Norin v. Scheldt Mfg. Co.

• Decision Date: 21 April 1921
• Docket Number: No. 13849.,13849.
• Citation: 297 Ill. 521,130 N.E. 791
• Parties: NORIN v. SCHELDT MFG. CO.
• Court: Illinois Supreme Court

297 Ill. 521

130 N.E. 791

NORIN

v.SCHELDT MFG. CO.

No. 13849.

Supreme Court of Illinois.

April 21, 1921.

Action by Gustavus P. Norin against the Scheldt Manufacturing Company. From judgment for plaintiff, defendant appealed to the Appellate Court, which granted certificate of importance, and defendant appeals.

Judgment affirmed.

Appeal from Second Branch Appellate Court, First District, on Appeal from the Superior Court of Cook County; Joseph B. David, Judge.

Ward & Baldridge, of Chicago, for appellant.

E. W. Rice, of Chicago, for appellee.

STONE, J.

Appellee sued the appellant, the Scheldt Manufacturing Company, in the superior court of Cook county to recover damages for malicious prosecution. He recovered a judgment for $750, which was affirmed by the Appellate Court. Owing to the legal question involved, that court granted a certificate of importance, and the cause comes here on appeal.

It is charged in the declaration that appellant maliciously and without probable cause filed its petition against appellee in the United States District Court praying that he be adjudged a bankrupt. It appears that summons was issued in that case, but the marshal failed to find appellee at the place given by appellant as his place of residence and the summons was returned ‘not found.’ Notice was then given by publication, and appellee failing to appear, he was defaulted and judgment declaring him to be a bankrupt entered against him. No receiver or trustee was appointed and no action taken, other than as herein stated, to reduce the property of the appellee to the possession of the bankruptcy court. It appears that appellee and Jacob T. Scheldt, the secretary-treasurer of appellant, had been acquainted for years. Both are residents of the city of Chicago, and Scheldt knew the place of residence of appellee, but the same was incorrectly stated in his petition. Appellee, hearing of the foregoing proceedings after judgment was rendered against him, entered his appearance and moved to set aside the judgment and default and to set the cause for a new hearing. The motion was allowed. At the second hearing appellee denied insolvency and sustained his denial with proof. Appellant admitted that it was unable to prove that appellee was insolvent at the time of the filing of the petition in bankruptcy, and the petition was dismissed. It was stipulated between the parties that no exceptions should be taken to the ruling of the court and that the testimony taken at the hearing should not be written up. Thereafter appellee brought this suit to recover damages for the malicious prosecution of the foregoing suit in bankruptcy.

It is contended by appellant that an action for malicious prosecution will not lie in this case even though the bankruptcy petition was filed without probable cause, for the reason that no property was seized in the bankruptcy proceedings and that appellee sustained no special injury not necessarily resulting in all suits prosecuted to recover for like causes of action; that even though the action would lie, appellee ought not to recover because appellant acted upon the advice of counsel in beginning the bankruptcy proceedings and in good faith believed there was probable cause for so doing; that the stipulation entered into at the time of the dismissal of the bankruptcy proceedings was a bar to appellee's action in the present suit.

The principal question involved here is whether or not the action for malicious prosecution will lie in this case. If the same rule is applied to malicious prosecution of an action on an involuntary petition in bankruptcyas obtains in the case of an ordinary civil action, the question is no longer open in this state. In Smith v. Michigan Buggy Co., 175 Ill. 619, 51 N. E. 569,67 Am. St. Rep. 242, it was definitely held that an action for the malicious prosecution of a civil suit without probable cause will not lie where the process in the suit so prosecuted is by summons, only, and is not accompanied by the arrest of the person or seizure of the property, or other special injury is sustained not necessarily resulting in all suits prosecuted to recover for like causes of action. This rule was adhered to by this court in Bonney v. King, 201 Ill. 47, 66 N. E. 377. In the former of these cases the original cause of action upon which the suit for malicious prosecution was based was an action of trespass on the case for damages, while in the second the action was assumpsit. In Lawrence v. Hagerman, 56 Ill. 68, 8 Am. Rep. 674, the original action on which the suit for malicious prosecution of a civil action was based was the suing out of a writ or attachment. It was there held that the action for malicious prosecution would lie. In Gordon v. Brown, 27 Ill. 489, 81 Am. Dec. 245, where the right to bring a suit for malicious prosecution of a civil action was denied, the original action upon which such suit was based was the issuance of an injunction. It was there held that the remedy lay on the injunction bond.

There have been no cases before this court where a comparison has been made between what is characterized as an ordinary civil action and a proceeding to decree a person a bankrupt. The case of Liquid Carbonic Acid Manf. Co. v. Convert, 186 Ill. 334, 57 N. E. 1129, arose over a suit for maiicious prosecution of an action to have the plaintiff in the suit under consideration adjudged insolvent under the laws of this state and for the appointment of a receiver to wind up its affairs as an insolvent corporation. Without discussing the question whether there is any distinction between an ordinary civil action and an involuntary petition for insolvency, the opinion holds that Smith v. Michigan Buggy Co., supra, controls. It is also apparent from the statement of facts in that case that the declaration in the suit for malicious prosecution did not aver that the proceedings to have plaintiff declared insolvent were at an end. This is, of course, essential to the action for malicious prosecution, and the case could not be maintained in the absence of such showing. The cases referred to are the only ones coming before this court in which the right to maintain this action has arisen. As in none of them was there a discussion whether application of this rule should be made to a bankruptcy petition, that question is still open. Liquid Carbonic Acid Manf. Co. v. Convert contains no discussion of that question and is not controlling here. The question open for discussion and settlement is, therefore, whether or not there is a distinction to be drawn between an ordinary suit at law and a proceeding in bankruptcy...