Grell v. Poulsen
| Decision Date | 18 June 1986 |
| Docket Number | No. 85-445,85-445 |
| Citation | 389 N.W.2d 661 |
| Parties | William GRELL and Mary Grell, Appellants, v. Carmen M. POULSEN, Executor of the Estate of Paul E. Poulsen, Deceased, and John Underwood, Appellees. |
| Court | Iowa Supreme Court |
Peter C. Riley and Mary K.P. Hoefer of Tom Riley Law Firm, P.C., Cedar Rapids, for appellants.
John T. Nolan of Rate, Nolan, Bohanan, Moen & Lucas, Iowa City, for appellee Poulsen.
Adrian T. Knuth, Anamosa, for appellee Underwood.
Considered by REYNOLDSON, C.J., and HARRIS, CARTER, WOLLE, and LAVORATO, JJ.
A disagreement concerning the unwritten terms of a business relationship between Paul E. Poulsen, now deceased, and plaintiff William Grell mushroomed into the present several-party multiple-count lawsuit. The case was submitted to a jury on four damage claims: the Grells' quantum meruit claim against the Poulsen estate; the estate's counterclaims for abuse of process and defamation; and defendant John Underwood's counterclaim against the Grells for abuse of process. The jury found no merit in the Grells' quantum meruit claim and also rejected the defamation counterclaim of the Poulsen estate. On the abuse of process claims which are the subject of this appeal, however, the estate and Underwood recovered damages from the Grells on the theory that Grells had initiated the litigation for the purpose of gaining a competitive business advantage. The Grells contend they were entitled to a directed verdict and judgment notwithstanding the verdict on the counterclaims because the evidence did not satisfy one element of abuse of process. We agree and therefore reverse.
In determining whether the evidence was sufficient to satisfy the elements of abuse of process and engender a jury question, we view the evidence in the light most favorable to the counterclaimants who received a favorable jury verdict. Rippel v. J.H.M. of Waterloo, Inc., 328 N.W.2d 499, 500 (Iowa 1983); Schiltz v. Cullen-Schiltz & Associates, 228 N.W.2d 10, 17 (Iowa 1975); Iowa R.App.P. 14(f)(2), (17). We focus on the business relationships between the parties. The counterclaimants seek to uphold their favorable jury verdicts on the theory that Grells sued Poulsen and Underwood not to recover damages but solely to disrupt the counterclaimants' businesses and business relationship.
William Grell first went to work for Poulsen as a distributor in Las Vegas, Nevada, for Poulsen's line of marguerita mixes. Poulsen did not manufacture his own drink mixes but obtained them from Bar None, Inc., a bottling company located in Tustin, California which Underwood owned and operated. When the Las Vegas venture was unsuccessful, William Grell returned to Iowa but continued working in Poulsen's bar mix business. His wife Mary and he also performed bookwork and other duties in connection with Poulsen's several Iowa City enterprises. The good business relationship between Poulsen and his supplier Underwood survived the unsuccessful Las Vegas venture; they continued their joint enterprise involving the production and sale of bar mixes in Iowa.
Grells worked for Poulsen in the Iowa City area from April of 1982 until March of 1983 when their business relationship ended in harsh words and bitter disagreements. Poulsen rejected the Grells' contention that he had orally agreed to provide them a partnership interest in his business enterprise. Within three weeks after the employment relationship terminated, the Grells commenced this lawsuit as a damage action against Poulsen. They contended he had committed intentional business torts by inducing them to work for him and then forcing them out of the business. Subsequently the Grells added Underwood as a defendant and alleged that he had "usurped [William Grell's] partnership position with Poulsen." By the time the jury received and rejected those damage claims against the Poulsen estate and Underwood, the Grells had scaled down their theories for recovery to a simple quantum meruit claim for damages.
In the meantime, however, Poulsen counterclaimed for damages alleging abuse of process and defamation, and when Underwood was joined as a defendant he too alleged in a counterclaim that Grells had abused process in filing their damage action. Because the jury rejected Poulsen's defamation counterclaim, we need not relate the evidence on which it was based. The abuse of process counterclaims were premised on the theory that the Grells had filed their lawsuit solely to gain a competitive business advantage over Poulsen and Underwood. The evidence, viewed in the light most favorable to the counterclaimants, disclosed that William Grell's brother was involved in a bar mix business that was in direct competition with that of Poulsen and Underwood. The brother's business had also received financial assistance from certain relatives of the attorney who initially filed the Grells' lawsuit. Against that backdrop of the Grells' motive to gain a competitive advantage over the bar mix business of Poulsen and Underwood, the counterclaimants highlighted three events which occurred after Poulsen and the Grells had parted company. First, William Grell declared shortly after the breakup that he had set out to find "the meanest lawyer in the country" and he was going to "tear Paul Poulsen's ... head right off his shoulders." Second, William Grell acknowledged that he considered Underwood an innocent bystander; Underwood contends this proved the Grells joined him as a lawsuit defendant solely to destroy his business relationship with Poulsen by driving a wedge between them. 1 Finally, the counterclaimants emphasized that in preparation for trial the Grells requested that Poulsen disclose to them his customer lists and other data concerning the bar mix business.
We must decide whether the evidence satisfied all of the elements of abuse of process or whether, as the Grells contend, the evidence was insufficient to support submission of those counterclaims to the jury.
We have most recently defined the elements of an abuse of process claim in Schmidt v. Wilkinson, 340 N.W.2d 282, 284-85 (Iowa 1983), drawing upon earlier discussions of abuse of process in Mills County State Bank v. Roure, 291 N.W.2d 1, 4 (Iowa 1980), and Sarvold v. Dodson, 237 N.W.2d 447, 448-49 (Iowa 1976). Schmidt adopted the definition contained in section 682 of the Restatement (Second) of Torts (1977):
One who uses a legal process, whether criminal or civil, against another primarily to accomplish a purpose for which it is not designed, is subject to liability to the other for harm caused by the abuse of process.
In Schmidt, we quoted with approval comment b to that Restatement section, an important comment on why the restrictive word "primarily" had been added to the original Restatement definition. The comment provides in pertinent part:
"Primarily." The significance of this word is that there is no action for abuse of process when the process is used for the purpose for which it is...
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