Gordon v. Noel

Citation356 N.W.2d 559
Decision Date17 October 1984
Docket NumberNo. 83-158,83-158
PartiesRonald GORDON, Appellee, v. David NOEL, David Bowen, and City of Des Moines, Iowa, Appellants.
CourtUnited States State Supreme Court of Iowa

J.M. Sullivan, Asst. Des Moines City Atty., for the appellants.

Nick Critelli, Des Moines, for appellee.

Considered by REYNOLDSON, C.J., and HARRIS, McCORMICK, SCHULTZ, and CARTER, JJ.

McCORMICK, Justice.

We granted further review of a decision of the court of appeals affirming a district court judgment for plaintiff to address a question concerning the effect of erroneous submission of one or more but not all theories of action in a multitheory submission when the jury returns a general verdict for the plaintiff. We hold that when a case is submitted on more than one theory of liability, even one of which is erroneously submitted, and the jury returns only a general verdict for the plaintiff, the case ordinarily must be reversed and remanded for new trial. Because the court of appeals adopted a contrary rule in affirming the judgment, we vacate the decision of the court of appeals and reverse the judgment of the district court and remand.

This action arose from an incident that occurred in a Des Moines bar operated by plaintiff Ronald Gordon at approximately 2:00 a.m. on September 27, 1979. Defendants David Noel and David Bowen are Des Moines police vice squad officers who entered the tavern to determine whether it was being operated after the statutory closing time. They were wearing civilian clothes. Gordon pointed a gun at the officers until they identified themselves, and a scuffle subsequently occurred over the gun. Eventually the officers arrested Gordon for being open after hours and on other charges and arrested two other persons on the premises, Rhonda Campbell and Steven Campbell, for intoxication. The charges against the Campbells were later dismissed, and Gordon was acquitted after a jury trial.

When Gordon's liquor license came up for renewal, defendants provided the city council and a hearing board of the state beer and liquor control department with evidence concerning the September 27th incident. Gordon's license was suspended for 30 days by the city council pursuant to Iowa Code section 123.39 (1979), and the suspension was affirmed first by the hearing board under section 123.32(4) and then by the district court in a judicial review proceeding.

Gordon and the Campbells brought the present action against the officers and the city seeking damages based on these events on several theories. They all sought damages for malicious prosecution and false arrest. Gordon also sought damages for assault and battery and intentional interference with prospective business advantage. The jury returned general verdicts for Gordon for $40,000 against defendants and for defendants against the Campbells. The jury also answered an interrogatory showing no damages were awarded to Gordon under one element in the general damage instruction relating to the intentional interference claim. This appeal by defendants followed. The Campbells are not involved in the appeal.

The questions concern the trial court's instructions on the malicious prosecution claim, the submission of the intentional interference claim, a discovery ruling and instruction on damages, and the effect of the general verdict for Gordon.

I. The malicious prosecution claim. In instructing the jury on the malicious prosecution claim, the trial court used language from uniform civil jury instruction 18.6 informing the jury that Gordon's acquittal on the criminal charge constituted evidence that would support a finding by the jury that the criminal prosecution was without probable cause. Defendants made a timely objection to the instruction, asserting that an acquittal is not probative on the issue of absence of probable cause. We recently addressed the same question in Carter v. MacMillan Oil Co., Inc., 355 N.W.2d 52, 56 (Iowa 1984), and our holding in that case disapproving the language of the instruction is dispositive here.

As noted by this court in Philpot v. Lucas, 101 Iowa 478, 481, 70 N.W. 625, 626 (1897):

Probable cause does not depend upon the guilt of the accused party in fact, but upon the honest and reasonable belief of the party commencing the prosecution.... [It] is well settled that the discharge of a defendant in a criminal prosecution does not raise even a presumption of want of probable cause. As some of the authorities put it in such a case, the acquittal affords no evidence that such charge was preferred without probable cause. [Citations omitted].

We adhere to that view. Therefore we find that the trial court erred in instructing the jury on the probable cause issue in this case.

