Aalfs v. Aalfs

• Citation: 66 N.W.2d 121,246 Iowa 158
• Decision Date: 21 September 1954
• Docket Number: No. 48533,48533
• Parties: Nittert Wilbur AALFS, Appellant, v. Nittert AALFS, Appellee.
• Court: United States State Supreme Court of Iowa

Page 121

66 N.W.2d 121

246 Iowa 158

Nittert Wilbur AALFS, Appellant, v. Nittert AALFS, Appellee.

No. 48533.

Supreme Court of Iowa.

Sept. 21, 1954.

Rehearing Denied Nov. 19, 1954.

Sifford & Wadden, Sioux City, for appellant.

A. H. Bolton, Sioux City, for appellee.

THOMPSON, Justice.

The question involved in the case before us is the right of the plaintiff to recover damages for the alleged malicious prosecution of a former action in which the present defendant, as plaintiff therein, sought to rescind a contract between himself and the present plaintiff, who was the defendant therein, and made certain charges of fraud and misrepresentation. The former action, after it had been pending for several months, was dismissed by the plaintiff therein before trial.

After the commencement of the instant action, the defendant filed a motion to dismiss, substantially upon the ground that the petition failed to state facts entitling the plaintiff to any relief. This motion was granted by the trial court, and judgment against the plaintiff was entered upon his election to stand upon the ruling.

It will be seen that the matter comes before us upon a question of pleading. The sole point involved is the right of the plaintiff to maintain his action for the claimed malicious prosecution of the first suit, brought against him by the present defendant. The plaintiff herein is a son of the defendant.

The petition which was dismissed alleged the filing of a petition by the appellee against the appellant in the District Court of Woodbury County, in which the appellee falsely, maliciously and without probable cause accused the appellant of having been guilty of fraud and of false and fraudulent misrepresentations, both individually and in conjunction with others, for the effected purpose of inducing the appellee to sell to appellant appellee's partnership interest in the Aalfs-Baker Manufacturing Company. It is further alleged that later the appellee filed an amended and substituted petition repeating and amplifying the charges and asking rescission of the contract of sale of appellee's interest in the company; that the charges were false and known by appellee so to be, and were made for the purpose of injuring appellant. The voluntary dismissal of appellee's action when the case was reached for trial is also pleaded.

Appellant's claimed damages, as set out in his petition, may be summarized as follows: his reputation has been damaged, he has been humiliated and he has suffered and will suffer great mental pain, shame, anguish and distress; he has incurred expense in defending the action brought by appellee; he has been deprived of the free use of the assets of the Aalfs-Baker Manufacturing Company, the use and sale of said assets has been interfered with, he was unable to continue the operations of the company in the wholesale trade and he has been compelled to discontinue such opperations and was compelled to sell at a loss certain goods; he was forced to restrict the manufacture of work clothing, the manufacturing business of the company, to contract manufacturing at a low margin of profit; and he could not obtain bank credit for his manufacturing operations. The petition alleged that appellee is reasonably worth more than $750,000; and prayed actual damages in the sum of $250,000, and punitive damages in a like amount.

The trial court having sustained the motion to dismiss, under well-settled rules we take all well-pleaded allegations of the petition as true. No claim is made that malice, falsity, and lack of probable cause, and the dismissal of the first suit were not properly pleaded. We have therefore the narrow but important question whether an action for malicious prosecution of a civil suit may be maintained where there has been no arrest of the person or seizure of the property, when damages such as are claimed here are pleaded.

