WESTSTAR MORTGAGE CORP. V. JACKSON, 2003-NMSC-002,
133 N.M. 114, 61 P.3d 823
CASE HISTORY ALERT: see ¶1, ¶26 - affects
2002-NMCA-009
WESTSTAR MORTGAGE CORPORATION, a New
Mexico corporation,
Plaintiff-Petitioner/Counter-defendant,
vs.
KEN JACKSON, Defendant-Respondent/Counter-plaintiff.
SUPREME COURT OF NEW MEXICO
2003-NMSC-002, 133 N.M. 114, 61 P.3d 823
Miller, Stratvert & Torgerson, P.A.,
Alice Tomlinson Lorenz, James J. Widland, Albuquerque, NM, for Petitioner.
Joseph P. Kennedy, Albuquerque, NM, for
Respondent.
GENE E. FRANCHINI, Justice. WE CONCUR:
PATRICIO M. SERNA, Chief Justice, PAMELA B. MINZNER, Justice, PETRA JIMENEZ
MAES, Justice.
AUTHOR: GENE E. FRANCHINI
{*117} FRANCHINI, Justice.
{1} Plaintiff Weststar
Mortgage Corporation (Weststar) appeals from a jury verdict granting
compensatory and punitive damages to Defendant Ken Jackson (Jackson). Weststar,
seeking to recover money from Jackson that belonged to Weststar, had filed an
action against Jackson for unjust enrichment, fraud, constructive fraud,
conversion, and promissory estoppel. In response, Jackson filed a counterclaim
alleging malicious abuse of process. The trial court granted partial summary
judgment for Weststar on the unjust enrichment claim and ordered Jackson to
repay the money in question with interest. However, the trial court did not
rule on Weststar's motion for summary judgment on the counterclaim. It was
subsequently tried before a jury which awarded Jackson $ 50,000 in compensatory
damages and $ 150,000 in punitive damages; the trial court declined to award
post-judgment interest on the punitive damages. Post-trial, the trial court
denied Weststar's motion for judgment as a matter of law, or, in the
alternative, a new trial. Weststar appealed the judgment to the Court of
Appeals, and Jackson filed a cross appeal challenging the denial of interest.
In a divided opinion, the Court of Appeals affirmed the judgment against
Weststar and reversed the trial court's denial of post-judgment interest on the
punitive damages.
Weststar Mortgage Co. v. Jackson, 2002-NMCA-9,
131
N.M. 493,
39 P.3d 710,
cert. granted,
131 N.M. 564,
40 P.3d 1008, No.
27,270 (2002). We granted Weststar's petition to this Court to issue a writ of
certiorari to the Court of Appeals
{*118} under
NMSA 1978, §
34-5-14(B) (1972). We reverse the Court of Appeals and the
judgment in favor of Jackson.
I. FACTUAL AND PROCEDURAL BACKGROUND
{2} Weststar is an
escrow company that provides services on escrow accounts, loans, and mortgages
by holding real estate contracts, collecting payments, and disbursing proceeds.
The corporation also purchases real estate contracts. In April 1998, Weststar
purchased a real estate contract from Jackson, for whom they had been providing
mortgage services. At that time, Jackson signed a closing statement with
Weststar, and he received a copy of the closing statement. There is no dispute
that the balance due to Jackson for his equity in the property was $ 2786.82.
But, on May 1, 1998, Norwest Bank mistakenly deposited the entire amount of the
sales proceeds into Jackson's account, including $ 12,927.26 due to Weststar.
Jackson testified that when he learned that more than $ 15,000 had been
deposited into his account, he knew that someone had made a mistake. He called
Weststar to inquire whether the money transfer had been completed, but did not
tell them about the excess funds in his account. On May 14, Jackson removed $
12,000 from the account to purchase a certificate of deposit (CD). By July 5,
1998, Weststar was aware of the error, and the employee who had handled the
purchase of the real estate contract, Ms. Lynch, contacted Jackson. The first
time they spoke, Jackson acted as though he did not understand what she was
talking about. During the second call, he acknowledged that he had received the
additional funds. Jackson told her about having used $ 12,000 of the funds to
purchase the CD and that he did not have the remaining $ 972.26. He agreed to
repay the $ 12,000 in August when the CD matured. In the meantime, Weststar,
concerned that Jackson had kept the money for two months without notifying them
and that his offer to repay the money was not in writing, sent a demand letter
to Jackson on August 7 requesting payment of their money within thirty days.
