LAW.coLAW.co

Spencer against Southwick

New York Supreme Court of Judicature1812-10
9 Johns. 314

Summary

Holding. The defendant is entitled to judgment on the general demurrer; however, the plaintiff may withdraw the demurrer and file a reply to the justification plea.

A senator who championed legislation creating the Manhattan Company was sued for libel after being accused of hypocrisy and breach of fiduciary duty. The defendant's justification plea alleged that the senator had supported the bill while holding substantial financial interests in the company, knew that the legislation secretly contained banking powers, and was aware that most legislators remained ignorant of this provision but failed to disclose it. The senator challenged the plea through a general demurrer, arguing the facts were insufficiently stated.

The court ruled that although the plea's statement of the senator's knowledge relied on argumentative inference rather than direct assertion, such argumentative pleading is permissible in response to a general demurrer. The court reasoned that when a person possesses good reasons to believe he fully understands a material fact, such knowledge is sufficient to establish legal responsibility for acting on that understanding, even when expressed inferentially. Accordingly, the plea constituted a valid answer to the libel charge.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

  • Sufficiency of argumentative versus direct pleading of knowledge
  • Whether constructive knowledge—having good reasons to believe one knows a fact—constitutes actionable knowledge in law
  • Adequacy of a justification plea to answer a libel charge of breach of fiduciary duty

Procedural posture

The plaintiff demurred generally to the defendant's plea in justification to a libel action.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion

majority opinion

Kent, Ch. J. (absente Spencer, J.) delivered the opinion of the court.

The gist of the libel consists in charging the plaintiff with hypocrisy, and a want of fidelity in his trust, as a senator, in effecting the incorporation of the Manhattan company, in which he was largely and profitably interested. The plea in justification of the charge states, that the plaintiff was a senator at the time of the passage of the bill, and that he advocated and supported it, and was, at the time, largely interested in its stock, and on which he made a great profit; that he knew that the bill contained a clause giving power to institute a bank, and that only a very small portion of the legislature, not exceeding ten in number, knew of that fact, and that the plaintiff had good reasons to believe that he well knew that a large majority of both houses were totally ignorant of the fact, and that he did not disclose and make it known to the senate. To this plea the plaintiff put in a general demurrer, and the question is 5 whether the facts in the plea are not sufficiently averred, and whether they do not amount to an answer to the whole charge contained in the declaration. We cannot perceive any charge in the libel to which the plea is not a substantial, answer, provided the plaintiff’s knowledge that the legislature were ignorant of a banking power lurking in the bill be sufficiently averred.

That knowledge is averred only by way of argument and inference, and not directly, and the plea would, therefore, have been bad on special demurrer. A plea should be a statement of facts, and not of argument. But an argumentative plea is good on general demurrer. (Com. Dig. tit. Pleader, E. 3. Bac. Abr. tit. Pleading, I. 5. in notis.) The plaintiff’s knowledge, in this case, is argumentatively stated. Certainty to a common intent is sufficient in a special plea; and certainty even to a certain intent, according to Mr. Justice Butter, means that which, upon a fair and reasonable construction, may be called certain, without recurring to possible facts; for when words are used which will bear a natural sense, and also an artificial one, or one to be made out by argument, or inference, the natural sense shall prevail. (Buller, J. in King v. Lyme, Doug. 159. and Dovaston v. Payne, 2 H. Bl. 530.) It is possible that the plaintiff might have had good reasons to believe, and yet not have believed; and that he might have had good reasons to believe that he well knew, and not have well known, or even imperfectly known, the truth before him. The force of any impression to be made upon the mind, from the operation of good reasons to be presented to it, will undoubtedly depend, in some degree, upon the character and discipline of that mind, and the existence of passions and biasses which may impede or facilitate the progress of truth. But I cannot conceive that any person of a sound and intelligent understanding can have good reasons to believe that he well knows a fact, and yet not feel, and act under the influence of that impression. To a common intent, and upon a reasonable construction, that averment charges the plaintiff with knowledge of the fact, not, indeed, directly, but argumentatively. When a man has good reasons to believe that he well knows a feet, it amounts to notice of the fact sufficient to charge him with a knowledge of it, and to hold him responsible., not only as a moral agent, but in law, for the consequences of such knowledge.

The court are, accordingly, of opinion, that the defendant is entitled to judgment, with leave, nevertheless, to the plaintiff to withdraw his demurrer and reply, on the usual terms.

Judgment for the defendant.