I. There are two opposed lines of authority concerning the right to maintain suits for malicious prosecution of civil cases. In some jurisdictions the action will lie, apparently without qualification other than proof of malice and lack of probable cause and the termination of the former litigation in favor of the defendant therein. But substantially an equal number of courts hold no cause of action arises unless there has been an arrest of the person, seizure of the property, or special injury sustained. Iowa is found in this latter category. Appellant's counsel, while maintaining their action is properly within the exceptions noted and so maintainable even under the established law in this state, have directed our attention to the opposing line of authority, with the suggestion we may desire to re-examine our own holdings and, possibly, to align ourselves with the contra doctrine. We can dispose of this thought by saying we are satisfied with the reasoning which we have considered sound in the past, and see no reason for changing the rule followed since the decision in Wetmore v. Mellinger, 64 Iowa 741, 18 N.W. 870, in 1884. Briefly, the courts which think an action for malicious prosecution of a civil action should be permitted in all cases reason the law should provide a remedy for every wrong, and a litigant should not be permitted to bring suit with charges of fraud, deceit, or other imputation of improper conduct against the defendant, such charges being knowingly false, malicious and without probable cause, without being required to respond in damages for the harm so wantonly done. The opposed position, which we have adopted and still believe sound, is that the courts should be open to all who think they have a just cause of action, and it would deter many honest litigants from asserting their rights if they knew they were to be penalized by a counter-action for damages based on alleged malice if for any reason they failed in winning their cause. This rule is identical in principle and in reasoning with that laid down in 53 C.J.S., Libel and Slander, § 104, pp. 173 and 174:

'Defamatory matter contained in pleadings filed according to law in a court having jurisdiction, if relevant and pertinent to the issues in the case, is absolutely privileged; and it is immaterial that the allegations are false and malicious or are made recklessly and without probable cause and under cover and pretense of a wrongful or groundless suit.'

We followed this rule in Mass v. Meire, 37 Iowa 97, 98, where we said:

'It may be conceded that charges made in * * * a civil proceeding will not support an action for libel, though such charges, made under other circumstances, would be actionable. The reason of the rule is that it would be a discouragement to suitors, and thus tend to defeat justice to subject them to prosecutions for matters alleged in their applications to the courts.' In Hess v. McKee, 150 Iowa 409, 410, 130 N.W. 375, 376, is this:

'It is the general rule that libelous or slanderous matter published in the due course of judicial procedure is absolutely privileged and will not support an action for defamation, although made maliciously and with knowledge of its falsity.' To the same effect is Anderson v. Hartley, 222 Iowa 921, 923, 924, 925, 270 N.W. 460. See also, as bearing upon the question of privileged communications, Ryan v. Wilson, 231 Iowa 33, 300 N.W. 707; Robinson v. Home Fire & Marine Insurance Company, 242 Iowa 1120, 49 N.W.2d 521; Robinson v. Home Fire & Marine Insurance Company, 244 Iowa 1084, 59 N.W.2d 776; and Mills v. Denny, Iowa, 63 N.W.2d 222.

This rule is generally accepted and followed by the courts when they are considering allegedly libelous matters contained in pleadings. The privilege is absolute, without regard to malice, knowledge, or lack of probable cause. The reasoning is strongly in point in suits brought for malicious prosecution of civil actions. Indeed, it is an anomaly to say that no action will lie for malicious statements contained in a pleading in a civil suit while at the same time permitting an action for malicious prosecution of the suit in which such statements were the gravamen, or at least a substantial and material part of the complaint. Such a rule would in effect destroy the absolute privilege against actions for libel because of charges made in a civil suit. The rule which Iowa and many other jurisdictions follow in denying a right to actions for malicious prosecution of civil suits, with certain exceptions not material here, is in itself a rule of privilege and is based upon the same reasoning which accords the privilege against libel actions above set out.

It may also be pointed out, that if such actions are freely permitted, the result would be to encourage a vast amount of litigation. Thus, if A sues B, and loses, he might be subjected to a suit based on alleged malice in bringing the first action. But if B fails in his suit for malicious prosecution, we know no reason why A might not then bring his own action in turn, alleging malice and want of probable cause in B's suit; and so on ad infinitum. The jurisdictions which hold with the Iowa rule say that such suits should not be encouraged. We quote from Abbott v. Thorne, 34 Wash. 692, 76 P. 302, 305, 65 L.R.A. 826:

'In this litigious age, when speculative lawsuits are rapidly multiplying, we think that considerations of sound public policy will not justify courts in announcing a doctrine which tends to encourage this character of litigation.' We agree with this thought, and adhere to the rule laid down in Wetmore v. Mellinger, supra, and following Iowa cases.

It may be that neither our own doctrine nor that of the opposing authorities is entirely satisfactory; but in the law, as in all human affairs, we rarely if ever have a choice between perfection and imperfection, but only between varying degrees of imperfection. The rule of the Wetmore case has not only been the established law of Iowa for seventy years, but we believe it preferable.

II. Wetmore v. Mellinger, supra...