Defendants also contend that the trial court erred in failing to give two of their requested instructions on the issue of actual malice. In one request they sought an instruction that malice cannot simply be inferred from lack of probable cause. In the other they sought an instruction that if the officers' purpose in initiating the prosecution was otherwise proper, their indignation or resentment toward Gordon, if any, would not subject them to liability. These requested instructions were based on an explanation of the actual malice standard in Vander Linden v. Crews, 231 N.W.2d 904, 906 (Iowa 1975). The concepts were applicable under the evidence and not embraced in the court's instructions. Therefore at least the substance of the requested instructions should have been given. See Adam v. T.I.P. Rural Electric Coop., 271 N.W.2d 896, 900 (Iowa 1978). We do not decide, however, whether reversal would be required on this ground.

II. The intentional interference with prospective business advantage claim. Gordon's theory on the intentional interference tort was that the police officers gave false evidence in his liquor license renewal proceeding. Defendants moved for directed verdict on this claim on the ground the officers' alleged false testimony in the license proceeding is not actionable in a civil case and on the ground of insufficiency of the evidence. The trial court overruled their motion, and they contend the court erred.

Gordon argues that the issue is moot because defendants prevailed on the intentional interference claim. He bases that argument on the jury's response to the following special interrogatory:

If you find that the plaintiff, Ronald Gordon, is entitled to recover on his claim for intentional interference with business relationship as set forth in Instruction 21, what portion of your verdict do you allocate for damages as set forth in Instruction No. 31F?

The jury placed a zero in the blank as a response. Gordon alleges this shows the jury found for defendants on the intentional interference claim.

We are unable to sustain the mootness claim for two reasons. First, the jury was to answer the interrogatory only if it found in Gordon's favor on the claim. Because the jury answered the interrogatory, we cannot say the particular answer proves the jury did not find defendants liable on that theory of action. Second, the instructions on intentional interference with prospective business advantage did not limit Gordon to the damages specified in instruction 31F. Instruction 31 was a general damages instruction and specified several other elements of damages. It is possible therefore that the jury allowed Gordon recovery for the business tort and awarded damages under the other provisions of instruction 31.

On the merits, we find that the trial court erred in overruling defendants' motion for directed verdict on the intentional interference claim on the ground of insufficiency of evidence. This claim was predicated on the fact the police officers' version of the incident of September 27, 1979, was before the city council and later the beer and liquor control department when these bodies acted on Gordon's application to renew his liquor license. In each instance the information was obtained at the request of the public entity as part of its administrative process. The bodies were informed in each instance that Gordon had been acquitted on the charges resulting from the incident.

The tort of intentional interference with prospective business advantage imposes liability on a person who intentionally and improperly interferes with the claimant's business expectancies "whether the interference consists of (a) inducing or otherwise causing a third person not to enter into or continue the prospective relation or (b) preventing the other from acquiring or continuing the prospective relation." Restatement (Second) of Torts § 766B (1979); see Page County Appliance Center v. Honeywell, 347 N.W.2d 171, 177 (Iowa 1984). In this case Gordon sought to show that his liquor license suspension was induced by false statements to the public bodies by the police officers. If it were not for the decision to suspend his license, he could not establish interference with his business expectancies. Therefore if the licensing decision cannot be impeached he has no intentional interference claim.

Gordon had a full and fair opportunity to be heard on the licensing issue before the public bodies charged with making the licensing decision. This included the opportunity to impugn the officers' statements. Adversary proceedings were conducted. With all of the evidence before them, the public bodies made the decision that Gordon's license should be suspended. It was their prerogative to do so. This exercise of independent judgment by the licensing authorities breaks the chain of causation between the officers' allegedly false statements and Gordon's loss of business expectancies. See Matossian v. Fahmie, 101 Cal.App.3d 128, 161 Cal.Rptr. 532 (1980); Carr v. Brown, 395 A.2d 79 (D.C.1978); Hohl v. Mettler, 62 N.J.Super. 62, 162 A.2d 128 (App.Div.1960). We hold that the trial court erred in overruling defendants' motion for directed verdict on the intentional interference claim.

III....

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