Burt v. Smith

• Decision Date: 21 February 1905
• Citation: 73 N.E. 495,181 N.Y. 1
• Parties: BURT et al. v. SMITH.
• Court: New York Court of Appeals Court of Appeals

181 N.Y. 1

73 N.E. 495

BURT et al.

v.SMITH.

Court of Appeals of New York.

Feb. 21, 1905.

Appeal from Supreme Court, Appellate Division, Fourth Department.

Action by Alfred H. Burt and another against William W. Smith. From an order of the Appellate Division (82 N. Y. Supp. 186,84 App. Div. 47) sustaining plaintiffs' exceptions, ordered to be heard in the first instance by the Appellate Division, and granting a motion for a new trial, defendant appeals. Reversed.

James L. Quackenbush, George P. Keating, and Milton A. Fowler, for appellant.

Norris Morey, for respondents.

VANN, J.

This is an action for malicious orosecution, brought under the following circumstances: In 1874 the defendant, William Smith, and his brother Andrew, as copartners, began to manufacture cough drops at the city of Poughkeepsie, and used the letters ‘S. B.,’ indicating ‘Smith Brothers,’ their firm name, as a trade-mark, upon the drops and packages. In January, 1892, they procured the registration of a trade-mark under the statutes of the United States, the essential feature of which, as stated in the application therefor, ‘consists of two bust portraits of male figures representing the Smith Brothers, the registrants.’ During the same year they obtained another certificate of registry, the essential feature of which ‘consists of the letters ‘S. B.” In 1891 the plaintiffs, who are copartners under the name of Burt & Sindele, began the manufacture of cough drops in connection with a confectionery business carried on by them in the city of Buffalo. The next year they adopted a package with a label designed by the United States Printing Company, and used the initials of their firm name, ‘B. & S.,’ both upon the label and the drops, to indicate the source of manufacture. At first their sales were small, but after advertising extensively they increased rapidly, and the business finally became profitable.

In 1894 Andrew Smith, one of the Smith brothers, died, and the defendant succeeded to the business of the firm, both as surviving partner, and by assignment from the executors of the decedent. In 1895 he commenced an action in the United States Circuit Court against the present plaintiffs, Burt & Sindele, to recover damages for an alleged infringement of said trade-marks, and asked for an injunction restraining them, both temporarily and permanently, from infringing the same. The bill of complaint set forth at great length facts and circumstances tending to show that Burt & Sindele had infringed both of said trade-marks, and had deceived the public by inducing the belief that their cough drops were made by the Smith brothers. General relief was demanded for infringement of the common-law rights, as well as technical relief for infringement of the statutory trade-marks. Upon affidavits and notice, Smith moved before the United States Circuit Court for the Northern District of New York for a temporary injunction in accordance with the prayer of the bill. The defendants appeared and read numerous affidavits in opposition, whereupon the court granted an injunction pendente lite, without requiring any security. Upon appeal to the United States Circuit Court of Appeals, the order granting the preliminary injunction was reversed upon the ground that the use of the combination ‘B. & S.’ was no infringement of the statutory trade-mark for the two letters ‘S. B.’ It was also held that the federal court could take jurisdiction only of the question whether the registered trade-marks had been infringed, and that it could not assume jurisdiction of the action so far as it was based upon ‘similarity in form, size, and color of the drops, in the arrangement of the package, in the text and style of the directions for use, and other details tending to show an intent to deceive the purchasing public,’ because both of the parties were residents of the same state. Subsequently, and on the 3d of February, 1896, the bill of Mr. Smith was dismissed by default, but still, as the record states, ‘upon the merits,’ with costs. This action was thereupon commenced by Burt & Sindele, the defendants in the injunction suit, against William Smith, the plaintiff therein, to recover damages for malicious prosecution. Upon the trial a nonsuit was granted, no evidence having been introduced by the defendant; but the plaintiffs' exceptions were ordered to be heard in the first instance by the Appellate Division, where they were sustained by a divided vote, and a new trial was ordered. The defendant appealed to this court, and gave the stipulation required by law.

