district attorney of the
criminal case People v. Allard was an abuse of discretion and a new trial
should be granted and proper discovery permitted.
7. Respondent presented insufficient evidence to support the award of $50,000
in compensatory damages which must have been awarded because of prejudice
against appellant.
8. Respondent failed to establish corporate direction or ratification and
also failed to establish knowing falsity and is therefore not entitled to any
punitive damages.
9. Even if the award of punitive damages was proper in this case, the size of
the instant reward, which would deprive appellant Church of more *446 than
40% Of its net worth, is grossly excessive on the facts of this case.
10. There was lack of proper instruction regarding probable cause. [FN3]
FN3. This issue is raised for the first time in appellant's reply brief.
DISCUSSION:
1. There was no prejudicial misconduct by respondent's trial counsel, and
appellant was not deprived of a fair trial.
Appellant claims that it was denied a fair trial through the statements,
questioning, and introduction of certain evidence by respondent's trial
counsel. Love v. Wolf, 226 Cal.App.2d 378, 38 Cal.Rptr. 183, is cited as
authority.
[2] We have reviewed the entire record and find appellant's contentions to
be without merit. Several of counsel's individual statements and questions
were inappropriate. However, there often were no objections by counsel for
appellant where an objection and subsequent admonition would have cured any
defect; or there was an objection, and the trial court judiciously admonished
the jury to disregard the comment. Except for these minor and infrequent
aberrations, the record reveals an exceptionally well-conducted and
dispassionate trial based on the evidence presented.
As in Stevens v. Parke, Davis & Co., 9 Cal.3d 51, 72, 107 Cal.Rptr. 45, 507
P.2d 653, a motion for a new trial was made, based in part upon the alleged
misconduct of opposing counsel at trial. What was said in Stevens applies
to the instant case. "A trial judge is in a better position than an appellate
court to determine whether a verdict resulted wholly, or in part, from the
asserted misconduct of counsel and his conclusion in the matter will not be
disturbed unless, under all the circumstances, it is plainly wrong.'
(Citation.) From our review of the instant record, we agree with the trial
judge's assessment of the conduct of plaintiff's counsel and for the reasons
stated above, we are of the opinion that defendant has failed to demonstrate
prejudicial misconduct on the part of such counsel. (Stevens v. Parke,
Davis & Co., supra, 9 Cal.3d at p. 72, 107 Cal.Rptr. at p. 58, 507 P.2d at p.
666.)
2. The procedure and verdict below does not constitute a violation of
appellant's First Amendment free exercise of religion.
*447 Appellant contends that various references to practices of the Church
of Scientology were not supported by the evidence, were not legally relevant,
and were unduly prejudicial. The claim is made that the **802 trial became
one of determining the validity of a religion rather than the commission of a
tort.
The references to which appellant now objects were to such practices as 'E-
meters,' tin cans used as E-meters, the creation of religious doctrine
purportedly to 'get' dissidents, and insinuations that the Church of
Scientology was a great money making business rather than a religion.
[3][4][5] The principal issue in this trial was one of credibility. If one
believed defendant's witnesses, then there was indeed conversion by
respondent. However, the opposite result, that reached by the jury, would
naturally follow if one believed the evidence introduced by respondent.
Appellant repeatedly argues that the introduction of the policy statements of
the Church was prejudicial error. However, those policy statements went
directly to the issue of credibility. Scientologists were allowed to trick,
sue, lie to, or destroy 'enemies.' (Exhibit 1.) If, as he claims, respondent
was considered to be an enemy, that policy was indeed relevant to the issues of
this case. That evidence well supports the jury's implied conclusion that
respondent had not taken the property of the Church, that he had merely
attempted to leave the Church with the documents for the Internal Revenue
Service, and that those witnesses who were Scientologists or had been
Scientologists were following the policy of the Church and lying to, suing and
attempting to destroy respondent. Evidence of such policy statements were
damaging to appellant, but they were entirely relevant. They were not
prejudicial. A party whose reprehensible acts are the cause of harm to another
and the reason for the lawsuit by the other cannot be heard to complain that
its conduct is so bad that it should not be disclosed. The relevance of
appellant's conduct far outweighs any claimed prejudice. [FN4]
FN4. The trial court gave appellant almost the entire trial within which
to produce evidence that the fair game policy had been repealed. Appellant
failed to do so, and the trial court thereafter permitted the admission of
Exhibit 1 into evidence.
We find the introduction of evidence of the policy statements and other
peripheral mention of practices of the Church of Scientology not to be error.
