Peoples Bank & Trust Co. v. Stock

• Decision Date: 13 May 1980
• Docket Number: No. 1-279A52,1-279A52
• Citation: 403 N.E.2d 1077,273 Ind. 342
• Court: Indiana Supreme Court
• Parties: PEOPLES BANK & TRUST CO., Appellant (Defendant Below), v. Sonja K. STOCK, Appellee (Plaintiff Below).

Page 1077

403 N.E.2d 1077

273 Ind. 342

PEOPLES BANK & TRUST CO., Appellant (Defendant Below), v. Sonja K. STOCK, Appellee (Plaintiff Below).

No. 1-279A52.

Supreme Court of Indiana.

May 13, 1980.

Appeal from Hancock Circuit Court, Hancock County; George B. Davis, Judge.

Seymour M. Bagal, Jon R. Pactor, Indianapolis, George J. Lewis, Greenfield, for appellant.

David W. Foley, Mullin, Foley & Gilroy, Indianapolis, Michael J. Tosick, Ging, Free, Brand, Tosick & Van Winkle, Greenfield, for appellee.

ON PETITION TO TRANSFER

PIVARNIK, Justice, dissenting.

The majority has voted to deny transfer in this cause and allow the opinion of the First District Court of Appeals, 392 N.E.2d 505, to stand. I respectfully dissent from this position and strongly urge that we grant transfer, set aside the opinion of the Court of Appeals, and reverse the judgment of the trial court.

The Court of Appeals has misconstrued the law set out in decisions on malicious prosecution, and effectively and drastically changed that cause of action as it originated and as it was understood to exist up to this point. The cause of action for malicious prosecution has its origin in the common law, and its definitions are to be found in the case law and not in statutory enactment. It has been a little-used cause of action, and it is therefore necessary to go back to the early years of the development of our jurisprudence to find its meaning. The elements or the burden the plaintiff must carry in maintaining his or her action for malicious prosecution have not changed, and were required of plaintiff Sonja K. Stock in this cause of action. Those requirements are: (1) the plaintiff was the subject of a prosecution by the defendant; (2) said prosecution was brought without probable cause; (3) said prosecution was brought with malice; and (4) said prosecution resulted in a favorable judgment for plaintiff. It appears to me the only proof the plaintiff, Sonja Stock, made in this cause, is that there was a prior law suit involving these parties that she won. I have serious questions that plaintiff here proved a prosecution, a lack of probable cause, or, especially, malice on the part of the defendant Peoples Bank.

In order to get these issues in perspective, it is necessary to set out the background facts in more detail than did the Court of Appeals. The evidence showed that Michael Canada was married to Virginia Canada and of this union there were born two children. In 1973, attorney Arthur Ecklund was retained by Virginia Canada to represent her in a divorce action against Michael Canada. He did so represent her through the proceedings and at the final hearing of the divorce in August, 1973. At this hearing, an agreed, non-contested judgment of divorce was entered. As part of this decree, Michael Canada was required to pay a weekly amount of support of the minor children, save Virginia harmless from a Sears Roebuck bill, and furnish Virginia with proof and a membership card showing that Blue Cross insurance was maintained for the children. In February, 1974, the record showed that Michael was in arrears about seven weeks in his support of the children, had not given Virginia proof of the Blue Cross-Blue Shield membership, and was in arrears in payments on the Sears Roebuck charge account. On behalf of Virginia Canada, Ecklund filed a petition for an order to show cause against Michael Canada because of his failure to comply with the orders of the Court in the final decree. In late February or early March of 1974, the parties were in court on the petition for an order to show cause. Sonja Stock accompanied Canada and his attorney to court that day, and Virginia Canada was accompanied by Ecklund. Ecklund, Canada, and Canada's attorney left the rest of the people and went to a private room in the Courthouse and settled the matter. The settlement was effected by Canada's paying the amount of the arrearage, furnishing the Blue Cross-Blue Shield membership card and showing that he had brought the Sears account up to date. The attorneys then drew an agreed order to show said compliance, and that completed those proceedings.