A malicious prosecution is one that is begun in malice, without probable cause to believe it can succeed, and which finally ends in failure. An action for malicious prosecution is usually based upon an arrest in criminal proceedings, although it may be founded upon a civil action, when commenced simply to harass and oppress the defendant. Pangburn v. Bull, 1 Wend. 345;Vanduzor v. Linderman, 10 Johns. 106;Bump v. Betts, 19 Wend. 421; Cooley on Torts, 187; 19 Am. & Eng. Encyc. Law (2d Ed.) 652. Damages are rarely recovered, however, for the malicious prosecution of a civil action, unless person or property is interfered with by some incidental remedy, such as arrest, attachment, or injunction. As public policy requires that all persons should freely resort to the courts for redress of wrongs, the law protects them when they act in good faith and upon reasonable grounds in commencing either a civil or criminal prosecution. While malice is the root of the action, malice alone, even when extreme, is not enough, for want of probable cause must also be shown. Probable cause is the knowledge of facts, actual or apparent, strong enough to justify a reasonable man in the belief that he has lawful grounds for prosecuting the defendant in the manner complained of. The want of probable cause does not mean the want of any cause, but the want of any reasonable cause, such as would persuade a man of ordinary care and prudence to believe in the truth of the charge. Probable cause does not necessarily depend upon the actual guilt of the person prosecuted, but may rest upon the prosecutor's belief in his guilt, when based on reasonable grounds. One may act upon what appears to be true, even if it turns out to be false, provided he believes it to be true, and the appearances are sufficient to justify the belief as reasonable. Belief alone, however sincere, is not sufficient, for it must be founded on circumstances which make the belief reasonable. If probable cause exists, it is an absolute protection against an action for malicious prosecution, even when express malice is proved. Thus an innocent person may be prosecuted unjustly, and subjected to expense and disgrace, with no right to call the prosecutor to account, provided he acted upon an honest and reasonable belief in commencing the proceeding complained of. Peace and good order exact this hardship from the individual for the benefit of the people at large, so that citizens may not be prevented by the fear of consequences from attempting to assert their own rights, or to vindicate the cause of public justice by an appeal to the courts. Hazzard v. Flury, 120 N. Y. 223, 24 N. E. 194;Heyne v. Blair, 62 N.Y. 19;Farnam v. Feeley, 56 N. Y. 451;Carl v. Ayers, 53 N. Y. 14;Long Island Bottlers' Union v. Seitz, 180 N. Y. 243, 73 N. E. 20;Foshay v. Ferguson, 2 Denio, 617; Bishop on Noncontract Law, 238; Bigelow on Torts, 194; Addison on Torts, 592; Newell on Malicious Prosecution, 252.

The learned trial judge granted a nonsuit upon the ground that the order allowing the injunction was conclusive evidence of probable cause. It has been held by the Supreme Court of the United States that a final judgment of a court of superior jurisdiction is conclusive evidence of probable cause, even if it is subsequently reversed on appeal, because public policy requires that judgments and decrees should ‘be invested with that force and sanctity which shall be a shield and protection to all parties and persons in privity with them.’ Crescent City Live Stock Co. v. Butchers' Union, 120 U. S. 141, 7 Sup. Ct. 472, 30 L. Ed. 614. Some states have the same rule, and in Georgia it has been extended to an ex parte order granting an injunction and appointing a receiver pendente lite. Short & Co. v. Spragins, Buck & Co., 104 Ga. 628, 30 S. E. 810;Spring v. Besore, 12 B. Mon. 551, 555;Griffis v. Sellars, 20 N. C. 315;Whitney v. Peckham, 15 Mass. 243;Herman v. Brookerhoff, 8 Watts, 240. We find no case in this state where the effect of a judgment of a court of superior jurisdiction in this regard has been passed upon, although it has been held that a judgment rendered by a justice of the peace, and subsequently reversed upon appeal, is not conclusive, but only prima facie, evidence of probable cause. Burt v. Place, 4 Wend. 591;Nicholson v. Sternberg, 61 App. Div. 51,70 N. Y. Supp. 212. In Palmer v. Avery, 41 Barb. 290, the prevailing opinion went farther than the point decided, which was that the trial judge properly ruled that a judgment rendered by a justice of the peace, although reversed on appeal, is...