Nevada Credit Rating Bureau, Inc. v. Williams

• Decision Date: 17 November 1972
• Docket Number: No. 6703,6703
• Parties: , 56 A.L.R.3d 483 NEVADA CREDIT RATING BUREAU, INC., a corporation, and John Aden, Appellants, v. Isaac N. WILLIAMS, Respondent.
• Court: Nevada Supreme Court

Page 9

503 P.2d 9

88 Nev. 601, 56 A.L.R.3d 483

NEVADA CREDIT RATING BUREAU, INC., a corporation, and John

Aden, Appellants, v. Isaac N. WILLIAMS, Respondent.

No. 6703.

Supreme Court of Nevada.

Nov. 17, 1972.

Wait, Shamberger & Georgeson, Reno, George W. Abbott, Minden, for appellants.

Daniel R. Walsh, Carson City, for respondent.

OPINION

BATJER, Justice:

This is an appeal from a judgment awarding respondent $32,002 compensatory damages jointly and severally against appellants, Nevada Credit Rating Bureau, Inc., (hereinafter Nevada Credit) and John Aden, and punitive damages of $1,500 against Nevada Credit and $250 against Aden for abuse of process.

In 1961 respondent Williams lived in the Mina-Luning area in Mineral County. He had engaged in the mining business in this state since 1923, and had gained possession of the necessary equipment to enable him to excavate, move and strip earth. Williams performed these operations around the Lovelock area until 1958 when he encountered financial difficulties. He became indebted to Nevada Bank of Commerce on some conditional sales contracts, and when he defaulted on several of the payments Graid Construction Company of Reno paid the bank on his behalf. In return Graid received title to some of Williams' equipment. However, at all times, Williams retained possession of and the right to use all of the equipment.

He moved to the Mina area in 1961. There he met appellant Aden who was employed by a mining corporation doing business in that area. In the spring of 1962 Aden requested Williams to do some excavating work for him, but Williams was unable to accept because the rails on his bulldozer were worn out. Several times Aden offered to purchase the rails and let Williams repay him by doing the proposed excavation work. Williams finally accepted this offer, and became indebted to Aden in the amount of $4,287.03 for the rails as well as for miscellaneous advances for operating expenses and repairs to other equipment.

Aden had work available after Williams' bulldozer became operational, but he offered no work to Williams. Instead, he contracted the work out to other individuals even though Williams was at all times ready to perform. At about this same time Aden contacted Robert Records, general manager of a mining company in the area, in an effort to have Records attempt to purchase Williams' equipment. Records told Aden that he would not act as a middleman and that he was sure Aden could purchase the equipment directly from Williams. Records testified that Aden said 'he would get it anyway.'

Aden next contacted appellant Nevada Credit about collecting the amount owed him by Williams and they accepted the alleged debt on assignment for purposes of bringing suit. No request or demand for payment was ever made by Nevada Credit, and on November 20, 1962, they filed an action in Washoe County against Williams seeking recovery of $4,395.07, plus interest, costs and attorney's fees. On this same date, Nevada Credit authorized an attachment of Williams' equipment and appointed Aden as its agent to accompany the deputy sheriff to Williams' property to execute the writ. Aden instructed the deputy sheriff to attach all of Williams' equipment, including his housetrailer. The deputy served Williams with a copy of the writ, inventoried the equipment and placed sheriff's seals on most major pieces. The machinery was not placed in storage but was left on property near Williams' residence. The deputy sheriff instructed Williams that he was not to move or touch any of his equipment. All of Williams' equipment which the trial court found to have a reasonable value of over $30,000 was attached to secure the alleged debt amounting to less than $5,000.

In the next several months various efforts were made to have some of the equipment released but the requests were summarily rejected by Nevada Credit. Graid Equipment Company and other parties having legal title to some of the equipment sought a release of individual pieces of machinery but their claims were not recognized by appellants.

The case on the alleged debt was tried in district court on August 5, 1963, and the court found for Williams, holding that there was no account stated, but merely an agreement whereby Williams was to repay Aden by performing work for him. On appeal, we affirmed the lower court's decision, and held that the contract was executory, and that Williams had not breached it. Nevada Cr. Rating Bureau v. Williams, 80 Nev. 343, 393 P.2d 618 (1964).

In February of 1966 Williams brought an action for wrongful attachment and/or malicious prosecution. Aden and Nevada Credit denied the facts alleged by Williams and asserted as defenses that no actual attachment of the property was ever perfected by the sheriff, that they both acted upon the basis of probable cause and without malice, and that in any event Williams incurred no damages entitling him to compensation from them.

