Greer v. State Farm Fire & Cas. Co.

• Decision Date: 16 June 1976
• Docket Number: No. 3,No. 52017,52017,3
• Parties: A. E. GREER et al. v. STATE FARM FIRE AND CASUALTY COMPANY
• Court: Georgia Court of Appeals

Page 881

227 S.E.2d 881

139 Ga.App. 74

A. E. GREER et al. v. STATE FARM FIRE AND CASUALTY COMPANY.

No. 52017.

Court of Appeals of Georgia, Division No. 3.

June 16, 1976.

Hugh G. Head, Jr., Kathleen Kessler, Douglas T. Noonan, Richard L. Fullerton, Atlanta, for appellants.

Henning, Chambers & Mabry, Edward J. Henning, Walter B. McClelland, Atlanta, for appellee.

QUILLIAN, Judge.

Mr. and Mrs. Greer, tenants in Atlanta's Baptist Towers, were injured in a fire which consumed the 7th through 10th floors of the Towers on November 30, 1972. Along with other tenants injured in that fire, the Greers brought suit against the builder, Thomas A. Butler, Sr., who was covered by a State Farm Fire & Casualty Company 'homeowner's policy.' Mr. Butler called upon State Farm to defend him. State Farm contended that as Mr. Butler had not immediately forwarded to them 'notice . . . concerning the occurrence' and 'every demand, notice of claim, summons or other process' received by him, it was questionable as to whether his 'policy conditions were violated.' However, they employed the firm of 'Greer, Pollack and Klosik' to represent Mr. Butler without waiving 'any of the terms or conditions of the policy.'

The record does not reveal when the Greers filed their first action against Mr. Butler, but at a later date, State Farm hired the law firm of Henning, Chambers and Mabry to represent them in this action for a declaratory judgment as to their liability to Mr. Butler under the policy, and prayed that the Greers and other plaintiffs be 'restrained and enjoined from proceeding with and prosecuting (their) damage suits until a final determination of this action has been reached.' All plaintiffs in the earlier actions against Mr. Butler, as well as the Greers and Mr. Butler, were named as defendants in this action for a declaratory judgment. This latter action was filed on June 16, 1975.

On June 22, 1975, the Greers wrote to a judge of DeKalb Superior Court 'in answer to papers served on (them)' in this action, advising the court that their suit arising from the Baptist Towers fire had been settled. However, three days later, on June 25, 1975, the Greers formally answered the present action and filed a counterclaim, alleging that the present suit by State Farm is 'malicious, vicious, and designed to be extortionate and harassing and outrageous so as to inflict . . . mental anguish, worry, suffering, and fear upon defendants . . .' because State Farm 'knew when it filed its suit that the litigation it sought to enjoin had been ended and (State Farm) had no conceivably valid legal cause of action.' Emphasis supplied.

On July 11, 1975, State Farm filed a 'Voluntary Dismissal' of its action against the Greers and moved to dismiss the Greers' counterclaim. In support of its motion to dismiss, State Farm filed affidavits of its attorneys who represented them in both civil actions and of a Mr. R. A. Reynolds, resident claims superintendent of State Farm, who 'handled under (his) direct supervision and control' the defense of the original claims against Mr. Butler. The attorney who defended Mr. Butler in the original action and one of the lawyers who represented State Farm in this action, and the State Farm claims superintendent all stated that they had no knowledge, either actual or constructive, that the Greers had 'settled or agreed to settle any claims which they might have asserted in' the original suit prior to this action being filed for a declaratory judgment. The remaining lawyer in the present case made the same statement but added that some time after June 16, 1975, the date this action was filed, it came to his attention that the prior case may have been settled, and through his investigation he discovered that the case 'had been dismissed and the court costs paid on June 30, 1975,' and therefore he filed 'a dismissal of the declaratory judgment action . . . on July 11, 1975.'

A hearing was set on plaintiff's motion to dismiss the Greers' counterclaim for August 19, 1975. On the day preceding the hearing the Greers filed an amendment to their counterclaim and 'incorporate(d) . . . by reference their entire counterclaims and pleadings heretofore filed by them.' On the following day, August 19, 1975, the trial court converted the motion to dismiss to one for summary judgment as evidence supporting the motion had been introduced. Plaintiff's motion for summary judgment was sustained. Defendants appeal. Held:

1. When a plaintiff employs a civil proceeding in order to execute the object which the law intends to subserve, but proceeds maliciously and without probable cause, an action for malicious use of process lies. Dixie Broadcasting Corp. v. Rivers, 209 Ga. 98(5), 70 S.E.2d 734. Before one can recover in an action for malicious use of civil process, three essential elements must appear: (1) malice, (2) want of probable cause, and (3) termination of proceedings in favor of the defendant. Georgia Veneer & Package Co. v. Florida National Bank, 198 Ga. 591(2), 32 S.E.2d 465. In the instant case the suit upon which the counterclaim was based had not terminated but was pending when the counterclaim was filed. This court held in Metro Chrysler-Plymouth, Inc. v. Pearce, 121 Ga.App. 835, 841, 175 S.E.2d 910: 'Under many decisions of the Supreme Court and of this court this counterclaim is premature, because there has been no termination of the main action in defendant's favor, and at the time of serving his pleading defendant had no claim, or was in no position to assert one, against the plaintiff for malicious use of process.' The court went further to explain that '(t)he rule that 'there can be no recovery unless the plaintiff has a complete cause of action at the time the suit is filed,' and that 'a cause of action accruing pending the suit will not entitle the plaintiff to recover,' (Deas v. Sammons, 126 Ga. 431, 432 (55 S.E. 170, 7 Ann.Cas. 1124)), applies equally to a counterclaim.' Id.

In Metro Chrysler-Plymouth, supra, this court discussed the effect of Code Ann. § 81A-113(a)-compulsory counterclaims which had not matured at the time of the filing of the action, but did not reach Code Ann. § 81A-113(e), 'a claim which either matured or was acquired by the pleader after serving his pleading.' This latter issue was discussed in Monumental Properties v. Johnson, 136 Ga.App. 39, 220 S.E.2d 55, in tandem with Code Ann. § 81A-115(d) (Ga.L.1966, pp. 609, 627; 1968, pp. 1104, 1106; 1972, pp. 689, 694) which provides: 'Upon motion of a party the court may, upon reasonable notice and upon such terms as are just, permit (a party) to serve a supplemental pleading setting forth transactions or occurrences or events which have happened since the date of the pleading sought to be supplemented. Permission may be granted even though the original pleading is defective in its statement of a claim for relief or defense.'

In the instant case, even if the answer and counterclaim were premature at the date of original filing, the subsequent amendment of the original counterclaim, after plaintiffs had voluntarily dismissed their complaint, was timely filed and no objection was made by plaintiff. On the contrary-plaintiff's counsel stated in judicio: 'We have no objection to them proceeding in court by way of a counterclaim to determine the issues raised in the counterclaim . . .' Accordingly, it would have been incorrect to dismiss the amended counterclaim, filed after the termination of the original action, as it was not premature under Code Ann. §§ 81A-113(e) and 81A-115(d), as a permissible counterclaim. Monumental Properties, Inc. v. Johnson, 136 Ga.App. 39, 40, 220 S.E.2d 55, supra; 3 Moore's Fed. Practice § 15.16(2)(3); compare Baitcher v. Louis R. Clerico Assoc., Inc., 132 Ga.App. 219(1), 207 S.E.2d 698.

2. The sole enumeration of error was that the final order of the trial...