Mayflower Industries v. Thor Corp.

• Citation: 15 N.J.Super. 139,83 A.2d 246
• Decision Date: 10 August 1951
• Docket Number: No. C--1349,C--1349
• Parties: MAYFLOWER INDUSTRIES v. THOR CORP. et al.
• Court: New Jersey Superior Court

Page 139

15 N.J.Super. 139

83 A.2d 246

MAYFLOWER INDUSTRIES v. THOR CORP. et al.

No. C--1349.

Superior Court of New Jersey, Chancery Division.

Aug. 10, 1951.

Ruback, Albach & Weisman, Newark (Meyer E. Ruback and Joseph A. Weisman and Alfred C. Clapp, Newark), for plaintiff.

Thomas J. Brogan, Jersey City, for defendant Thor Corp.

Richard J. FitzMaurice, Orange, for defendant Teldisco, Inc.

FRANCIS, J.C.C. (temporarily assigned).

Plaintiff, Mayflower Industries, has moved for summary judgment in its favor on the 'First Counterclaim' filed by the defendant, Thor Corporation, and on the counterclaim filed by the defendant, Teldisco, Inc.

The grounds upon which the relief is sought are set forth in the notice of motion as follows:

(1) There is no genuine issue as to any material fact challenged, and that plaintiff is entitled to judgment as a matter of law;

(2) The counterclaims fail to state a claim upon which relief can be granted; or,

(3) That if dismissal is not granted on (1) or (2), then judgment should be entered in favor of the defendants on their respective counterclaims and against the plaintiff for nominal damages, namely, six cents.

I.

The Thor Counterclaim.

A. Liability.

The Thor counterclaim involved on this motion charges:

'Fortieth: That on or about March 20, 1950, the plaintiff maliciously and without probable cause, commenced this action against defendant, Thor Corporation, and a restraining order was obtained on the basis of a false and groundless claim of a distributorship contract for as long as Thor Corporation manufactures home appliances.

'Forty-First: That said action and restraining order has caused and is causing defendant, Thor Corporation, great injury and damage in loss of business, profits and good will, and also in expenses of litigation, including attorneys' fees.'

In the last letter supplement to the three briefs submitted by the plaintiff, the argument is made that the counterclaim is premature because the litigation charged to have been maliciously initiated and prosecuted, had not terminated at the time it was filed. It is the fact, of course, that the counterclaim was interposed in this very action which is the one alleged by the defendant to have been maliciously prosecuted. The weight of authority in this country, including New Jersey, is to the effect that the original proceeding must have terminated before an action for malicious prosecution can be instituted. (Little v. Little, 4 N.J.Super. 352, 67 A.2d 201 (App.Div.1949); Shoemaker v. Shoemaker, 11 N.J.Super. 471, 78 A.2d 605 (App.Div.1951); Kietrys v. Cregar, 43 A.2d 810, 23 N.J.Misc. 273 (Sup.Ct.1945); Weisner v. Hansen, 81 N.J.L. 601, 80 A. 455 (E. & A. 1911); Potter v. Casterline, 41 N.J.L. 22, 23 (Sup.Ct.1879); March & Vogel, New Jersey Practice Forms, § 377; Restatement of Torts, c. 30, § 674; 34 Am.Jur., Malicious Prosecution, § 41; Prosser on Torts, § 96, p. 867; 54 C.J.S., Malicious Prosecution, § 79, p. 1045), although there is some authority in support of the view that it may be done by way of counterclaim in the pending suit. Herendeen v. Ley Realty Co., 75 N.Y.S.2d 836 (Sup.Ct.N.Y.1947).

It may well be that under our present liberal practice rules, designed as they are in large measure to achieve the disposition of all actions between the parties in one litigation, the filing of such a counterclaim would be allowed, but trial thereon withheld pending the disposition of the original action. Ciocca v. Hacker, 4 N.J.Super. 28, 66 A.2d 451 (App.Div.1949); Shapiro v. Rice, 5 N.J.Super. 133, 68 A.2d 563 (App.Div.1949). However, that problem need not be determined for reasons to be stated presently.

The counterclaim was recorded on April 11, 1951. No motion was made to dismiss it on the ground of prematurity. Plaintiff's action was dismissed with prejudice on May 28, 1951. So, aside from the fact that even on the present notice of motion prematurity is not set down as a reason for summary judgment, the state of the record now is that the original action has terminated. Accordingly, defendant's counterclaim should not be subjected to the summary disposition sought by the plaintiff, only to have the action immediately reinstituted as an independent suit.

In its own brief, defendant expresses some concern over the failure to allege in the counterclaim that the suit maliciously brought by the plaintiff had terminated in its favor. And it requests, under Rule 3:15, that if the court finds such allegation to be essential, an amendment be allowed to include it.