The letter also stated that, if necessary, Weststar would pursue legal
remedies, including a civil lawsuit, to recover their funds. In response to the
letter, Jackson and his wife met with his first attorney who told them that the
mistaken transfer of funds to their account was Weststar's loss and their gain.
He advised them that the money was theirs to keep and that Jackson could not be
arrested for keeping the money.
{3} When Ms. Lynch
contacted Jackson in August to arrange for the repayment that they had discussed
earlier, he told her that she would now have to speak with his attorney. When
Ms. Lynch reported this information to Weststar, a senior vice-president, Mr.
Inman, called Jackson's attorney to clarify Jackson's intent. The attorney
responded that he and his client considered the mistaken transfer of funds to
have been a "golden opportunity" and laughed at the question when Mr.
Inman asked about repayment. When Jackson's attorney did respond to Weststar's
letter in mid-September, he stated that Jackson no longer had the full amount
of $ 12,927.26, and offered to repay $ 3000 of the amount due to settle the
matter in full. Mr. Inman testified that at this point he believed the money
was gone and contacted the Carlsbad police to determine whether a criminal act
had been committed. After that conversation, Ms. Lynch met with Detective
Sergeant Boutelle of the Carlsbad Police Department on September 23, 1998, and
took the documents involved with the contract purchase for his review. She
testified that Weststar's purpose in going to the police was to determine
whether a crime had been committed and to make a record of the occurrence. The
detective explained to her that all he could do was prosecute any criminal
wrongdoing and that he was not a collection agent. She stated that she
understood and that Weststar's attorneys were preparing to begin civil
proceedings for that purpose. Detective Boutelle responded that even if Jackson
paid the money back, it would not change his pursuit of the criminal case. During
this meeting with Ms. Lynch, the detective called Jackson's attorney to advise
him that Weststar had contacted the police about the actions of his client. The
detective testified that the attorney had responded that he thought it was a
civil matter. The detective disagreed with him and suggested
{*119}
that the attorney should talk to his client about returning the money. The
attorney laughed at him. During his investigation, Detective Boutelle contacted
Jackson to tell him that the police were investigating Weststar's complaint.
The detective also informed Jackson that he thought his attorney had given him
bad advice with regard to his keeping Weststar's money. He suggested that, if
Jackson felt he was entitled to keep the money, he should return it to Weststar
and then file a civil action to recover the funds. A similar suggestion to
Jackson's first attorney was also rebuffed.
{4} Detective Boutelle
testified that he completed his investigation and gave it to an assistant
district attorney for review. Upon determining that probable cause existed, the
assistant district attorney issued a criminal complaint. The complaint was
taken to a magistrate judge for approval, and an arrest warrant was issued for
Jackson. After a preliminary hearing in December 1998 before a presiding
magistrate judge, Jackson, who was then represented by his current attorney,
was bound over for trial in district court. The assistant district attorney
later dismissed the criminal charges when Norwest Bank failed to supply in a
timely manner documentation that he would need to prosecute the case.
{5} In his
counterclaim, Jackson alleged that Weststar initiated criminal proceedings
against him for an improper purpose and without probable cause. He also claimed
that their actions were intentional, willful, and in reckless disregard of his
rights. Weststar maintains that the trial court erred when it refused to
dismiss the counterclaim for malicious abuse of process, arguing that the
evidence presented by Jackson was legally insufficient to sustain the
counterclaim. Weststar first raised the issue in a motion for summary judgment.
Weststar's argument was continued in motions for a directed verdict after the
close of evidence by Jackson and at the close of trial, in a motion for
judgment as a matter of law, and in a motion for a new trial. The trial court
denied all the motions.