The trial court did not find the appellants guilty of wrongful attachment or malicious prosecution but instead found that they had committed the tort of abuse of process. Although abuse of process was not raised by the pleadings the evidence supported this issue. NRCP 15(b); Jaksich v. Guisti, 36 Nev. 104, 134 P. 452 (1913). The trial court found that as a direct and proximate result of the wrongful acts of Aden and Nevada Credit, Williams was deprived of the use of his property for 11 months (one machine for only 9 months) and that the reasonable rental value for that period, with adjustments for depreciation and demand for hiring the equipment was $32,002. In addition to these compensatory damages the court assessed punitive damages. No damages were awarded for suffering, humiliation, or loss of credit.

The appellants contend that the judgment of the trial court must be reversed because no valid attachment ever occurred upon which an action for wrongful attachment, malicious prosecution or abuse of process could be based. In this regard they rely upon NRS 31.060(2) which requires that personal property capable of manual delivery shall be attached by taking it into custody. All of Williams' machinery was bulky, and some was inoperable, but it would have been possible for the sheriff to have taken it into his physical possession. Nevertheless, the sheriff left the property in the equipment yard. He did examine all of the machinery, recorded all of the serial and identification numbers, and placed sheriff's seals on most of it. At the time the writ was served on Williams, the sheriff told him unequivocally that he was not to use or move any of his attached property. Williams obeyed this command for the duration of the attachment. Even if it could be said that the deputy sheriff permitted the attached property to remain in Williams' possession, the attachment lien continued in force between the appellants and Williams (Mickelson v. Williams, 50 Wash.2d 402, 312 P.2d 656 (1957); Annot., 86 A.L.R. 1412; 6 Am.Jur.2d, Attachment and Garnishment, § 505); see also 7 C.J.S. Attachment § 233d.

Here the trial court awarded damages for abuse of process based primarily upon the facts that the attachment was far in excess of that necessary to secure the debt, and was used in an attempt to pressure respondent into paying the claim. The appellants assert that the damages were improperly awarded because there was no adequate showing of the necessary elements of malice and want of probable cause. Although malice and want of probable cause are necessary elements for recovery in an action for wrongful attachment and malicious prosecution (McIntosh v. Knox, 40 Nev. 403, 165 P. 337 (1917)) they are not essential to recovery for abuse of process. The two fundamental elements that constitute the basis of the tort of abuse of process are (1) an ulterior purpose and (2) a willful act in the use of the process not proper in the regular conduct of the proceeding. Barquis v. Merchants Collection Ass'n of Oakland, 7 Cal.3d 94, 101 Cal.Rptr. 745, 496 P.2d 817 (1972); Tempelton Feed and Grain v. Ralston Purina Co., 69 Cal.2d 461, 72 Cal.Rptr. 344, 446 P.2d 152 (1968). The action for abuse of process hinges on the misuse of regularly issued process, in contrast to malicious prosecution which rests upon the wrongful issuance of process. Clikos v. Long, 231 Ala. 424, 164 So. 394 (1936). Here the trial judge found that attempting to force payment of the claim rather than obtaining security for the debt was the ulterior purpose and that attaching all of the respondent's equipment and refusing to release any of it was the willful act not proper in the regular conduct of the proceeding. White Lightning Company v. Wolfson, 68 Cal.2d 336, 66 Cal.Rptr. 697, 438 P.2d 345 (1968); Tempelton Feed and Grain v. Ralston Purina Co., supra; Spellens v. Spellens, 49 Cal.2d 210, 317 P.2d 613 (1957); Pimentel v. Houk, 101 Cal.App.2d 884, 226 P.2d 739 (1951); Prosser on Torts, 856 (4th ed. 1971).

It is appellants' burden to show that the findings and judgment of the trial court were not based upon substantial evidence or were clearly erroneous. Brandon v. Travitsky, 86 Nev. 613, 472 P.2d 353 (1970; Utley v. Airoso, 86 Nev. 116, 464 P.2d 778 (1970). Our review of the record in this case discloses substantial evidence which supports the court's finding of abuse of process. Although the property was divisible, it was attached in its entirety. Property valued at over $30,000 was placed under attachment to secure an alleged debt of less than $5,000. Efforts to release parts of the property were summarily rejected while appellants possessed full knowledge of the devastating effect of the attachment upon respondent's business. These actions of the appellants in willful disregard of the right of respondent to use his property (subject only to a reasonable attachment) gave the trial court adequate grounds for concluding that the purpose of the attachment was to pressure payment rather than...