Under our former practice, this allegation was indispensable. Kietrys v. Cregar, supra. Rigid pleading requirements were interred upon the birth of the new Rules of Civil Practice. Applying the more liberal approach, it is argued in effect that the allegation 'without probable cause' connotes and encompasses a termination of the original action, favorable to the party seeking recovery for malicious prosecution. However, favorable termination is one of the essential elements of such a claim, and even the new rules have not dispensed with the need for alleging the conditions precedent to the existence of a particular cause of action. Grobart v. Society for Establishing Useful Manufacture, 2 N.J. 136, 65 A.2d 833 (1949).

Defendant refers to some instances outside of New Jersey where, in exceptional circumstances the right of action was recognized even though the outcome of the original proceeding was adverse to the plaintiff in the malicious prosecution case. Without undertaking to differentiate them from a Pleading standpoint or to declare them to be inconsistent with the holding of our appellate courts, it seems advisable at this time, and in view of the actual termination here of the original litigation, to require the allegation to appear in the counterclaim. Defendant's motion to add it by way of amendment will be granted.

Disposition of these matters makes necessary consideration of the more fundamental problems raised by the motion.

The counterclaim sounds in malicious prosecution. Defendant argues that it may, and in fact should, be looked at also as pleading a cause of action for unlawful interference with economic or business relations and for abuse of process. However, since the existence or non-existence of the cause of action is so centered about the good faith of the original action and the truth or falsity of the affidavit on which the Ad interim restraint was granted, and because the only wrongdoing charged relates to the institution of the one action, the claim will be treated as one for malicious prosecution. In view of the conclusion reached herein that a factual issue is presented on that claim, it does not appear to be necessary to deal with any other concept of wrongdoing charged against the plaintiff.

It may be said in passing that on the pleadings and affidavits now before the court, a case of abuse of process is not presented. Such a cause of action arises where process is perverted after its regular issue. Ash v. Cohn, 119 N.J.L. 54, 58, 194 A. 174 (E. & A.1937); Hoppe v. Klopperich, 224 Minn. 224, 28 N.W.2d 780, 790, 173 A.L.R. 819 (Minn.Sup.Ct.1947); Prosser on Torts, § 98; 1 Cooley on Torts, 4th ed. § 131, p. 437; Anno., 80 A.L.R. 580; Restatement-Torts, § 136(b), comment (c); 40 Harv.L.Rev. 502 (note).

So far as the case for malicious interference with business relations is concerned in the present situation, the basic proof requirements appear to be substantially the same as those needed to support the malicious prosecution counterclaim. Such an action seems to be regarded generally as one in the nature of malicious prosecution. Prosser on Torts, § 97, p. 888, § 1018--1019; Polo v. Edelbrau Brewery, 185 Misc. 775, 60 N.Y.S.2d 346 (N.Y.Sup.Ct.1947).

Originally, no cause of action was recognized in the law for the wrongful institution of a civil action irrespective of the fact that it was brought maliciously and without probable cause. The recovery of costs by the defendant was considered sufficient redress. However, the inadequacy of this remedy asserted itself and as early as 1816 our Supreme Court established an exception to the doctrine. In Potts v. Imlay, 4 N.J.L. 377, 382 (Sup.Ct.1816), it was declared that an action for malicious prosecution could not be maintained for prosecuting a civil suit Unless the defendant in that suit was 'arrested without cause and deprived of his liberty or made to suffer other special grievance different from and superadded to the ordinary expense of a defense.' This rule has never been changed or criticized and it still represents the law of this State. Bitz v. Meyer, 40 N.J.L. 252 (Sup.Ct.1878); Schneider v. Mueller, 132 N.J.L. 163, 39 A.2d 132 (E. & A.1944).

Our courts have not been confronted with the need for particularizing the 'special grievance' referred to. Cooley on Torts, after reviewing the cases on the subject in other jurisdictions, many of which refer to Potts v. Imley as source material, says: 'So a suit for malicious prosecution will lie where the plaintiff's property or business has been interfered with by the appointment of a receiver, the Granting of an injunction, by writ of replevin, by the filing of a lis pendens, or the preferment of charges against a police officer which results in his suspension from duty.' Section 128; see also Restatement of Law of Torts, § 677; H. P. Rieger & Co. v. Knight (76 U.S.App.D.C. 154) 128 Md. 189, 97 A. 358 (L.R.A.1916E, 1277) (Ct. of App.1916); Melvin v. Pence, 130 F.2d 423 (143 A.L.R. 149) (C.C.A.D.C.1942); Peckham v. Union Finance Co., (60 App.D.C. 104) 48 F.2d 1016 (C.C.A.D.C.1931); 34 Am.Jur. § 11.

There can be no reasonable disagreement with this statement. Plainly, an injunction which prevented Thor from conducting its business in a particular area and from using, enjoying and dealing with its property, constitutes a special grievance.

The action for malicious prosecution of a civil suit is governed by...