Three Lakes Ass'n v. Whiting

• Decision Date: 16 May 1977
• Docket Number: Docket No. 23615
• Citation: 75 Mich.App. 564,255 N.W.2d 686
• Parties: THREE LAKES ASSOCIATION, a Michigan non-profit Corp., Plaintiff-Appellant, v. Helen Dow WHITING, Macauley Whiting, Robert G. Edgar, Robert D. Welchli, John G. Apfel, Russell W. Redfern, and Ware Real Estate Corporation, a Michigan Corp., Defendants-Appellees. 75 Mich.App. 564, 255 N.W.2d 686
• Court: Court of Appeal of Michigan — District of US

Page 686

255 N.W.2d 686

THREE LAKES ASSOCIATION, a Michigan non-profit Corp. Plaintiff-Appellant, v. Helen Dow WHITING, Macauley Whiting, Robert G. Edgar, Robert D. Welchli, John G. Apfel, Russell W. Redfern, and Ware Real Estate Corporation, a Michigan Corp., Defendants-Appellees.

Docket No. 23615.

75 Mich.App. 564, 255 N.W.2d 686

Court of Appeals of Michigan.

May 16, 1977.

Rehearing Denied June 30, 1977.

Released for Publication July 20, 1977.

[75 MICHAPP 567] Jaffe, Snider, Raitt, Garratt & Heuer, P.C. by C. William Garratt, Detroit, for plaintiff-appellant.

Gemuend, Barbier & Goulet, P.C. by Ralph W. Barbier, Jr., St. Clair Shores, for defendants-appellees.

Before D. E. HOLBROOK, Jr., P. J., and V. J. BRENNAN and BRONSON, JJ.

BRONSON, Judge.

Plaintiff appeals by right from a March 6, 1975, order of the Antrim County Circuit Court granting summary judgment in favor of defendants.

According to allegations contained in plaintiff's complaint, plaintiff is a Michigan non-profit corporation, primarily composed of individuals having ownership interests in riparian property situated on Torch Lake in Antrim County, Michigan. The individual defendants are alleged to be shareholders, directors, and officers of the defendant real estate corporation.

Plaintiff initiated this action in Wayne County Circuit Court on August 6, 1974. Pursuant to motion by defendants, summary judgment was entered against plaintiff for failure to state a claim upon which relief could be granted, GCR 1963, 117.2(1), with leave granted plaintiff to file an amended complaint. At the same time, venue of the case was ordered changed to Antrim County.

[75 MICHAPP 568] Plaintiff subsequently filed a "First Amended Complaint" in Antrim County Circuit Court, defendants were again granted summary judgment, and plaintiff now appeals challenging the grant of summary judgment and the order changing venue. For purposes of this opinion, plaintiff's first amended complaint will be referred to simply as the complaint.

The complaint alleges that the defendant corporation owns certain property on Torch Lake and has taken steps to develop a residential condominium project on that property. It is alleged that the plaintiff association and three individual owners of nearby property instituted an action in 1970 pursuant to the Environmental Protection Act of 1970 ¹ to enjoin the proposed project, alleging that undue pollution would result. That action (referred to by the parties as "Action 849") has apparently never resulted in a final judgment, with the trial court retaining jurisdiction of the case in order to police defendant's activities to prevent undue pollution.

Plaintiff's complaint further alleges that on August 6, 1971, the corporate defendant and some of the individual defendants instituted, as plaintiffs, a civil action in Antrim County Circuit Court against the plaintiff association and various individual members of plaintiff, alleging individual and concerted tortious actions by the association and its members in obstructing the condominium project. That action, referred to by the parties as "Action 926", claimed damages in the amount of $2,500,000 and apparently continues to date.

Defendants' motion for summary judgment was premised on both GCR 1963, 117.2(1), failure to state a claim upon which relief can be granted, [75 MICHAPP 569] and 117.2(3), no genuine issue as to a material fact. Each of the five counts of the complaint was dismissed on one ground or the other as will be indicated in the following discussion.

I.

Count 1 of plaintiff's complaint was dismissed pursuant to GCR 1963, 117.2(1). On appeal, plaintiff asserts that it has stated a cause of action for abuse of process.

A motion grounded on failure to state a claim challenges only the legal sufficiency of the claim and is to be tested by the pleadings alone. All well-pled allegations and reasonable conclusions from them must be accepted as true. Dismissal is appropriate only when plaintiff's claim, on the pleadings, is so clearly unenforceable as a matter of law that no factual development can possibly justify a right to recovery. Crowther v. Ross Chemical & Manufacturing Co., 42 Mich.App. 426, 202 N.W.2d 577 (1972); Harvey v. Aetna Insurance Co., 72 Mich.App. 285, 252 N.W.2d 471 (1976).