{6} Both parties rely
upon -
DeVaney v. Thriftway Marketing Corp., 1998-NMSC-1,
124 N.M. 512,
953 P.2d 277, to support their respective arguments. In that case, this Court
reviewed the purposes and elements of the two torts of abuse of process and
malicious prosecution.
Id., ¶¶13-16. We concluded these torts would no
longer be separate causes of actions and restated their elements into a single
tort to be known as malicious abuse of process.
Id., ¶12. The elements
of this cause of action were defined as follows:
(1) the initiation of judicial proceedings against the
plaintiff by the defendant;
(2) an act by the defendant in the use of process
other than such as would be proper in the regular prosecution of the claim;
(3) a primary motive by the defendant in misusing the
process to accomplish an illegitimate end; and
Id. 1998-NMSC-1, P17. This Court noted that these
causes of action involve a balance between "the interest in protecting
litigants' right of access to the courts and the interest in protecting
citizens from unfounded or illegitimate applications of the power of the state
through the misuse of the courts." Id. 1998-NMSC-1, P14. In
restating the torts as a single cause of action, we observed that they shared a
common purpose of protecting "a plaintiff who has been made the subject of
legal process improperly, where the action was wrongfully brought by a
defendant merely for the purpose of vexing or injuring the plaintiff, and
resulting in damage to his or her personal rights." Id. The two
torts also served "to protect the important interest of access to the
courts, thereby preventing any chilling effect on the legitimate use of process."
Id. 1998-NMSC-1, P18. Because "meaningful access to the courts is a
right of fundamental importance in our system of justice," the tort of
malicious abuse of process is to be construed narrowly to protect the right of
access. Id. 1998-NMSC-1, P19.
{7} On appeal,
Weststar argues that the trial court erred in the following manner: (1) by
submitting Jackson's counterclaim to the jury because Weststar did not initiate
criminal proceedings against Jackson as that term
{*120}
is used in malicious abuse of process claims; (2) by failing to determine, as a
matter of law, the question of whether Weststar had probable cause to believe
that Jackson acted wrongfully; (3) by misunderstanding the element of misuse of
process; (4) by finding that Weststar had an improper motive; (5) by submitting
an incorrect instruction on malicious abuse of process to the jury; and (6) by
allowing the question of punitive damages to go to the jury. Weststar also
contends that Jackson's claim was precluded as a matter of law by the fact that
he was guilty of a criminal offense and that the Court of Appeals erred when it
reversed the trial court and awarded post-judgment interest on the punitive
damages.
{8} We treat
Weststar's argument as challenging the sufficiency of the evidence upon which
the jury based its verdict.
See Gonzales v. N.M. Dep't of Health,
2000-NMSC-29, P18,
129 N.M. 586,
11 P.3d 550. If the verdict below is supported
by substantial evidence, which we have defined as "such relevant evidence
that a reasonable mind would find adequate to support a conclusion," we
will affirm the result.
Landavazo v. Sanchez,
111 N.M. 137, 138,
802
P.2d 1283, 1284 (1990). In assessing whether the evidence is sufficient as a
matter of law to justify the jury's verdict, we review all evidence in the
light most favorable to the verdict and resolve all conflicts in the light most
favorable to the prevailing party.
Smith v. FDC Corp.,
109 N.M. 514,
519,
787 P.2d 433, 438 (1990). We examine the record for "such relevant
evidence as a reasonable mind might accept as adequate to support a
conclusion."
Id. (quoted authority and quotation marks omitted). It
is not the task of a reviewing court to sit as a trier of fact or to reweigh
the evidence.
Id. After reviewing the record, we are persuaded that, as
a matter of law, the evidence presented in this case was insufficient to
satisfy any of the elements of the tort. A reasonable jury could not have
determined that Weststar's actions in this matter constituted a malicious abuse
of process; therefore, the trial court erred in submitting this case to the
jury. Given the apparent confusion of the
Weststar majority in dealing
with the tort of malicious abuse of process and the law of agency, we address
each of the elements to reaffirm the
DeVaney analysis and holding.
