Berman v. Karvounis

• Decision Date: 01 September 1986
• Docket Number: No. 75,75
• Citation: 308 Md. 259,518 A.2d 726
• Parties: Malcolm BERMAN, et al. v. Demetrios N. KARVOUNIS. ,
• Court: Maryland Court of Appeals

Page 259

308 Md. 259

518 A.2d 726

Malcolm BERMAN, et al. v. Demetrios N. KARVOUNIS.

No. 75, Sept. Term, 1986.

Court of Appeals of Maryland.

Jan. 2, 1987.

Diane G. Goldsmith (Stephen L. Snyder and Snyder & Janet, on the brief), Baltimore, for appellants.

John H. Doud III (Fedder & Garten, P.A., on the brief), Baltimore, for appellee.

Argued before MURPHY, C.J., and ELDRIDGE, COLE, RODOWSKY, COUCH, McAULIFFE and ADKINS, JJ.

ADKINS, Judge.

In recent years the torts of abuse of process and malicious prosecution have received considerable attention in the appellate courts of Maryland. See e.g., Wood v. Palmer Ford, Inc., 47 Md.App. 692, 425 A.2d 671 (1981); Palmer Ford, Inc. v. Wood, 298 Md. 484, 471 A.2d 297 (1984); Palmer Ford, Inc. v. Wood, 65 Md.App. 390, 500 A.2d 1055 (1985); Keys v. Chrysler Credit Corp., 303 Md. 397, 494 A.2d 200 (1985). In the case before us we revisit this area of law to decide whether the Circuit Court for Baltimore City erred when it dismissed the abuse of process and malicious use of process ¹ claims appellants Malcolm Berman Morton Sarubin, and Jack W. Stolloff had asserted against appellee, Demetrios N. Karvounis. The trial court thought these "claims must fail at this time because the proceedings upon which [the] claims are based have not yet been fully terminated." We granted certiorari before the Court of Special Appeals had acted on appellant's appeal from that dismissal, and from the trial court's refusal to reconsider it. 307 Md. 163, 512 A.2d 1055 (1986).

Facts

Since the matter arises on a motion to dismiss, we look to the well-pleaded facts in appellants' amended complaint for enlightenment. According to that document, in 1981 Karvounis filed 12 law actions against appellants, six in the Circuit Court for Baltimore County and six in what is now the Circuit Court for Baltimore City. Each declaration contained six counts. Counts 3-6 of each declaration charged appellants with fraudulently inducing Karvounis to enter into certain contracts, and claimed both compensatory and punitive damages. Eventually the Baltimore County cases were transferred to Baltimore City and consolidated with the cases pending there. Somewhere along the line, Counts 3-6 in each case were dismissed with prejudice. Karvounis dismissed each Count 2. Thus, Count 1 in each consolidated case remained alive and undisposed of. In 1985, after these events had occurred, appellants filed the instant action in the Circuit Court for Baltimore City. In Count I they charged Karvounis with abuse of process, and in Count II with malicious use of process, all based on the facts we have outlined. ²Abuse of Process

Appellants aver that the trial judge erred in dismissing Count I on the basis that "the proceedings upon which their claims are based have not yet been fully terminated." They argue that no requirement of termination of prior proceedings attends the tort of abuse of process. We agree. In Palmer Ford, Inc. v. Wood, 298 Md. at 511, 471 A.2d at 310-311, we explained: " 'The tort of abuse of process occurs when a party has wilfully misused criminal or civil process after it has issued in order to obtain a result not contemplated by law' " (quoting Krashes v. White, 275 Md. 549, 555, 341 A.2d 798, 802 (1975)). And we quoted from W. Prosser, Handbook of the Law of Torts, § 121 at 857 (4th ed. 1971): "The essential elements of the abuse of process as the tort has developed, have been stated to be: first, an ulterior purpose, and second, a wilful act in the use of the process not proper in the regular conduct of the proceeding." ³ Put otherwise:

"To sustain an action of abuse of process the plaintiff must show that:

"1. the defendant wilfully used process for an illegal purpose;

"2. to satisfy the defendant's ulterior motive; and

"3. the plaintiff was damaged by the defendant's perverted use of process." [footnote omitted]

Maryland Tort Law, supra, § 5.4 at 47.

In short, prior termination of proceedings in favor of the plaintiff in the abuse of process case is not an element of the tort. We said as much in Wesko v. G.E.M. Inc., 272 Md. 192, 195, 321 A.2d 529, 531 (1974): "[R]ecovery [for the tort of abuse of process] may generally be had without the necessity of showing ... the termination of the proceeding in favor of the plaintiff...." Accord Delisi v. Garnett, 257 Md. 4, 7, 261 A.2d 784, 786 (1970); Walker v. American Security Co., 237 Md. 80, 87, 205 A.2d 302, 306 (1964); Wood v. Palmer Ford, Inc., 47 Md.App. at 705, 425 A.2d at 680. But see Gore v. Condon, 87 Md. 368, 375, 39 A. 1042, 1044 (1898) (apparently confusing the elements of abuse of process and malicious prosecution).