During this period, subsequent to the entering of the divorce decree, Michael Canada and Sonja Stock started keeping company. Sonja was still married to another man during this time. Sonja and Canada lived together during this time, and there was evidence that she did, at times, use the name of "Canada" rather than "Stock," and that she did, in fact, have bank accounts, driver's license, and other instruments in which she used the name "Sonja Canada," and other instances where she used the name "Sonja Stock." In October, 1974, while Sonja was living with Michael, he committed suicide. Sonja and Michael had never married. Although the evidence is sketchy on the subject, it appears that Sonja Stock's divorce from her husband did become final some months prior to Michael Canada's death.

A short time after Michael Canada's death, Virginia Canada contacted attorney Ecklund, advised him that Michael Canada An examination of the policy showed that Michael Canada had designated the beneficiary in May, 1974: "Sonja Stock--fiancee." In July, 1974, the designation of beneficiary was: "Sonja Canada--wife." Attorney Ecklund further determined that if the designated beneficiary failed, the money would then go to the heirs of Michael Canada, and, of course, those heirs were his two living children. He then attempted to determine whether Sonja Stock had actually married Michael Canada, and he found that she had not. He could find no record of a marriage license being issued to them, and no record that a marriage had been performed by anyone. Everyone in this case agrees that Michael Canada and Sonja Stock had never married. He then determined that since Sonja Stock had been designated as the beneficiary of the life insurance policy, which designation had later been changed to "Sonja Canada--wife," and, since there was no "Sonja Canada--wife," because Sonja had never become Michael's wife, that, in that case, it may be determined that there would be a failure of a designated beneficiary, since it could have been the intention of Michael Canada to leave the money to Sonja if she became his wife. Ecklund reasoned that because she never did become his wife, the money would go to his children. He said he recognized that this was a legal question, and thought it merited a judicial determination.

was now dead, [273 Ind. 345] and inquired of him what steps might be taken to determine what assets there might be of Michael Canada's that might pass by descent to the children. Attorney Ecklund advised her that he would make an investigation and determine whether or not there were any assets that might be obtainable for Michael's children. He determined there were some assets totalling approximately eighteen-hundred ($1,800) dollars, forthcoming from Michael's employer, that represented pay that had not yet been distributed, and further determined there was an insurance policy issued by the Metropolitan Life Insurance Company on Michael Canada's life. He obtained a copy of this policy from the employer and examined it to determine if there was any chance the children might be able to receive the benefits of it. The value of the policy was eleven-thousand, five-hundred ($11,500) dollars.

Ecklund therefore notified Metropolitan Life Insurance Company that he intended to make a claim on behalf of the children. He advised Virginia Canada that the proper procedure would be to open an estate and pursue the insurance policy in the interest of the children. He further advised Virginia Canada that since she, Virginia Canada, and Sonja Stock, had animosity toward each other because of their involvement with Michael Canada, it would be wiser to get a non-partisan person to act as personal representative in the estate. They agreed to ask the trust department of Peoples Bank to act as said personal representative because Ecklund knew they had a capable trust department and had acted as personal representative in estate and guardianship matters in the past. As a matter of fact, Ecklund previously had handled estate matters in which the Peoples Bank acted as personal representative. He then contacted James Rice of the Peoples Bank Trust Department. He advised Rice that he represented Virginia Canada and her children, and advised him of the insurance policy and the legal problem as to the beneficiary, and further indicated to him that it was his opinion that the proper procedure would be to open an estate and have the personal representative of that estate sue the Metropolitan Life Insurance Company for the proceeds of the policy. He advised Rice that there was a legal question involving the designation of beneficiary and that he thought that question needed to be resolved by judicial determination. Rice said he would check with the Senior Trust Officer and let Ecklund know if they were interested in becoming involved. After three or four discussions with Mr. Rice, Peoples Bank agreed to act as personal representative in the cause.

Attorney Ecklund drew up the necessary papers and documents to open the estate and have Peoples Bank designated as personal representative, which was done. Ecklund This action for malicious prosecution was then filed by Sonja Canada, who had since had her name legally changed to Canada, against the Peoples Bank, complaining that the action brought by Peoples Bank contesting the right of Sonja K. Canada to collect the proceeds of the policy, was done maliciously and without probable cause and in reckless disregard of her rights. Peoples Bank moved to join Attorney Ecklund as a third party defendant. The trial court at first granted the motion, but on reconsideration, denied it. The cause thus went to trial with Peoples Bank as the only defendant. The defendant moved for judgment on the evidence at the close of the plaintiff's case, and...