Because we reverse based on the lack of substantial evidence on the malicious
abuse of process claim, we do not address Weststar's remaining claims.
A. Initiation of Proceedings.
{9} Weststar argues
that the first element of initiation of proceedings was not established by
Jackson. Jackson responds that Weststar "made the call to prosecute"
and then controlled and maintained that prosecution.
1
In a claim for malicious abuse of process, the plaintiff has the burden of
proving that the defendant initiated judicial proceedings against him or her.
DeVaney,
1998-NMSC-1, PP17-18.
{10} Weststar responds
that merely providing the authorities with accurate information does not
initiate proceedings when the decision to prosecute is left to the discretion
of another. The company argues that its participation in the criminal prosecution
was to report truthfully about the actions of Jackson to the authorities.
Weststar maintains that Detective Boutelle then conducted his own investigation
in the matter and consulted with the district attorney's office as to whether
to pursue a criminal action against Jackson. In making this argument, Weststar
relies upon
Johnson v. Weast, 1997-NMCA-66, P20,
123 N.M. 470,
943 P.2d
117. In
Johnson, the plaintiff had filed a civil rights suit against the
defendant under 42 U.S.C. P 1983.
See Dan B. Dobbs,
The Law of Torts
§ 430, at 1216 (2000) [hereinafter Dobbs] (recognizing that a civil rights
action parallels the tort of malicious prosecution
{*121}
and that claims are "treated in a quite similar manner"). The
plaintiff alleged that the defendant was responsible for the plaintiff's
wrongful arrest because he had initiated criminal proceedings against the
plaintiff without probable cause.
Johnson, 1997-NMCA-66, PP5, 6. The
jury found for the plaintiff, the defendant appealed, and the Court of Appeals
reversed.
Id. 1997-NMCA-66, P1. The basis of the plaintiff's claim was
that the defendant had submitted an investigative report to an assistant
district attorney. The district attorney had then used the report as the basis
for the grand jury proceedings that resulted in the plaintiff's indictment.
Id.
1997-NMCA-66, P17. The Court held that, as a matter of law, the report did not
initiate criminal proceedings.
Id. In resolving the claim, the Court of
Appeals stated the following:
Merely providing information that is not false to the
authorities does not initiate proceedings so as to give rise to a malicious
prosecution claim, if the decision to proceed is left to the discretion of
another person such as the prosecutor and the absence of falsity allows the prosecutor
to exercise independent judgment.
Id. 1997-NMCA-66, P20 (relying upon Zamora v.
Creamland Dairies, Inc., 106 N.M. 628, 632-33, 747 P.2d 923, 927-28 ); see
also Restatement (Second) of Torts § 653 cmt. d, cmt. g (1977).
{11} We are in
agreement with this principle. In
Hughes v. Van Bruggen,
44 N.M. 534,
539,
105 P.2d 494, 497 (1940), this Court cited with approval the following
language from the same section of the Restatement, "the exercise of the
officer's discretion makes the initiation of the prosecution his [or her] own
and protects from liability the person whose information or accusation has led
the officer to initiate proceedings."
See Dobbs,
supra, §
431, at 1217 ("The defendant can be regarded as an instigator of the
proceeding only if (a) he [or she] communicates material information falsely or
inaccurately and the prosecutor relies upon his [or her] statement
2, or (b) the defendant uses his [or
her] power or position to influence the prosecutor in favor of
prosecution.").
{12} Jackson presented
no evidence that Weststar placed any pressure on the authorities to pursue the
matter. The undisputed evidence of the two Weststar employees was that their
involvement with the criminal proceedings consisted of reporting to the
authorities about their dealings with Jackson and then agreeing to cooperate
with any prosecution.
See ...