Count 1 of the complaint, spread over some 30 pages, describes in somewhat greater detail the allegations which have already been set forth in this opinion and goes on equally painstakingly to describe the lake, the defendants' plans for the condominium development and their likely effect on the lake, actions by defendants in furtherance of those plans (including numerous allegations of improprieties in obtaining licenses and permits), and describes the progress of Action 849.

Paragraph 11 of the complaint begins to approach the substance of this matter. In some 15 pages, it details actions taken by defendants in their institution and prosecution of Action 926.

[75 MICHAPP 570] The complaint filed in Action 926 is incorporated in plaintiff's complaint. In an attempt to sum up another lengthy complaint in a few words, Action 926 seeks $2,500,000 in damages for allegedly tortious conduct by the Three Lakes Association and several individual members in their opposition to the condominium project. Torts alleged apparently include conspiracy, defamation and interference with contractual relations.

To return to this case, plaintiff goes on to allege that defendants, in Action 926, had no intention of accomplishing the ostensible purpose of the suit (to recover damages) but rather intended to use Action 926 as a means to coerce plaintiff to give up entirely all opposition to the condominium project. Thus, it is alleged, defendants have abused the discovery process by burdening plaintiff with requests for discovery while at the same time causing delays in complying with legitimate discovery procedures of plaintiff, that defendants at one point agreed to settle the case and subsequently refused to comply with that agreement, and that defendants have conducted that lawsuit in an oppressive manner in various other ways.

It is also claimed that defendants have stated that they would dismiss Action 926 without receiving any damages if plaintiff would agree not to express opposition to or otherwise oppose defendants' proposed condominium project.

The gist of plaintiff's complaint thus charges defendants with an abuse of process because they instituted the action for damages for the malicious and ulterior purpose of causing plaintiff so much expense and trouble in defending it that plaintiff would be forced to give up or at least be frustrated in pursuing its legitimate activities in opposition to defendants' condominium project.

[75 MICHAPP 571] We think plaintiff has stated a cause of action for abuse of process sufficient to withstand a motion for summary judgment.

The essence of the tort is explained in 3 Restatement of Torts, comment under § 682, the language of which was adopted by the Michigan Supreme Court in Moore v. Michigan National Bank, 368 Mich. 71, 75, 117 N.W.2d 105, 107 (1962), as follows:

" 'The gravamen of the misconduct for which the liability stated in this Section is imposed is not the wrongful procurement of legal process or the wrongful initiation of criminal or civil proceedings; it is the misuse of process, no matter how properly obtained, for any purpose other than that which it was designed to accomplish. Therefore, it is immaterial that the process was properly issued, that it was obtained in the course of proceedings which were brought with probable cause and for a proper purpose or even that the proceedings terminated in favor of the person instituting or initiating them. The subsequent misuse of the process, though properly obtained, constitutes the misconduct for which the liability is imposed under the rule stated in this Section.' "

Defendants contend that plaintiff's complaint fails to state a cause of action for this tort because, while it is alleged that defendants caused a summons to issue in Action 926, thereby requiring plaintiff to appear and defend that suit or suffer a default judgment, and plaintiff has sufficiently alleged improper motives on the part of defendants in bringing that action, defendants insist that the complaint contains no allegations which would take the case outside the rule stated in Spear v. Pendill, 164 Mich. 620, 130 N.W. 343 (1911).

In that case, a case which has been continually [75 MICHAPP 572] looked to as the law on this tort, ² the Court stated the elements of the tort as follows " 'Two elements are necessary to an action for the malicious abuse of legal process: First, the existence of an ulterior purpose, and, second, an act in the use of the process not proper in the regular prosecution of the proceeding. Regular and legitimate use of process, though with a bad intention, is not a malicious abuse of process.' " Spear, supra, at 623, 130 N.W. at 344.

In Spear, the Supreme Court held that a verdict should have been directed in favor of the defendant after plaintiff had proved no more than that defendant, upon claiming that plaintiff owed him money and threatening to cause plaintiff trouble if he were not paid, signed a criminal complaint against plaintiff, whereupon plaintiff was arrested, charged, and pled guilty. It appears that while the defendant in Spear may have had an ulterior or improper motive in causing criminal process to issue against plaintiff, once the warrant had been issued defendant had no further connection with the proceedings. Thus, it was held that plaintiff had failed to prove an act in the use of the process not proper in the regular prosecution of the proceeding. Spear, supra, pp. 624-625, 130 N.W. 343.

Defendants contend that this case, as far as appears from plaintiff's complaint, is no different than Spear. In addition, defendants rely on several cases from other jurisdictions...