Hillside Associates v. Stravato

• Decision Date: 02 June 1994
• Docket Number: No. 93-85-A,93-85-A
• Citation: 642 A.2d 664
• Parties: HILLSIDE ASSOCIATES v. Louis R. STRAVATO.
• Court: Rhode Island Supreme Court

Page 664

642 A.2d 664

HILLSIDE ASSOCIATES v. Louis R. STRAVATO.

No. 93-85-A.

Supreme Court of Rhode Island.

June 2, 1994.

Mark E. Liberati, Leroy, Liberati & Peretti, Providence, for plaintiff.

Ira L. Schreiber, Schreiber & Schreiber, Cranston, for defendant.

OPINION

LEDERBERG, Justice.

This matter came before the Supreme Court on the appeal of Hillside Associates (Hillside or plaintiff) from a directed verdict in favor of Louis R. Stravato (Stravato or defendant). The sole issue before us is whether the defendant's appeal of the issuance of a building permit to the plaintiff can subject the defendant to liability for malicious prosecution and/or abuse of process. For the reasons stated herein, we conclude that such causes of action may arise from the misuse of administrative proceedings. Facts pertinent to this appeal follow.

BACKGROUND

The plaintiff, a limited partnership, formulated a plan in the early 1970s to build a forty-two-unit subsidized housing project (project) on land located on Plainfield Street, Providence, Rhode Island. The plaintiff's plans, however, met fierce opposition from residents of the neighborhood. See Mesolella v. City of Providence, 439 A.2d 1370, 1372 (R.I.1982). The defendant, who, as a member of the Providence City Council, represented the Plainfield Street neighborhood from 1975 to 1989 and was a landowner within one mile of the proposed project, took up his constituents' cause and vigorously challenged the project. One action initiated by defendant was an amendment to the city zoning ordinance that changed the area from its R-3 designation, which permitted multiple-unit dwellings, to an R-1 zone, which prohibited multifamily housing, and thereby barred the project. Following plaintiff's challenge, this court held that the amendment was null and void in respect to plaintiff's land, id. at 1375, after which decision the project was resumed.

After an action in Federal District Court, ¹ plaintiff received the necessary building permit from the Providence building inspector on July 14, 1989. Within a week or two, plaintiff began surveying and clearing the land for construction. But defendant appealed the issuance of the building permit to the Providence Zoning Board of Review (board), ² and a cease-and-desist order halted further construction of the project during defendant's appeal. In his appeal to the board, defendant alleged that, because plaintiff's proposal did not comply with a Providence zoning ordinance that set out parking requirements for dwellings, the building permit had been issued illegally. After a hearing, the board, on October 6, 1989, found that the proposed project complied with the Providence Code of Ordinances, rejected defendant's appeal, and ruled that the permit had been properly issued. The plaintiff resumed construction and completed the project on July 30, 1990, almost twenty years after its inception.

In 1989, before the project was completed, plaintiff filed the instant action against defendant, seeking monetary damages for one count of malicious prosecution and one count of abuse of process. The Superior Court initially granted summary judgment in favor of defendant. On appeal, however, this court vacated that judgment and remanded the case for trial on the merits. Hillside Associates v. Stravato, 590 A.2d 105, 105 (R.I.1991). Trial was commenced on September 24, 1992. At the conclusion of plaintiff's presentation of evidence, the trial justice granted defendant's motion for a directed verdict. The plaintiff then filed this appeal pursuant to G.L.1956 (1985 Reenactment) § 9-24-1.

STANDARD OF REVIEW

We note that when reviewing a decision by the trial court "on a motion for a directed verdict, this court is bound by the same rules that govern the trial justice," Rodrigues v. Miriam Hospital, 623 A.2d 456, 460 (R.I.1993), namely, "[w]e must examine all the evidence in the light most favorable to the nonmoving party without considering the weight of the evidence or the credibility of the witnesses. We must draw from that evidence only those reasonable inferences that support the position of the opposing party." Id.

THE INSTANT APPEAL: ANALYSIS

The trial justice granted the directed verdict for defendant after determining that claims for malicious prosecution and abuse of process cannot arise from an appeal to a zoning board of review. The sole issue on appeal, then, is whether the initiation of such an administrative proceeding can give rise to liability for malicious prosecution and/or abuse of process.