In the few instances where mention of religious practices may have been
slightly less germane than the policy statements regarding fair game, they were
nonetheless relevant and there was no prejudice to appellant by the
introduction of such evidence.
*448 3. The trial court properly denied the motion for judgment
notwithstanding the verdict.
Appellant claimed that it had probable cause to file suit against respondent.
The claim is made that even if Alan Boughton did take the checks from the safe,
knowledge of that act should not be imputed to appellant Church.
[6] Based on the policy statements of appellant that were introduced in
evidence, a jury could infer that Boughton was within the scope of his
employment when he stole the francs from the safe or lied about respondent's
alleged theft. Inferences can be drawn that the Church, through its agents,
was carrying out its own policy of fair game in its actions against
respondent. Given that view of the evidence, which as a reviewing court we
must accept, there is substantial evidence proving that appellant maliciously
prosecuted respondent. Therefore, the trial court did not err in denying the
motion for the judgment notwithstanding the verdict.
4. The trial court performed proper voir dire of prospective jurors.
Appellant claims that the trial court refused to ask or permit voir dire
questions of prospective jurors pertaining to their religious prejudices or
attitudes. The record does not so indicate. Each juror was asked if he or she
had any belief or feeling toward any of the parties that might be regarded as a
bias or prejudice for or **803 against any of them. Each juror was also
asked if her or she had ever heard of the Church of Scientology. If the juror
answered affirmatively, he or she was further questioned as to the extent of
knowledge regarding Scientology and whether such knowledge would hinder the
rendering of an impartial decision. One juror was excused when she explained
that her husband is a clergyman and that she knows a couple that was split over
the Church of Scientology.
[7] The trial court's thorough questioning served the purpose of voir dire,
which is to select a fair and impartial jury, not to educate the jurors or to
determine the exercise of peremptory challenges. (Rousseau v. West Coast
House Movers, 256 Cal.App.2d 878, 882, 64 Cal.Rptr. 655.)
5. It was not prejudicial error to direct the jury, in its assessment of the
malicious prosecution claim, to disregard evidence that respondent stole
appellant's Australian and American Express travelers' checks.
*449 [8] Appellant submits that evidence of respondent's purported theft
of the Australian and American Express travelers' checks should have been
admitted as to the issue of malicious prosecution as well as the cross-
complaint as to conversion. If there were any error in this regard, it could
not possibly be prejudicial since the jury found for respondent on the cross-
complaint. It is evident that the jury did not believe that respondent stole
the travelers' checks; therefore, there could be no prejudice to appellant by
the court's ruling.
6. Appellant suffered no prejudice by the trial court's denial of discovery
of the factual basis for obtaining of the dismissal by the district attorney.
Prior to trial, appellant apparently sought to discover the reasons underlying
the dismissal of the criminal charges against respondent. This was relevant to
the instant case since one of the elements of a cause of action for malicious
prosecution is that the criminal prosecution against the plaintiff shall have
been favorably terminated. (Jaffe v. Stone, 18 Cal.2d 146, 114 P.2d 335.)
[9] Whether or not the lower court was justified in making such an order,
the denial of discovery along these lines could not be prejudicial. During the
trial, counsel for all parties stipulated that the criminal proceedings against
Allard were terminated In his favor by a dismissal by a judge of that court
upon the recommendation of the district attorney.
In addition, there was a hearing outside the presence of the jury in which the
trial court inquired of the deputy district attorney as to the reasons for the
dismissal. It was apparent at that time that the prospective witnesses for the
Church of Scientology were considered to be evasive. There was no prejudice to
appellant since the deputy district attorney was available at trial. Earlier
knowledge of the information produced would not have helped defendant. We find
no prejudicial error in the denial of this discovery motion.
7. The award of $50,000 compensatory damages was proper.
Appellant contends that based upon the evidence presented at trial, the
compensatory damage award is excessive. In addition, appellant contends that
the trial court erred in not allowing appellant to introduce evidence of
respondent's prior bad reputation.
*450 There was some discussion at trial as to whether respondent was going
to claim damaged reputation as part of general damages. The trial court's
initial reaction was to allow evidence only of distress or emotional
disturbance; in return for no evidence of damaged reputation, appellant would
not be able to introduce evidence of prior bad reputation. The court, however,
relying on the case of Clay v. Lagiss, 143 Cal.App.2d 441, 299 P.2d 1025,
held that lack of damage to reputation is not admissible. Therefore,
respondent was allowed to claim damage to reputation without allowing appellant
to introduce evidence of his prior bad reputation.