Hughes, 44 N.M. at 538-539, 105
P.2d at 497 ("In order to charge a private person with responsibility for
the initiating of proceedings by a public official, it must therefore appear
that his [or her] desire to have the proceedings initiated expressed by
direction, request, or pressure of any kind was the determining factor in the
official's decision to commence the prosecution . . . ."). Weststar would
not have agreed to cooperate in the criminal proceedings except for Jackson's
refusal to return the amount due, and the detective testified that he would
typically not have pursued an investigation in a case like this unless the
complaining witness agreed to cooperate in the investigation and to testify at
trial. However, these circumstances are not sufficient as a matter of law to
establish that Weststar initiated the criminal proceedings against Jackson.
See
Johnson, 1997-NMCA-66, P20 (recognizing that, although the assistant
district attorney would not have proceeded without the defendant's
investigative report, "there was no testimony that the ADA was influenced
or pressured by [the defendant], or deceived by misrepresentation, into
bringing an indictment").
{13} Detective
Boutelle testified that he conducted his own investigation and concluded
{*122} that there was probable cause to believe that
a crime had been committed. He then took the results to an assistant district
attorney for approval. After reviewing the investigation, the district attorney
approved a criminal complaint for larceny against Jackson. The complaint was
based on Boutelle's independent investigation, not on the information supplied
by the Weststar employees. The independent exercise of prosecutorial discretion
establishes as a matter of law that Weststar did not initiate the prosecution.
See
...
Bordenkircher v. Hayes, 434 U.S. 357, 364, 54 L. Ed. 2d 604, 98
S. Ct. 663 (1978) ("So long as the prosecutor has probable cause to
believe that the accused committed an offense defined by statute, the decision
whether or not to prosecute, and what charge to file or bring before a grand jury,
generally rests entirely in [the prosecutor's] discretion." ); Dobbs,
supra,
§ 431, at 1217 ("If the officer or prosecutor makes his [or her] own
decision to prosecute, it is he [or she], not the complaining witness, who is
regarded as instituting the action."). The independent exercise of
prosecutorial discretion establishes that Weststar did not initiate the
prosecution.
See Restatement (Second) of Torts § 653 cmt. g.
{14} We note that, in
resolving this issue, the
Weststar majority concluded, "A complainant
who persuades, requests, directs, or pressures prosecuting authorities to
proceed with a prosecution can be regarded in proper circumstances as
initiating the prosecution and be held liable for it."
Weststar,
2002-NMCA-9, P25. We disapprove of this statement and consider it to be an
overly broad interpretation of this element of malicious abuse of process which
could create a serious risk of chilling the reporting of crime.
See DeVaney,
1998-NMSC-1, P19 (recognizing that the tort of malicious abuse of process must
be construed narrowly "to protect the right of access to the
courts"). This statement fails to recognize the public policy articulated
in
DeVaney and ignores the need for exercising caution in reviewing
malicious abuse of process actions. Moreover, citizens must have "wide
latitude in reporting facts to authorities so as not to discourage the exposure
of crime."
Zamora, 106 N.M. at 634, 747 P.2d at 929.
"Efficient law enforcement requires that a private person who aids the
police by giving honest, even if mistaken, information about crime, should be
given effective protection from civil liability."
Id.
{15} An improper act
constituting a misuse of process is the second essential element of the tort of
malicious abuse of process.
DeVaney, 1998-NMSC-1, P17. A misuse of
process may be established by showing either a lack of probable cause or a
procedural impropriety.
Id. 1998-NMSC-1, PP22, 28. "Under this new
tort, there must be a misuse of process by the defendant beyond the mere
initiation of proceedings against the plaintiff."
Id. 1998-NMSC-1,
P53. "The requirement of a misuse of process, in addition to the mere
initiation of proceedings, serves to prevent a chilling effect on claims
well-founded in fact and law and asserted for the legitimate purpose of
redressing a grievance."
Id. 1998-NMSC-1, P21. The
Weststar
majority found both a lack of probable cause and a misuse of process.
Weststar,
2002-NMCA-9, P39. We disagree with both determinations.
1. Lack of Probable Cause.
{16} In
DeVaney,
this Court stated that to demonstrate the improper act required in an action
for malicious abuse of process, the "plaintiff may show the defendant
filed an action against that plaintiff without probable cause. For this
purpose, we define probable cause as the reasonable belief, founded on known
facts established after a reasonable pre-filing investigation, that a claim can
be established to the satisfaction of a court or jury."
