Bain v. Phillips

• Decision Date: 08 October 1976
• Docket Number: No. 751031,751031
• Citation: 228 S.E.2d 576,217 Va. 387
• Parties: Thomas A. BAIN, III v. Nelson S. PHILLIPS, Jr. Record
• Court: Virginia Supreme Court

Page 576

228 S.E.2d 576

217 Va. 387

Thomas A. BAIN, III v. Nelson S. PHILLIPS, Jr.

Record No. 751031.

Supreme Court of Virginia.

Oct. 8, 1976.

William B. Spong, Jr., Portsmouth (Joseph B. Benedetti, Richmond, Cooper Spong, Davis, Kilgore, Parker, Leon & Fennell, Portsmouth, Minor, Saunders & Benedetti, Richmond, on briefs), for plaintiff-in-error.

Thomas S. Word, Jr., Richmond (Willard I. Walker, William L. Matson, McGuire, Woods & Battle, Richmond, on brief), for defendant-in-error.

Before I'ANSON, C.J., and CARRICO, HARRISON, COCHRAN, HARMAN, POFF and COMPTON, JJ.

COMPTON, Justice.

In this malicious prosecution action stemming from a layman's alleged wrongful criminal prosecution of another, we deal with the subject of probable cause for initiating the criminal proceedings.

Appellee Nelson S. Phillips, Jr., the plaintiff below, used appellant Thomas A. Bain, III, and John F. Batte, Jr. and R. Bolling Batte, the defendants below, for compensatory and punitive damages alleging Bain wrongfully initiated criminal prosecutions in Amelia and Louisa counties charging Phillips with violations of the so-called fictitious name statutes, note 2 Infra. During the jury trial and after plaintiff's evidence had been presented, the trial court sustained the respective motions to strike of the Battes. ¹ Thereafter the jury awarded Phillips $10,000 compensatory damages and $25,000 punitive damages. On May 7, 1975, the trial court entered judgment on the verdict after remitting § 15,000 of the punitive damage award. We granted Bain a writ of error and Phillips filed cross-error, complaining of the remittitur.

The principal question is whether the trial court erred in failing to submit to the jury the broad issue of Bain's probable cause, or lack of same, for instituting the criminal proceedings. The court below decided Phillips established as a matter of law that Bain lacked probable cause in securing criminal warrants against Phillips and submitted to the jury, along with the damage question, the issues of malice and whether Bain had established his affirmative defense of advice of counsel. Bain claims this was error and argues the jury should have been permitted to consider, under proper instructions and in addition to the defense of advice of counsel, the issue of probable cause. We disagree and affirm.

As we recite the facts, it will be assumed, in accordance with the jury's finding, that Bain did not prosecute Philips in reliance on the advice of counsel. But under the familiar rules used to determine whether a question is one of fact for the jury or one of law for the court, we will consider the controlling issue in this case by viewing the evidence relating to probable cause in the light most favorable to Bain.

In 1973, Bain was employed as a salesman by a Richmond real estate company, J. F. Batte & Sons, and was 'part owner' and president of NDH Company, a Virginia corporation engaged in the construction of modular homes on property NDH owned in Amelia and Louisa Counties. At that time, Phillips, who was also in the construction business, and Bain, casual social acquaintances for ten years but never involved in a business relationship together, orally agreed that Phillips would perform work for Bain in the erection of several modular homes in the foregoing counties. Phillips was operating a sole proprietorship doing business as 'Nelson S. Phillips, Jr., t/a Phillips Construction Company.' Bain was then unaware of the details of Phillips' business form.

Immediately prior to reaching the agreement with Phillips, Bain while investigating Phillips' performance on other construction jobs learned that 'a year or two before' Phillips had worked on the construction of a veterinary hospital and that the owners were then 'dealing' with Phillips, Phillips' father, Phillips' uncle, 'and other'; Bain testified that he understood Phillips' business was 'a family affair with others involved.' Bain also learned that in the past Phillips 'might (have been) selling stock', presumably in a corporation in which Phillips had an interest. Bain admitted, however, that he previously stated in discovery depositions he had no reason to believe that Phillips had any partners or that he was transacting business as a partnership.

In June of 1973, Bain and Phillips had a disagreement over the quality of the work done by Phillips Construction Company and the charges therefor made to NDH Company. In an unsuccessful effort to settle the dispute, Bain and Phillips subsequently met in the office of Phillips' attorney. Also present were Phillips' father, who 'had very little to say' during the four-hour conference, and John F. Batte, Jr., an attorney and principal in J. F. Batte & Sons. Bain Sought Batte's assistance in resolving the dispute because Bain regarded Batte an experienced builder, developer, and attorney.