**804 [10][11][12] In matters of slander that are libelous per se, for
example the charging of a crime, general damages have been presumed as a matter
of law. (Douglas v. Janis, 43 Cal.App.3d 931, 940, 118 Cal.Rptr. 280(4),
citing Clay v. Lagiss, supra, 143 Cal.App.2d at p. 448, 299 P.2d 1025.
Compare Gertz v. Welch, 418 U.S. 323, 94 S.Ct. 2997, 41 L.Ed.2d 789.) [FN5]
Damages in malicious prosecution actions are similar to those in defamation.
Therefore, damage to one's reputation can be presumed from a charge, such as
that in the instant case that a person committed the crime of theft. In any
event, as the trial court in the instant case noted, there was no offer of
proof regarding respondent's prior bad reputation; any refusal to allow
possible evidence on that subject has not been shown to be error, much less
prejudicial error.
FN5. The Supreme Court held in Gertz v. Welch, supra, 418 U.S. 323,
349, 810, 94 S.Ct. 2997, 3011, 41 L.Ed.2d 789, an action for defamation,
that 'the States may not permit recovery of presumed or punitive damages,
At least when liability is not based on a showing of knowledge of falsity
or reckless disregard for the truth.' (Emphasis added.) The instant stant
case is distinguishable from Gertz. Initially, the interests protected by
a suit for malicious prosecution include misuse of the judicial system
itself; a party should not be able to claim First Amendment protection
maliciously to prosecute another person. Secondly, the jury in the instant
case must have found 'knowledge of falsity or reckless disregard for the
truth' in order to award punitive damages herein. Therefore, even under
Gertz, a finding of presumed damages is not unconstitutional.
Appellant further contends that the amount of compensatory damages awarded was
excessive and that the jury was improperly instructed regarding compensatory
damages. The following modified version of BAJI 14.00 and 14.13 was given:
'If, under the court's instructions, you find that plaintiff is entitled to a
verdict against defendant, you must then award plaintiff damages in an amount
that will reasonably compensate him for each of the following elements of loss
or harm, which in this case are presumed to flow from *451 the defendant's
conduct without any proof of such harm or loss: damage to reputation,
humiliation and emotional distress.
'No definite standard or method of calculation is prescribed by law to fix
reasonable compensation for these presumed elements of damage. Nor is the
opinion of any witness required as to the amount of such reasonable
compensation. Furthermore, the argument of counsel as to the amount of damages
is not evidence of reasonable compensation. In making an award for damage to
reputation, humiliation and emotional distress, you shall exercise your
authority with calm and reasonable judgment, and the damages you find shall be
just and reasonable.'
The following instruction was requested by defendant and was rejected by the
trial court:
'The amount of compensatory damages should compensate plaintiff for actual
injury suffered. The law will not put the plaintiff in a better position than
he would be in had the wrong not been done.' Accompanying the request for that
motion is a citation to Staub v. Muller, 7 Cal.2d 221, 60 P.2d 283, and
Basin Oil Co. of Cal. v. Baash-Ross Tool Co., 125 Cal.App.2d 578, 271 P.2d
122.
The Supreme Court has recognized that 'Damages potentially recoverable in a
malicious prosecution action are substantial. They include out-of-pocket
expenditures, such as attorney's and other legal fees . . .; business
losses . . .; general harm to reputation, social standing and credit . . .;
mental and bodily harm . . .; and exemplary damages where malice is
shown . . ..' (Babb v. Superior Court, 3 Cal.3d 841, 848, fn. 4, 92
Cal.Rptr. 179, 183, 479 P.2d 379, 383.) While these damages are compensable, it
is the determination of the damages by the jury with which we are concerned.
Appellant seems to contend that the jury must have actual evidence of the
damages suffered and the monetary amount thereof.
**805 [13] '(T)he determination of the jury on the issue of damages is
conclusive on appeal unless the amount thereof is so grossly excessive that it
can be reasonably imputed solely to passion or prejudice in the jury.
(Citations.)' (Douglas v. Janis, supra, 43 Cal.App.3d at p. 940, 118
Cal.Rptr. at p. 286.) The presumed damage to respondent's reputation from an
unfounded charge of theft, along with imprisonment for twenty-one days, and the
mental and emotional anguish that must have followed are such that we cannot
say that the jury's finding of $50,000 in compensatory damages is unjustified.
*452 That amount does not alone demonstrate that it was the result of
passion and prejudice.