Id.
1998-NMSC-1, P22 (internal citation omitted). "Probable cause-the
reasonableness of inferences of guilt-is to be judged by facts as they appeared
at the time, not by later-discovered facts." Dobbs,
supra, § 432,
at 1220;
accord Restatement (Second) of Torts § 662 cmt. e (stating that
an accusation leading to the initiation of a criminal prosecution must be based
on probable cause determined as of the time the
{*123}
action was filed). The lack of probable cause must be manifest.
DeVaney,
1998-NMSC-1, P22.
{17} Weststar argues
that the trial court erred when it submitted the question of probable cause to
the jury rather than deciding the issue itself as a matter of law. We agree.
"The existence of probable cause in the underlying proceeding, that is,
whether the facts amount to probable cause, is a question of law" and
"shall be decided by the trial judge."
DeVaney, 1998-NMSC-1,
PP24, 41;
accord Restatement (Second) of Torts, §§ 673, 681B. The
Weststar
majority concluded that the relevant facts were in dispute and, therefore, the
question of probable cause was properly determined by the jury.
Weststar,
2002-NMCA-9, P29. In reaching that determination, the Court of Appeals relied
in part on the following statement in
DeVaney, 1998-NMSC-1, P41.
"The circumstances surrounding the filing of the complaint, if in dispute,
must be resolved by a fact-finder." We disagree for two reasons. First, in
this case, the essential facts on which the issue of probable cause turns-what
Weststar knew at the time it went to the police-are not in dispute. Second, the
Court of Appeals misapprehended the meaning of the language in
DeVaney.
When the relevant facts are disputed, the role of the jury is to determine the
disputed facts bearing on the probable cause question, that is, "the
circumstances surrounding the filing of the complaint." Whether those
facts constitute probable cause remains a matter for the trial court to
determine.
See Dobbs,
supra, § 432, at 1222-23. The trial court
erred in submitting this legal determination to the jury. Furthermore, there
was no evidence to dispute probable cause, and the trial court should have
directed a verdict for the defendant and determined that probable cause was
established as a matter of law.
{18} The trial court
and the Court of Appeals therefore erred in concluding that Weststar lacked
probable cause to proceed against Jackson. The record reflects that Weststar
had a reasonable belief, founded on known facts, that they had a legal claim
against Jackson. The company was faced with an individual who was aware that
there was some $ 13,000 in his account that did not belong there. Not only did
he know that the money did not belong to him, he also knew that it belonged to
Weststar and how to contact them. Yet, for over two months, he made no effort
to tell Weststar about the mistaken delivery of the funds. When the company
contacted him in July, they learned that he had removed the money from the
account, putting $ 12,000 in a CD and spending the rest. By the time Weststar
went to the authorities in September, the money still had not been returned to
them. The reasonableness of Weststar's belief was confirmed by the
investigating officer and the district attorney's office which concluded that
there was probable cause for issuing a criminal complaint. The warrant for
Jackson's arrest was issued by a magistrate judge after an independent review
of the charging document for probable cause. Subsequently, after a preliminary
hearing at which Jackson was represented by his current attorney, the presiding
magistrate judge found probable cause to bind Jackson over for trial in
district court. "The fact that a plaintiff has been bound over for trial
on the criminal matter constitutes prima facie evidence of the existence of
probable cause for the detention."
Roberts v. Goodner's Wholesale
Foods, Inc., 2002 OK CIV APP73, 50 P.3d 1149, 1152 (Okla. Ct. App. 2002),
cert.
denied, Jul. 2, 2002;
Christopher v. Circle K Convenience Stores, Inc.,
1997 OK 27, 937 P.2d 77, 79 (Okla. 1997) (stating that a finding of probable
cause at a preliminary hearing binding over a defendant for criminal trial
precluded a plaintiff in a subsequent civil suit for false arrest from
relitigating the issue of probable cause).