Because of the dispute, Phillips discontinued work on the modular homes in Amelia and Louisa counties. In the Fall of 1973 Phillips filed memoranda for mechanics' liens in both counties against the property involved. Thereafter in March 1974, a bill in chancery to enforce the Louisa mechanics' lien was filed in the Circuit Court of Louisa County styled 'Nelson S. Phillips, Jr., t/a Phillips Construction Company v. NDH Company.' In the first paragraph of the bill, Phillips alleged that he was 'a general contractor, with his principal office at 1403 Blue Jay Lane, Richmond, Virginia 23229', an allegation admitted in the answer subsequently filed by Bain for NDH Company. Phillips and his family resided at the foregoing address.

Upon being served with the suit papers as registered agent for NDH Company, Bain sought the advice of R. Bolling Batte, a member of the law firm of Batte, Batte & Graham whose offices were located in the Batte Building in the City of Richmond. Other members of the law firm were John F. Batte, Jr. and Oakley J. Graham, Jr. Also located in the same building, but separately from the law offices, was the realty office of J. F. Batte & Sons, Bain's employer. The Batte law firm had not represented NDH Company at any prior time.

Bolling Batte, who devoted his full time to the practice of law, told Bain he would draft an answer to the bill for Bain to sign and file but that he would not participate in the lawsuit or represent NDH Company. The answer was prepared and typed in Batte's office, executed by Bain as president of NDH Company and filed by him 'pro se.' Batte submitted a bill to NDH Company for $50 for 'consultation and preparation of pleadings' in the mechanics' lien suit, which was promptly paid with an NDH Company check signed by Bain.

During the period after Bain first contacted Bolling Batte and before the criminal warrants in issue were secured, Bain, who had attended law school for one year, discussed 'the case' on several occasions with Batte in Batte's office. During one of these discussions, Batte called Bain's attention to the Virginia assumed or fictitious name statutes, ² with which Bain was unfamiliar and 'pointed out the possibility' that Phillips 'might' be in violation of them. Batte read Bain the code section, but did not inform him of the following portion of the annotation to § 59.1--69:

'Name not within chapter.--Where the designation under which a business is being conducted consists of the surname of the proprietor or proprietors, with the addition of the words 'and Company' or '& Co.', preceded by a word descriptive of the nature of the business, the name is not within this chapter. Tate v. Atlanta Oak Flooring Co., 179 Va. 365, 18 S.E.2d 903 (1942), holding that this section did not apply where trade name was 'A. E. Tate Lumber Company' and A. E. Tate was the sole owner. See also Matthews v. Barfield, 179 Va. 691, 20 S.E.2d 497 (1942).' ³

During another discussion with Bain, Batte in Bain's presence made a telephone call to the Louisa County Clerk's Office and learned that Phillips had not filed the certificate provided for by Code § 59.1--69. Bain testified that Batte then 'suggested that I secure (criminal) warrants in both Amelia and Louisa' against Phillips. Bain further testified that Batte instructed Bain 'to be sure and let him know when the case on the warrants came to be heard, that he would call (the Commonwealth's Attorney of Louisa County) who's a personal friend of his and alert him to (Code § 59.1--69) since it was generally unknown and alert him to be aware of it, so that he could prosecute the case when it came to trial.'

Batte denied making the foregoing statements. He testified categorically that he never advised Bain to initiate criminal proceedings against Phillips but that he merely suggsted to Bain that he make Phillips' failure to file the certificate an issue in the mechanics' lien suit under the provisions of Code § 59.1--76, note 2 Supra.

On May 13, 1974, Bain attended the docket call in Louisa Circuit Court, accompanied by Graham, in connection with the mechanics' lien suit and while there Graham determined that no fictitious name certificate had yet been filed by Phillips. Bain then secured the issuance of an arrest warrant in Louisa County General District Court against Phillips charging violation of Code § 59.1--69. Later that same day Bain ascertained that Phillips had not filed a certificate in the Amelia Clerk's Office and a similar warrant was issued by the Amelia County General District Court at Bain's request against Phillips charging the same violation in Amelia County. Bain testified that his purpose in securing the warrants was (1) to assure that one who had violated the criminal laws in two counties was punished and (2) to ascertain 'the people that we were dealing with' as Phillips Construction Company. Bain denied that his action in securing the warrants was related to the fact he had been sued by Phillips.

Subsequent to the issuance of the warrants, attempts to serve them upon Phillips at his home in Henrico County...