8. Respondent is entitled to punitive damages.
[14] Appellant cites the general rule that although an employer may be held
liable for an employee's tort under the doctrine of respondeat superior,
ordinarily he cannot be made to pay punitive damages where he neither
authorized nor ratified the act. (4 Witkin, Summary of Calif. Law, 8th Ed., s
855, p. 3147.) [FN6] Appellant claims that the Church of Scientology, which is
the corporate defendant herein, never either authorized or ratified the
malicious prosecution.
FN6. We again note that Gertz v. Welch, supra, precludes the award of
punitive damages in defamation actions 'at least when liability is not
based on a showing of knowledge of falsity or reckless disregard for the
truth.' The facts of the instant case fall within that categorization, so
a finding of punitive damages was proper. Moreover, as we noted above, an
egregious case of malicious prosecution subjects the judicial system itself
to abuse, thereby interfering with the constitutional rights of all
litigants. Punitive damages may therefore be more easily justified in
cases of malicious prosecution than in cases of defamation. The societal
interests competing with First Amendment considerations are more compelling
in the former case.
[15] The finding of authorization may be based on many grounds in the
instant case. For example, the fair game policy itself was initiated by L. Ron
Hubbard, the founder and chief official in the Church. (Exhibit 1.) It was an
official authorization to treat 'enemies' in the manner in which respondent
herein was treated by the Church of Scientology.
Furthermore, all the officials of the Church to whom respondent relayed his
desire to leave were important managerial employees of the corporation. (See 4
Witkin, Summary of Calif.Law, 8th Ed., Supra, s 857, p. 3148.)
The trier of fact certainly could have found authorization by the corporation
of the act involved herein.
9. The award of punitive damages.
[16] Any party whose tenets include lying and cheating in order to attack
its 'enemies' deserves the results of the risk which such conduct entails. On
the other hand, this conduct may have so enraged the jury that the award of
punitive damages may have been more the result of *453 feelings of
animosity, rather than a dispassionate determination of an amount necessary to
assess defendant in order to deter it from similar conduct in the future. In
our view the disparity between the compensatory damages ($50,000) and the
punitive damages ($250,000) suggests that animosity was the deciding factor.
Our reading of the decisional authority compels us to conclude that we should
reduce the punitive damages. We find $50,000 to be a reasonable amount to
which the punitive damages should be reduced. We perceive this duty, and have
so modified the punitive damages award not with any belief that a reviewing
court more ably may perform it. [FN7] Simply stated the decisional authority
seems to indicate that the reviewing court should examine punitive damages and
where necessary modify the amount in order **806 to do justice.
(Cunningham v. Simpson, 1 Cal.3d 301, 81 Cal.Rptr. 855, 461 P.2d 39;
Forte v. Nolfi, 25 Cal.App.3d 656, 102 Cal.Rptr. 455; Shroeder v. Auto
Driveaway Company, 11 Cal.3d 908, 114 Cal.Rptr. 622, 523 P.2d 662; Livesey
v. Stock, 208 Cal. 315, 322, 281 P. 70.)
FN7. See dissent in Cunningham v. Sumpson, 1 Cal.3d 301, 81 Cal.Rptr.
855, 461 P.2d 39.
10. Instruction on probable cause.
Appellant requested an instruction stating: 'Where it is proven that a judge
has had a preliminary hearing and determined that the facts and evidence show
probable cause to believe the plaintiff guilty of the offense charged
therefore, ordering the plaintiff to answer a criminal complaint, this is Prima
facie evidence of the existence of probable cause.' The trial court gave the
following instruction: 'The fact that plaintiff was held to answer the charge
of grand theft after a preliminary hearing is evidence tending to show that the
initiator of the charge had probable cause. This fact is to be considered by
you along with all the other evidence tending to show probable cause or the
lack thereof.' [FN8]
FN8. This instruction was given on the court's own motion.
[17][18] Appellant claimed for the first time in his reply brief that the
trial court's lack of proper instruction regarding probable cause was
prejudicial error. Since this issue was raised for the first time in
appellant's reply brief, we decline to review the issue. [FN9]
FN9. We note that given the circumstances of the instant case, the juror
could have easily been misled by the requested instruction. If the
evidence showed that the agents and employees of appellant were lying, then
the preliminary hearing at which they also testified would not be valid.
While the jurors may of course consider that the magistrate at the
preliminary hearing found probable cause, that should be in no way
conclusive in the jury's determination of probable cause.
*454 The judgment is modified by reducing the award of punitive damages
only, from $250,000 to the sum of $50,000. As modified the judgment is in all
other respects affirmed.
Costs on appeal are awarded to respondent Allard.
ROTH, P.J. and FLEMING, J., concur.