{19} In
DeVaney,
this Court held that "an unfavorable termination for the
malicious-abuse-of-process plaintiff, meaning some form of recovery for the
original-proceeding plaintiff, is 'conclusive evidence of the existence of
probable cause.'"
Id. 1998-NMSC-1, P23 (quoting W. Page Keeton et
al.,
Prosser & Keeton on the Law of Torts § 120, at 894 (5th ed.
1984). In this case, there was no favorable termination for Jackson in either
the civil or criminal proceeding. In the civil
{*124}
proceeding, on a motion for summary judgment, the trial court found for
Weststar and ordered Jackson to repay the money with interest from the date
that he had taken the money from the account to purchase the CD. The criminal
case was dismissed on procedural grounds, not on the merits.
See Dobbs,
supra,
§ 434, at 1226 ("When the criminal prosecution is terminated because of a
mere lapse of time, . . . or for other reasons that do not bear even remotely
upon the merits, courts have held that the termination is not favorable to the accused
. . . .").
2. Procedural Impropriety.
{20} A procedural
impropriety under the tort of malicious abuse of process might arise if there
was an improper use of criminal or civil process in a manner not contemplated
by law.
DeVaney, 1998-NMSC-1, P28. There is no liability when the
defendant in an abuse of process claim has done nothing more than carry out the
process to its authorized conclusion, even if done with bad intentions.
Id.
1998-NMSC-1, P20 ("Nevertheless, the filing of a proper complaint with
probable cause, and without any overt misuse of process, will not subject a
litigant to liability for malicious abuse of process, even if it is the result
of a malicious motive.").
{21} The
Weststar
majority found that the telephone call made by Detective Boutelle to Jackson's
first attorney during the detective's first meeting with a Weststar employee
constituted a misuse of process.
Weststar, 2002-NMCA-9, P41. The Court
characterized the telephone call as a procedural impropriety, because it was
"a form of extortion" intended "to compel Jackson to return the
money owed to Weststar."
Id. Moreover, the
Weststar majority
found, the telephone call was sufficient evidence for a reasonable jury to have
concluded that the detective "was acting on behalf of Weststar and
therefore Weststar should be charged with Boutelle's action."
Id.
However, as stated above, a report to the authorities of possible criminal
activity is not legal process and neither are the pre-trial investigative
actions of the police. As a matter of law, this would not be sufficient to
constitute the "legal process" required for a claim of abuse of
process. At trial, Jackson did not allege or offer any evidence to prove that
Weststar performed any wrongful act during the course of the criminal
proceeding. No testimony was offered to show an involvement by Weststar in the
criminal proceedings after their initial involvement in reporting to the police
about Jackson's retention of their funds; rather the uncontradicted testimony
by the investigating detective and the Weststar employees was to the contrary.
We conclude that Weststar did not maliciously misuse the legal process.
{22} Generally, one
can only be charged with the actions of another if that individual is acting as
one's agent under a principal-agent relationship or an employer-employee
relationship.
See Madsen v. Scott, 1999-NMSC-42, PP8-9,
128 N.M. 255,
992 P.2d 268. At trial, Jackson did not claim that the detective was acting as
Weststar's agent, and no evidence was presented that would support such a
claim. Although Ms. Lynch was present when the detective called Jackson's
lawyer to tell him about the possible criminal investigation, Detective
Boutelle did not testify that he had done so at her request. Ms. Lynch
testified that the detective had initiated the telephone call on his own and
that she had not asked him to call anyone. There was no basis in law or in fact
for the
Weststar majority to have charged Weststar with the actions of
Detective Boutelle.
C. Primary Motive to Accomplish an Illegitimate
End.
{23} A plaintiff
claiming malicious abuse of process must also prove that the defendant
initiated the legal proceedings primarily to accomplish an illegitimate end,
that is, "to accomplish a purpose for which [the legal process] is not
designed."
DeVaney, 1998-NMSC-1, P29. To prove this element, a
plaintiff must show that the defendant did more than act with ill will or
spite.
Id. In
DeVaney, this Court stated that neither lack of
probable cause nor an improper purpose created an illegitimate end for a legal
proceeding, although they could be used to support
{*125}
an inference of an improper purpose.