We impliedly suggested our response in the earlier appeal from summary judgment. Hillside, 590 A.2d at 105. In that per curiam opinion, we held that summary judgment had been improper because there was an outstanding issue of fact "concerning whether or not defendant's appeal from the awarding of a building permit could have constituted an abuse of the administrative appellate process and may have been taken for purposes which might be found to be malicious." (Emphasis added.) Id. Upon remand, however, in deciding defendant's motion for a directed verdict, the trial justice ruled that claims for malicious prosecution and abuse of process can arise only by subversion of a judicial process. With this opinion, we expand our previous formulation, and conclude that, in the proper circumstances, claims for malicious prosecution and/or abuse of process may arise from a party's malicious use or abuse of an administrative process.

Since the time of the ancient biblical proscriptions against bearing false witness against one's neighbor (Book of Exodus 20:16), to the Restatement (Second) Torts § 674, § 680 (1977)(wrongful initiation of proceedings), to the protections of limits on Strategic Litigation against Public Participation (SLAPP) suits, G.L.1956 (1985 Reenactment) chapter 33 of title 9 as enacted by P.L.1993, ch. 354, § 1 and P.L.1993, ch. 448, § 1 (suits that harass or inhibit another's rights), societies have attached liability--whether deferred or immediate--to litigation brought with malice and without probable cause. See Brough v. Foley, 572 A.2d 63, 66 (R.I.1990). One Anglo-Saxon sanction called for removing the tongue of the complainant who brought a frivolous suit, though monetary compensation could be substituted. 8 Stuart M. Speiser et al., The American Law of Torts § 28:2 at 9 & n. 9 (1991).

The torts of malicious prosecution and abuse of process, although often linked, are two distinct causes of action. Malicious prosecution or malicious use of process has been "defined as a suit for damages resulting from a prior criminal or civil legal proceeding that was instituted maliciously and without probable cause, and that terminated unsuccessfully for the plaintiff therein." Nagy v. McBurney, 120 R.I. 925, 929, 392 A.2d 365, 367 (1978). Abuse of process, on the other hand, arises when a legal proceeding, although set in motion in proper form, becomes perverted to accomplish an ulterior or a wrongful purpose for which it was not designed. Brough, 572 A.2d at 67-68 (citing Nagy, 120 R.I. at 934, 392 A.2d at 370). "Thus if the defendant prosecutes an innocent plaintiff for a crime without reasonable grounds to believe him guilty, it is malicious prosecution; if he prosecutes him with such [reasonable] grounds [but his ulterior motive is] to extort payment of a debt, it is abuse of process." W. Page Keeton et al., Prosser and Keeton on the Law of Torts § 121 at 897-98 (5th ed.1984).

These torts originally developed to prevent individuals from abusing their right of access to the courts and other tribunals. See Melvin v. Pence, 130 F.2d 423, 426 (D.C.Cir.1942). Whereas historically such causes of action arose from misuse of court proceedings or judicial processes, the continually expanding role of administrative bodies that perform quasi-judicial functions created the setting for the abuse of administrative proceedings. See id.

The Rhode Island Legislature has recognized the increasing role of administrative bodies in determining individual rights and interests. The Administrative Procedures Act (APA), for example, requires administrative agencies, in contested cases, to afford all parties an opportunity for a hearing and reasonable notice of such hearing. G.L. 1956 (1993 Reenactment) § 42-35-9. In addition, all parties can present evidence and argument on all issues, § 42-35-9(c), as well as conduct cross-examination in order to obtain full and true disclosure of the facts, § 42-35-10(c). Moreover, the Legislature recently attempted to balance two important competing interests through the enactment of G.L.1956 (1991 Reenactment) § 45-24-67: one interest represents public participation in zoning board hearings; the other interest embodies the potential for abuse of such proceedings. The statute provides that "[p]articipation in a zoning hearing * * * shall not be a cause for civil action or liability except for acts not in good faith, intentional misconduct, a knowing violation of law, transactions where there is an improper personal benefit, or malicious, wanton, or willful misconduct." (Emphasis added.)

Courts in other jurisdictions have also recognized the increasing role and importance of administrative agencies in adjudicating individual rights and interests. As early as 1932, liability for the tort of malicious prosecution was found to arise from a proceeding outside the traditional judicial process. In National Surety Co. v. Page, 58 F.2d 145, 148 (4th Cir.1932), the Fourth Circuit ruled that an attempt before a state corporation commission to revoke an insurance agent's license could give rise to suit for malicious prosecution. In 1942 the United States Court of Appeals for the District of Columbia held that a cause of action for malicious prosecution could arise from the malicious filing of a complaint before the District of Columbia licensing authority in an attempt to revoke a private-detective license. Melvin, 130 F.2d at...