The trial judge erred, therefore, when he dismissed Count I of the amended complaint on the assumption that it could not be sustained absent a showing of the termination of Karvounis's prior action in favor of appellants. Karvounis does not really disagree with this conclusion. He argues, instead, that a judgment may be affirmed on any ground adequately shown by the record, whether or not relied upon by the trial court--the notion that a trial court may be right for the wrong reasons. Robeson v. State, 285 Md. 498, 502, 403 A.2d 1221, 1223 (1979) (and cases cited therein), cert. denied, 444 U.S. 1021, 100 S.Ct. 680, 62 L.Ed.2d 654 (1980); Ellett v. Giant Food, Inc., 66 Md.App. 695, 700, 505 A.2d 888, 891 (1986); see Joseph H. Munson Co. v. Sec. of State, 294 Md. 160, 167-168, 448 A.2d 935, 939 (1982), aff'd, 467 U.S. 947, 104 S.Ct. 2839, 81 L.Ed.2d 786 (1984). He further avers that his motion to dismiss, with respect to Count I, argued not only the meritless "termination" ground but also that appellants in other respects had failed to allege facts necessary to make out a cause of action for abuse of process. He raises those other contentions before us, and asserts that we should in any event affirm the dismissal because Count I fails to state a claim for relief.

Unfortunately for Karvounis, we reject his conclusion. The judge was not right for the wrong reasons; he was wrong. His order amounted to a dismissal without prejudice; it simply dismissed Count I because he thought it premature, absent the termination of the prior action in favor of appellants. Had he agreed with Karvounis's "failure to state a claim" argument, he would either have dismissed Count I with prejudice or granted Karvounis leave to amend. Md. Rule 2-322(c). He did neither. Consequently, we cannot affirm that portion of his judgment. We must reverse it and remand for further proceedings. Nevertheless, for the reasons of judicial economy noted in Robeson, supra, and for the guidance of the trial court on remand, Rule 885, we shall discuss these other contentions.

We return to the elements of abuse of process, as stated by Prosser, supra: "an ulterior purpose" and "a wilful act in the use of the process not proper in the regular conduct of the proceeding." In their amended complaint appellants alleged that the filing of the 12 actions in two jurisdictions, with their claims of large punitive damages, "was and remains motivated by the ulterior purpose of causing unnecessary, deliberate, costly and vicious litigation" and was designed to "harass and oppress [appellants] in their personal and business lives...." They went on to allege:

"This ulterior motive(s) manifested itself in the improper use of the process after it had been issued, i.e., by misusing the process for an end other than that which it was designed to accomplish. Through [Karvounis's] claim that [appellants] had fraudulently induced him into entering into the contracts in question with the intent of not compensating him (Counts 3, 4, 5 and 6 of [Karvounis's] Declarations) coupled with [Karvounis's] claim of punitive damages (Counts 5 and 6 of Declarations), [Karvounis] sought to coerce/extort money and/or property from [appellants] to which he was not entitled."

Since we are dealing with a motion to dismiss, we consider appellants' well-pleaded allegations in the light most favorable to them. See Flaherty v. Weinberg, 303 Md. 116, 135-136, 492 A.2d 618, 628 (1985); Hoffman v. Key Federal Sav. and Loan Ass'n, 286 Md. 28, 33-34, 416 A.2d 1265, 1268 (1979); Ungar v. State, 63 Md.App. 472, 479, 492 A.2d 1336, 1340 (1985), cert. denied, --- U.S. ----, 106 S.Ct 1379, 89 L.Ed.2d 604 (1986). But what we consider are allegations of fact and inferences deducible from them, not merely conclusory charges. Lord Calvert Theatre v. Balto., 208 Md. 606, 614, 119 A.2d 415, 418-419 (1956); Sims v. Ryland Group, Inc., 37 Md.App. 470, 472, 378 A.2d 1, 2 (1977). If we assume, without deciding, that Count I sufficiently alleges the "ulterior motive" element of abuse of process, we nevertheless believe that it fails to allege facts that demonstrate "a wilful act in the use of process not proper in the regular course of the proceeding."

As Prosser explains, this second element of the tort requires "[s]ome definite act or threat not authorized by the process, or aimed at an objective not legitimate in the use of the process ...; and there is no liability where the defendant has done no more than carry out the process to its authorized conclusion, even though with bad intentions." Handbook of the Law of Torts, supra, at 857. Thus in Palmer Ford, the tort was established because there was evidence to support a finding that criminal process had been used as a coercive tactic to collect a civil debt. 298 Md. at 513, 471 A.2d at 312. There was some "improper use of the process in a manner not contemplated by law, after process [had] been issued...." Id. But here there are no facts to show how the process was used for any purpose other than the normal one of obtaining personal jurisdiction over the appellants. Appellants have failed to allege in what manner process was used in some abnormal fashion "to coerce/extort money and/or property from" them.

As in Bartlett v. Christhilf, 69 Md. 219, 230, 14 A....