Id. 1998-NMSC-1, P30. "The
burden of proving the overt act by independent evidence remains upon the
plaintiff."
Id.
{24} On appeal, Jackson
relies upon the Restatement (Second) of Torts § 668 comment d, which describes
the principal situations in which criminal proceedings are initiated for an
improper purpose as being, "(1) when the accuser does not believe in the
guilt of the accused, (2) when the proceedings are initiated primarily because
of hostility or ill will toward the accused, (3) when the proceedings are
initiated for the purpose of obtaining a private advantage even though the
advantage might legitimately have been obtained in civil proceedings."
(citation omitted) He relies in particular upon comment g to Section 668 for
the following language, "One who initiates the proceedings to force the
accused to pay money . . . does not act for a proper purpose. This is true
although the money is lawfully owed to the accuser . . . so that relief, might
have been secured in appropriate civil proceedings." Restatement (Second)
of Torts § 668 cmt. g. The
Weststar majority also relied on this
language in finding that Weststar acted with an improper motive.
Weststar,
2002-NMCA-9, PP42-43.
{25} However, we note
that comment g also states, "Nevertheless, if the accuser's belief in the
criminal character of the accused's conduct is reasonable, the proceedings and
the existence of an improper purpose is not enough to make [the accuser]
liable." Restatement (Second) of Torts § 668 cmt. g. No evidence was
presented that Weststar initiated an unfounded criminal prosecution because of
ill will or hostility toward Jackson. At trial, evidence was presented that
Weststar provided the authorities with relevant information concerning someone
who had received approximately $ 13,000 belonging to Weststar and who, they
believed, did not intend to return the money. Additionally, Weststar's belief in
the criminal character of Jackson's actions was vindicated by the investigation
of the detective, the approval of the criminal complaint by a district
attorney, and the finding of probable cause after a preliminary hearing. As a
matter of law, there was insufficient evidence to conclude that Weststar acted
to accomplish an illegitimate end.
{26} In pursuing a
tort claim of malicious abuse of process, a plaintiff's failure to prove any
one of its elements would be fatal to his or her claim. Our review of the
record persuades us that Jackson did not satisfy any elements of the tort, and
we hold that this failure defeats his claim. We reverse the district court and
the Court of Appeals on the claim of malicious abuse of process, the award of
compensatory and punitive damages, and the order on prejudgment interest. We
remand this case to the trial court for entry of judgment for Weststar and
against Jackson.
GENE E. FRANCHINI, Justice
PATRICIO M. SERNA, Chief Justice
PAMELA B. MINZNER, Justice
PETRA JIMENEZ MAES, Justice
1
In support of this assertion, Jackson claims that Detective Boutelle testified
that Weststar could have "called him off." A review of the transcript
reveals that the detective did not make that statement. In this passage of his
testimony, he is discussing the role of the district attorney's office in
determining whether a case should go forward. Although this opinion will not
address every instance of misattribution, we remind appellate counsel of his
duty of candor toward this Court. Rule 16-303 NMRA 2002 ("A lawyer shall
not knowingly . . . make a false statement of material fact or law to a
tribunal.").
2
The Weststar majority concluded that "a jury could infer Weststar
provided Boutelle with misleading information." 2002-NMCA-9, P23. Jackson
did not introduce evidence of Inman's statement to Boutelle regarding the
purpose of the CD, so we do not rely on this information and conclude that the
Court of Appeals ought not to have done so. See Campos Enters., Inc.
v. Edwin K. Williams & Co., 1998-NMCA-131, P12, 125 N.M. 691, 964 P.2d
855 ("As a court of review, we cannot review . . . allegations which were
not before the district court."). Moreover, we believe that the evidence
relied upon by the Court of Appeals does not support a reasonable inference
that Weststar misled Boutelle. Andrus v. Gas Co. of N.M., 110 N.M. 593,
596, 798 P.2d 194, 197 ("A reasonable inference cannot be based on
supposition or conjecture.").